Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2021 | |
Document and Entity Information | |
Document Type | S-1/A |
Amendment Flag | false |
Entity Registrant Name | Skillsoft Corp. |
Entity Central Index Key | 0001774675 |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Small Business | false |
BALANCE SHEETS (As Restated)
BALANCE SHEETS (As Restated) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash | $ 3,873,865 | $ 2,238,275 |
Prepaid Income Taxes | 27,140 | |
Prepaid expenses | 94,299 | 275,525 |
Total Current Assets | 3,968,164 | 2,540,940 |
Cash and marketable securities held in Trust Account | 696,957,196 | 695,295,418 |
TOTAL ASSETS | 700,925,360 | 697,836,358 |
Current liabilities | ||
Current Liabilities Accounts payable and accrued expenses | 635,483 | 257,466 |
Income tax payable | 95,302 | |
Convertible promissory note-related party | 3,104,359 | |
Total Current Liabilities | 3,835,144 | 257,466 |
Deferred income tax payable | 976 | 9,657 |
Deferred underwriting fee payable | 21,371,000 | 21,371,000 |
Derivative Liability | 128,339,190 | 56,360,000 |
Total Liabilities | 153,546,310 | 77,998,123 |
Commitments and Contingencies | ||
Class A Common stock subject to possible redemption, 53,712,502 and 61,025,925 shares at redemption value as of December 31, 2020 and 2019, respectively | 542,379,040 | 614,838,229 |
Stockholders' Equity | ||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | ||
Additional paid-in capital | 92,138,533 | 19,680,076 |
Accumulated deficit | (87,141,777) | (14,682,592) |
Total Stockholders' Equity | 5,000,010 | 5,000,006 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 700,925,360 | 697,836,358 |
Class A Common Stock [Member] | ||
Stockholders' Equity | ||
Common stock value | 1,529 | 797 |
Total Stockholders' Equity | 1,529 | 797 |
Class B Common Stock [Member] | ||
Stockholders' Equity | ||
Common stock value | 1,725 | 1,725 |
Total Stockholders' Equity | $ 1,725 | $ 1,725 |
BALANCE SHEETS (As Restated) (P
BALANCE SHEETS (As Restated) (Parenthetical) - $ / shares | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Oct. 12, 2020 | Dec. 31, 2019 | Jun. 26, 2019 | Jun. 07, 2019 |
Temporary Equity, Shares Outstanding | 57,909,708 | 53,712,502 | 61,025,925 | ||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||
Preferred Stock, Shares Issued | 0 | 0 | 0 | ||||
Preferred Stock, Shares Outstanding | 0 | 0 | 0 | ||||
Class A Common Stock [Member] | |||||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||
Common Stock, Shares, Issued | 11,090,292 | 15,287,498 | 7,974,075 | ||||
Common Stock, Shares, Outstanding | 11,090,292 | 3,840,000 | 15,287,498 | 7,974,075 | |||
Common Stock, Redemption Shares | 57,909,708 | 53,712,502 | 61,025,925 | ||||
Class B Common Stock [Member] | |||||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||
Common Stock, Shares, Issued | 17,250,000 | 17,250,000 | 17,250,000 | ||||
Common Stock, Shares, Outstanding | 17,250,000 | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 |
STATEMENTS OF OPERATIONS (As Re
STATEMENTS OF OPERATIONS (As Restated) | 12 Months Ended |
Dec. 31, 2020USD ($)$ / sharesshares | |
Formation and operating costs | $ 2,906,903 |
Reimbursement of transaction expenses | (2,000,000) |
Loss from operations | (906,903) |
Other income (expense): | |
Interest earned on marketable securities held in Trust Account | 2,516,752 |
Loss on derivative liabilities | (73,583,549) |
Unrealized gain (loss) on marketable securities held in Trust Account | 1,276 |
Other income, net | (71,065,521) |
Loss before income taxes | (71,972,424) |
Provision for income taxes | (486,761) |
Net income (loss) | $ (72,459,185) |
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | shares | 27,526,131 |
Basic and diluted net loss per share, Non-redeemable common stock | $ / shares | $ (2.68) |
Class A Common Stock [Member] | |
Other income (expense): | |
Net income (loss) | $ 0 |
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption | shares | 58,723,869 |
Basic and diluted net income per share | $ / shares | $ 0.03 |
CONDENSED STATEMENT OF CHANGES
CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (As Restated) - USD ($) | Class A Common Stock [Member] | Class B Common Stock [Member] | Common Stock Subject to Possible Redemption | Additional Paid in Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Apr. 10, 2019 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | |
Balance (in shares) at Apr. 10, 2019 | 0 | 0 | ||||
Net income | (16,497,280) | |||||
Balance at Apr. 10, 2019 | $ 0 | $ 0 | 0 | 0 | 0 | |
Balance (in shares) at Apr. 10, 2019 | 0 | 0 | ||||
Issuance of Class B common stock to Sponsor | $ 0 | $ 1,725 | 23,275 | 0 | 25,000 | |
Issuance of Class B common stock to Sponsor (in shares) | 0 | 17,250,000 | ||||
Sale of 69,000,000 Units, net of underwriting discount and offering expenses | $ 6,900 | $ 0 | 634,488,927 | 0 | 634,495,827 | |
Sale of 69,000,000 Units, net of underwriting discount and offering expenses (in shares) | 69,000,000 | 0 | ||||
Change in value of Class A common stock subject to possible redemption | $ (6,103) | $ 0 | (614,832,126) | 0 | (614,838,229) | |
Change in value of common stock subject to possible redemption (in shares) | (61,025,925) | 0 | ||||
Net income | $ 0 | $ 0 | 0 | (14,682,592) | (14,682,592) | |
Balance at Dec. 31, 2019 | $ 797 | $ 1,725 | 19,680,076 | (14,682,592) | 5,000,006 | |
Balance (in shares) at Dec. 31, 2019 | 7,974,075 | 17,250,000 | ||||
Issuance of Class B common stock to Sponsor (in shares) | 0 | |||||
Net income | $ 0 | $ 0 | 0 | (8,823,514) | (8,823,514) | |
Balance at Mar. 31, 2020 | $ 900 | $ 1,725 | 28,503,490 | (23,506,106) | 5,000,009 | |
Balance (in shares) at Mar. 31, 2020 | 9,001,781 | 17,250,000 | ||||
Balance at Dec. 31, 2019 | $ 797 | $ 1,725 | 19,680,076 | (14,682,592) | 5,000,006 | |
Balance (in shares) at Dec. 31, 2019 | 7,974,075 | 17,250,000 | ||||
Net income | (53,585,867) | |||||
Balance at Dec. 31, 2019 | $ 797 | $ 1,725 | 19,680,076 | (14,682,592) | 5,000,006 | |
Balance (in shares) at Dec. 31, 2019 | 7,974,075 | 17,250,000 | ||||
Net income | (25,340,816) | |||||
Balance at Dec. 31, 2019 | $ 797 | $ 1,725 | 19,680,076 | (14,682,592) | 5,000,006 | |
Balance (in shares) at Dec. 31, 2019 | 7,974,075 | 17,250,000 | ||||
Issuance of Class B common stock to Sponsor (in shares) | 7,313,423 | |||||
Change in value of Class A common stock subject to possible redemption | $ 732 | $ 0 | 72,458,457 | 0 | 72,459,189 | |
Net income | 0 | 0 | 0 | (72,459,185) | (72,459,185) | |
Balance at Dec. 31, 2020 | $ 1,529 | $ 1,725 | 92,138,533 | (87,141,777) | 5,000,010 | |
Balance (in shares) at Dec. 31, 2020 | 15,287,498 | 17,250,000 | ||||
Balance at Mar. 31, 2020 | $ 900 | $ 1,725 | 28,503,490 | (23,506,106) | 5,000,009 | |
Balance (in shares) at Mar. 31, 2020 | 9,001,781 | 17,250,000 | ||||
Balance at Dec. 31, 2020 | $ 1,529 | $ 1,725 | 92,138,533 | (87,141,777) | 5,000,010 | |
Balance (in shares) at Dec. 31, 2020 | 15,287,498 | 17,250,000 | ||||
Change in value of Class A common stock subject to possible redemption | $ (420) | $ 0 | (41,740,385) | 0 | (41,740,805) | |
Change in value of common stock subject to possible redemption (in shares) | (4,197,206) | 0 | ||||
Net income | $ 0 | $ 0 | 0 | 41,740,801 | 41,740,801 | |
Balance at Mar. 31, 2021 | $ 1,109 | $ 1,725 | $ 50,398,148 | $ (45,400,976) | $ 5,000,006 | |
Balance (in shares) at Mar. 31, 2021 | 11,090,292 | 17,250,000 |
CONDENSED STATEMENT OF CHANGE_2
CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (As Restated) (Parenthetical) | 9 Months Ended |
Dec. 31, 2019shares | |
IPO [Member] | |
Partners' Capital Account, Units, Sale of Units | 69,000,000 |
STATEMENTS OF CASH FLOWS (As Re
STATEMENTS OF CASH FLOWS (As Restated) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net income | $ (72,459,185) | $ (14,682,592) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Interest earned on marketable securities held in Trust Account | (2,516,752) | (6,639,430) |
Transaction costs attributable to the Initial Public Offering | 1,125,634 | |
Loss on derivative liabilities | 73,583,549 | 18,250,000 |
Unrealized gain on marketable securities held in Trust Account | (1,276) | (45,988) |
Deferred income tax (benefit) provision | (8,681) | 9,657 |
Changes in operating assets and liabilities: | ||
Prepaid expenses | 181,226 | (275,525) |
Prepaid income taxes | 27,140 | (27,140) |
Accounts payable and accrued expenses | 378,017 | 257,466 |
Income taxes payable | 95,302 | |
Net cash used in operating activities | (720,660) | (2,027,918) |
Cash Flows from Investing Activities: | ||
Investment of cash in Trust Account | (690,000,000) | |
Cash withdrawn from Trust Account for working capital | 250,000 | 125,000 |
Cash withdrawn from Trust Account to pay franchise and income taxes | 606,250 | 1,265,000 |
Net cash provided by investing activities | 856,250 | (688,610,000) |
Cash Flows from Financing Activities: | ||
Proceeds from issuance of Class B common stock to Sponsor | 25,000 | |
Proceeds from sale of Units, net of underwriting discounts paid | 677,788,000 | |
Proceeds from sale of Private Placement Warrants | 15,800,000 | |
Proceeds from promissory notes-related party | 1,500,000 | 200,000 |
Repayment of promissory notes-related party | (200,000) | |
Payment of offering costs | (736,807) | |
Net cash provided by financing activities | 1,500,000 | 692,876,193 |
Net Change in Cash | 1,635,590 | 2,238,275 |
Cash-Beginning of period | 2,238,275 | 0 |
Cash-End of period | 3,873,865 | 2,238,275 |
Supplemental cash flow information: | ||
Cash paid for income taxes | 373,000 | 1,265,000 |
Non-Cash investing and financing activities: | ||
Initial classification of Class A common stock subject to redemption | 628,390,190 | |
Change in value of Class A common stock subject to possible redemption | (72,459,189) | (13,551,961) |
Deferred underwriting fee payable | $ 21,371,000 | |
Class B Common Stock [Member] | ||
Cash Flows from Operating Activities: | ||
Net income | $ 0 |
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 Churchill Capital Corp II (the "Company") was incorporated in Delaware on April 11, 2019. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (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 through March 31, 2021 relates to the Company’s formation, initial public offering (the “Initial Public Offering”), which is described below, and subsequent to the Initial Public Offering, identifying a target company for a Business Combination and activities in connection with the potential acquisition of Software Luxembourg Holding S.A., a public limited liability company (société anonyme) incorporated and organized under the laws of the Grand Duchy of Luxembourg (“Skillsoft”) (see Note 6). The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company generates 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 June 26, 2019. On July 1, 2019, the Company consummated the Initial Public Offering of 69,000,000 units (the “Units” and, with respect to the shares of Class A common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriter of the over-allotment option to purchase an additional 9,000,000 Units, at $10.00 per Unit, generating gross proceeds of $690,000,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 15,800,000 warrants (the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant in a private placement to Churchill Sponsor II LLC, a Delaware limited liability company (the “Sponsor”), generating gross proceeds of $15,800,000, which is described in Note 4. Transaction costs amounted to $34,319,807 consisting of $12,212,000 of underwriting discount, $21,371,000 of deferred underwriting discount and $736,807 of other offering costs. Following the closing of the Initial Public Offering on July 1, 2019, an amount of $690,000,000 ($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 Placement Warrants was placed in a trust account (the “Trust Account”), and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended, (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 meeting the conditions of Rule 2a‑7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination or (ii) the distribution of the Trust Account, as described below, except that interest earned on the Trust Account can be released to the Company to fund working capital requirements, subject to an annual limit of $250,000 and to pay its tax obligations. 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 Placement Warrants, 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 an initial Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable) at the time of the agreement to enter into the 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 ($10.00 per Public Share, plus any pro rata interest, net of amounts withdrawn for working capital requirements, subject to an annual limit of $250,000 and to pay its taxes ("permitted withdrawals")). The per-share amount to be distributed to public stockholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 7). 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 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 or stock exchange requirements 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 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 Company’s Sponsor and its permitted transferees have agreed to vote their Founder Shares (as defined in Note 6) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction. If the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% or more of the Public Shares, without the prior consent of the Company. The Sponsor has agreed (a) to waive its redemption rights with respect to its Founder Shares and Public Shares held by it in connection with the completion of a Business Combination, (b) to waive its rights to liquidating distributions from the Trust Account with respect to its Founder Shares if the Company fails to consummate a Business Combination within the Combination Window (as defined below) and (c) not to propose an amendment to the Company’s Amended and Restated Certificate of Incorporation that would 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 shares in conjunction with any such amendment. If the Company is unable to complete a Business Combination by July 1, 2021 (or October 1, 2021 if the Company has an executed letter of intent, agreement in principle or definitive agreement for a Business Combination by July 1, 2021) (the "Combination Window"), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest (net of permitted withdrawals and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Window. The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Window. However, if the Sponsor acquires 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 Window. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 7) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Window and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. 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 Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party (other than the Company’s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or similar agreement, reduce the amount of funds in the Trust Account to below (i) $10.00 per Public Share or (ii) the amount per Public Share held in the Trust Account as of the liquidation of the Trust Account, if less than $10.00 per Public Shares due to reductions in the value of the trust assets, in each case net of permitted withdrawals. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account or to any claims under the Company’s indemnity of the underwriters of the 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 Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, 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. Liquidity The Company has principally financed its operations from inception using proceeds from the sale of its equity securities to its shareholders prior to the Initial Public Offering and such amount of proceeds from the Initial Public Offering that were placed in an account outside of the Trust Account for working capital purposes. As of March 31, 2021, the Company had $2,382,560 in its operating bank accounts, $697,018,229 in securities held in the Trust Account to be used for a Business Combination or to repurchase or redeem its common stock in connection therewith and adjusted working capital of $1,182,603, which amount excludes interest earned which may withdrawn from the Company’s Trust Account to pay its franchise and income taxes. As of March 31, 2021, approximately $7,018,000 of the amount on deposit in the Trust Account represented interest income, which is available to pay the Company's tax obligations. Based on the foregoing, the Company believes it will have sufficient cash to meet its needs for a reasonable period of time, which is considered to be one year from the issuance date of the condensed financial statements. | NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS Churchill Capital Corp II (the “Company”) was incorporated in Delaware on April 11, 2019. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (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 through December 31, 2020 relates to the Company’s formation, the initial public offering (“Initial Public Offering”), which is described below, identifying a target for a Business Combination and activities in connection with the potential acquisition of Software Luxembourg Holding S.A., a public limited liability company (société anonyme) incorporated and organized under the laws of the Grand Duchy of Luxembourg (“Skillsoft”) (see Note 7). The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company generates 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 June 26, 2019. On July 1, 2019, the Company consummated the Initial Public Offering of 69,000,000 units (the“Units” and, with respect to the shares of Class A common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriter of the over-allotment option to purchase an additional 9,000,000 Units, at $10.00 per Unit, generating gross proceeds of $690,000,000, which is described in Note 4. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 15,800,000 warrants (the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant in a private placement to Churchill Sponsor II LLC, a Delaware limited liability company (the “Sponsor”), generating gross proceeds of $15,800,000, which is described in Note 5. Transaction costs amounted to $34,319,807 consisting of $12,212,000 of underwriting discount, $21,371,000 of deferred underwriting discount and $736,807 of other offering costs. Following the closing of the Initial Public Offering on July 1, 2019, an amount of $690,000,000 ($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 Placement Warrants was placed in a trust account (the “Trust Account”) and 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 or (ii) the distribution of the Trust Account, as described below, except that interest earned on the Trust Account can be released to the Company to fund working capital requirements, subject to an annual limit of $250,000 and to pay its tax obligations. 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 Placement Warrants, 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 an initial Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable) at the time of the agreement to enter into the 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 ($10.00 per Public Share, plus any pro rata interest, net of amounts withdrawn for working capital requirements, subject to an annual limit of $250,000 and to pay its taxes (“permitted withdrawals”)). The per-share amount to be distributed to public stockholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 7). 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 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 or stock exchange requirements 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 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 Company’s Sponsor and its permitted transferees have agreed to vote their Founder Shares (as defined in Note 6) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction. If the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% or more of the Public Shares, without the prior consent of the Company. The Sponsor has agreed (a) to waive its redemption rights with respect to its Founder Shares and Public Shares held by it in connection with the completion of a Business Combination, (b) to waive its rights to liquidating distributions from the Trust Account with respect to its Founder Shares if the Company fails to consummate a Business Combination within the Combination Window (as defined below) and (c) not to propose an amendment to the Company’s Amended and Restated Certificate of Incorporation that would 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 shares in conjunction with any such amendment. If the Company is unable to complete a Business Combination by July 1, 2021 (or October 1, 2021 if the Company has an executed letter of intent, agreement in principle or definitive agreement for a Business Combination by July 1, 2021) (the “Combination Window”), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest (net of permitted withdrawals and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Window. The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Window. However, if the Sponsor acquires 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 Window. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 7) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Window and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. 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 Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party (other than the Company’s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or similar agreement, reduce the amount of funds in the Trust Account to below (i) $10.00 per Public Share or (ii) the amount per Public Share held in the Trust Account as of the liquidation of the Trust Account, if less than $10.00 per Public Shares due to reductions in the value of the trust assets, in each case net of permitted withdrawals. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account or to any claims under the Company’s indemnity of the underwriters of the 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 Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, 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. |
RESTATEMENT OF PREVIOUSLY ISSUE
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS | 12 Months Ended |
Dec. 31, 2020 | |
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS | |
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS | NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS The Company previously accounted for its outstanding Public Warrants (as defined in Note 4) and Private Placement Warrants (collectively, with the Public Warrants, the “Warrants”) issued in connection with its Initial Public Offering as components of equity instead of as derivative liabilities. In addition, the Company did not account for its convertible promissory note and Prosus Agreement as derivative liabilities (the convertible promissory note, Prosus Agreement, together with the Warrants, the “Derivative Instruments”). The warrant agreement governing the Warrants includes a provision that provides for potential changes to the settlement amounts dependent upon the characteristics of the holder of the warrant. In addition, the warrant agreement includes a provision that in the event of a tender or exchange offer made to and accepted by holders of more than 50% of the outstanding shares of a single class of common shares, all holders of the Warrants would be entitled to receive cash for their Warrants (the “tender offer provision”). On April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the Securities and Exchange Commission together issued a statement regarding the accounting and reporting considerations for warrants issued by special purpose acquisition companies entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Warrant Accounting Statement”). Specifically, the SEC Warrant Accounting Statement focused on certain settlement terms and provisions related to certain tender offers following a business combination, which terms are similar to those contained in the Derivative Instruments. In further consideration of the SEC Warrant Accounting Statement, the Company’s management further evaluated the Warrants under Accounting Standards Codification (“ASC”) Subtopic 815-40, Contracts in Entity’s Own Equity. ASC Section 815-40-15 addresses equity versus liability treatment and classification of equity-linked financial instruments, including warrants, and states that a warrant may be classified as a component of equity only if, among other things, the warrant is indexed to the issuer’s common stock. Under ASC Section 815-40-15, a warrant is not indexed to the issuer’s common stock if the terms of the warrant require an adjustment to the exercise price upon a specified event and that event is not an input to the fair value of the warrant. Based on management’s evaluation, the Company’s audit committee, in consultation with management and after discussion with the Company’s independent registered public accounting firm, concluded that the Company’s Private Placement Warrants are not indexed to the Company’s common shares in the manner contemplated by ASC Section 815-40-15 because the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares. In addition, based on management’s evaluation, the Company’s audit committee, in consultation with management and after discussion with the Company’s independent registered public accounting firm, concluded the tender offer provision included in the warrant agreement fails the “classified in shareholders’ equity” criteria as contemplated by ASC Section 815-40-25. As a result of the above, the Company should have classified the Derivative Instruments as derivative liabilities in its previously issued financial statements. Under this accounting treatment, the Company is required to measure the fair value of the Derivative Instruments at the end of each reporting period and recognize changes in the fair value from the prior period in the Company’s operating results for the current period. See Notes 3, 6, 7, 8, 9, 10 and 11. The Company’s accounting for the Derivative Instruments as components of equity instead of as derivative liabilities did not have any effect on the Company’s previously reported investments held in the Trust Account, operating expenses, or cash. The table below summarizes the effects of the restatement on the financial statements for all periods being restated: As Previously As Reported Adjustments Restated Balance sheet as of July 1, 2019 (audited) Total Liabilities $ 21,509,982 $ 38,110,000 $ 59,619,982 Class A Common Stock Subject to Possible Redemption 666,500,190 (38,110,000) 628,390,190 Class A Common Stock 235 381 616 Additional Paid-in Capital 5,003,043 1,125,253 6,128,296 Accumulated Deficit (5,000) (1,125,634) (1,130,634) Total Stockholders’ Equity 5,000,003 — 5,000,003 Number of Class A common stock subject to redemption 66,650,019 (3,811,000) 62,839,019 Balance sheet as of September 30, 2019 (unaudited) Total Liabilities $ 21,438,614 $ 55,988,000 $ 77,426,614 Class A Common Stock Subject to Possible Redemption 669,011,539 (55,988,000) 613,023,539 Class A Common Stock 233 558 791 Additional Paid-in Capital 2,491,696 19,003,076 21,494,772 Retained Earnings (Accumulated Deficit) 2,506,354 (19,003,634) (16,497,280) Total Stockholders’ Equity 5,000,008 — 5,000,008 Number of Class A common stock subject to redemption 66,673,530 (5,579,751) 61,093,779 Balance sheet as of December 31, 2019 (audited) Total Liabilities $ 21,638,123 $ 56,360,000 $ 77,998,123 Class A Common Stock Subject to Possible Redemption 671,198,229 (56,360,000) 614,838,229 Class A Common Stock 238 559 797 Additional Paid-in Capital 305,001 19,375,075 19,680,076 Retained Earnings (Accumulated Deficit) 4,693,042 (19,375,634) (14,682,592) Total Stockholders’ Equity 5,000,006 — 5,000,006 Number of Class A common stock subject to redemption 66,619,951 (5,594,026) 61,025,925 Balance sheet as of March 31, 2020 (unaudited) Total Liabilities $ 21,805,994 $ 66,706,000 $ 88,511,994 Class A Common Stock Subject to Possible Redemption 672,720,712 (66,706,000) 606,014,712 Class A Common Stock 240 660 900 Additional Paid-in Capital — 28,503,490 28,503,490 Retained Earnings (Accumulated Deficit) 4,998,044 (28,504,150) (23,506,106) Total Stockholders’ Equity 5,000,009 — 5,000,009 Number of Class A common stock subject to redemption 66,602,417 (6,604,198) 59,998,219 Balance sheet as of June 30, 2020 (unaudited) Total Liabilities $ 21,739,976 $ 111,342,000 $ 133,081,976 Class A Common Stock Subject to Possible Redemption 672,594,363 (111,342,000) 561,252,363 Class A Common Stock 242 1,102 1,344 Additional Paid-in Capital 126,347 73,139,048 73,265,395 Retained Earnings (Accumulated Deficit) 4,871,691 (73,140,150) (68,268,459) Total Stockholders’ Equity 5,000,005 — 5,000,005 Number of Class A common stock subject to redemption 66,584,915 (11,022,539) 55,562,376 Balance sheet as of September 30, 2020 (unaudited) Total Liabilities $ 21,689,446 $ 83,004,000 $ 104,693,446 Class A Common Stock Subject to Possible Redemption 672,501,414 (83,004,000) 589,497,414 Class A Common Stock 244 821 1,065 Additional Paid-in Capital 219,294 44,801,329 45,020,623 Retained Earnings (Accumulated Deficit) 4,778,742 (44,802,150) (40,023,408) Total Stockholders’ Equity 5,000,005 — 5,000,005 Number of Class A common stock subject to redemption 66,563,478 (8,215,648) 58,347,830 As Previously As Reported Adjustments Restated Balance sheet as of December 31, 2020 (audited) Total Liabilities $ 23,602,761 $ 129,943,549 $ 153,546,310 Class A Common Stock Subject to Possible Redemption 672,322,591 (129,943,551) 542,379,040 Class A Common Stock 242 1,287 1,529 Additional Paid-in Capital 398,119 91,740,414 92,138,533 Retained Earnings (Accumulated Deficit) 4,599,922 (91,741,699) (87,141,777) Total Stockholders’ Equity 5,000,008 2 5,000,010 Number of Class A common stock subject to redemption 66,580,981 (12,868,479) 53,712,502 Statement of Operations for the three months ended September 30, 2019 (unaudited) Net income (loss) $ 2,507,354 $ (19,003,634) $ (16,496,280) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,650,019 (3,811,000) 62,839,019 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.04 — 0.04 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,549,981 3,769,576 23,319,557 Basic and diluted net loss per share, Non-redeemable common stock 0.00 (0.81) (0.81) Statement of Operations for the period from April 11, 2019 (inception) to September 30, 2019 (unaudited) Net income (loss) $ 2,506,354 $ (19,003,634) $ (16,497,280) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,650,019 (3,811,000) 62,839,019 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.04 — 0.04 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 17,433,711 2,016,285 19,449,996 Basic and diluted net loss per share, Non-redeemable common stock 0.00 (0.98) (0.98) Statement of Operations for the period from April 11, 2019 (inception) to December 31, 2019 (audited) Net income (loss) $ 4,693,042 $ (19,375,634) $ (14,682,592) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,661,839 (4,700,208) 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.07 0.01 0.08 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 18,180,430 3,258,099 21,438,529 Basic and diluted net loss per share, Non-redeemable common stock (0.01) (0.90) (0.91) Statement of Operations for the three months ended March 31, 2020 (unaudited) Net income (loss) $ 1,522,486 $ (10,346,000) $ (8,823,514) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,619,951 (5,594,026) 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.02 — 0.02 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,630,049 5,594,026 25,224,075 Basic and diluted net loss per share, Non-redeemable common stock (0.41) (0.41) Statement of Operations for the three months ended June 30, 2020 (unaudited) Net loss $ (126,353) $ (44,636,000) $ (44,762,353) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,585,251 (6,587,032) 59,998,219 Basic and diluted net income per share, Class A common stock subject to possible redemption — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,664,749 6,587,032 26,251,781 Basic and diluted net loss per share, Non-redeemable common stock (0.01) (1.70) (1.71) Statement of Operations for the six months ended June 30, 2020 (unaudited) Net income (loss) $ 1,396,133 $ (54,982,000) $ (53,585,867) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,602,601 (6,090,529) 60,512,072 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.02 0.01 0.03 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,647,399 6,090,529 25,737,928 Basic and diluted net loss per share, Non-redeemable common stock (0.01) (2.13) (2.14) Statement of Operations for the three months ended September 30, 2020 (unaudited) Net income (loss) $ (92,949) $ 28,338,000 $ 28,245,051 Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,563,636 (11,001,260) 55,562,376 Basic and diluted net income per share, Class A common stock subject to possible redemption — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,686,364 11,001,260 30,687,624 Basic and diluted net loss per share, Non-redeemable common stock 0.92 0.92 Statement of Operations for the nine months ended September 30, 2020 (unaudited) Net income (loss) $ 1,303,184 $ (26,644,000) $ (25,340,816) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,589,518 (7,739,388) 58,850,130 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.02 0.01 0.03 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,660,482 7,739,388 27,399,870 Basic and diluted net loss per share, Non-redeemable common stock (0.02) (0.96) (0.98) Statement of Operations for the year ended December 31, 2020 (audited) Net income (loss) $ 1,124,364 $ (73,583,549) $ (72,459,185) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,592,589 (7,868,720) 58,723,869 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.02 0.01 0.03 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,657,411 7,868,720 27,526,131 Basic and diluted net loss per share, Non-redeemable common stock (0.02) (2.67) (2.68) As Previously As Reported Adjustments Restated Statement of Cash Flows for the period from April 11, 2019 (inception) to September 30, 2019 (unaudited) Net income (loss) $ 2,506,354 $ (19,003,634) $ (16,497,280) Transaction costs attributable to the Initial Public Offering — (1,125,634) (1,125,634) Loss on Derivative Liabilities — (17,878,000) (17,878,000) Initial classification of Class A common stock subject to redemption 666,500,190 (38,110,000) 628,390,190 Change in value of Class A common stock subject to possible redemption 2,511,349 (17,878,000) (15,366,651) Statement of Cash Flows for the period from April 11, 2019 (inception) to December 31, 2019 (audited) Net income (loss) $ 4,693,042 $ (19,375,634) $ (14,682,592) Transaction costs attributable to the Initial Public Offering — (1,125,634) (1,125,634) Loss on Derivative Liabilities — (18,250,000) (18,250,000) Initial classification of Class A common stock subject to redemption 666,500,190 (38,110,000) 628,390,190 Change in value of Class A common stock subject to possible redemption 4,698,039 (18,250,000) (13,551,961) Statement of Cash Flows for the three months ended March 31, 2020 (unaudited) Net income (loss) $ 1,522,486 $ (10,346,000) $ (8,823,514) Loss on Derivative Liabilities — (10,346,000) (10,346,000) Change in value of Class A common stock subject to possible redemption 1,522,483 (10,346,000) (8,823,517) Statement of Cash Flows for the six months ended June 30, 2020 (unaudited) Net income (loss) $ 1,396,133 $ (54,982,000) $ (53,585,867) Loss on Derivative Liabilities — (54,982,000) (54,982,000) Change in value of Class A common stock subject to possible redemption 1,396,134 (54,982,000) (53,585,866) Statement of Cash Flows for the nine months ended September 30, 2020 (unaudited) Net income (loss) $ 1,303,184 $ (26,644,000) $ (25,340,816) Loss on Derivative Liabilities — (26,644,000) (26,644,000) Change in value of Class A common stock subject to possible redemption 1,303,185 (26,644,000) (25,340,815) Statement of Cash Flows for the year ended December 31, 2020 (audited) Net income (loss) $ 1,124,364 $ (73,583,549) $ (72,459,185) Loss on Derivative Liabilities — (73,583,549) (73,583,549) Change in value of Class A common stock subject to possible redemption 1,124,362 (73,583,551) (72,459,189) |
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 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/A for the year ended December 31, 2020, as filed with the SEC on May 11, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year 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 statement 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 the condensed 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 December 31, 2020. Marketable Securities Held in Trust Account At March 31, 2021 and December 31, 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through March 31, 2021, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which no amounts were withdrawn during the three months ended March 31, 2021. Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common stock and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. Class A Common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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 statements 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 and permanent differences. Net income (Loss) per Share Net income (loss) per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per share, basic and diluted, for Class A 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 the weighted average number of Class A 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 Class A 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 share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) 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 Corporation coverage limit 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 Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature, except for the Company's derivative instruments (see Note 9). Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | NOTE 3. 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 the 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. Cash equivalents consist of mutual funds. The Company did not have any cash equivalents as of December 31, 2020 and 2019. Marketable Securities Held in Trust Account At December 31, 2020 and 2019, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through December 31, 2020, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which $856,250 was withdrawn during the year ended December 31, 2020. Class A common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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. Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common shares and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. 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 statements 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, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses (“NOL) and allow businesses to carry back NOLs arising in 2018, 2019 and 2020 to the five prior years, suspend the excess business loss rules, accelerate refunds of previously generated corporate alternative minimum tax credits, generally loosen the business interest limitation under IRC section 163(j) from 30 percent to 50 percent among other technical corrections included in the Tax Cuts and Jobs Act tax provisions. The Company does not believe that the CARES Act will have a significant impact on Company's financial position or statement of operations. Net Income (Loss) per Common Share Net income (loss) per common share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. The Company has not considered the effect of the warrants sold in the Public Offering and Private Placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per ordinary share. Net income (loss) per common share, basic and diluted, for Class A 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 by the weighted average number of Class A common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income or loss on marketable securities attributable to Class A common stock subject to possible redemption, by the weighted average number of non-redeemable ordinary shares 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 the non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) 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 limit 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, except for the Company’s Derivative Instruments (see Note 6 and 11). 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 69,000,000 Units, at a purchase price of $10.00 per Unit, which includes the full exercise by the underwriter of its option to purchase an additional 9,000,000 Units at $10.00 per Unit. Each Unit consists of one share of Class A common stock and one-third of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at an exercise price of $11.50 per share, subject to adjustment (see Note 8). | NOTE 4. PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 69,000,000 Units at a purchase price of $10.00 per Unit, which includes the full exercise by the underwriter of its option to purchase an additional 9,000,000 Units at $10.00 per Unit. Each Unit consists of one share of Class A common stock and one-third of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment (see Note 9). |
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 Sponsor purchased an aggregate of 15,800,000 Private Placement Warrants at a price of $1.00 per Private Placement Warrant, for an aggregate purchase price of $15,800,000. Each Private Placement Warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share. The proceeds from the sale of the Private Placement Warrants 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 Window, the proceeds from the sale of the Private Placement Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless. There will be no redemption rights or liquidating distributions from the Trust Account with respect to the Private Placement Warrants. | NOTE 5. PRIVATE PLACEMENT Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 15,800,000 Private Placement Warrants at a price of $1.00 per Private Placement Warrant, for an aggregate purchase price of $15,800,000. Each Private Placement Warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share. The proceeds from the sale of the Private Placement Warrants 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 Window, the proceeds from the sale of the Private Placement Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless. There will be no redemption rights or liquidating distributions from the Trust Account with respect to the Private Placement Warrants. |
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 May 2019, the Sponsor purchased 8,625,000 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On June 7, 2019, the Company effected a stock dividend at one-third of one share of Class B common stock for each outstanding share of Class B common stock, resulting in an aggregate of 11,500,000 Founder Shares outstanding. On June 26, 2019, the Company effected a further stock dividend of one-half of a share of Class B common stock for each outstanding share of Class B common stock, resulting in the Sponsor holding an aggregate of 17,250,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the stock dividend. The Founder Shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 7. The Founder Shares included an aggregate of up to 2,250,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, 2,250,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) the date on which the Company completes a liquidation, merger, stock exchange, reorganization or similar transaction after a Business Combination that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A common stock equals or exceeds $12.00 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 at least 150 days after a Business Combination, the Founder Shares will be released form the lock-up. Administrative Support Agreement The Company entered into an agreement, commencing on June 26, 2019 through the earlier of the Company’s consummation of a Business Combination and its liquidation, pursuant to which the Company will pay an affiliate of the Sponsor a total of up to $20,000 per month for office space, administrative and support services. For the three months ended March 31, 2021 and 2020, the Company incurred and paid $60,000 in fees for these services. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor or the Company’s directors and officers 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. 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 either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On November 2, 2020, the Company entered into a convertible promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Promissory Note”). The Convertible Promissory Note is non-interest bearing and payable on the earlier of the date on which the Company consummates a Business Combination or the date that the winding up of the Company is effective. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Promissory Note; however, no proceeds from the Trust Account may be used for such repayment. Up to $1,500,000 of the Convertible Promissory Note may be converted into warrants at a price of $1.00 per warrant at the option of the Sponsor. The warrants would be identical to the Private Placement Warrants. As of March31, 2021 and December 31, 2020, the outstanding balance under the Convertible Promissory Note amounted to an aggregate of $1,500,000. The Company assessed the provisions of the Convertible Promissory Note under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on conversion option liability. The conversion option was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 9). The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the conversion option is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of November 2, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of conversion option: Fair value as of January 1, 2021 $ 1,604,359 Change in valuation inputs and other assumptions 27,624 Fair value as of March 31, 2021 $ 1,632,013 Advisory Fee The Company may engage M. Klein and Company, LLC, an affiliate of the Sponsor, or another affiliate of the Sponsor, as its lead financial advisor in connection with a Business Combination and may pay such affiliate a customary financial advisory fee in an amount that constitutes a market standard financial advisory fee for comparable transactions. | NOTE 6. RELATED PARTY TRANSACTIONS Founder Shares In May 2019, the Sponsor purchased 8,625,000 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On June 7, 2019, the Company effected a stock dividend at one-third of one share of Class B common stock for each outstanding share of Class B common stock, resulting in an aggregate of 11,500,000 Founder Shares outstanding. On June 26, 2019, the Company effected a further stock dividend of one-half of a share of Class B common stock for each outstanding share of Class B common stock, resulting in the Sponsor holding an aggregate of 17,250,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the stock dividend. The Founder Shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 8. The Founder Shares included an aggregate of up to 2,250,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, 2,250,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) the date on which the Company completes a liquidation, merger, stock exchange, reorganization or similar transaction after a Business Combination that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A common stock equals or exceeds $12.00 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 at least 150 days after a Business Combination, the Founder Shares will be released from the lock-up. Promissory Note — Related Party On April 29, 2019, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Promissory Note”). The Promissory Note was non-interest bearing and payable on the earlier of December 31, 2019 or the completion of the Initial Public Offering. The Promissory Note was drawn in the amount of $200,000 and was repaid in full upon the consummation of the Initial Public Offering on July 1, 2019. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or the Company’s officers and directors 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. 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 either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On November 2, 2020, the Company entered into a convertible promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Promissory Note”). The Convertible Promissory Note is non-interest bearing and payable on the earlier of the date on which the Company consummates a Business Combination or the date that the winding up of the Company is effective. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Promissory Note; however, no proceeds from the Trust Account may be used for such repayment. Up to $1,500,000 of the Convertible Promissory Note may be converted into warrants at a price of $1.00 per warrant at the option of the Sponsor. The warrants would be identical to the Private Placement Warrants. As of December 31, 2020, the outstanding balance under the Convertible Promissory Note amounted to an aggregate of $1,500,000. The Company assessed the provisions of the Convertible Promissory Note under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on conversion option liability. The conversion option was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 11). The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the conversion option is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of November 2, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of conversion option: Fair value as of January 1, 2020 $ — Initial measurement on November 2, 2020 1,493,877 Change in valuation inputs and other assumptions 110,482 Fair value as of December 31, 2020 $ 1,604,359 Administrative Support Agreement The Company entered into an agreement whereby, commencing on June 26, 2019 through the earlier of the Company’s consummation of a Business Combination and its liquidation, the Company will pay an affiliate of the Sponsor a total of $20,000 per month for office space, administrative and support services. For the year ended December 31, 2020 and for the period from April 11, 2019 through December 31, 2019, the Company incurred and paid $240,000 and $123,333 of such fees, respectively. Advisory Fee The Company may engage M. Klein and Company, LLC, an affiliate of the Sponsor, or another affiliate of the Sponsor, as its lead financial advisor in connection with a Business Combination and may pay such affiliate a customary financial advisory fee in an amount that constitutes a market standard financial advisory fee for comparable transactions. |
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 June 26, 2019, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants or warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) will be entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). The holders of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Underwriting Agreement The underwriters are entitled to a deferred fee of $21,371,000 in the aggregate. The deferred fee will be waived by the underwriters in the event that the Company does not complete a Business Combination, subject to the terms of the underwriting agreement. On July 1, 2019, the underwriters agreed to waive the upfront and deferred underwriting discount on 7,940,000 units, resulting in a reduction of the upfront and deferred underwriting discount of $1,588,000 and $2,779,000, respectively. Skillsoft Merger Agreement On October 12, 2020, the Company entered into an Agreement and Plan of Merger (the “Skillsoft Merger Agreement”) by and between the Company and Skillsoft. Pursuant to the terms of the Skillsoft Merger Agreement, a business combination between the Company and Skillsoft will be effected through the merger of Skillsoft with and into the Company, with the Company surviving as the surviving company (the “Skillsoft Merger”). At the effective time of the Skillsoft Merger (the “Effective Time”), (a) each Class A share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class A Shares”), outstanding immediately prior to the Effective Time, will be automatically canceled and the Company will issue as consideration therefor (i) such number of shares of the Company’s Class A common stock, par value $0.0001 per share (the “Churchill Class A Common Stock”) equal to the Class A First Lien Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (ii) the Company’s Class C common stock, par value $0.0001 per share (the “Churchill Class C Common Stock”), equal to the Class C Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (b) each Class B share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class B Shares”), will be automatically canceled and the Company will issue as consideration therefor such number of shares of the Company’s Class A common stock equal to the Per Class B Share Merger Consideration (as defined in the Skillsoft Merger Agreement). Pursuant to the terms of the Skillsoft Merger Agreement, the Company is required to use commercially reasonable efforts to cause the Company Class A Common Stock to be issued in connection with the transactions contemplated by the Skillsoft Merger Agreement (the “Skillsoft Transactions”) to be listed on the New York Stock Exchange (“NYSE”) prior to the closing of the Skillsoft Merger (the “Skillsoft Closing”). Immediately following the Effective Time, the Company will redeem all of the shares of Class C Common Stock issued to the holders of Skillsoft Class A Shares for an aggregate redemption price of (i) $505,000,000 in cash and (ii) indebtedness under the Existing Second Out Credit Agreement (as defined in the Skillsoft Merger Agreement), as amended by the Existing Second Out Credit Agreement Amendment (as defined in the Skillsoft Merger Agreement), in the aggregate principal amount equal to the sum of $20,000,000 to be issued by the Surviving Corporation (as defined in the Skillsoft Merger Agreement) or one of its subsidiaries, in each case, pro rata among the holders of Churchill Class C Common Stock issued in connection with the Skillsoft Merger. The consummation of the proposed Skillsoft Transactions is subject to the receipt of the requisite approval of (i) the stockholders of Churchill (the “Churchill Stockholder Approval”) and (ii) the shareholders of Skillsoft (the “Skillsoft Shareholder Approval”) and the fulfillment of certain other conditions. In October 2020, the Company was advanced $2,000,000 for expenses incurred with the Skillsoft Merger. If the planned business combination is not completed, the Company would be required to refund any unused amount. For the year ended December 31, 2020 the Company had utilized the advance in connection with the Skillsoft Merger. As of the date of these financial statements, the advance is no longer refundable. Global Knowledge Merger Agreement Concurrently with its entry into the Skillsoft Merger Agreement, the Company also entered into an Agreement and Plan of Merger (the “Global Knowledge Merger Agreement”) by and among the Company, Magnet Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), and Albert DE Holdings Inc., a Delaware corporation owned by investment funds affiliated with Rhône Capital L.L.C. Pursuant to the Global Knowledge Merger Agreement, Merger Sub will merge with and into Global Knowledge, with Global Knowledge surviving the transaction as a wholly-owned subsidiary of the Company (the “Global Knowledge Merger”). At the effective time (the “Global Knowledge Effective Time”) of the Global Knowledge Merger, as consideration for the Global Knowledge Merger, 100% of the issued and outstanding equity interests of Global Knowledge will be converted, in the aggregate, into the right to receive warrants, each of which shall entitle the holders thereof to purchase one share of the Company’s Class A Stock at an exercise price of $11.50 per share. The aggregate number of warrants to be received by the equity holders of Global Knowledge as consideration in the Global Knowledge Merger will be 5,000,000. The warrants to be issued to the equity holders of Global Knowledge will be non-redeemable and otherwise substantially similar to the private placement warrants issued to the Churchill Sponsor in connection with Churchill’s initial public offering. The consummation of the proposed Global Knowledge Merger (the “Global Knowledge Closing”) is subject to the consummation of the Skillsoft Merger, among other conditions contained in the Global Knowledge Merger Agreement. Restructuring Support Agreement On October 12, 2020, Global Knowledge entered into a Restructuring Support Agreement (the “Global Knowledge RSA”) with (i) 100% of its lenders under that certain Amended and Restated First Lien Credit and Guaranty Agreement, dated as of January 30, 2015, as amended from time to time, by and among, inter alios, GK Holdings, as borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto and Credit Suisse, acting in its capacity as administrative agent and collateral agent (the “First Lien Credit Agreement,” and the lenders thereto, the “First Lien Lenders”); and (ii) 100% of its lenders under that certain Amended and Restated Second Lien Credit and Guaranty Agreement, dated as of January 30, 2015, as amended from time to time, by and among, inter alios, GK Holdings, as borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto and Wilmington Trust, acting in its capacity as administrative agent and collateral agent (the “Second Lien Credit Agreement,” and there lenders thereto, the “Second Lien Lenders,” together with the First Lien Lenders, the “Secured Lenders”). The Global Knowledge RSA contemplates an out-of-court restructuring (the “Restructuring”) that provides meaningful recoveries, funded by Churchill, to all Secured Lenders. Churchill is a third-party beneficiary of the Global Knowledge RSA with respect to enforcement of certain specific provisions and its explicit rights under the Global Knowledge RSA and not a direct party. Subscription Agreements Prosus Agreement On November 10, 2020, MIH Edtech Investments B.V. (formerly known as MIH Ventures B.V.) ("MIH Edtech Investments") exercised its option to subscribe for an additional 40,000,000 newly-issued shares of Churchill Class A Common Stock, subject to certain adjustments, at a purchase price of $10.00 per share (the “Prosus Second Step Investment”), pursuant to the Subscription Agreement, dated October 12, 2020, by and among Churchill, the Sponsor and MIH Edtech Investments (the “Prosus Agreement”). On February 16, 2021, MIH Edtech Investments assigned all of its rights, title and interest in and to, and obligations under, the Prosus Agreement to MIH Learning B.V. (“Prosus”) and Prosus accepted such assignments. Together with its initial subscription for 10,000,000 newly-issued shares of Churchill Class A Common Stock, at a purchase price of $10.00 per share (the “Prosus First Step Investment”), Prosus’s total investment in Churchill is expected to be 50,000,000 shares of Churchill Class A Common Stock for an aggregate purchase price of $500.0 million (the “Prosus PIPE Investment”). As part of the Prosus Agreement, Prosus and the Company agreed to a strategic support agreement, pursuant to which Prosus will provide certain business development and investor relations support services in the event it exercises its option to make the Prosus Second Step Investment and beneficially owns at least 20% of the outstanding Churchill Class A common stock following closing of the Prosus PIPE Investment on a fully-diluted and as-converted basis. If Prosus consummates the Prosus PIPE Investment, it will also nominate an individual to serve as the chairman of Churchill’s Board. Pursuant to the Prosus Agreement, in connection with the consummation of the Second Step Prosus Investment, Churchill will issue to Prosus warrants to purchase a number of shares of Churchill Class A common stock equal to one-third of the number of shares of Churchill Class A common stock purchased in the Prosus PIPE Investment (the “Prosus Warrants”). The Prosus Warrants will have terms substantively identical to those included in the units offered in Churchill’s IPO. The Company assessed the provisions of the Prosus Agreement under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on Prosus Agreement liability. The Prosus Agreement liability was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 9). The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the Prosus Agreement liability is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of October 12, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of the Prosus Agreement liability: Fair value as of January 1, 2021 $ 50,481,190 Change in valuation inputs and other assumptions (25,948,777) Fair value as of March 31, 2021 $ 24,532,413 SuRo Subscription Agreement On October 14, 2020, in connection with the execution of the Skillsoft Merger Agreement, Churchill entered into a subscription agreement with SuRo Capital Corp. (“SuRo”) pursuant to which SuRo subscribed for 1,000,000 newly-issued shares of Churchill Class A common stock, at a purchase price of $10.00 per share, to be issued at the closing of the Merger (the “SuRo Subscription Agreement”). The obligations to consummate the transactions contemplated by the SuRo Subscription Agreement are conditioned upon, among other things, customary closing conditions and the consummation of the Skillsoft Merger. Lodbrok Subscription Agreement On October 13, 2020, in connection with the execution of the Global Knowledge Merger Agreement, Churchill entered into a subscription agreement with Lodbrok Capital LLP (“Lodbrok”) pursuant to which Lodbrok subscribed for 2,000,000 newly-issued shares of Churchill Class A common stock, at a purchase price of $10.00 per share, to be issued at the closing of the Global Knowledge Merger (the “Lodbrok Subscription Agreement”). The obligations to consummate the transactions contemplated by the Lodbrok Subscription Agreement are conditioned upon, among other things, customary closing conditions and the consummation of the Global Knowledge Merger. Service Provider Agreement From time to time the Company has entered into and may enter into agreements with various services providers and advisors, including investment banks, to help us identify targets, negotiate terms of potential Business Combinations, consummate a Business Combination and/or provide other services. In connection with these agreements, the Company may be required to pay such service providers and advisors fees in connection with their services to the extent that certain conditions, including the closing of a potential Business Combination, are met. If a Business Combination does not occur, the Company would not expect to be required to pay these contingent fees. There can be no assurance that the Company will complete a Business Combination. The Company and Tyton Partners entered into an agreement, whereby Tyton Partners served as an advisor to the Company and will be entitled to receive a success fee of $150,000 at the close of the Business Combination. For the three months ended March 31, 2021, the Company incurred $332,476 and paid of consulting fees. Legal Proceedings In connection with the initial business combination, certain shareholders have filed lawsuits and other shareholders have threatened to file lawsuits alleging breaches of fiduciary duty and violations of the disclosure requirements of the Securities Exchange Act of 1934. The Company intends to defend the matters vigorously. These cases are in the early stages and the Company is unable to reasonably determine the outcome or estimate any potential losses, and, as such, has not recorded a loss contingency. | NOTE 7. COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on June 26, 2019, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants or warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) will be entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). The holders of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Underwriting Agreement The underwriters are entitled to a deferred fee of $21,371,000 in the aggregate. The deferred fee will be waived by the underwriters in the event that the Company does not complete a Business Combination, subject to the terms of the underwriting agreement. On July 1, 2019, the underwriters agreed to waive the upfront and deferred underwriting discount on 7,940,000 units, resulting in a reduction of the upfront and deferred underwriting discount of $1,588,000 and $2,779,000, respectively. Skillsoft Merger Agreement On October 12, 2020, the Company entered into an Agreement and Plan of Merger (the “Skillsoft Merger Agreement”) by and between the Company and Skillsoft. Pursuant to the terms of the Skillsoft Merger Agreement, a business combination between the Company and Skillsoft will be effected through the merger of Skillsoft with and into the Company, with the Company surviving as the surviving company (the “Skillsoft Merger”). At the effective time of the Skillsoft Merger (the “Effective Time”), (a) each Class A share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class A Shares”), outstanding immediately prior to the Effective Time, will be automatically canceled and the Company will issue as consideration therefor (i) such number of shares of the Company’s Class A common stock, par value $0.0001 per share (the “Churchill Class A Common Stock”) equal to the Class A First Lien Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (ii) the Company’s Class C common stock, par value $0.0001 per share (the “Churchill Class C Common Stock”), equal to the Class C Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (b) each Class B share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class B Shares”), will be automatically canceled and the Company will issue as consideration therefor such number of shares of the Company’s Class A common stock equal to the Per Class B Share Merger Consideration (as defined in the Skillsoft Merger Agreement). Pursuant to the terms of the Skillsoft Merger Agreement, the Company is required to use commercially reasonable efforts to cause the Company Class A Common Stock to be issued in connection with the transactions contemplated by the Skillsoft Merger Agreement (the “Skillsoft Transactions”) to be listed on the New York Stock Exchange (“NYSE”) prior to the closing of the Skillsoft Merger (the “Skillsoft Closing”). Immediately following the Effective Time, the Company will redeem all of the shares of Class C Common Stock issued to the holders of Skillsoft Class A Shares for an aggregate redemption price of (i) $505,000,000 in cash and (ii) indebtedness under the Existing Second Out Credit Agreement (as defined in the Skillsoft Merger Agreement), as amended by the Existing Second Out Credit Agreement Amendment (as defined in the Skillsoft Merger Agreement), in the aggregate principal amount equal to the sum of $20,000,000 to be issued by the Surviving Corporation (as defined in the Skillsoft Merger Agreement) or one of its subsidiaries, in each case, pro rata among the holders of Churchill Class C Common Stock issued in connection with the Skillsoft Merger. The consummation of the proposed Skillsoft Transactions is subject to the receipt of the requisite approval of (i) the stockholders of Churchill (the “Churchill Stockholder Approval”) and (ii) the shareholders of Skillsoft (the “Skillsoft Shareholder Approval”) and the fulfillment of certain other conditions. In October 2020, the Company was advanced $2,000,000 for expenses incurred with the Skillsoft Merger. If the planned business combination is not completed, the Company would be required to refund any unused amount. For the year ended December 31, 2020 the Company had utilized the advance in connection with the Skillsoft Merger. As of the date of these financial statements, the advance is no longer refundable. Global Knowledge Merger Agreement Concurrently with its entry into the Skillsoft Merger Agreement, the Company also entered into an Agreement and Plan of Merger (the “Global Knowledge Merger Agreement”) by and among the Company, Magnet Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), and Albert DE Holdings Inc., a Delaware corporation owned by investment funds affiliated with Rhône Capital L.L.C. Pursuant to the Global Knowledge Merger Agreement, Merger Sub will merge with and into Global Knowledge, with Global Knowledge surviving the transaction as a wholly-owned subsidiary of the Company (the “Global Knowledge Merger”). At the effective time (the “Global Knowledge Effective Time”) of the Global Knowledge Merger, as consideration for the Global Knowledge Merger, 100% of the issued and outstanding equity interests of Global Knowledge will be converted, in the aggregate, into the right to receive warrants, each of which shall entitle the holders thereof to purchase one share of the Company’s Class A Stock at an exercise price of $11.50 per share. The aggregate number of warrants to be received by the equity holders of Global Knowledge as consideration in the Global Knowledge Merger will be 5,000,000. The warrants to be issued to the equity holders of Global Knowledge will be non-redeemable and otherwise substantially similar to the private placement warrants issued to the Churchill Sponsor in connection with Churchill’s initial public offering. The consummation of the proposed Global Knowledge Merger (the “Global Knowledge Closing”) is subject to the consummation of the Skillsoft Merger, among other conditions contained in the Global Knowledge Merger Agreement. Restructuring Support Agreement On October 12, 2020, Global Knowledge entered into a Restructuring Support Agreement (the “Global Knowledge RSA”) with (i) 100% of its lenders under that certain Amended and Restated First Lien Credit and Guaranty Agreement, dated as of January 30, 2015, as amended from time to time, by and among, inter alios, GK Holdings, as borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto and Credit Suisse, acting in its capacity as administrative agent and collateral agent (the “First Lien Credit Agreement,” and the lenders thereto, the “First Lien Lenders”); and (ii) 100% of its lenders under that certain Amended and Restated Second Lien Credit and Guaranty Agreement, dated as of January 30, 2015, as amended from time to time, by and among, inter alios, GK Holdings, as borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto and Wilmington Trust, acting in its capacity as administrative agent and collateral agent (the “Second Lien Credit Agreement,” and there lenders thereto, the “Second Lien Lenders,” together with the First Lien Lenders, the “Secured Lenders”). The Global Knowledge RSA contemplates an out-of-court restructuring (the “Restructuring”) that provides meaningful recoveries, funded by Churchill, to all Secured Lenders. Churchill is a third-party beneficiary of the Global Knowledge RSA with respect to enforcement of certain specific provisions and its explicit rights under the Global Knowledge RSA and not a direct party. Subscription Agreements Prosus Agreement On November 10, 2020, MIH Edtech Investments B.V. (formerly known as MIH Ventures B.V.) (“MIH Edtech Investments”) exercised its option to subscribe for an additional 40,000,000 newly-issued shares of Churchill Class A Common Stock, subject to certain adjustments, at a purchase price of $10.00 per share (the “Prosus Second Step Investment”), pursuant to the Subscription Agreement, dated October 12, 2020, by and among Churchill, the Sponsor and MIH Edtech Investments (the “Prosus Agreement”). On February 16, 2021, MIH Edtech Investments assigned all of its rights, title and interest in and to, and obligations under, the Prosus Agreement to MIH Learning B.V. (“Prosus”) and Prosus accepted such assignments. Together with its initial subscription for 10,000,000 newly-issued shares of Churchill Class A Common Stock, at a purchase price of $10.00 per share (the “Prosus First Step Investment”), Prosus’s total investment in Churchill is expected to be 50,000,000 shares of Churchill Class A Common Stock for an aggregate purchase price of $500.0 million (the “Prosus PIPE Investment”). As part of the Prosus Agreement, Prosus and the Company agreed to a strategic support agreement, pursuant to which Prosus will provide certain business development and investor relations support services in the event it exercises its option to make the Prosus Second Step Investment and beneficially owns at least 20% of the outstanding Churchill Class A Common Stock following closing of the Prosus PIPE Investment on a fully-diluted and as-converted basis. If Prosus consummates the Prosus PIPE Investment, it will also nominate an individual to serve as the chairman of Churchill's Board. Pursuant to the Prosus Agreement, in connection with the consummation of the Second Step Prosus Investment, Churchill will issue to Prosus warrants to purchase a number of shares of Churchill Class A Common Stock equal to one-third of the number of shares of Churchill Class A Common Stock purchased in the Prosus PIPE Investment (the “Prosus Warrants”). The Prosus Warrants will have terms substantively identical to those included in the units offered in Churchill's IPO. The Company assessed the provisions of the Prosus Agreement under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on Prosus Agreement liability. The Prosus Agreement liability was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 11). The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the Prosus Agreement liability is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of October 12, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of the Prosus Agreement liability: Fair value as of January 1, 2020 $ — Initial measurement on October 12, 2020 71,969,454 Change in valuation inputs and other assumptions (21,488,264) Fair value as of December 31, 2020 $ 50,481,190 SuRo Subscription Agreement On October 14, 2020, in connection with the execution of the Skillsoft Merger Agreement, Churchill entered into a subscription agreement with SuRo Capital Corp. (“SuRo”) pursuant to which SuRo subscribed for 1,000,000 newly-issued shares of Churchill Class A Common Stock, at a purchase price of $10.00 per share, to be issued at the closing of the Merger (the “SuRo Subscription Agreement”). The obligations to consummate the transactions contemplated by the SuRo Subscription Agreement are conditioned upon, among other things, customary closing conditions and the consummation of the Skillsoft Merger. Lodbrok Subscription Agreement On October 13, 2020, in connection with the execution of the Global Knowledge Merger Agreement, Churchill entered into a subscription agreement with Lodbrok Capital LLP (“Lodbrok”) pursuant to which Lodbrok subscribed for 2,000,000 newly-issued shares of Churchill Class A Common Stock, at a purchase price of $10.00 per share, to be issued at the closing of the Global Knowledge Merger (the “Lodbrok Subscription Agreement”). The obligations to consummate the transactions contemplated by the Lodbrok Subscription Agreement are conditioned upon, among other things, customary closing conditions and the consummation of the Global Knowledge Merger. Service Provider Agreement From time to time the Company has entered into and may enter into agreements with various services providers and advisors, including investment banks, to help us identify targets, negotiate terms of potential Business Combinations, consummate a Business Combination and/or provide other services. In connection with these agreements, the Company may be required to pay such service providers and advisors fees in connection with their services to the extent that certain conditions, including the closing of a potential Business Combination, are met. If a Business Combination does not occur, the Company would not expect to be required to pay these contingent fees. There can be no assurance that the Company will complete a Business Combination. The Company and Tyton Partners entered into an agreement, whereby Tyton Partners served as an advisor to the Company and will be entitled to receive a success fee of $150,000 at the close of the Business Combination. For the year ended December 31, 2020, the Company incurred $222,742 of consulting fees. As of December 31, 2020, $9,975 remained unpaid and are reflected in accounts payable and accrued expense in the accompanying balance sheets. Legal Proceedings In connection with the initial business combination, certain shareholders have filed lawsuits and other shareholders have threatened to file lawsuits alleging breaches of fiduciary duty and violations of the disclosure requirements of the Securities Exchange Act of 1934. The Company intends to defend the matters vigorously. These cases are in the early stages and the Company is unable to reasonably determine the outcome or estimate any potential losses, and, as such, has not recorded a loss contingency. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
STOCKHOLDERS' EQUITY | ||
STOCKHOLDERS' EQUITY | NOTE 7. STOCKHOLDERS’ EQUITY Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At March 31, 2021 and December 31, 2020, there were no shares of preferred stock issued or outstanding. Class A Common Stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At March 31, 2021, there were 11,090,292 shares of Class A common stock issued and outstanding, excluding 57,909,708 shares of Class A common stock subject to possible redemption. At December 31, 2020, there were 15,287,498 shares of Class A common stock issued and outstanding, excluding 53,712,502 shares of Class A common stock subject to possible redemption. Class B Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At March 31, 2021 and December 31, 2020, there were 17,250,000 shares of Class B common stock issued and outstanding. Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business Combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, any private placement-equivalent warrants issued, or to be issued, to any seller in a Business Combination. | NOTE 8. STOCKHOLDERS’ EQUITY Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At December 31, 2020 and 2019, there were no shares of preferred stock issued or outstanding. Common Stock Class A Common Stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At December 31, 2020 and 2019, there were 15,287,498 and 7,974,075 shares of Class A common stock issued or outstanding, excluding 53,712,502 and 61,025,925 shares of Class A common stock subject to possible redemption, respectively. Class B Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At December 31, 2020 and 2019, there were 17,250,000 shares of Class B common stock issued and outstanding. Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business Combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, any private placement-equivalent warrants issued, or to be issued, to any seller in a Business Combination. |
WARRANT LIABILITY
WARRANT LIABILITY | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
WARRANT LIABILITY | ||
WARRANT LIABILITY | NOTE 8. WARRANT LIABILITY Public Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation. The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available. The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, the Company will use its best efforts to file with the SEC, and within 60 business days following a Business Combination to have declared effective, a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed. Notwithstanding the above, if the Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its reasonable best efforts to qualify the shares under applicable blue sky laws to the extent an exemption is not available. 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; · upon not less than 30 days’ prior written notice of redemption; · if, and only if, the reported last sale price of the Company’s common stock equals or exceeds $18.00 per share for any 20 trading days within a 30‑trading day period ending on the third business day prior to the notice of redemption to the warrant holders; and · if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying the warrants. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. 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 Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuance of Class A common stock at a price below its exercise price. 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 Window 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. The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. | NOTE 9. WARRANT LIABILITY Warrants — Public Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation. The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available. The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, the Company will use its best efforts to file with the SEC, and within 60 business days following a Business Combination to have declared effective, a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed. Notwithstanding the above, if the Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its reasonable best efforts to qualify the shares under applicable blue sky laws to the extent an exemption is not available. 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; · upon not less than 30 days’ prior written notice of redemption; · if, and only if, the reported last sale price of the Company’s common stock equals or exceeds $18.00 per share for any 20 trading days within a 30‑trading day period ending on the third business day prior to the notice of redemption to the warrant holders; and · if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying the warrants. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. 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 Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuance of Class A common stock at a price below its exercise price. 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 Window 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. The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement 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 10. INCOME TAX The following is a summary of the Company's net deferred tax asset (liability): December 31, December 31, 2020 2019 Deferred tax asset (liability) Startup and organizational expenses $ 148,348 $ — Unrealized gain on marketable securities (976) (9,657) Total deferred tax asset (liability) 147,372 (9,657) Valuation Allowance (148,348) — Deferred tax asset (liability), net of allowance $ (976) $ (9,657) The income tax provision consists of the following: December 31, December 31, 2020 2019 Federal Current expense $ 495,442 $ 1,237,860 Deferred (benefit) expense (157,029) 9,657 State and Local Current — — Deferred — — Change in valuation allowance 148,348 — Income tax provision $ 486,761 $ 1,247,517 As of December 31, 2020 and 2019, the Company did not have any of U.S. federal and state 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 period from January 1, 2020 through December 31, 2020, the change in the valuation allowance was $148,348. 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 % % Transaction costs attributable to Initial Public Offering % (1.8) % Loss on conversion option liability (0.5) % % Loss on warrant liability (6.3) % (28.5) % Loss on Prosus agreement (14.7) % % Valuation allowance (0.2) % % Income tax provision (0.7) % (9.3) % 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 and subject to examination by the taxing authorities. The Company considers New York to be a significant state tax jurisdiction. |
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 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: Level 2: Level 3: The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020 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 $ 697,018,229 $ 696,957,196 Liabilities: Warrant liability-Public Warrants 1 33,810,000 45,310,000 Warrant liability-Private Placement Warrants 3 26,702,000 32,548,000 Prosus Agreement liability 3 24,532,413 50,481,190 Conversion option liability 3 1,632,013 1,604,359 The derivative instruments were accounted for as liabilities in accordance with ASC 815-40 and are measured at fair value at inception and on a recurring basis, with changes in fair value recorded in the consolidated statement of operations. At issuance, the Warrant Liability for Public Warrants and Private Placement Warrants were valued as of June 26, 2019 using a Monte Carlo simulation and Black Scholes model, respectively, which are considered to be a Level 3 fair value measurements. Subsequent to the Public Warrants detachment from the Units, the Public Warrants are valued based on quoted market price, under ticker CCX WS, which is a Level 1 fair value. The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the Warrants is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination was 80% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. As of issuance and March 31, 2021, the estimated fair value of Warrant Liability — Private Placement Warrants were determined using a Black-Scholes valuation and based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.68 $ 10.00 Volatility 16.5 % 25 % Probability of completing a Business Combination 80.0 % 90 % Term 5.33 5.08 Risk-free rate 1.86 % 0.94 % Dividend yield 0.0 % 0.0 % At inception, the Prosus Agreement Liability consisted of two components: a commitment for the First Step Investment and an option for the Second Step Investment. Subsequent to Prosus exercising its Second Step Investment option, the Prosus Agreement Liability represented a commitment. The commitment and option were valued using forward contract valuation methodology and a Black Scholes model, respectively. Both valuation methodologies were considered to be Level 3 fair value measurements. As of inception and March 31, 2021, the estimated fair value of Prosus Agreement Liability was determined based on the following significant inputs: At As of March 31, inception 2021 Exercise price $ 400.0 M $ 500.0 M Underlying value $ 436.8 M $ 524.5 M Volatility 40.0 % N/A Term 0.55 0.08 Risk-free rate 0.12 % 0.08 % Dividend yield 0.00 % N/A The Conversion option liability was valued using a Black Scholes model, which was considered to be a Level 3 fair value measurement. At inception and March 31, 2021, the estimated fair value of Conversion option liability was determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 1.00 $ 1.00 Underlying warrant value $ 1.92 * $ 2.09 * Volatility 125.0 % 115.0 % Number of Class A Shares 1.5 M% 1.5 M% Term 0.28 0.08 Risk-free rate 0.09 % 0.01 % Dividend yield 0.0 % 0.0 % * The underlying warrant value equals the calculated fair value of the private placement warrants as of each date presented and determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.97 $ 10.00 Volatility 30.0 % 25 % Probability of completing a Business Combination 85.0 % 90 % Term 5.28 5.08 Risk-free rate 0.41 % 0.94 % Dividend yield 0.0 % 0.0 % The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrants Warrants Warrant Liabilities January 1, 2021 $ 32,548,000 $ 45,310,000 $ 77,858,000 Change in valuation inputs or other assumptions (5,846,000) (11,500,000) (17,346,000) Fair value as of March 31, 2021 26,702,000 33,810,000 60,512,000 There were no transfers in or out of Level 3 from other levels in the fair value hierarchy. | NOTE 11. 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 and liabilities that are measured at fair value on a recurring basis at December 31, 2020 and 2019, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, December 31, Description Level 2020 2019 Assets: Cash and marketable securities held in Trust Account 1 $ 696,957,196 $ 695,295,418 Liabilities: Warrant Liabilities – Public Warrants 1 45,310,000 32,660,000 Warrant Liabilities – Private Placement Warrants 3 32,548,000 23,700,000 Prosus subscription agreement liability 3 50,481,190 — Conversion option liability 3 1,604,359 — The Derivative Instruments were accounted for as liabilities in accordance with ASC 815-40 and are measured at fair value at inception and on a recurring basis, with changes in fair value recorded in the statement of operations. The Warrants were valued as of July 1, 2019 using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement. The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the Warrants is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination was 80% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable 'blank-check' companies without an identified target. The subsequent measurements of the Public Warrants after the detachment of the Public Warrants from the Units is classified as Level 1 due to the use of an observable market quote in an active market under the ticker CVII.WS. The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrant Liabilities Fair value as of April 11, 2019 (inception) $ — $ — $ — Initial measurement on July 1, 2019 15,800,000 22,310,000 38,110,000 Change in valuation inputs or other assumptions 7,900,000 10,350,000 18,250,000 Fair value as of December 31, 2019 23,700,000 32,660,000 56,360,000 Change in valuation inputs and other assumptions 8,848,000 12,650,000 21,498,000 Fair value as of December 31, 2020 $ 32,548,000 $ 45,310,000 $ 77,858,000 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUBSEQUENT EVENTS | ||
SUBSEQUENT EVENTS | NOTE 10. 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, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements, except as set forth below. On May 3, 2021, the Company was informed by Prosus that Prosus received notice from CFIUS that it has concluded all action under Section 721 of the Defense Production Act of 1950 and determined that there are no unresolved national security concerns with respect to the Prosus PIPE Investment. | NOTE 12. 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 and in Note 2, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. On January 22, 2021, the Company entered into an amendment (the “Merger Agreement Amendment”), to which amends and restates in its entirety the definition of “Applicable Majority” in the Skillsoft Merger Agreement. The definition of “Applicable Majority” is used in the Skillsoft Merger Agreement. |
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 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/A for the year ended December 31, 2020, as filed with the SEC on May 11, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year 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 statement 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 the condensed 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 the 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 December 31, 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. Cash equivalents consist of mutual funds. 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 At March 31, 2021 and December 31, 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through March 31, 2021, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which no amounts were withdrawn during the three months ended March 31, 2021. | Marketable Securities Held in Trust Account At December 31, 2020 and 2019, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through December 31, 2020, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which $856,250 was withdrawn during the year ended December 31, 2020. |
Class A common Stock Subject to Possible Redemption | Class A Common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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. | Class A common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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. |
Derivative Liabilities | Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common shares and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. | |
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 statements 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 and permanent differences. | 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 statements 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, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses (“NOL) and allow businesses to carry back NOLs arising in 2018, 2019 and 2020 to the five prior years, suspend the excess business loss rules, accelerate refunds of previously generated corporate alternative minimum tax credits, generally loosen the business interest limitation under IRC section 163(j) from 30 percent to 50 percent among other technical corrections included in the Tax Cuts and Jobs Act tax provisions. The Company does not believe that the CARES Act will have a significant impact on Company's financial position or statement of operations. |
Net Income (Loss) per Common Share | Net income (Loss) per Share Net income (loss) per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per share, basic and diluted, for Class A 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 the weighted average number of Class A 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 Class A 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 share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) | Net Income (Loss) per Common Share Net income (loss) per common share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. The Company has not considered the effect of the warrants sold in the Public Offering and Private Placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per ordinary share. Net income (loss) per common share, basic and diluted, for Class A 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 by the weighted average number of Class A common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income or loss on marketable securities attributable to Class A common stock subject to possible redemption, by the weighted average number of non-redeemable ordinary shares 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 the non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) |
Concentration of Credit Risk | 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 Corporation coverage limit of $250,000. The Company has not experienced losses on this account. | 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 limit 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, except for the Company's derivative instruments (see Note 9). | 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, except for the Company’s Derivative Instruments (see Note 6 and 11). |
Recent Accounting Standards | Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements. Management does not believe that any other 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. |
RESTATEMENT OF PREVIOUSLY ISS_2
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS | |
Schedule of impact of the restatement on financial statements | As Previously As Reported Adjustments Restated Balance sheet as of July 1, 2019 (audited) Total Liabilities $ 21,509,982 $ 38,110,000 $ 59,619,982 Class A Common Stock Subject to Possible Redemption 666,500,190 (38,110,000) 628,390,190 Class A Common Stock 235 381 616 Additional Paid-in Capital 5,003,043 1,125,253 6,128,296 Accumulated Deficit (5,000) (1,125,634) (1,130,634) Total Stockholders’ Equity 5,000,003 — 5,000,003 Number of Class A common stock subject to redemption 66,650,019 (3,811,000) 62,839,019 Balance sheet as of September 30, 2019 (unaudited) Total Liabilities $ 21,438,614 $ 55,988,000 $ 77,426,614 Class A Common Stock Subject to Possible Redemption 669,011,539 (55,988,000) 613,023,539 Class A Common Stock 233 558 791 Additional Paid-in Capital 2,491,696 19,003,076 21,494,772 Retained Earnings (Accumulated Deficit) 2,506,354 (19,003,634) (16,497,280) Total Stockholders’ Equity 5,000,008 — 5,000,008 Number of Class A common stock subject to redemption 66,673,530 (5,579,751) 61,093,779 Balance sheet as of December 31, 2019 (audited) Total Liabilities $ 21,638,123 $ 56,360,000 $ 77,998,123 Class A Common Stock Subject to Possible Redemption 671,198,229 (56,360,000) 614,838,229 Class A Common Stock 238 559 797 Additional Paid-in Capital 305,001 19,375,075 19,680,076 Retained Earnings (Accumulated Deficit) 4,693,042 (19,375,634) (14,682,592) Total Stockholders’ Equity 5,000,006 — 5,000,006 Number of Class A common stock subject to redemption 66,619,951 (5,594,026) 61,025,925 Balance sheet as of March 31, 2020 (unaudited) Total Liabilities $ 21,805,994 $ 66,706,000 $ 88,511,994 Class A Common Stock Subject to Possible Redemption 672,720,712 (66,706,000) 606,014,712 Class A Common Stock 240 660 900 Additional Paid-in Capital — 28,503,490 28,503,490 Retained Earnings (Accumulated Deficit) 4,998,044 (28,504,150) (23,506,106) Total Stockholders’ Equity 5,000,009 — 5,000,009 Number of Class A common stock subject to redemption 66,602,417 (6,604,198) 59,998,219 Balance sheet as of June 30, 2020 (unaudited) Total Liabilities $ 21,739,976 $ 111,342,000 $ 133,081,976 Class A Common Stock Subject to Possible Redemption 672,594,363 (111,342,000) 561,252,363 Class A Common Stock 242 1,102 1,344 Additional Paid-in Capital 126,347 73,139,048 73,265,395 Retained Earnings (Accumulated Deficit) 4,871,691 (73,140,150) (68,268,459) Total Stockholders’ Equity 5,000,005 — 5,000,005 Number of Class A common stock subject to redemption 66,584,915 (11,022,539) 55,562,376 Balance sheet as of September 30, 2020 (unaudited) Total Liabilities $ 21,689,446 $ 83,004,000 $ 104,693,446 Class A Common Stock Subject to Possible Redemption 672,501,414 (83,004,000) 589,497,414 Class A Common Stock 244 821 1,065 Additional Paid-in Capital 219,294 44,801,329 45,020,623 Retained Earnings (Accumulated Deficit) 4,778,742 (44,802,150) (40,023,408) Total Stockholders’ Equity 5,000,005 — 5,000,005 Number of Class A common stock subject to redemption 66,563,478 (8,215,648) 58,347,830 As Previously As Reported Adjustments Restated Balance sheet as of December 31, 2020 (audited) Total Liabilities $ 23,602,761 $ 129,943,549 $ 153,546,310 Class A Common Stock Subject to Possible Redemption 672,322,591 (129,943,551) 542,379,040 Class A Common Stock 242 1,287 1,529 Additional Paid-in Capital 398,119 91,740,414 92,138,533 Retained Earnings (Accumulated Deficit) 4,599,922 (91,741,699) (87,141,777) Total Stockholders’ Equity 5,000,008 2 5,000,010 Number of Class A common stock subject to redemption 66,580,981 (12,868,479) 53,712,502 Statement of Operations for the three months ended September 30, 2019 (unaudited) Net income (loss) $ 2,507,354 $ (19,003,634) $ (16,496,280) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,650,019 (3,811,000) 62,839,019 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.04 — 0.04 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,549,981 3,769,576 23,319,557 Basic and diluted net loss per share, Non-redeemable common stock 0.00 (0.81) (0.81) Statement of Operations for the period from April 11, 2019 (inception) to September 30, 2019 (unaudited) Net income (loss) $ 2,506,354 $ (19,003,634) $ (16,497,280) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,650,019 (3,811,000) 62,839,019 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.04 — 0.04 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 17,433,711 2,016,285 19,449,996 Basic and diluted net loss per share, Non-redeemable common stock 0.00 (0.98) (0.98) Statement of Operations for the period from April 11, 2019 (inception) to December 31, 2019 (audited) Net income (loss) $ 4,693,042 $ (19,375,634) $ (14,682,592) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,661,839 (4,700,208) 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.07 0.01 0.08 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 18,180,430 3,258,099 21,438,529 Basic and diluted net loss per share, Non-redeemable common stock (0.01) (0.90) (0.91) Statement of Operations for the three months ended March 31, 2020 (unaudited) Net income (loss) $ 1,522,486 $ (10,346,000) $ (8,823,514) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,619,951 (5,594,026) 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.02 — 0.02 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,630,049 5,594,026 25,224,075 Basic and diluted net loss per share, Non-redeemable common stock (0.41) (0.41) Statement of Operations for the three months ended June 30, 2020 (unaudited) Net loss $ (126,353) $ (44,636,000) $ (44,762,353) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,585,251 (6,587,032) 59,998,219 Basic and diluted net income per share, Class A common stock subject to possible redemption — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,664,749 6,587,032 26,251,781 Basic and diluted net loss per share, Non-redeemable common stock (0.01) (1.70) (1.71) Statement of Operations for the six months ended June 30, 2020 (unaudited) Net income (loss) $ 1,396,133 $ (54,982,000) $ (53,585,867) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,602,601 (6,090,529) 60,512,072 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.02 0.01 0.03 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,647,399 6,090,529 25,737,928 Basic and diluted net loss per share, Non-redeemable common stock (0.01) (2.13) (2.14) Statement of Operations for the three months ended September 30, 2020 (unaudited) Net income (loss) $ (92,949) $ 28,338,000 $ 28,245,051 Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,563,636 (11,001,260) 55,562,376 Basic and diluted net income per share, Class A common stock subject to possible redemption — Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,686,364 11,001,260 30,687,624 Basic and diluted net loss per share, Non-redeemable common stock 0.92 0.92 Statement of Operations for the nine months ended September 30, 2020 (unaudited) Net income (loss) $ 1,303,184 $ (26,644,000) $ (25,340,816) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,589,518 (7,739,388) 58,850,130 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.02 0.01 0.03 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,660,482 7,739,388 27,399,870 Basic and diluted net loss per share, Non-redeemable common stock (0.02) (0.96) (0.98) Statement of Operations for the year ended December 31, 2020 (audited) Net income (loss) $ 1,124,364 $ (73,583,549) $ (72,459,185) Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 66,592,589 (7,868,720) 58,723,869 Basic and diluted net income per share, Class A common stock subject to possible redemption 0.02 0.01 0.03 Basic and diluted weighted average shares outstanding, Non-redeemable common stock 19,657,411 7,868,720 27,526,131 Basic and diluted net loss per share, Non-redeemable common stock (0.02) (2.67) (2.68) As Previously As Reported Adjustments Restated Statement of Cash Flows for the period from April 11, 2019 (inception) to September 30, 2019 (unaudited) Net income (loss) $ 2,506,354 $ (19,003,634) $ (16,497,280) Transaction costs attributable to the Initial Public Offering — (1,125,634) (1,125,634) Loss on Derivative Liabilities — (17,878,000) (17,878,000) Initial classification of Class A common stock subject to redemption 666,500,190 (38,110,000) 628,390,190 Change in value of Class A common stock subject to possible redemption 2,511,349 (17,878,000) (15,366,651) Statement of Cash Flows for the period from April 11, 2019 (inception) to December 31, 2019 (audited) Net income (loss) $ 4,693,042 $ (19,375,634) $ (14,682,592) Transaction costs attributable to the Initial Public Offering — (1,125,634) (1,125,634) Loss on Derivative Liabilities — (18,250,000) (18,250,000) Initial classification of Class A common stock subject to redemption 666,500,190 (38,110,000) 628,390,190 Change in value of Class A common stock subject to possible redemption 4,698,039 (18,250,000) (13,551,961) Statement of Cash Flows for the three months ended March 31, 2020 (unaudited) Net income (loss) $ 1,522,486 $ (10,346,000) $ (8,823,514) Loss on Derivative Liabilities — (10,346,000) (10,346,000) Change in value of Class A common stock subject to possible redemption 1,522,483 (10,346,000) (8,823,517) Statement of Cash Flows for the six months ended June 30, 2020 (unaudited) Net income (loss) $ 1,396,133 $ (54,982,000) $ (53,585,867) Loss on Derivative Liabilities — (54,982,000) (54,982,000) Change in value of Class A common stock subject to possible redemption 1,396,134 (54,982,000) (53,585,866) Statement of Cash Flows for the nine months ended September 30, 2020 (unaudited) Net income (loss) $ 1,303,184 $ (26,644,000) $ (25,340,816) Loss on Derivative Liabilities — (26,644,000) (26,644,000) Change in value of Class A common stock subject to possible redemption 1,303,185 (26,644,000) (25,340,815) Statement of Cash Flows for the year ended December 31, 2020 (audited) Net income (loss) $ 1,124,364 $ (73,583,549) $ (72,459,185) Loss on Derivative Liabilities — (73,583,549) (73,583,549) Change in value of Class A common stock subject to possible redemption 1,124,362 (73,583,551) (72,459,189) |
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 | ||
Schedule of basic and diluted loss per common share | The following table reflects the calculation of basic and diluted net income (loss) per share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) | The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Convertible Promissory Note [Member] | ||
Summary of the changes in the fair value | Fair value as of January 1, 2021 $ 1,604,359 Change in valuation inputs and other assumptions 27,624 Fair value as of March 31, 2021 $ 1,632,013 | Fair value as of January 1, 2020 $ — Initial measurement on November 2, 2020 1,493,877 Change in valuation inputs and other assumptions 110,482 Fair value as of December 31, 2020 $ 1,604,359 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Prosus Agreement [Member] | ||
Summary of the changes in the fair value | Fair value as of January 1, 2021 $ 50,481,190 Change in valuation inputs and other assumptions (25,948,777) Fair value as of March 31, 2021 $ 24,532,413 | Fair value as of January 1, 2020 $ — Initial measurement on October 12, 2020 71,969,454 Change in valuation inputs and other assumptions (21,488,264) Fair value as of December 31, 2020 $ 50,481,190 |
INCOME TAX (Tables)
INCOME TAX (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAX | |
Schedule of company's net deferred tax liability | The following is a summary of the Company's net deferred tax asset (liability): December 31, December 31, 2020 2019 Deferred tax asset (liability) Startup and organizational expenses $ 148,348 $ — Unrealized gain on marketable securities (976) (9,657) Total deferred tax asset (liability) 147,372 (9,657) Valuation Allowance (148,348) — Deferred tax asset (liability), net of allowance $ (976) $ (9,657) |
Schedule of income tax provision | The income tax provision consists of the following: December 31, December 31, 2020 2019 Federal Current expense $ 495,442 $ 1,237,860 Deferred (benefit) expense (157,029) 9,657 State and Local Current — — Deferred — — Change in valuation allowance 148,348 — Income tax provision $ 486,761 $ 1,247,517 |
Schedule of reconciliation of the federal income tax rate | 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 % % Transaction costs attributable to Initial Public Offering % (1.8) % Loss on conversion option liability (0.5) % % Loss on warrant liability (6.3) % (28.5) % Loss on Prosus agreement (14.7) % % Valuation allowance (0.2) % % Income tax provision (0.7) % (9.3) % |
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 assets measured at fair value on a recurring basis | The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020 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 $ 697,018,229 $ 696,957,196 Liabilities: Warrant liability-Public Warrants 1 33,810,000 45,310,000 Warrant liability-Private Placement Warrants 3 26,702,000 32,548,000 Prosus Agreement liability 3 24,532,413 50,481,190 Conversion option liability 3 1,632,013 1,604,359 | The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2020 and 2019, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, December 31, Description Level 2020 2019 Assets: Cash and marketable securities held in Trust Account 1 $ 696,957,196 $ 695,295,418 Liabilities: Warrant Liabilities – Public Warrants 1 45,310,000 32,660,000 Warrant Liabilities – Private Placement Warrants 3 32,548,000 23,700,000 Prosus subscription agreement liability 3 50,481,190 — Conversion option liability 3 1,604,359 — |
Schedule of fair value of warrant liabilities | Private Placement Public Warrants Warrants Warrant Liabilities January 1, 2021 $ 32,548,000 $ 45,310,000 $ 77,858,000 Change in valuation inputs or other assumptions (5,846,000) (11,500,000) (17,346,000) Fair value as of March 31, 2021 26,702,000 33,810,000 60,512,000 | Private Placement Public Warrant Liabilities Fair value as of April 11, 2019 (inception) $ — $ — $ — Initial measurement on July 1, 2019 15,800,000 22,310,000 38,110,000 Change in valuation inputs or other assumptions 7,900,000 10,350,000 18,250,000 Fair value as of December 31, 2019 23,700,000 32,660,000 56,360,000 Change in valuation inputs and other assumptions 8,848,000 12,650,000 21,498,000 Fair value as of December 31, 2020 $ 32,548,000 $ 45,310,000 $ 77,858,000 |
DESCRIPTION OF ORGANIZATION A_2
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Details) - USD ($) | Jul. 01, 2019 | May 31, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2020 | Apr. 10, 2019 | Dec. 31, 2018 |
Shares Issued, Price Per Share | $ 10 | ||||||||
Proceeds from Issuance Initial Public Offering | $ 677,788,000 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 | ||||||||
Proceeds from Issuance of Warrants | 15,800,000 | ||||||||
Transaction Cost Related To Issuance Of Common Stock | $ 34,319,807 | ||||||||
Underwriting Fees | 12,212,000 | ||||||||
Underwriting Discount | 12,212,000 | ||||||||
Deferred Underwriting Discount Payable Non current | 21,371,000 | ||||||||
Other Offering Costs Related To Issuance Of Common Stock | 736,807 | ||||||||
Other Costs Related To Issuance Of Common Stock | 736,807 | ||||||||
Cash | $ 2,382,560 | $ 2,014,521 | $ 2,238,275 | $ 2,238,275 | $ 3,873,865 | $ 2,238,275 | $ 0 | ||
Working capital | 1,182,603 | ||||||||
Amount deposited in Trust Account | $ 7,018,000 | ||||||||
Working Capital Requirement Fund Annual Limit | $ 250,000 | ||||||||
Temporary Equity, Redemption Price Per Share | $ 10 | ||||||||
Maximum Percentage Of Shares Eligible From Redemption | 15.00% | ||||||||
Dissolution Expenses Payable | $ 100,000 | ||||||||
IPO [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 69,000,000 | ||||||||
Shares Issued, Price Per Share | $ 10 | ||||||||
Proceeds from Issuance Initial Public Offering | $ 690,000,000 | ||||||||
Over-Allotment Option [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 9,000,000 | ||||||||
Shares Issued, Price Per Share | $ 10 | ||||||||
Private Placement [Member] | |||||||||
Number Of Warrants Issued | 15,800,000 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | ||||||||
Proceeds from Issuance of Warrants | $ 15,800,000 | ||||||||
Churchill Sponsor LLC [Member] | |||||||||
Business Combination Aggregate Fair Market Value On Assets Held In Trust Percentage | 80.00% | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | $ 5,000,001 | ||||||||
Class B Common Stock [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 8,625,000 | 0 | 17,250,000 |
RESTATEMENT OF PREVIOUSLY ISS_3
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 01, 2019 | Apr. 10, 2019 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||||
Tender offer provision (as a percentage) | 50.00% | ||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
Total Liabilities | $ 110,392,112 | $ 77,998,123 | $ 153,546,310 | $ 77,998,123 | |||||||||
Class A Common stock subject to possible redemption, 53,712,502 and 61,025,925 shares at redemption value as of December 31, 2020 and 2019, respectively | 584,119,845 | 614,838,229 | 542,379,040 | 614,838,229 | |||||||||
Additional paid-in capital | 50,398,148 | 19,680,076 | 92,138,533 | 19,680,076 | |||||||||
Retained Earnings (Accumulated Deficit) | (45,400,976) | (14,682,592) | (87,141,777) | (14,682,592) | |||||||||
Total Stockholders' Equity | $ 5,000,006 | $ 5,000,009 | $ 5,000,006 | $ 5,000,010 | $ 5,000,006 | $ 0 | |||||||
Number of Class A common stock subject to redemption | 57,909,708 | 61,025,925 | 53,712,502 | 61,025,925 | |||||||||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
Net income (loss) | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) | |||||
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption | 53,712,502 | 61,025,925 | |||||||||||
Basic and diluted net income per share | $ 0 | $ 0.02 | |||||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | |||||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 1.28 | $ (0.41) | $ (0.91) | $ (2.68) | |||||||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||||||
Net income (loss) | $ 41,740,801 | $ (8,823,514) | (53,585,867) | (16,497,280) | (25,340,816) | $ (14,682,592) | $ (72,459,185) | (14,682,592) | |||||
Transaction costs attributable to the Initial Public Offering | (1,125,634) | (1,125,634) | (1,125,634) | ||||||||||
Loss on Derivative Liabilities | (10,346,000) | (54,982,000) | (17,878,000) | (26,644,000) | (18,250,000) | (73,583,549) | |||||||
Initial classification of Class A common stock subject to redemption | 628,390,190 | 628,390,190 | 628,390,190 | ||||||||||
Change in value of Class A common stock subject to possible redemption | (8,823,517) | (53,585,866) | (15,366,651) | (25,340,815) | (13,551,961) | (72,459,189) | |||||||
Class A Common Stock [Member] | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
Class A Common Stock | 1,109 | 797 | 1,529 | 797 | |||||||||
Total Stockholders' Equity | 1,109 | 900 | 797 | 1,529 | 797 | $ 0 | |||||||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
Net income (loss) | 0 | 0 | $ 0 | $ 0 | |||||||||
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption | 61,961,631 | 58,723,869 | |||||||||||
Basic and diluted net income per share | $ 0.08 | $ 0.03 | |||||||||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||||||
Net income (loss) | $ 0 | 0 | $ 0 | $ 0 | |||||||||
As Previously Reported | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
Total Liabilities | $ 21,689,446 | $ 21,739,976 | 21,805,994 | $ 21,438,614 | 21,739,976 | 21,438,614 | 21,689,446 | 21,638,123 | 23,602,761 | 21,638,123 | $ 21,509,982 | ||
Class A Common stock subject to possible redemption, 53,712,502 and 61,025,925 shares at redemption value as of December 31, 2020 and 2019, respectively | 672,501,414 | 672,594,363 | 672,720,712 | 669,011,539 | 672,594,363 | 669,011,539 | 672,501,414 | 671,198,229 | 672,322,591 | 671,198,229 | 666,500,190 | ||
Additional paid-in capital | 219,294 | 126,347 | 2,491,696 | 126,347 | 2,491,696 | 219,294 | 305,001 | 398,119 | 305,001 | 5,003,043 | |||
Retained Earnings (Accumulated Deficit) | 4,778,742 | 4,871,691 | 4,998,044 | 2,506,354 | 4,871,691 | 2,506,354 | 4,778,742 | 4,693,042 | 4,599,922 | 4,693,042 | (5,000) | ||
Total Stockholders' Equity | $ 5,000,005 | $ 5,000,005 | $ 5,000,009 | $ 5,000,008 | $ 5,000,005 | $ 5,000,008 | $ 5,000,005 | $ 5,000,006 | $ 5,000,008 | $ 5,000,006 | $ 5,000,003 | ||
Number of Class A common stock subject to redemption | 66,563,478 | 66,584,915 | 66,602,417 | 66,673,530 | 66,584,915 | 66,673,530 | 66,563,478 | 66,619,951 | 66,580,981 | 66,619,951 | 66,650,019 | ||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
Net income (loss) | $ (92,949) | $ (126,353) | $ 1,522,486 | $ 2,507,354 | $ 1,396,133 | $ 2,506,354 | $ 1,303,184 | $ 4,693,042 | $ 1,124,364 | ||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 19,686,364 | 19,664,749 | 19,630,049 | 19,549,981 | 19,647,399 | 17,433,711 | 19,660,482 | 18,180,430 | 19,657,411 | ||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 0 | $ (0.01) | $ 0 | $ 0 | $ (0.01) | $ 0 | $ (0.02) | $ (0.01) | $ (0.02) | ||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||||||
Net income (loss) | $ (92,949) | $ (126,353) | $ 1,522,486 | $ 2,507,354 | $ 1,396,133 | $ 2,506,354 | $ 1,303,184 | $ 4,693,042 | $ 1,124,364 | ||||
Initial classification of Class A common stock subject to redemption | 666,500,190 | 666,500,190 | |||||||||||
Change in value of Class A common stock subject to possible redemption | 1,522,483 | 1,396,134 | 2,511,349 | 1,303,185 | 4,698,039 | 1,124,362 | |||||||
As Previously Reported | Class A Common Stock [Member] | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
Class A Common Stock | $ 244 | $ 242 | $ 240 | $ 233 | $ 242 | $ 233 | $ 244 | $ 238 | $ 242 | $ 238 | $ 235 | ||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption | 66,563,636 | 66,585,251 | 66,619,951 | 66,650,019 | 66,602,601 | 66,650,019 | 66,589,518 | 66,661,839 | 66,592,589 | ||||
Basic and diluted net income per share | $ 0 | $ 0 | $ 0.02 | $ 0.04 | $ 0.02 | $ 0.04 | $ 0.02 | $ 0.07 | $ 0.02 | ||||
Restatement Adjustment | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
Total Liabilities | $ 83,004,000 | $ 111,342,000 | $ 66,706,000 | $ 55,988,000 | $ 111,342,000 | $ 55,988,000 | $ 83,004,000 | $ 56,360,000 | $ 129,943,549 | 56,360,000 | 38,110,000 | ||
Class A Common stock subject to possible redemption, 53,712,502 and 61,025,925 shares at redemption value as of December 31, 2020 and 2019, respectively | (83,004,000) | (111,342,000) | (66,706,000) | (55,988,000) | (111,342,000) | (55,988,000) | (83,004,000) | (56,360,000) | (129,943,551) | (56,360,000) | (38,110,000) | ||
Additional paid-in capital | 44,801,329 | 73,139,048 | 28,503,490 | 19,003,076 | 73,139,048 | 19,003,076 | 44,801,329 | 19,375,075 | 91,740,414 | 19,375,075 | 1,125,253 | ||
Retained Earnings (Accumulated Deficit) | $ (44,802,150) | $ (73,140,150) | $ (28,504,150) | $ (19,003,634) | $ (73,140,150) | $ (19,003,634) | $ (44,802,150) | $ (19,375,634) | (91,741,699) | $ (19,375,634) | $ (1,125,634) | ||
Total Stockholders' Equity | $ 2 | ||||||||||||
Number of Class A common stock subject to redemption | (8,215,648) | (11,022,539) | (6,604,198) | (5,579,751) | (11,022,539) | (5,579,751) | (8,215,648) | (5,594,026) | (12,868,479) | (5,594,026) | (3,811,000) | ||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
Net income (loss) | $ 28,338,000 | $ (44,636,000) | $ (10,346,000) | $ (19,003,634) | $ (54,982,000) | $ (19,003,634) | $ (26,644,000) | $ (19,375,634) | $ (73,583,549) | ||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 11,001,260 | 6,587,032 | 5,594,026 | 3,769,576 | 6,090,529 | 2,016,285 | 7,739,388 | 3,258,099 | 7,868,720 | ||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 0.92 | $ (1.70) | $ (0.41) | $ (0.81) | $ (2.13) | $ (0.98) | $ (0.96) | $ (0.90) | $ (2.67) | ||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||||||
Net income (loss) | $ 28,338,000 | $ (44,636,000) | $ (10,346,000) | $ (19,003,634) | $ (54,982,000) | $ (19,003,634) | $ (26,644,000) | $ (19,375,634) | $ (73,583,549) | ||||
Transaction costs attributable to the Initial Public Offering | (1,125,634) | (1,125,634) | |||||||||||
Loss on Derivative Liabilities | (10,346,000) | (54,982,000) | (17,878,000) | (26,644,000) | (18,250,000) | (73,583,549) | |||||||
Initial classification of Class A common stock subject to redemption | (38,110,000) | (38,110,000) | |||||||||||
Change in value of Class A common stock subject to possible redemption | (10,346,000) | (54,982,000) | (17,878,000) | (26,644,000) | (18,250,000) | (73,583,551) | |||||||
Restatement Adjustment | Class A Common Stock [Member] | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
Class A Common Stock | $ 821 | $ 1,102 | $ 660 | $ 558 | $ 1,102 | $ 558 | $ 821 | $ 559 | $ 1,287 | $ 559 | $ 381 | ||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption | (11,001,260) | (6,587,032) | (5,594,026) | (3,811,000) | (6,090,529) | (3,811,000) | (7,739,388) | (4,700,208) | (7,868,720) | ||||
Basic and diluted net income per share | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||
Restatement of derivative liabilities | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
Total Liabilities | $ 104,693,446 | $ 133,081,976 | $ 88,511,994 | $ 77,426,614 | $ 133,081,976 | $ 77,426,614 | $ 104,693,446 | $ 77,998,123 | $ 153,546,310 | 77,998,123 | 59,619,982 | ||
Class A Common stock subject to possible redemption, 53,712,502 and 61,025,925 shares at redemption value as of December 31, 2020 and 2019, respectively | 589,497,414 | 561,252,363 | 606,014,712 | 613,023,539 | 561,252,363 | 613,023,539 | 589,497,414 | 614,838,229 | 542,379,040 | 614,838,229 | 628,390,190 | ||
Additional paid-in capital | 45,020,623 | 73,265,395 | 28,503,490 | 21,494,772 | 73,265,395 | 21,494,772 | 45,020,623 | 19,680,076 | 92,138,533 | 19,680,076 | 6,128,296 | ||
Retained Earnings (Accumulated Deficit) | (40,023,408) | (68,268,459) | (23,506,106) | (16,497,280) | (68,268,459) | (16,497,280) | (40,023,408) | (14,682,592) | (87,141,777) | (14,682,592) | (1,130,634) | ||
Total Stockholders' Equity | $ 5,000,005 | $ 5,000,005 | $ 5,000,009 | $ 5,000,008 | $ 5,000,005 | $ 5,000,008 | $ 5,000,005 | $ 5,000,006 | $ 5,000,010 | $ 5,000,006 | $ 5,000,003 | ||
Number of Class A common stock subject to redemption | 58,347,830 | 55,562,376 | 59,998,219 | 61,093,779 | 55,562,376 | 61,093,779 | 58,347,830 | 61,025,925 | 53,712,502 | 61,025,925 | 62,839,019 | ||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
Net income (loss) | $ 28,245,051 | $ (44,762,353) | $ (8,823,514) | $ (16,496,280) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | ||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 30,687,624 | 26,251,781 | 25,224,075 | 23,319,557 | 25,737,928 | 19,449,996 | 27,399,870 | 21,438,529 | 27,526,131 | ||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 0.92 | $ (1.71) | $ (0.41) | $ (0.81) | $ (2.14) | $ (0.98) | $ (0.98) | $ (0.91) | $ (2.68) | ||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||||||
Net income (loss) | $ 28,245,051 | $ (44,762,353) | $ (8,823,514) | $ (16,496,280) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | ||||
Restatement of derivative liabilities | Class A Common Stock [Member] | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
Class A Common Stock | $ 1,065 | $ 1,344 | $ 900 | $ 791 | $ 1,344 | $ 791 | $ 1,065 | $ 797 | $ 1,529 | $ 797 | $ 616 | ||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption | 55,562,376 | 59,998,219 | 61,025,925 | 62,839,019 | 60,512,072 | 62,839,019 | 58,850,130 | 61,961,631 | 58,723,869 | ||||
Basic and diluted net income per share | $ 0 | $ 0 | $ 0.02 | $ 0.04 | $ 0.03 | $ 0.04 | $ 0.03 | $ 0.08 | $ 0.03 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net loss per common share (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Mar. 31, 2021 | Mar. 31, 2020 | Jun. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: Earnings allocable to Class A common stock subject to possible redemption | ||||||||
Interest income | $ 59,701 | $ 2,250,075 | $ 2,516,752 | $ 6,639,430 | ||||
Unrealized gain (loss) on investments held in Trust Account | 1,332 | (20,917) | $ 45,988 | 1,276 | 45,988 | |||
Net income (loss) | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | (14,682,592) |
Denominator: Weighted average Class A common stock subject to possible redemption | ||||||||
Basic and diluted weighted average shares outstanding | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | ||||
Basic and diluted net income per share, Class A common stock subject to possible redemption | $ 0 | $ 0.02 | ||||||
Numerator: Net loss minus net earnings | ||||||||
Net income | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) |
Denominator: Weighted Average Non-Redeemable Common Stock | ||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | ||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 1.28 | $ (0.41) | $ (0.91) | $ (2.68) | ||||
Class A Common Stock Subject to Possible Redemption [Member] | ||||||||
Numerator: Earnings allocable to Class A common stock subject to possible redemption | ||||||||
Interest income | $ 50,107 | $ 1,956,529 | $ 6,410,370 | $ 1,959,040 | ||||
Unrealized gain (loss) on investments held in Trust Account | 1,118 | (18,188) | 44,401 | 993 | ||||
Less: Company's portion available to be withdrawn to pay taxes | (43,998) | (395,474) | (1,344,722) | (534,953) | ||||
Less: Company's portion available to be withdrawn for working capital purposes | $ (7,227) | $ (217,385) | (241,375) | (194,600) | ||||
Net income (loss) | $ 4,868,674 | $ 1,230,480 | ||||||
Denominator: Weighted average Class A common stock subject to possible redemption | ||||||||
Basic and diluted weighted average shares outstanding | 53,712,502 | 61,025,925 | 61,961,631 | 58,723,869 | ||||
Basic and diluted net income per share, Class A common stock subject to possible redemption | $ 0 | $ 0.02 | $ 0.08 | $ 0.02 | ||||
Numerator: Net loss minus net earnings | ||||||||
Net income | $ 4,868,674 | $ 1,230,480 | ||||||
Less: Income attributable to Class A common stock subject to possible redemption | $ (1,325,482) | |||||||
Denominator: Weighted Average Non-Redeemable Common Stock | ||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 53,712,502 | 61,025,925 | 61,961,631 | 58,723,869 | ||||
Non-Redeemable Common Stock [Member] | ||||||||
Numerator: Earnings allocable to Class A common stock subject to possible redemption | ||||||||
Net income (loss) | $ 41,740,801 | $ (8,823,514) | $ (14,682,592) | $ (72,459,185) | ||||
Denominator: Weighted average Class A common stock subject to possible redemption | ||||||||
Basic and diluted weighted average shares outstanding | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | ||||
Basic and diluted net income per share, Class A common stock subject to possible redemption | $ 1.28 | $ (0.40) | ||||||
Numerator: Net loss minus net earnings | ||||||||
Net income | $ 41,740,801 | $ (8,823,514) | $ (14,682,592) | $ (72,459,185) | ||||
Less: Income attributable to Class A common stock subject to possible redemption | (1,325,482) | (4,868,674) | (1,230,480) | |||||
Non-Redeemable Net Income Loss | $ 41,740,801 | $ (10,148,996) | $ (19,551,226) | $ (73,689,665) | ||||
Denominator: Weighted Average Non-Redeemable Common Stock | ||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | ||||
Basic and diluted net loss per share, Non-redeemable common stock | $ (0.91) | $ (2.68) | ||||||
Class B Common Stock [Member] | ||||||||
Numerator: Earnings allocable to Class A common stock subject to possible redemption | ||||||||
Net income (loss) | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Numerator: Net loss minus net earnings | ||||||||
Net income | $ 0 | $ 0 | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash Withdrawn From Trust Account | $ 0 | $ 856,250 | ||
Unrecognized Tax Benefits | 0 | 0 | $ 0 | |
Accrued Interest and Penalty | 0 | 0 | $ 0 | |
Cash, FDIC Insured Amount | $ 250,000 | $ 250,000 | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | 21.00% | 21.00% |
Effective Income Tax Rate Reconciliation, Percent | (0.70%) | (9.30%) | ||
US Treasury Bill Securities [Member] | ||||
Cash Withdrawn From Trust Account | $ 2,246,250 | $ 2,246,250 | ||
Warrant [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 38,800,000 | 38,800,000 |
PUBLIC OFFERING (Details)
PUBLIC OFFERING (Details) - $ / shares | Nov. 10, 2020 | Jul. 01, 2019 | Dec. 31, 2019 |
Shares Issued, Price Per Share | $ 10 | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 | ||
IPO [Member] | |||
Stock Issued During Period, Shares, New Issues | 69,000,000 | ||
Shares Issued, Price Per Share | $ 10 | ||
Over-Allotment Option [Member] | |||
Stock Issued During Period, Shares, New Issues | 9,000,000 | ||
Shares Issued, Price Per Share | $ 10 | ||
Private Placement [Member] | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | ||
Class A Common Stock [Member] | |||
Stock Issued During Period, Shares, New Issues | 0 | ||
Class A Common Stock [Member] | IPO [Member] | |||
Stock Issued During Period, Shares, New Issues | 10,000,000 | ||
Class A Common Stock [Member] | Private Placement [Member] | |||
Stock Issued During Period, Shares, New Issues | 1 | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 |
PRIVATE PLACEMENT (Details)
PRIVATE PLACEMENT (Details) - USD ($) | Jul. 01, 2019 | Dec. 31, 2019 |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 | |
Proceeds from Issuance of Warrants | $ 15,800,000 | |
Private Placement [Member] | ||
Number Of Warrants Issued | 15,800,000 | |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | |
Proceeds from Issuance of Warrants | $ 15,800,000 | |
Class A Common Stock [Member] | Private Placement [Member] | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - Convertible Promissory Note [Member] - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | Nov. 02, 2020 | |
Probability for consummation of business combination | 85.00% | 85.00% | |
Fair value as of January 1, 2021 | $ 1,604,359 | $ 0 | |
Initial measurement on November 2, 2020 | 1,493,877 | ||
Change in valuation inputs and other assumptions | 27,624 | 110,482 | |
Fair value as of March 31, 2021 | $ 1,632,013 | $ 1,604,359 |
RELATED PARTY TRANSACTIONS - Ad
RELATED PARTY TRANSACTIONS - Additional Information (Details) - USD ($) | Nov. 10, 2020 | Jul. 01, 2019 | Jun. 26, 2019 | Jun. 07, 2019 | Apr. 29, 2019 | May 31, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2021 | Nov. 02, 2020 |
Stock Issued During Period, Value, New Issues | $ 25,000 | |||||||||||
Weighted Average Number of Shares, Common Stock Subject to Repurchase or Cancellation | 53,712,502 | 61,025,925 | ||||||||||
Share Price | $ 18 | $ 18 | ||||||||||
Initial Public Offering Cost | $ 300,000 | |||||||||||
Notes Payable, Related Parties | $ 200,000 | |||||||||||
Management Fee Expense | $ 20,000 | |||||||||||
Debt Conversion, Original Debt, Amount | $ 1,500,000 | $ 1,500,000 | ||||||||||
Debt Instrument, Convertible, Conversion Price | $ 1 | $ 1 | ||||||||||
Warrants price | $ 11.50 | |||||||||||
Convertible Promissory Note [Member] | ||||||||||||
Aggregate principal amount to be issued | $ 1,500,000 | $ 1,500,000 | $ 1,500,000 | |||||||||
Additional Paid in Capital [Member] | ||||||||||||
Stock Issued During Period, Value, New Issues | 23,275 | |||||||||||
Accumulated Deficit [Member] | ||||||||||||
Stock Issued During Period, Value, New Issues | 0 | |||||||||||
Over-Allotment Option [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 9,000,000 | |||||||||||
Weighted Average Number of Shares, Common Stock Subject to Repurchase or Cancellation | 2,250,000 | |||||||||||
IPO [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 69,000,000 | |||||||||||
Related Party Loan [Member] | ||||||||||||
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party | $ 60,000 | $ 60,000 | $ 123,333 | $ 240,000 | ||||||||
Sponsor [Member] | ||||||||||||
Weighted Average Number of Shares, Common Stock Subject to Repurchase or Cancellation | 2,250,000 | 2,250,000 | ||||||||||
Equity Method Investment, Ownership Percentage | 20.00% | 20.00% | ||||||||||
Sponsor [Member] | Convertible Promissory Note [Member] | ||||||||||||
Maximum amount of promissory note convertible into warrants | $ 1,500,000 | |||||||||||
Warrants price | $ 1 | |||||||||||
Class A Common Stock [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 0 | |||||||||||
Stock Issued During Period, Value, New Issues | $ 0 | |||||||||||
Common Stock, Shares, Outstanding | 11,090,292 | 7,974,075 | 15,287,498 | 3,840,000 | ||||||||
Weighted Average Number of Shares, Common Stock Subject to Repurchase or Cancellation | 61,961,631 | 58,723,869 | ||||||||||
Share Price | $ 12 | $ 12 | ||||||||||
Class A Common Stock [Member] | IPO [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 10,000,000 | |||||||||||
Class B Common Stock [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 8,625,000 | 0 | 17,250,000 | |||||||||
Stock Issued During Period, Value, New Issues | $ 25,000 | $ 1,725 | ||||||||||
Dividends Common Stock Dividends Per Share | $ 1 | |||||||||||
Common Stock, Shares, Outstanding | 17,250,000 | 11,500,000 | 17,250,000 | 17,250,000 | 17,250,000 | 160,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2020 | Oct. 12, 2020 | |
Fair value as of beginning period | $ 77,858,000 | $ 56,360,000 | ||
Initial measurement on October 12, 2020 | 38,110,000 | |||
Change in valuation inputs or other assumptions | (17,346,000) | 18,250,000 | 21,498,000 | |
Fair value as of Ending period | 60,512,000 | 56,360,000 | $ 77,858,000 | |
Prosus Agreement [Member] | ||||
Probability for consummation of business combination | 85.00% | 85.00% | ||
Fair value as of beginning period | 50,481,190 | $ 0 | ||
Initial measurement on October 12, 2020 | 71,969,454 | |||
Change in valuation inputs or other assumptions | (25,948,777) | (21,488,264) | ||
Fair value as of Ending period | $ 24,532,413 | $ 0 | $ 50,481,190 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Additional Information (Details) - USD ($) | Nov. 10, 2020 | Oct. 14, 2020 | Oct. 13, 2020 | Oct. 12, 2020 | Jul. 01, 2019 | Oct. 31, 2020 | May 31, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Underwriting Fees Payable | $ 21,371,000 | $ 21,371,000 | ||||||||||
Deferred Underwriting Discount, Shares | 7,940,000 | |||||||||||
Deferred Underwriting Upfront Payment | $ 1,588,000 | |||||||||||
Debt Issuance Costs, Net | $ 2,779,000 | |||||||||||
Nominal value per share | $ 10 | |||||||||||
Aggregate redemption price | 41,740,805 | $ 614,838,229 | (72,459,189) | |||||||||
Proceeds from Issuance Initial Public Offering | $ 677,788,000 | |||||||||||
Current Liabilities Accounts payable and accrued expenses | $ 745,986 | $ 257,466 | $ 635,483 | $ 257,466 | ||||||||
Warrants price | 11.50 | |||||||||||
Percentage of investment and beneficially owns outstanding | 20.00% | 20.00% | ||||||||||
IPO [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 69,000,000 | |||||||||||
Proceeds from Issuance Initial Public Offering | $ 690,000,000 | |||||||||||
Class A Common Stock [Member] | ||||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||
Aggregate redemption price | $ 420 | $ 6,103 | $ (732) | |||||||||
Newly issued shares | 0 | |||||||||||
Class A Common Stock [Member] | IPO [Member] | ||||||||||||
Newly issued shares | 10,000,000 | |||||||||||
Class B Common Stock [Member] | ||||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||
Aggregate redemption price | $ 0 | $ 0 | $ 0 | |||||||||
Newly issued shares | 8,625,000 | 0 | 17,250,000 | |||||||||
Class C Common Stock [Member] | ||||||||||||
Common stock, par value | $ 0.0001 | |||||||||||
Skillsoft Merger Agreement [Member] | ||||||||||||
Aggregate redemption price | $ 505,000,000 | |||||||||||
Aggregate principal amount to be issued | $ 20,000,000 | |||||||||||
Advanced for expenses incurred | $ 2,000,000 | |||||||||||
Skillsoft Merger Agreement [Member] | Class A Common Stock [Member] | ||||||||||||
Nominal value per share | $ 0.01 | |||||||||||
Skillsoft Merger Agreement [Member] | Class B Common Stock [Member] | ||||||||||||
Nominal value per share | $ 0.01 | |||||||||||
Global Knowledge Merger Agreement [Member] | ||||||||||||
Warrants price | $ 11.50 | $ 11.50 | ||||||||||
Equity interests on issued and outstanding | 100.00% | 100.00% | ||||||||||
Aggregate warrants to be issued | 5,000,000 | 5,000,000 | ||||||||||
Prosus Agreement [Member] | Class A Common Stock [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 40,000,000 | |||||||||||
Prosus Agreement [Member] | Class A Common Stock [Member] | IPO [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 50,000,000 | |||||||||||
Proceeds from Issuance Initial Public Offering | $ 500,000,000 | |||||||||||
SuRo Subscription Agreement [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 1,000,000 | |||||||||||
Lodbrok Subscription Agreement [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 2,000,000 | |||||||||||
Service Provider Agreement [Member] | ||||||||||||
Success fee | $ 150,000 | $ 150,000 | ||||||||||
Consulting fees | $ 332,476 | 222,742 | ||||||||||
Current Liabilities Accounts payable and accrued expenses | $ 9,975 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - $ / shares | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Oct. 12, 2020 | Dec. 31, 2019 | Jun. 26, 2019 | Jun. 07, 2019 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||
Preferred Stock, Shares Issued | 0 | 0 | 0 | ||||
Preferred Stock, Shares Outstanding | 0 | 0 | 0 | ||||
Sponsor [Member] | |||||||
Equity Method Investment, Ownership Percentage | 20.00% | 20.00% | |||||
Class A Common Stock [Member] | |||||||
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Common Stock, Shares, Issued | 11,090,292 | 15,287,498 | 7,974,075 | ||||
Common Stock, Shares, Outstanding | 11,090,292 | 3,840,000 | 15,287,498 | 7,974,075 | |||
Common Stock, Redemption Shares | 57,909,708 | 53,712,502 | 61,025,925 | ||||
Class B Common Stock [Member] | |||||||
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Common Stock, Shares, Issued | 17,250,000 | 17,250,000 | 17,250,000 | ||||
Common Stock, Shares, Outstanding | 17,250,000 | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 |
WARRANT LIABILITY (Details)
WARRANT LIABILITY (Details) - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
WARRANT LIABILITY | ||
Class of Warrant or Right Warrants Expiration Period | 5 years | 5 years |
Class of Warrant or Right Warrants Redemption Price | $ 0.01 | $ 0.01 |
Share Price | $ 18 | $ 18 |
INCOME TAX - Company's net defe
INCOME TAX - Company's net deferred tax liability (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax asset (liability) | ||
Startup and organizational expenses | $ 148,348 | |
Unrealized gain on marketable securities | (976) | $ (9,657) |
Deferred tax asset (liability) | 147,372 | (9,657) |
Valuation Allowance | (148,348) | |
Deferred tax asset (liability), net of allowance | $ (976) | $ (9,657) |
INCOME TAX - Income tax provisi
INCOME TAX - Income tax provision (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Federal | |||||
Current expense | $ 495,442 | $ 1,237,860 | |||
Deferred (benefit) expense | (157,029) | 9,657 | |||
State | |||||
Change in valuation allowance | 148,348 | ||||
Income tax provision | $ 2,422 | $ 404,809 | $ 1,247,517 | $ 486,761 | $ 1,247,517 |
INCOME TAX - Reconciliation of
INCOME TAX - Reconciliation of federal income tax rate (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
INCOME TAX | ||||
Statutory federal income tax rate | 21.00% | 21.00% | 21.00% | 21.00% |
State taxes, net of federal tax benefit | 0.00% | 0.00% | ||
Transaction costs attributable to Initial Public Offering | 0.00% | (1.80%) | ||
Loss on conversion option liability | (0.50%) | 0.00% | ||
Loss on warrant liability | (6.30%) | (28.50%) | ||
Loss on Prosus agreement | (14.70%) | 0.00% | ||
Valuation allowance | (0.20%) | 0.00% | ||
Income tax provision | (0.70%) | (9.30%) |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Level 1 | |||
Assets: | |||
Cash and marketable securities held in Trust Account | $ 697,018,229 | $ 696,957,196 | $ 695,295,418 |
Level 3 | |||
Liabilities: | |||
Prosus subscription agreement liability | 24,532,413 | 50,481,190 | |
Conversion option liability | 1,632,013 | 1,604,359 | |
Private Placement Warrants | Level 3 | |||
Liabilities: | |||
Warrant Liabilities | 26,702,000 | 32,548,000 | 23,700,000 |
Public Warrants | Level 1 | |||
Liabilities: | |||
Warrant Liabilities | $ 33,810,000 | $ 45,310,000 | $ 32,660,000 |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair value of warrant liabilities (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2020 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value as of beginning period | $ 77,858,000 | $ 56,360,000 | |
Initial measurement on July 1, 2019 | 38,110,000 | ||
Change in valuation inputs or other assumptions | (17,346,000) | 18,250,000 | 21,498,000 |
Fair value as of Ending period | 60,512,000 | 56,360,000 | 77,858,000 |
Private Placement Warrants | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value as of beginning period | 32,548,000 | 23,700,000 | |
Initial measurement on July 1, 2019 | 15,800,000 | ||
Change in valuation inputs or other assumptions | (5,846,000) | 7,900,000 | 8,848,000 |
Fair value as of Ending period | 26,702,000 | 23,700,000 | 32,548,000 |
Public Warrants | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value as of beginning period | 45,310,000 | 32,660,000 | |
Initial measurement on July 1, 2019 | 22,310,000 | ||
Change in valuation inputs or other assumptions | (11,500,000) | 10,350,000 | 12,650,000 |
Fair value as of Ending period | $ 33,810,000 | $ 32,660,000 | $ 45,310,000 |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash | $ 2,382,560 | $ 3,873,865 |
Prepaid expenses | 111,174 | 94,299 |
Total Current Assets | 2,493,734 | 3,968,164 |
Marketable securities held in Trust Account | 697,018,229 | 696,957,196 |
TOTAL ASSETS | 699,511,963 | 700,925,360 |
Current liabilities | ||
Accounts payable and accrued expenses | 745,986 | 635,483 |
Income taxes payable | 98,700 | 95,302 |
Convertible promissory note-related party | 3,132,013 | 3,104,359 |
Total Current Liabilities | 3,976,699 | 3,835,144 |
Deferred income tax payable | 0 | 976 |
Deferred underwriting fee payable | 21,371,000 | 21,371,000 |
Derivative liabilities | 85,044,413 | 128,339,190 |
Total Liabilities | 110,392,112 | 153,546,310 |
Commitments and Contingencies | ||
Class A common stock subject to possible redemption, 57,909,708 and 53,712,502 shares at redemption value at as of March 31, 2021 and December 31, 2020, respectively | 584,119,845 | 542,379,040 |
Stockholders' Equity | ||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | ||
Additional paid-in capital | 50,398,148 | 92,138,533 |
Accumulated deficit | (45,400,976) | (87,141,777) |
Total Stockholders' Equity | 5,000,006 | 5,000,010 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 699,511,963 | 700,925,360 |
Class A Common Stock [Member] | ||
Stockholders' Equity | ||
Common stock value | 1,109 | 1,529 |
Total Stockholders' Equity | 1,109 | 1,529 |
Class B Common Stock [Member] | ||
Stockholders' Equity | ||
Common stock value | 1,725 | 1,725 |
Total Stockholders' Equity | $ 1,725 | $ 1,725 |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Oct. 12, 2020 | Dec. 31, 2019 | Jun. 26, 2019 | Jun. 07, 2019 |
Temporary Equity, Shares Outstanding | 57,909,708 | 53,712,502 | 61,025,925 | ||||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||
Preferred Stock, Shares Issued | 0 | 0 | 0 | ||||
Preferred Stock, Shares Outstanding | 0 | 0 | 0 | ||||
Class A Common Stock [Member] | |||||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||
Common Stock, Shares, Issued | 11,090,292 | 15,287,498 | 7,974,075 | ||||
Common Stock, Shares, Outstanding | 11,090,292 | 3,840,000 | 15,287,498 | 7,974,075 | |||
Common Stock, Redemption Shares | 57,909,708 | 53,712,502 | 61,025,925 | ||||
Class B Common Stock [Member] | |||||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||
Common Stock, Shares, Issued | 17,250,000 | 17,250,000 | 17,250,000 | ||||
Common Stock, Shares, Outstanding | 17,250,000 | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CONDENSED STATEMENTS OF OPERATIONS | ||
Operating and formation costs | $ 1,584,933 | $ 301,863 |
Loss from operations | (1,584,933) | (301,863) |
Other income (expense): | ||
Interest earned on marketable securities held in Trust Account | 59,701 | 2,250,075 |
Gain (loss) on derivative liabilities | 43,267,123 | (10,346,000) |
Unrealized gain (loss) on marketable securities held in Trust Account | 1,332 | (20,917) |
Other income, net | 43,328,156 | (8,116,842) |
Income (loss) before income taxes | 41,743,223 | (8,418,705) |
Provision for income taxes | (2,422) | (404,809) |
Net income (loss) | $ 41,740,801 | $ (8,823,514) |
Basic and diluted weighted average shares outstanding, Class A common stock subject to redemption | 53,712,502 | 61,025,925 |
Basic and diluted net income per share | $ 0 | $ 0.02 |
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 32,537,498 | 25,224,075 |
Basic and diluted net income (loss) per share, Non-redeemable common stock | $ 1.28 | $ (0.41) |
CONDENSED STATEMENT OF CHANGE_3
CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Class A Common Stock [Member] | Class B Common Stock [Member] | Additional Paid in Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Apr. 10, 2019 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 |
Balance (in shares) at Apr. 10, 2019 | 0 | 0 | |||
Net income | (16,497,280) | ||||
Balance at Apr. 10, 2019 | $ 0 | $ 0 | 0 | 0 | 0 |
Balance (in shares) at Apr. 10, 2019 | 0 | 0 | |||
Change in value of common stock subject to redemption (in shares) | (61,025,925) | 0 | |||
Change in value of Class A common stock subject to redemption | $ (6,103) | $ 0 | (614,832,126) | 0 | (614,838,229) |
Net income | 0 | 0 | 0 | (14,682,592) | (14,682,592) |
Balance at Dec. 31, 2019 | $ 797 | $ 1,725 | 19,680,076 | (14,682,592) | 5,000,006 |
Balance (in shares) at Dec. 31, 2019 | 7,974,075 | 17,250,000 | |||
Change in value of common stock subject to redemption | $ 103 | $ 0 | 8,823,414 | 0 | 8,823,517 |
Change in value of common stock subject to redemption (in shares) | 1,027,706 | ||||
Net income | $ 0 | 0 | 0 | (8,823,514) | (8,823,514) |
Balance at Mar. 31, 2020 | $ 900 | $ 1,725 | 28,503,490 | (23,506,106) | 5,000,009 |
Balance (in shares) at Mar. 31, 2020 | 9,001,781 | 17,250,000 | |||
Balance at Dec. 31, 2019 | $ 797 | $ 1,725 | 19,680,076 | (14,682,592) | 5,000,006 |
Balance (in shares) at Dec. 31, 2019 | 7,974,075 | 17,250,000 | |||
Net income | (53,585,867) | ||||
Balance at Dec. 31, 2019 | $ 797 | $ 1,725 | 19,680,076 | (14,682,592) | 5,000,006 |
Balance (in shares) at Dec. 31, 2019 | 7,974,075 | 17,250,000 | |||
Net income | (25,340,816) | ||||
Balance at Dec. 31, 2019 | $ 797 | $ 1,725 | 19,680,076 | (14,682,592) | 5,000,006 |
Balance (in shares) at Dec. 31, 2019 | 7,974,075 | 17,250,000 | |||
Change in value of Class A common stock subject to redemption | $ 732 | $ 0 | 72,458,457 | 0 | 72,459,189 |
Net income | 0 | 0 | 0 | (72,459,185) | (72,459,185) |
Balance at Dec. 31, 2020 | $ 1,529 | $ 1,725 | 92,138,533 | (87,141,777) | 5,000,010 |
Balance (in shares) at Dec. 31, 2020 | 15,287,498 | 17,250,000 | |||
Balance at Mar. 31, 2020 | $ 900 | $ 1,725 | 28,503,490 | (23,506,106) | 5,000,009 |
Balance (in shares) at Mar. 31, 2020 | 9,001,781 | 17,250,000 | |||
Balance at Dec. 31, 2020 | $ 1,529 | $ 1,725 | 92,138,533 | (87,141,777) | 5,000,010 |
Balance (in shares) at Dec. 31, 2020 | 15,287,498 | 17,250,000 | |||
Change in value of common stock subject to redemption (in shares) | (4,197,206) | 0 | |||
Change in value of Class A common stock subject to redemption | $ (420) | $ 0 | (41,740,385) | 0 | (41,740,805) |
Net income | 0 | 0 | 0 | 41,740,801 | 41,740,801 |
Balance at Mar. 31, 2021 | $ 1,109 | $ 1,725 | $ 50,398,148 | $ (45,400,976) | $ 5,000,006 |
Balance (in shares) at Mar. 31, 2021 | 11,090,292 | 17,250,000 |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash Flows from Operating Activities: | ||
Net income (loss) | $ 41,740,801 | $ (8,823,514) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Interest earned on marketable securities held in Trust Account | (59,701) | (2,250,075) |
(Gain) loss on derivative liabilities | (43,267,123) | 10,346,000 |
Unrealized gain on marketable securities held in Trust Account | (1,332) | 20,917 |
Deferred income tax benefit | (976) | (14,050) |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | (16,875) | (12,950) |
Prepaid income taxes | 0 | 27,140 |
Accounts payable and accrued expenses | 110,503 | (54,191) |
Income taxes payable | 3,398 | 231,719 |
Net cash used in operating activities | (1,491,305) | (529,004) |
Cash Flows from Investing Activities: | ||
Cash withdrawn from Trust Account to pay for franchise and income taxes | 0 | 305,250 |
Net cash provided by investing activities | 0 | 305,250 |
Cash Flows from Financing Activities: | ||
Net Change in Cash | (1,491,305) | (223,754) |
Cash-Beginning of period | 3,873,865 | 2,238,275 |
Cash-End of period | 2,382,560 | 2,014,521 |
Supplemental cash flow information: | ||
Cash paid for income taxes | 373,000 | 160,000 |
Non-Cash investing and financing activities: | ||
Change in value of Class A common stock subject to possible redemption | $ (30,718,384) | $ (8,823,517) |
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 Churchill Capital Corp II (the "Company") was incorporated in Delaware on April 11, 2019. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (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 through March 31, 2021 relates to the Company’s formation, initial public offering (the “Initial Public Offering”), which is described below, and subsequent to the Initial Public Offering, identifying a target company for a Business Combination and activities in connection with the potential acquisition of Software Luxembourg Holding S.A., a public limited liability company (société anonyme) incorporated and organized under the laws of the Grand Duchy of Luxembourg (“Skillsoft”) (see Note 6). The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company generates 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 June 26, 2019. On July 1, 2019, the Company consummated the Initial Public Offering of 69,000,000 units (the “Units” and, with respect to the shares of Class A common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriter of the over-allotment option to purchase an additional 9,000,000 Units, at $10.00 per Unit, generating gross proceeds of $690,000,000, which is described in Note 3. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 15,800,000 warrants (the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant in a private placement to Churchill Sponsor II LLC, a Delaware limited liability company (the “Sponsor”), generating gross proceeds of $15,800,000, which is described in Note 4. Transaction costs amounted to $34,319,807 consisting of $12,212,000 of underwriting discount, $21,371,000 of deferred underwriting discount and $736,807 of other offering costs. Following the closing of the Initial Public Offering on July 1, 2019, an amount of $690,000,000 ($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 Placement Warrants was placed in a trust account (the “Trust Account”), and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended, (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 meeting the conditions of Rule 2a‑7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination or (ii) the distribution of the Trust Account, as described below, except that interest earned on the Trust Account can be released to the Company to fund working capital requirements, subject to an annual limit of $250,000 and to pay its tax obligations. 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 Placement Warrants, 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 an initial Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable) at the time of the agreement to enter into the 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 ($10.00 per Public Share, plus any pro rata interest, net of amounts withdrawn for working capital requirements, subject to an annual limit of $250,000 and to pay its taxes ("permitted withdrawals")). The per-share amount to be distributed to public stockholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 7). 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 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 or stock exchange requirements 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 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 Company’s Sponsor and its permitted transferees have agreed to vote their Founder Shares (as defined in Note 6) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction. If the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% or more of the Public Shares, without the prior consent of the Company. The Sponsor has agreed (a) to waive its redemption rights with respect to its Founder Shares and Public Shares held by it in connection with the completion of a Business Combination, (b) to waive its rights to liquidating distributions from the Trust Account with respect to its Founder Shares if the Company fails to consummate a Business Combination within the Combination Window (as defined below) and (c) not to propose an amendment to the Company’s Amended and Restated Certificate of Incorporation that would 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 shares in conjunction with any such amendment. If the Company is unable to complete a Business Combination by July 1, 2021 (or October 1, 2021 if the Company has an executed letter of intent, agreement in principle or definitive agreement for a Business Combination by July 1, 2021) (the "Combination Window"), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest (net of permitted withdrawals and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Window. The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Window. However, if the Sponsor acquires 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 Window. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 7) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Window and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. 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 Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party (other than the Company’s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or similar agreement, reduce the amount of funds in the Trust Account to below (i) $10.00 per Public Share or (ii) the amount per Public Share held in the Trust Account as of the liquidation of the Trust Account, if less than $10.00 per Public Shares due to reductions in the value of the trust assets, in each case net of permitted withdrawals. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account or to any claims under the Company’s indemnity of the underwriters of the 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 Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, 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. Liquidity The Company has principally financed its operations from inception using proceeds from the sale of its equity securities to its shareholders prior to the Initial Public Offering and such amount of proceeds from the Initial Public Offering that were placed in an account outside of the Trust Account for working capital purposes. As of March 31, 2021, the Company had $2,382,560 in its operating bank accounts, $697,018,229 in securities held in the Trust Account to be used for a Business Combination or to repurchase or redeem its common stock in connection therewith and adjusted working capital of $1,182,603, which amount excludes interest earned which may withdrawn from the Company’s Trust Account to pay its franchise and income taxes. As of March 31, 2021, approximately $7,018,000 of the amount on deposit in the Trust Account represented interest income, which is available to pay the Company's tax obligations. Based on the foregoing, the Company believes it will have sufficient cash to meet its needs for a reasonable period of time, which is considered to be one year from the issuance date of the condensed financial statements. | NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS Churchill Capital Corp II (the “Company”) was incorporated in Delaware on April 11, 2019. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (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 through December 31, 2020 relates to the Company’s formation, the initial public offering (“Initial Public Offering”), which is described below, identifying a target for a Business Combination and activities in connection with the potential acquisition of Software Luxembourg Holding S.A., a public limited liability company (société anonyme) incorporated and organized under the laws of the Grand Duchy of Luxembourg (“Skillsoft”) (see Note 7). The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company generates 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 June 26, 2019. On July 1, 2019, the Company consummated the Initial Public Offering of 69,000,000 units (the“Units” and, with respect to the shares of Class A common stock included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriter of the over-allotment option to purchase an additional 9,000,000 Units, at $10.00 per Unit, generating gross proceeds of $690,000,000, which is described in Note 4. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 15,800,000 warrants (the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant in a private placement to Churchill Sponsor II LLC, a Delaware limited liability company (the “Sponsor”), generating gross proceeds of $15,800,000, which is described in Note 5. Transaction costs amounted to $34,319,807 consisting of $12,212,000 of underwriting discount, $21,371,000 of deferred underwriting discount and $736,807 of other offering costs. Following the closing of the Initial Public Offering on July 1, 2019, an amount of $690,000,000 ($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 Placement Warrants was placed in a trust account (the “Trust Account”) and 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 or (ii) the distribution of the Trust Account, as described below, except that interest earned on the Trust Account can be released to the Company to fund working capital requirements, subject to an annual limit of $250,000 and to pay its tax obligations. 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 Placement Warrants, 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 an initial Business Combination having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable) at the time of the agreement to enter into the 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 ($10.00 per Public Share, plus any pro rata interest, net of amounts withdrawn for working capital requirements, subject to an annual limit of $250,000 and to pay its taxes (“permitted withdrawals”)). The per-share amount to be distributed to public stockholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 7). 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 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 or stock exchange requirements 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 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 Company’s Sponsor and its permitted transferees have agreed to vote their Founder Shares (as defined in Note 6) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction. If the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% or more of the Public Shares, without the prior consent of the Company. The Sponsor has agreed (a) to waive its redemption rights with respect to its Founder Shares and Public Shares held by it in connection with the completion of a Business Combination, (b) to waive its rights to liquidating distributions from the Trust Account with respect to its Founder Shares if the Company fails to consummate a Business Combination within the Combination Window (as defined below) and (c) not to propose an amendment to the Company’s Amended and Restated Certificate of Incorporation that would 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 shares in conjunction with any such amendment. If the Company is unable to complete a Business Combination by July 1, 2021 (or October 1, 2021 if the Company has an executed letter of intent, agreement in principle or definitive agreement for a Business Combination by July 1, 2021) (the “Combination Window”), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest (net of permitted withdrawals and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Window. The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Window. However, if the Sponsor acquires 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 Window. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 7) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Window and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. 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 Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party (other than the Company’s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or similar agreement, reduce the amount of funds in the Trust Account to below (i) $10.00 per Public Share or (ii) the amount per Public Share held in the Trust Account as of the liquidation of the Trust Account, if less than $10.00 per Public Shares due to reductions in the value of the trust assets, in each case net of permitted withdrawals. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account or to any claims under the Company’s indemnity of the underwriters of the 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 Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, 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. |
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 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/A for the year ended December 31, 2020, as filed with the SEC on May 11, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year 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 statement 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 the condensed 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 December 31, 2020. Marketable Securities Held in Trust Account At March 31, 2021 and December 31, 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through March 31, 2021, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which no amounts were withdrawn during the three months ended March 31, 2021. Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common stock and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. Class A Common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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 statements 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 and permanent differences. Net income (Loss) per Share Net income (loss) per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per share, basic and diluted, for Class A 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 the weighted average number of Class A 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 Class A 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 share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) 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 Corporation coverage limit 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 Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature, except for the Company's derivative instruments (see Note 9). Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | NOTE 3. 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 the 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. Cash equivalents consist of mutual funds. The Company did not have any cash equivalents as of December 31, 2020 and 2019. Marketable Securities Held in Trust Account At December 31, 2020 and 2019, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through December 31, 2020, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which $856,250 was withdrawn during the year ended December 31, 2020. Class A common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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. Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common shares and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. 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 statements 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, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses (“NOL) and allow businesses to carry back NOLs arising in 2018, 2019 and 2020 to the five prior years, suspend the excess business loss rules, accelerate refunds of previously generated corporate alternative minimum tax credits, generally loosen the business interest limitation under IRC section 163(j) from 30 percent to 50 percent among other technical corrections included in the Tax Cuts and Jobs Act tax provisions. The Company does not believe that the CARES Act will have a significant impact on Company's financial position or statement of operations. Net Income (Loss) per Common Share Net income (loss) per common share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. The Company has not considered the effect of the warrants sold in the Public Offering and Private Placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per ordinary share. Net income (loss) per common share, basic and diluted, for Class A 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 by the weighted average number of Class A common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income or loss on marketable securities attributable to Class A common stock subject to possible redemption, by the weighted average number of non-redeemable ordinary shares 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 the non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) 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 limit 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, except for the Company’s Derivative Instruments (see Note 6 and 11). 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 69,000,000 Units, at a purchase price of $10.00 per Unit, which includes the full exercise by the underwriter of its option to purchase an additional 9,000,000 Units at $10.00 per Unit. Each Unit consists of one share of Class A common stock and one-third of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at an exercise price of $11.50 per share, subject to adjustment (see Note 8). | NOTE 4. PUBLIC OFFERING Pursuant to the Initial Public Offering, the Company sold 69,000,000 Units at a purchase price of $10.00 per Unit, which includes the full exercise by the underwriter of its option to purchase an additional 9,000,000 Units at $10.00 per Unit. Each Unit consists of one share of Class A common stock and one-third of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment (see Note 9). |
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 Sponsor purchased an aggregate of 15,800,000 Private Placement Warrants at a price of $1.00 per Private Placement Warrant, for an aggregate purchase price of $15,800,000. Each Private Placement Warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share. The proceeds from the sale of the Private Placement Warrants 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 Window, the proceeds from the sale of the Private Placement Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless. There will be no redemption rights or liquidating distributions from the Trust Account with respect to the Private Placement Warrants. | NOTE 5. PRIVATE PLACEMENT Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 15,800,000 Private Placement Warrants at a price of $1.00 per Private Placement Warrant, for an aggregate purchase price of $15,800,000. Each Private Placement Warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share. The proceeds from the sale of the Private Placement Warrants 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 Window, the proceeds from the sale of the Private Placement Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless. There will be no redemption rights or liquidating distributions from the Trust Account with respect to the Private Placement Warrants. |
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 May 2019, the Sponsor purchased 8,625,000 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On June 7, 2019, the Company effected a stock dividend at one-third of one share of Class B common stock for each outstanding share of Class B common stock, resulting in an aggregate of 11,500,000 Founder Shares outstanding. On June 26, 2019, the Company effected a further stock dividend of one-half of a share of Class B common stock for each outstanding share of Class B common stock, resulting in the Sponsor holding an aggregate of 17,250,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the stock dividend. The Founder Shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 7. The Founder Shares included an aggregate of up to 2,250,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, 2,250,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) the date on which the Company completes a liquidation, merger, stock exchange, reorganization or similar transaction after a Business Combination that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A common stock equals or exceeds $12.00 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 at least 150 days after a Business Combination, the Founder Shares will be released form the lock-up. Administrative Support Agreement The Company entered into an agreement, commencing on June 26, 2019 through the earlier of the Company’s consummation of a Business Combination and its liquidation, pursuant to which the Company will pay an affiliate of the Sponsor a total of up to $20,000 per month for office space, administrative and support services. For the three months ended March 31, 2021 and 2020, the Company incurred and paid $60,000 in fees for these services. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor or the Company’s directors and officers 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. 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 either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On November 2, 2020, the Company entered into a convertible promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Promissory Note”). The Convertible Promissory Note is non-interest bearing and payable on the earlier of the date on which the Company consummates a Business Combination or the date that the winding up of the Company is effective. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Promissory Note; however, no proceeds from the Trust Account may be used for such repayment. Up to $1,500,000 of the Convertible Promissory Note may be converted into warrants at a price of $1.00 per warrant at the option of the Sponsor. The warrants would be identical to the Private Placement Warrants. As of March31, 2021 and December 31, 2020, the outstanding balance under the Convertible Promissory Note amounted to an aggregate of $1,500,000. The Company assessed the provisions of the Convertible Promissory Note under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on conversion option liability. The conversion option was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 9). The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the conversion option is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of November 2, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of conversion option: Fair value as of January 1, 2021 $ 1,604,359 Change in valuation inputs and other assumptions 27,624 Fair value as of March 31, 2021 $ 1,632,013 Advisory Fee The Company may engage M. Klein and Company, LLC, an affiliate of the Sponsor, or another affiliate of the Sponsor, as its lead financial advisor in connection with a Business Combination and may pay such affiliate a customary financial advisory fee in an amount that constitutes a market standard financial advisory fee for comparable transactions. | NOTE 6. RELATED PARTY TRANSACTIONS Founder Shares In May 2019, the Sponsor purchased 8,625,000 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On June 7, 2019, the Company effected a stock dividend at one-third of one share of Class B common stock for each outstanding share of Class B common stock, resulting in an aggregate of 11,500,000 Founder Shares outstanding. On June 26, 2019, the Company effected a further stock dividend of one-half of a share of Class B common stock for each outstanding share of Class B common stock, resulting in the Sponsor holding an aggregate of 17,250,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the stock dividend. The Founder Shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 8. The Founder Shares included an aggregate of up to 2,250,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, 2,250,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) the date on which the Company completes a liquidation, merger, stock exchange, reorganization or similar transaction after a Business Combination that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A common stock equals or exceeds $12.00 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 at least 150 days after a Business Combination, the Founder Shares will be released from the lock-up. Promissory Note — Related Party On April 29, 2019, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Promissory Note”). The Promissory Note was non-interest bearing and payable on the earlier of December 31, 2019 or the completion of the Initial Public Offering. The Promissory Note was drawn in the amount of $200,000 and was repaid in full upon the consummation of the Initial Public Offering on July 1, 2019. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or the Company’s officers and directors 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. 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 either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On November 2, 2020, the Company entered into a convertible promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Promissory Note”). The Convertible Promissory Note is non-interest bearing and payable on the earlier of the date on which the Company consummates a Business Combination or the date that the winding up of the Company is effective. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Promissory Note; however, no proceeds from the Trust Account may be used for such repayment. Up to $1,500,000 of the Convertible Promissory Note may be converted into warrants at a price of $1.00 per warrant at the option of the Sponsor. The warrants would be identical to the Private Placement Warrants. As of December 31, 2020, the outstanding balance under the Convertible Promissory Note amounted to an aggregate of $1,500,000. The Company assessed the provisions of the Convertible Promissory Note under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on conversion option liability. The conversion option was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 11). The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the conversion option is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of November 2, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of conversion option: Fair value as of January 1, 2020 $ — Initial measurement on November 2, 2020 1,493,877 Change in valuation inputs and other assumptions 110,482 Fair value as of December 31, 2020 $ 1,604,359 Administrative Support Agreement The Company entered into an agreement whereby, commencing on June 26, 2019 through the earlier of the Company’s consummation of a Business Combination and its liquidation, the Company will pay an affiliate of the Sponsor a total of $20,000 per month for office space, administrative and support services. For the year ended December 31, 2020 and for the period from April 11, 2019 through December 31, 2019, the Company incurred and paid $240,000 and $123,333 of such fees, respectively. Advisory Fee The Company may engage M. Klein and Company, LLC, an affiliate of the Sponsor, or another affiliate of the Sponsor, as its lead financial advisor in connection with a Business Combination and may pay such affiliate a customary financial advisory fee in an amount that constitutes a market standard financial advisory fee for comparable transactions. |
COMMITMENTS AND CONTINGENCIES_3
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 June 26, 2019, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants or warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) will be entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). The holders of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Underwriting Agreement The underwriters are entitled to a deferred fee of $21,371,000 in the aggregate. The deferred fee will be waived by the underwriters in the event that the Company does not complete a Business Combination, subject to the terms of the underwriting agreement. On July 1, 2019, the underwriters agreed to waive the upfront and deferred underwriting discount on 7,940,000 units, resulting in a reduction of the upfront and deferred underwriting discount of $1,588,000 and $2,779,000, respectively. Skillsoft Merger Agreement On October 12, 2020, the Company entered into an Agreement and Plan of Merger (the “Skillsoft Merger Agreement”) by and between the Company and Skillsoft. Pursuant to the terms of the Skillsoft Merger Agreement, a business combination between the Company and Skillsoft will be effected through the merger of Skillsoft with and into the Company, with the Company surviving as the surviving company (the “Skillsoft Merger”). At the effective time of the Skillsoft Merger (the “Effective Time”), (a) each Class A share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class A Shares”), outstanding immediately prior to the Effective Time, will be automatically canceled and the Company will issue as consideration therefor (i) such number of shares of the Company’s Class A common stock, par value $0.0001 per share (the “Churchill Class A Common Stock”) equal to the Class A First Lien Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (ii) the Company’s Class C common stock, par value $0.0001 per share (the “Churchill Class C Common Stock”), equal to the Class C Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (b) each Class B share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class B Shares”), will be automatically canceled and the Company will issue as consideration therefor such number of shares of the Company’s Class A common stock equal to the Per Class B Share Merger Consideration (as defined in the Skillsoft Merger Agreement). Pursuant to the terms of the Skillsoft Merger Agreement, the Company is required to use commercially reasonable efforts to cause the Company Class A Common Stock to be issued in connection with the transactions contemplated by the Skillsoft Merger Agreement (the “Skillsoft Transactions”) to be listed on the New York Stock Exchange (“NYSE”) prior to the closing of the Skillsoft Merger (the “Skillsoft Closing”). Immediately following the Effective Time, the Company will redeem all of the shares of Class C Common Stock issued to the holders of Skillsoft Class A Shares for an aggregate redemption price of (i) $505,000,000 in cash and (ii) indebtedness under the Existing Second Out Credit Agreement (as defined in the Skillsoft Merger Agreement), as amended by the Existing Second Out Credit Agreement Amendment (as defined in the Skillsoft Merger Agreement), in the aggregate principal amount equal to the sum of $20,000,000 to be issued by the Surviving Corporation (as defined in the Skillsoft Merger Agreement) or one of its subsidiaries, in each case, pro rata among the holders of Churchill Class C Common Stock issued in connection with the Skillsoft Merger. The consummation of the proposed Skillsoft Transactions is subject to the receipt of the requisite approval of (i) the stockholders of Churchill (the “Churchill Stockholder Approval”) and (ii) the shareholders of Skillsoft (the “Skillsoft Shareholder Approval”) and the fulfillment of certain other conditions. In October 2020, the Company was advanced $2,000,000 for expenses incurred with the Skillsoft Merger. If the planned business combination is not completed, the Company would be required to refund any unused amount. For the year ended December 31, 2020 the Company had utilized the advance in connection with the Skillsoft Merger. As of the date of these financial statements, the advance is no longer refundable. Global Knowledge Merger Agreement Concurrently with its entry into the Skillsoft Merger Agreement, the Company also entered into an Agreement and Plan of Merger (the “Global Knowledge Merger Agreement”) by and among the Company, Magnet Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), and Albert DE Holdings Inc., a Delaware corporation owned by investment funds affiliated with Rhône Capital L.L.C. Pursuant to the Global Knowledge Merger Agreement, Merger Sub will merge with and into Global Knowledge, with Global Knowledge surviving the transaction as a wholly-owned subsidiary of the Company (the “Global Knowledge Merger”). At the effective time (the “Global Knowledge Effective Time”) of the Global Knowledge Merger, as consideration for the Global Knowledge Merger, 100% of the issued and outstanding equity interests of Global Knowledge will be converted, in the aggregate, into the right to receive warrants, each of which shall entitle the holders thereof to purchase one share of the Company’s Class A Stock at an exercise price of $11.50 per share. The aggregate number of warrants to be received by the equity holders of Global Knowledge as consideration in the Global Knowledge Merger will be 5,000,000. The warrants to be issued to the equity holders of Global Knowledge will be non-redeemable and otherwise substantially similar to the private placement warrants issued to the Churchill Sponsor in connection with Churchill’s initial public offering. The consummation of the proposed Global Knowledge Merger (the “Global Knowledge Closing”) is subject to the consummation of the Skillsoft Merger, among other conditions contained in the Global Knowledge Merger Agreement. Restructuring Support Agreement On October 12, 2020, Global Knowledge entered into a Restructuring Support Agreement (the “Global Knowledge RSA”) with (i) 100% of its lenders under that certain Amended and Restated First Lien Credit and Guaranty Agreement, dated as of January 30, 2015, as amended from time to time, by and among, inter alios, GK Holdings, as borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto and Credit Suisse, acting in its capacity as administrative agent and collateral agent (the “First Lien Credit Agreement,” and the lenders thereto, the “First Lien Lenders”); and (ii) 100% of its lenders under that certain Amended and Restated Second Lien Credit and Guaranty Agreement, dated as of January 30, 2015, as amended from time to time, by and among, inter alios, GK Holdings, as borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto and Wilmington Trust, acting in its capacity as administrative agent and collateral agent (the “Second Lien Credit Agreement,” and there lenders thereto, the “Second Lien Lenders,” together with the First Lien Lenders, the “Secured Lenders”). The Global Knowledge RSA contemplates an out-of-court restructuring (the “Restructuring”) that provides meaningful recoveries, funded by Churchill, to all Secured Lenders. Churchill is a third-party beneficiary of the Global Knowledge RSA with respect to enforcement of certain specific provisions and its explicit rights under the Global Knowledge RSA and not a direct party. Subscription Agreements Prosus Agreement On November 10, 2020, MIH Edtech Investments B.V. (formerly known as MIH Ventures B.V.) ("MIH Edtech Investments") exercised its option to subscribe for an additional 40,000,000 newly-issued shares of Churchill Class A Common Stock, subject to certain adjustments, at a purchase price of $10.00 per share (the “Prosus Second Step Investment”), pursuant to the Subscription Agreement, dated October 12, 2020, by and among Churchill, the Sponsor and MIH Edtech Investments (the “Prosus Agreement”). On February 16, 2021, MIH Edtech Investments assigned all of its rights, title and interest in and to, and obligations under, the Prosus Agreement to MIH Learning B.V. (“Prosus”) and Prosus accepted such assignments. Together with its initial subscription for 10,000,000 newly-issued shares of Churchill Class A Common Stock, at a purchase price of $10.00 per share (the “Prosus First Step Investment”), Prosus’s total investment in Churchill is expected to be 50,000,000 shares of Churchill Class A Common Stock for an aggregate purchase price of $500.0 million (the “Prosus PIPE Investment”). As part of the Prosus Agreement, Prosus and the Company agreed to a strategic support agreement, pursuant to which Prosus will provide certain business development and investor relations support services in the event it exercises its option to make the Prosus Second Step Investment and beneficially owns at least 20% of the outstanding Churchill Class A common stock following closing of the Prosus PIPE Investment on a fully-diluted and as-converted basis. If Prosus consummates the Prosus PIPE Investment, it will also nominate an individual to serve as the chairman of Churchill’s Board. Pursuant to the Prosus Agreement, in connection with the consummation of the Second Step Prosus Investment, Churchill will issue to Prosus warrants to purchase a number of shares of Churchill Class A common stock equal to one-third of the number of shares of Churchill Class A common stock purchased in the Prosus PIPE Investment (the “Prosus Warrants”). The Prosus Warrants will have terms substantively identical to those included in the units offered in Churchill’s IPO. The Company assessed the provisions of the Prosus Agreement under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on Prosus Agreement liability. The Prosus Agreement liability was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 9). The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the Prosus Agreement liability is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of October 12, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of the Prosus Agreement liability: Fair value as of January 1, 2021 $ 50,481,190 Change in valuation inputs and other assumptions (25,948,777) Fair value as of March 31, 2021 $ 24,532,413 SuRo Subscription Agreement On October 14, 2020, in connection with the execution of the Skillsoft Merger Agreement, Churchill entered into a subscription agreement with SuRo Capital Corp. (“SuRo”) pursuant to which SuRo subscribed for 1,000,000 newly-issued shares of Churchill Class A common stock, at a purchase price of $10.00 per share, to be issued at the closing of the Merger (the “SuRo Subscription Agreement”). The obligations to consummate the transactions contemplated by the SuRo Subscription Agreement are conditioned upon, among other things, customary closing conditions and the consummation of the Skillsoft Merger. Lodbrok Subscription Agreement On October 13, 2020, in connection with the execution of the Global Knowledge Merger Agreement, Churchill entered into a subscription agreement with Lodbrok Capital LLP (“Lodbrok”) pursuant to which Lodbrok subscribed for 2,000,000 newly-issued shares of Churchill Class A common stock, at a purchase price of $10.00 per share, to be issued at the closing of the Global Knowledge Merger (the “Lodbrok Subscription Agreement”). The obligations to consummate the transactions contemplated by the Lodbrok Subscription Agreement are conditioned upon, among other things, customary closing conditions and the consummation of the Global Knowledge Merger. Service Provider Agreement From time to time the Company has entered into and may enter into agreements with various services providers and advisors, including investment banks, to help us identify targets, negotiate terms of potential Business Combinations, consummate a Business Combination and/or provide other services. In connection with these agreements, the Company may be required to pay such service providers and advisors fees in connection with their services to the extent that certain conditions, including the closing of a potential Business Combination, are met. If a Business Combination does not occur, the Company would not expect to be required to pay these contingent fees. There can be no assurance that the Company will complete a Business Combination. The Company and Tyton Partners entered into an agreement, whereby Tyton Partners served as an advisor to the Company and will be entitled to receive a success fee of $150,000 at the close of the Business Combination. For the three months ended March 31, 2021, the Company incurred $332,476 and paid of consulting fees. Legal Proceedings In connection with the initial business combination, certain shareholders have filed lawsuits and other shareholders have threatened to file lawsuits alleging breaches of fiduciary duty and violations of the disclosure requirements of the Securities Exchange Act of 1934. The Company intends to defend the matters vigorously. These cases are in the early stages and the Company is unable to reasonably determine the outcome or estimate any potential losses, and, as such, has not recorded a loss contingency. | NOTE 7. COMMITMENTS AND CONTINGENCIES Registration Rights Pursuant to a registration rights agreement entered into on June 26, 2019, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants or warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) will be entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). The holders of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Underwriting Agreement The underwriters are entitled to a deferred fee of $21,371,000 in the aggregate. The deferred fee will be waived by the underwriters in the event that the Company does not complete a Business Combination, subject to the terms of the underwriting agreement. On July 1, 2019, the underwriters agreed to waive the upfront and deferred underwriting discount on 7,940,000 units, resulting in a reduction of the upfront and deferred underwriting discount of $1,588,000 and $2,779,000, respectively. Skillsoft Merger Agreement On October 12, 2020, the Company entered into an Agreement and Plan of Merger (the “Skillsoft Merger Agreement”) by and between the Company and Skillsoft. Pursuant to the terms of the Skillsoft Merger Agreement, a business combination between the Company and Skillsoft will be effected through the merger of Skillsoft with and into the Company, with the Company surviving as the surviving company (the “Skillsoft Merger”). At the effective time of the Skillsoft Merger (the “Effective Time”), (a) each Class A share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class A Shares”), outstanding immediately prior to the Effective Time, will be automatically canceled and the Company will issue as consideration therefor (i) such number of shares of the Company’s Class A common stock, par value $0.0001 per share (the “Churchill Class A Common Stock”) equal to the Class A First Lien Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (ii) the Company’s Class C common stock, par value $0.0001 per share (the “Churchill Class C Common Stock”), equal to the Class C Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (b) each Class B share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class B Shares”), will be automatically canceled and the Company will issue as consideration therefor such number of shares of the Company’s Class A common stock equal to the Per Class B Share Merger Consideration (as defined in the Skillsoft Merger Agreement). Pursuant to the terms of the Skillsoft Merger Agreement, the Company is required to use commercially reasonable efforts to cause the Company Class A Common Stock to be issued in connection with the transactions contemplated by the Skillsoft Merger Agreement (the “Skillsoft Transactions”) to be listed on the New York Stock Exchange (“NYSE”) prior to the closing of the Skillsoft Merger (the “Skillsoft Closing”). Immediately following the Effective Time, the Company will redeem all of the shares of Class C Common Stock issued to the holders of Skillsoft Class A Shares for an aggregate redemption price of (i) $505,000,000 in cash and (ii) indebtedness under the Existing Second Out Credit Agreement (as defined in the Skillsoft Merger Agreement), as amended by the Existing Second Out Credit Agreement Amendment (as defined in the Skillsoft Merger Agreement), in the aggregate principal amount equal to the sum of $20,000,000 to be issued by the Surviving Corporation (as defined in the Skillsoft Merger Agreement) or one of its subsidiaries, in each case, pro rata among the holders of Churchill Class C Common Stock issued in connection with the Skillsoft Merger. The consummation of the proposed Skillsoft Transactions is subject to the receipt of the requisite approval of (i) the stockholders of Churchill (the “Churchill Stockholder Approval”) and (ii) the shareholders of Skillsoft (the “Skillsoft Shareholder Approval”) and the fulfillment of certain other conditions. In October 2020, the Company was advanced $2,000,000 for expenses incurred with the Skillsoft Merger. If the planned business combination is not completed, the Company would be required to refund any unused amount. For the year ended December 31, 2020 the Company had utilized the advance in connection with the Skillsoft Merger. As of the date of these financial statements, the advance is no longer refundable. Global Knowledge Merger Agreement Concurrently with its entry into the Skillsoft Merger Agreement, the Company also entered into an Agreement and Plan of Merger (the “Global Knowledge Merger Agreement”) by and among the Company, Magnet Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), and Albert DE Holdings Inc., a Delaware corporation owned by investment funds affiliated with Rhône Capital L.L.C. Pursuant to the Global Knowledge Merger Agreement, Merger Sub will merge with and into Global Knowledge, with Global Knowledge surviving the transaction as a wholly-owned subsidiary of the Company (the “Global Knowledge Merger”). At the effective time (the “Global Knowledge Effective Time”) of the Global Knowledge Merger, as consideration for the Global Knowledge Merger, 100% of the issued and outstanding equity interests of Global Knowledge will be converted, in the aggregate, into the right to receive warrants, each of which shall entitle the holders thereof to purchase one share of the Company’s Class A Stock at an exercise price of $11.50 per share. The aggregate number of warrants to be received by the equity holders of Global Knowledge as consideration in the Global Knowledge Merger will be 5,000,000. The warrants to be issued to the equity holders of Global Knowledge will be non-redeemable and otherwise substantially similar to the private placement warrants issued to the Churchill Sponsor in connection with Churchill’s initial public offering. The consummation of the proposed Global Knowledge Merger (the “Global Knowledge Closing”) is subject to the consummation of the Skillsoft Merger, among other conditions contained in the Global Knowledge Merger Agreement. Restructuring Support Agreement On October 12, 2020, Global Knowledge entered into a Restructuring Support Agreement (the “Global Knowledge RSA”) with (i) 100% of its lenders under that certain Amended and Restated First Lien Credit and Guaranty Agreement, dated as of January 30, 2015, as amended from time to time, by and among, inter alios, GK Holdings, as borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto and Credit Suisse, acting in its capacity as administrative agent and collateral agent (the “First Lien Credit Agreement,” and the lenders thereto, the “First Lien Lenders”); and (ii) 100% of its lenders under that certain Amended and Restated Second Lien Credit and Guaranty Agreement, dated as of January 30, 2015, as amended from time to time, by and among, inter alios, GK Holdings, as borrower, the guarantors from time to time party thereto, the lenders from time to time party thereto and Wilmington Trust, acting in its capacity as administrative agent and collateral agent (the “Second Lien Credit Agreement,” and there lenders thereto, the “Second Lien Lenders,” together with the First Lien Lenders, the “Secured Lenders”). The Global Knowledge RSA contemplates an out-of-court restructuring (the “Restructuring”) that provides meaningful recoveries, funded by Churchill, to all Secured Lenders. Churchill is a third-party beneficiary of the Global Knowledge RSA with respect to enforcement of certain specific provisions and its explicit rights under the Global Knowledge RSA and not a direct party. Subscription Agreements Prosus Agreement On November 10, 2020, MIH Edtech Investments B.V. (formerly known as MIH Ventures B.V.) (“MIH Edtech Investments”) exercised its option to subscribe for an additional 40,000,000 newly-issued shares of Churchill Class A Common Stock, subject to certain adjustments, at a purchase price of $10.00 per share (the “Prosus Second Step Investment”), pursuant to the Subscription Agreement, dated October 12, 2020, by and among Churchill, the Sponsor and MIH Edtech Investments (the “Prosus Agreement”). On February 16, 2021, MIH Edtech Investments assigned all of its rights, title and interest in and to, and obligations under, the Prosus Agreement to MIH Learning B.V. (“Prosus”) and Prosus accepted such assignments. Together with its initial subscription for 10,000,000 newly-issued shares of Churchill Class A Common Stock, at a purchase price of $10.00 per share (the “Prosus First Step Investment”), Prosus’s total investment in Churchill is expected to be 50,000,000 shares of Churchill Class A Common Stock for an aggregate purchase price of $500.0 million (the “Prosus PIPE Investment”). As part of the Prosus Agreement, Prosus and the Company agreed to a strategic support agreement, pursuant to which Prosus will provide certain business development and investor relations support services in the event it exercises its option to make the Prosus Second Step Investment and beneficially owns at least 20% of the outstanding Churchill Class A Common Stock following closing of the Prosus PIPE Investment on a fully-diluted and as-converted basis. If Prosus consummates the Prosus PIPE Investment, it will also nominate an individual to serve as the chairman of Churchill's Board. Pursuant to the Prosus Agreement, in connection with the consummation of the Second Step Prosus Investment, Churchill will issue to Prosus warrants to purchase a number of shares of Churchill Class A Common Stock equal to one-third of the number of shares of Churchill Class A Common Stock purchased in the Prosus PIPE Investment (the “Prosus Warrants”). The Prosus Warrants will have terms substantively identical to those included in the units offered in Churchill's IPO. The Company assessed the provisions of the Prosus Agreement under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on Prosus Agreement liability. The Prosus Agreement liability was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 11). The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the Prosus Agreement liability is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of October 12, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of the Prosus Agreement liability: Fair value as of January 1, 2020 $ — Initial measurement on October 12, 2020 71,969,454 Change in valuation inputs and other assumptions (21,488,264) Fair value as of December 31, 2020 $ 50,481,190 SuRo Subscription Agreement On October 14, 2020, in connection with the execution of the Skillsoft Merger Agreement, Churchill entered into a subscription agreement with SuRo Capital Corp. (“SuRo”) pursuant to which SuRo subscribed for 1,000,000 newly-issued shares of Churchill Class A Common Stock, at a purchase price of $10.00 per share, to be issued at the closing of the Merger (the “SuRo Subscription Agreement”). The obligations to consummate the transactions contemplated by the SuRo Subscription Agreement are conditioned upon, among other things, customary closing conditions and the consummation of the Skillsoft Merger. Lodbrok Subscription Agreement On October 13, 2020, in connection with the execution of the Global Knowledge Merger Agreement, Churchill entered into a subscription agreement with Lodbrok Capital LLP (“Lodbrok”) pursuant to which Lodbrok subscribed for 2,000,000 newly-issued shares of Churchill Class A Common Stock, at a purchase price of $10.00 per share, to be issued at the closing of the Global Knowledge Merger (the “Lodbrok Subscription Agreement”). The obligations to consummate the transactions contemplated by the Lodbrok Subscription Agreement are conditioned upon, among other things, customary closing conditions and the consummation of the Global Knowledge Merger. Service Provider Agreement From time to time the Company has entered into and may enter into agreements with various services providers and advisors, including investment banks, to help us identify targets, negotiate terms of potential Business Combinations, consummate a Business Combination and/or provide other services. In connection with these agreements, the Company may be required to pay such service providers and advisors fees in connection with their services to the extent that certain conditions, including the closing of a potential Business Combination, are met. If a Business Combination does not occur, the Company would not expect to be required to pay these contingent fees. There can be no assurance that the Company will complete a Business Combination. The Company and Tyton Partners entered into an agreement, whereby Tyton Partners served as an advisor to the Company and will be entitled to receive a success fee of $150,000 at the close of the Business Combination. For the year ended December 31, 2020, the Company incurred $222,742 of consulting fees. As of December 31, 2020, $9,975 remained unpaid and are reflected in accounts payable and accrued expense in the accompanying balance sheets. Legal Proceedings In connection with the initial business combination, certain shareholders have filed lawsuits and other shareholders have threatened to file lawsuits alleging breaches of fiduciary duty and violations of the disclosure requirements of the Securities Exchange Act of 1934. The Company intends to defend the matters vigorously. These cases are in the early stages and the Company is unable to reasonably determine the outcome or estimate any potential losses, and, as such, has not recorded a loss contingency. |
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 Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At March 31, 2021 and December 31, 2020, there were no shares of preferred stock issued or outstanding. Class A Common Stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At March 31, 2021, there were 11,090,292 shares of Class A common stock issued and outstanding, excluding 57,909,708 shares of Class A common stock subject to possible redemption. At December 31, 2020, there were 15,287,498 shares of Class A common stock issued and outstanding, excluding 53,712,502 shares of Class A common stock subject to possible redemption. Class B Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At March 31, 2021 and December 31, 2020, there were 17,250,000 shares of Class B common stock issued and outstanding. Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business Combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, any private placement-equivalent warrants issued, or to be issued, to any seller in a Business Combination. | NOTE 8. STOCKHOLDERS’ EQUITY Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At December 31, 2020 and 2019, there were no shares of preferred stock issued or outstanding. Common Stock Class A Common Stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At December 31, 2020 and 2019, there were 15,287,498 and 7,974,075 shares of Class A common stock issued or outstanding, excluding 53,712,502 and 61,025,925 shares of Class A common stock subject to possible redemption, respectively. Class B Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At December 31, 2020 and 2019, there were 17,250,000 shares of Class B common stock issued and outstanding. Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business Combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, any private placement-equivalent warrants issued, or to be issued, to any seller in a Business Combination. |
WARRANT LIABILITY_2
WARRANT LIABILITY | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
WARRANT LIABILITY | ||
WARRANT LIABILITY | NOTE 8. WARRANT LIABILITY Public Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation. The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available. The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, the Company will use its best efforts to file with the SEC, and within 60 business days following a Business Combination to have declared effective, a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed. Notwithstanding the above, if the Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its reasonable best efforts to qualify the shares under applicable blue sky laws to the extent an exemption is not available. 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; · upon not less than 30 days’ prior written notice of redemption; · if, and only if, the reported last sale price of the Company’s common stock equals or exceeds $18.00 per share for any 20 trading days within a 30‑trading day period ending on the third business day prior to the notice of redemption to the warrant holders; and · if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying the warrants. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. 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 Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuance of Class A common stock at a price below its exercise price. 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 Window 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. The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. | NOTE 9. WARRANT LIABILITY Warrants — Public Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation. The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available. The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, the Company will use its best efforts to file with the SEC, and within 60 business days following a Business Combination to have declared effective, a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed. Notwithstanding the above, if the Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its reasonable best efforts to qualify the shares under applicable blue sky laws to the extent an exemption is not available. 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; · upon not less than 30 days’ prior written notice of redemption; · if, and only if, the reported last sale price of the Company’s common stock equals or exceeds $18.00 per share for any 20 trading days within a 30‑trading day period ending on the third business day prior to the notice of redemption to the warrant holders; and · if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying the warrants. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. 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 Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuance of Class A common stock at a price below its exercise price. 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 Window 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. The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. |
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 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: Level 2: Level 3: The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020 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 $ 697,018,229 $ 696,957,196 Liabilities: Warrant liability-Public Warrants 1 33,810,000 45,310,000 Warrant liability-Private Placement Warrants 3 26,702,000 32,548,000 Prosus Agreement liability 3 24,532,413 50,481,190 Conversion option liability 3 1,632,013 1,604,359 The derivative instruments were accounted for as liabilities in accordance with ASC 815-40 and are measured at fair value at inception and on a recurring basis, with changes in fair value recorded in the consolidated statement of operations. At issuance, the Warrant Liability for Public Warrants and Private Placement Warrants were valued as of June 26, 2019 using a Monte Carlo simulation and Black Scholes model, respectively, which are considered to be a Level 3 fair value measurements. Subsequent to the Public Warrants detachment from the Units, the Public Warrants are valued based on quoted market price, under ticker CCX WS, which is a Level 1 fair value. The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the Warrants is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination was 80% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. As of issuance and March 31, 2021, the estimated fair value of Warrant Liability — Private Placement Warrants were determined using a Black-Scholes valuation and based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.68 $ 10.00 Volatility 16.5 % 25 % Probability of completing a Business Combination 80.0 % 90 % Term 5.33 5.08 Risk-free rate 1.86 % 0.94 % Dividend yield 0.0 % 0.0 % At inception, the Prosus Agreement Liability consisted of two components: a commitment for the First Step Investment and an option for the Second Step Investment. Subsequent to Prosus exercising its Second Step Investment option, the Prosus Agreement Liability represented a commitment. The commitment and option were valued using forward contract valuation methodology and a Black Scholes model, respectively. Both valuation methodologies were considered to be Level 3 fair value measurements. As of inception and March 31, 2021, the estimated fair value of Prosus Agreement Liability was determined based on the following significant inputs: At As of March 31, inception 2021 Exercise price $ 400.0 M $ 500.0 M Underlying value $ 436.8 M $ 524.5 M Volatility 40.0 % N/A Term 0.55 0.08 Risk-free rate 0.12 % 0.08 % Dividend yield 0.00 % N/A The Conversion option liability was valued using a Black Scholes model, which was considered to be a Level 3 fair value measurement. At inception and March 31, 2021, the estimated fair value of Conversion option liability was determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 1.00 $ 1.00 Underlying warrant value $ 1.92 * $ 2.09 * Volatility 125.0 % 115.0 % Number of Class A Shares 1.5 M% 1.5 M% Term 0.28 0.08 Risk-free rate 0.09 % 0.01 % Dividend yield 0.0 % 0.0 % * The underlying warrant value equals the calculated fair value of the private placement warrants as of each date presented and determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.97 $ 10.00 Volatility 30.0 % 25 % Probability of completing a Business Combination 85.0 % 90 % Term 5.28 5.08 Risk-free rate 0.41 % 0.94 % Dividend yield 0.0 % 0.0 % The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrants Warrants Warrant Liabilities January 1, 2021 $ 32,548,000 $ 45,310,000 $ 77,858,000 Change in valuation inputs or other assumptions (5,846,000) (11,500,000) (17,346,000) Fair value as of March 31, 2021 26,702,000 33,810,000 60,512,000 There were no transfers in or out of Level 3 from other levels in the fair value hierarchy. | NOTE 11. 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 and liabilities that are measured at fair value on a recurring basis at December 31, 2020 and 2019, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, December 31, Description Level 2020 2019 Assets: Cash and marketable securities held in Trust Account 1 $ 696,957,196 $ 695,295,418 Liabilities: Warrant Liabilities – Public Warrants 1 45,310,000 32,660,000 Warrant Liabilities – Private Placement Warrants 3 32,548,000 23,700,000 Prosus subscription agreement liability 3 50,481,190 — Conversion option liability 3 1,604,359 — The Derivative Instruments were accounted for as liabilities in accordance with ASC 815-40 and are measured at fair value at inception and on a recurring basis, with changes in fair value recorded in the statement of operations. The Warrants were valued as of July 1, 2019 using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement. The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the Warrants is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination was 80% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable 'blank-check' companies without an identified target. The subsequent measurements of the Public Warrants after the detachment of the Public Warrants from the Units is classified as Level 1 due to the use of an observable market quote in an active market under the ticker CVII.WS. The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrant Liabilities Fair value as of April 11, 2019 (inception) $ — $ — $ — Initial measurement on July 1, 2019 15,800,000 22,310,000 38,110,000 Change in valuation inputs or other assumptions 7,900,000 10,350,000 18,250,000 Fair value as of December 31, 2019 23,700,000 32,660,000 56,360,000 Change in valuation inputs and other assumptions 8,848,000 12,650,000 21,498,000 Fair value as of December 31, 2020 $ 32,548,000 $ 45,310,000 $ 77,858,000 |
SUBSEQUENT EVENTS_2
SUBSEQUENT EVENTS | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
SUBSEQUENT EVENTS | ||
SUBSEQUENT EVENTS | NOTE 10. 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, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements, except as set forth below. On May 3, 2021, the Company was informed by Prosus that Prosus received notice from CFIUS that it has concluded all action under Section 721 of the Defense Production Act of 1950 and determined that there are no unresolved national security concerns with respect to the Prosus PIPE Investment. | NOTE 12. 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 and in Note 2, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. On January 22, 2021, the Company entered into an amendment (the “Merger Agreement Amendment”), to which amends and restates in its entirety the definition of “Applicable Majority” in the Skillsoft Merger Agreement. The definition of “Applicable Majority” is used in the Skillsoft Merger Agreement. |
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 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/A for the year ended December 31, 2020, as filed with the SEC on May 11, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year 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 statement 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 the condensed 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 the 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 December 31, 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. Cash equivalents consist of mutual funds. 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 At March 31, 2021 and December 31, 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through March 31, 2021, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which no amounts were withdrawn during the three months ended March 31, 2021. | Marketable Securities Held in Trust Account At December 31, 2020 and 2019, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through December 31, 2020, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which $856,250 was withdrawn during the year ended December 31, 2020. |
Derivative Liabilities | Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common stock and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. | |
Class A Common Stock Subject to Possible Redemption | Class A Common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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. | Class A common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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 | 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 statements 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 and permanent differences. | 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 statements 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, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses (“NOL) and allow businesses to carry back NOLs arising in 2018, 2019 and 2020 to the five prior years, suspend the excess business loss rules, accelerate refunds of previously generated corporate alternative minimum tax credits, generally loosen the business interest limitation under IRC section 163(j) from 30 percent to 50 percent among other technical corrections included in the Tax Cuts and Jobs Act tax provisions. The Company does not believe that the CARES Act will have a significant impact on Company's financial position or statement of operations. |
Net income (Loss) per Share | Net income (Loss) per Share Net income (loss) per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per share, basic and diluted, for Class A 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 the weighted average number of Class A 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 Class A 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 share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) | Net Income (Loss) per Common Share Net income (loss) per common share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. The Company has not considered the effect of the warrants sold in the Public Offering and Private Placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per ordinary share. Net income (loss) per common share, basic and diluted, for Class A 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 by the weighted average number of Class A common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income or loss on marketable securities attributable to Class A common stock subject to possible redemption, by the weighted average number of non-redeemable ordinary shares 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 the non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) |
Concentration of Credit Risk | 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 Corporation coverage limit of $250,000. The Company has not experienced losses on this account. | 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 limit 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, except for the Company's derivative instruments (see Note 9). | 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, except for the Company’s Derivative Instruments (see Note 6 and 11). |
Recent Accounting Standards | Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements. Management does not believe that any other 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 | ||
Schedule of basic and diluted loss per share | The following table reflects the calculation of basic and diluted net income (loss) per share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) | The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) |
RELATED PARTY TRANSACTIONS (T_2
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Convertible Promissory Note [Member] | ||
Summary of the changes in the fair value | Fair value as of January 1, 2021 $ 1,604,359 Change in valuation inputs and other assumptions 27,624 Fair value as of March 31, 2021 $ 1,632,013 | Fair value as of January 1, 2020 $ — Initial measurement on November 2, 2020 1,493,877 Change in valuation inputs and other assumptions 110,482 Fair value as of December 31, 2020 $ 1,604,359 |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Prosus Agreement [Member] | ||
Summary of the changes in the fair value | Fair value as of January 1, 2021 $ 50,481,190 Change in valuation inputs and other assumptions (25,948,777) Fair value as of March 31, 2021 $ 24,532,413 | Fair value as of January 1, 2020 $ — Initial measurement on October 12, 2020 71,969,454 Change in valuation inputs and other assumptions (21,488,264) Fair value as of December 31, 2020 $ 50,481,190 |
FAIR VALUE MEASUREMENTS (Tabl_2
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Schedule of assets measured at fair value on a recurring basis | The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020 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 $ 697,018,229 $ 696,957,196 Liabilities: Warrant liability-Public Warrants 1 33,810,000 45,310,000 Warrant liability-Private Placement Warrants 3 26,702,000 32,548,000 Prosus Agreement liability 3 24,532,413 50,481,190 Conversion option liability 3 1,632,013 1,604,359 | The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2020 and 2019, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, December 31, Description Level 2020 2019 Assets: Cash and marketable securities held in Trust Account 1 $ 696,957,196 $ 695,295,418 Liabilities: Warrant Liabilities – Public Warrants 1 45,310,000 32,660,000 Warrant Liabilities – Private Placement Warrants 3 32,548,000 23,700,000 Prosus subscription agreement liability 3 50,481,190 — Conversion option liability 3 1,604,359 — |
Schedule of fair value of warrant liabilities | Private Placement Public Warrants Warrants Warrant Liabilities January 1, 2021 $ 32,548,000 $ 45,310,000 $ 77,858,000 Change in valuation inputs or other assumptions (5,846,000) (11,500,000) (17,346,000) Fair value as of March 31, 2021 26,702,000 33,810,000 60,512,000 | Private Placement Public Warrant Liabilities Fair value as of April 11, 2019 (inception) $ — $ — $ — Initial measurement on July 1, 2019 15,800,000 22,310,000 38,110,000 Change in valuation inputs or other assumptions 7,900,000 10,350,000 18,250,000 Fair value as of December 31, 2019 23,700,000 32,660,000 56,360,000 Change in valuation inputs and other assumptions 8,848,000 12,650,000 21,498,000 Fair value as of December 31, 2020 $ 32,548,000 $ 45,310,000 $ 77,858,000 |
Private Placement Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Schedule of quantitative information regarding Level 3 fair value measurements inputs | * The underlying warrant value equals the calculated fair value of the private placement warrants as of each date presented and determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.97 $ 10.00 Volatility 30.0 % 25 % Probability of completing a Business Combination 85.0 % 90 % Term 5.28 5.08 Risk-free rate 0.41 % 0.94 % Dividend yield 0.0 % 0.0 % | |
Prosus Agreement Liability Member | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Schedule of quantitative information regarding Level 3 fair value measurements inputs | As of inception and March 31, 2021, the estimated fair value of Prosus Agreement Liability was determined based on the following significant inputs: At As of March 31, inception 2021 Exercise price $ 400.0 M $ 500.0 M Underlying value $ 436.8 M $ 524.5 M Volatility 40.0 % N/A Term 0.55 0.08 Risk-free rate 0.12 % 0.08 % Dividend yield 0.00 % N/A | |
Black-Scholes Valuation | Private Placement Warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Schedule of quantitative information regarding Level 3 fair value measurements inputs | As of issuance and March 31, 2021, the estimated fair value of Warrant Liability — Private Placement Warrants were determined using a Black-Scholes valuation and based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.68 $ 10.00 Volatility 16.5 % 25 % Probability of completing a Business Combination 80.0 % 90 % Term 5.33 5.08 Risk-free rate 1.86 % 0.94 % Dividend yield 0.0 % 0.0 % | |
Black-Scholes Valuation | Conversion Option Liability | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Schedule of quantitative information regarding Level 3 fair value measurements inputs | At inception and March 31, 2021, the estimated fair value of Conversion option liability was determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 1.00 $ 1.00 Underlying warrant value $ 1.92 * $ 2.09 * Volatility 125.0 % 115.0 % Number of Class A Shares 1.5 M% 1.5 M% Term 0.28 0.08 Risk-free rate 0.09 % 0.01 % Dividend yield 0.0 % 0.0 % |
DESCRIPTION OF ORGANIZATION A_4
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS (Details) - USD ($) | Jul. 01, 2019 | May 31, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2020 | Apr. 10, 2019 | Dec. 31, 2018 |
Shares Issued, Price Per Share | $ 10 | ||||||||
Proceeds from Issuance Initial Public Offering | $ 677,788,000 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 | ||||||||
Proceeds from Issuance of Warrants | 15,800,000 | ||||||||
Transaction Cost Related To Issuance Of Common Stock | $ 34,319,807 | ||||||||
Underwriting Fees | 12,212,000 | ||||||||
Underwriting Discount | 12,212,000 | ||||||||
Deferred Underwriting Discount Payable Non current | 21,371,000 | ||||||||
Other Offering Costs Related To Issuance Of Common Stock | 736,807 | ||||||||
Other Costs Related To Issuance Of Common Stock | 736,807 | ||||||||
Working Capital Requirement Fund Annual Limit | $ 250,000 | ||||||||
Temporary Equity, Redemption Price Per Share | $ 10 | ||||||||
Maximum Percentage Of Shares Eligible From Redemption | 15.00% | ||||||||
Dissolution Expenses Payable | $ 100,000 | ||||||||
Cash | $ 2,382,560 | $ 2,014,521 | $ 2,238,275 | 2,238,275 | $ 3,873,865 | $ 2,238,275 | $ 0 | ||
Working capital | 1,182,603 | ||||||||
Marketable securities held in Trust Account | 697,018,229 | $ 695,295,418 | $ 695,295,418 | $ 696,957,196 | |||||
Amount deposited in trust account | $ 7,018,000 | ||||||||
IPO [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 69,000,000 | ||||||||
Shares Issued, Price Per Share | $ 10 | ||||||||
Proceeds from Issuance Initial Public Offering | $ 690,000,000 | ||||||||
Over-Allotment Option [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 9,000,000 | ||||||||
Shares Issued, Price Per Share | $ 10 | ||||||||
Private Placement [Member] | |||||||||
Number Of Warrants Issued | 15,800,000 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | ||||||||
Proceeds from Issuance of Warrants | $ 15,800,000 | ||||||||
Churchill Sponsor LLC [Member] | |||||||||
Business Combination Aggregate Fair Market Value On Assets Held In Trust Percentage | 80.00% | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | $ 5,000,001 | ||||||||
Class B Common Stock [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 8,625,000 | 0 | 17,250,000 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net income (loss) per share (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Mar. 31, 2021 | Mar. 31, 2020 | Jun. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: Earnings allocable to Class A common stock subject to possible redemption | ||||||||
Interest income | $ 59,701 | $ 2,250,075 | $ 2,516,752 | $ 6,639,430 | ||||
Unrealized gain (loss) on investments held in Trust Account | $ 1,332 | $ (20,917) | $ 45,988 | $ 1,276 | 45,988 | |||
Denominator: Weighted average Class A common stock subject to possible redemption | ||||||||
Basic and diluted weighted average shares outstanding | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | ||||
Basic and diluted net income (loss) per share | $ 0 | $ 0.02 | ||||||
Numerator: Net loss minus net earnings | ||||||||
Net income (loss) | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) |
Class A Common Stock Subject to Possible Redemption [Member] | ||||||||
Numerator: Earnings allocable to Class A common stock subject to possible redemption | ||||||||
Interest income | 50,107 | 1,956,529 | 6,410,370 | 1,959,040 | ||||
Unrealized gain (loss) on investments held in Trust Account | 1,118 | (18,188) | 44,401 | 993 | ||||
Less: Company's portion available to be withdrawn to pay taxes | (43,998) | (395,474) | (1,344,722) | (534,953) | ||||
Less: Company's portion available to be withdrawn for working capital purposes | $ (7,227) | (217,385) | $ (241,375) | $ (194,600) | ||||
Net income allocable to Class A common stock subject to possible redemption | $ 1,325,482 | |||||||
Denominator: Weighted average Class A common stock subject to possible redemption | ||||||||
Basic and diluted weighted average shares outstanding | 53,712,502 | 61,025,925 | 61,961,631 | 58,723,869 | ||||
Basic and diluted net income (loss) per share | $ 0 | $ 0.02 | $ 0.08 | $ 0.02 | ||||
Numerator: Net loss minus net earnings | ||||||||
Net income (loss) | $ 4,868,674 | $ 1,230,480 | ||||||
Less: Income allocable to Class A common stock subject to possible redemption | $ (1,325,482) | |||||||
Non-Redeemable Common Stock [Member] | ||||||||
Numerator: Earnings allocable to Class A common stock subject to possible redemption | ||||||||
Net income allocable to Class A common stock subject to possible redemption | $ 1,325,482 | $ 4,868,674 | $ 1,230,480 | |||||
Denominator: Weighted average Class A common stock subject to possible redemption | ||||||||
Basic and diluted weighted average shares outstanding | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | ||||
Basic and diluted net income (loss) per share | $ 1.28 | $ (0.40) | ||||||
Numerator: Net loss minus net earnings | ||||||||
Net income (loss) | $ 41,740,801 | $ (8,823,514) | $ (14,682,592) | $ (72,459,185) | ||||
Less: Income allocable to Class A common stock subject to possible redemption | (1,325,482) | (4,868,674) | (1,230,480) | |||||
Non-Redeemable Net Income Loss | 41,740,801 | (10,148,996) | (19,551,226) | (73,689,665) | ||||
Class B Common Stock [Member] | ||||||||
Numerator: Net loss minus net earnings | ||||||||
Net income (loss) | $ 0 | $ 0 | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash Withdrawn From Trust Account | $ 0 | $ 856,250 | ||
Unrecognized Tax Benefits | 0 | 0 | $ 0 | |
Accrued Interest and Penalty | 0 | 0 | $ 0 | |
Cash, FDIC Insured Amount | $ 250,000 | $ 250,000 | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | 21.00% | 21.00% |
Effective Income Tax Rate Reconciliation, Percent | (0.70%) | (9.30%) | ||
US Treasury Bill Securities [Member] | ||||
Cash Withdrawn From Trust Account | $ 2,246,250 | $ 2,246,250 | ||
Warrant [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 38,800,000 | 38,800,000 |
PUBLIC OFFERING (Details)_2
PUBLIC OFFERING (Details) - $ / shares | Nov. 10, 2020 | Jul. 01, 2019 | Dec. 31, 2019 |
Shares Issued, Price Per Share | $ 10 | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 | ||
IPO [Member] | |||
Stock Issued During Period, Shares, New Issues | 69,000,000 | ||
Shares Issued, Price Per Share | $ 10 | ||
Over-Allotment Option [Member] | |||
Stock Issued During Period, Shares, New Issues | 9,000,000 | ||
Shares Issued, Price Per Share | $ 10 | ||
Private Placement [Member] | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | ||
Class A Common Stock [Member] | |||
Stock Issued During Period, Shares, New Issues | 0 | ||
Class A Common Stock [Member] | IPO [Member] | |||
Stock Issued During Period, Shares, New Issues | 10,000,000 | ||
Class A Common Stock [Member] | Private Placement [Member] | |||
Stock Issued During Period, Shares, New Issues | 1 | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 |
PRIVATE PLACEMENT (Details)_2
PRIVATE PLACEMENT (Details) - USD ($) | Jul. 01, 2019 | Dec. 31, 2019 |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 | |
Proceeds from Issuance of Warrants | $ 15,800,000 | |
Private Placement [Member] | ||
Number Of Warrants Issued | 15,800,000 | |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | |
Proceeds from Issuance of Warrants | $ 15,800,000 | |
Class A Common Stock [Member] | Private Placement [Member] | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 11.50 |
RELATED PARTY TRANSACTIONS (D_2
RELATED PARTY TRANSACTIONS (Details) - Convertible Promissory Note [Member] - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | Nov. 02, 2020 | |
Probability for consummation of business combination | 85.00% | 85.00% | |
Fair value as of January 1, 2021 | $ 1,604,359 | $ 0 | |
Change in valuation inputs and other assumptions | 27,624 | 110,482 | |
Fair value as of March 31, 2021 | $ 1,632,013 | $ 1,604,359 |
RELATED PARTY TRANSACTIONS - _2
RELATED PARTY TRANSACTIONS - Additional Information (Details) - USD ($) | Nov. 10, 2020 | Jul. 01, 2019 | Jun. 26, 2019 | Jun. 07, 2019 | Apr. 29, 2019 | May 31, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2021 | Nov. 02, 2020 |
Stock Issued During Period, Value, New Issues | $ 25,000 | |||||||||||
Weighted Average Number of Shares, Common Stock Subject to Repurchase or Cancellation | 53,712,502 | 61,025,925 | ||||||||||
Share Price | $ 18 | $ 18 | ||||||||||
Initial Public Offering Cost | $ 300,000 | |||||||||||
Notes Payable, Related Parties | $ 200,000 | |||||||||||
Management Fee Expense | $ 20,000 | |||||||||||
Debt Conversion, Original Debt, Amount | $ 1,500,000 | $ 1,500,000 | ||||||||||
Debt Instrument, Convertible, Conversion Price | $ 1 | $ 1 | ||||||||||
Warrants price | $ 11.50 | |||||||||||
Maximum [Member] | ||||||||||||
Management Fee Expense | $ 20,000 | |||||||||||
Convertible Promissory Note [Member] | ||||||||||||
Aggregate principal amount to be issued | $ 1,500,000 | $ 1,500,000 | $ 1,500,000 | |||||||||
Additional Paid in Capital [Member] | ||||||||||||
Stock Issued During Period, Value, New Issues | 23,275 | |||||||||||
Accumulated Deficit [Member] | ||||||||||||
Stock Issued During Period, Value, New Issues | 0 | |||||||||||
Over-Allotment Option [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 9,000,000 | |||||||||||
Weighted Average Number of Shares, Common Stock Subject to Repurchase or Cancellation | 2,250,000 | |||||||||||
IPO [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 69,000,000 | |||||||||||
Related Party Loan [Member] | ||||||||||||
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party | $ 60,000 | $ 60,000 | $ 123,333 | $ 240,000 | ||||||||
Sponsor [Member] | ||||||||||||
Weighted Average Number of Shares, Common Stock Subject to Repurchase or Cancellation | 2,250,000 | 2,250,000 | ||||||||||
Equity Method Investment, Ownership Percentage | 20.00% | 20.00% | ||||||||||
Sponsor [Member] | Convertible Promissory Note [Member] | ||||||||||||
Maximum amount of promissory note convertible into warrants | $ 1,500,000 | |||||||||||
Warrants price | $ 1 | |||||||||||
Class A Common Stock [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 0 | |||||||||||
Stock Issued During Period, Value, New Issues | $ 0 | |||||||||||
Common Stock, Shares, Outstanding | 11,090,292 | 7,974,075 | 15,287,498 | 3,840,000 | ||||||||
Weighted Average Number of Shares, Common Stock Subject to Repurchase or Cancellation | 61,961,631 | 58,723,869 | ||||||||||
Share Price | $ 12 | $ 12 | ||||||||||
Class A Common Stock [Member] | IPO [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 10,000,000 | |||||||||||
Class B Common Stock [Member] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 8,625,000 | 0 | 17,250,000 | |||||||||
Stock Issued During Period, Value, New Issues | $ 25,000 | $ 1,725 | ||||||||||
Dividends Common Stock Dividends Per Share | $ 1 | |||||||||||
Common Stock, Shares, Outstanding | 17,250,000 | 11,500,000 | 17,250,000 | 17,250,000 | 17,250,000 | 160,000 |
COMMITMENTS AND CONTINGENCIES_5
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2020 | Oct. 12, 2020 | |
Fair value as of beginning period | $ 77,858,000 | $ 56,360,000 | ||
Change in valuation inputs or other assumptions | (17,346,000) | 18,250,000 | 21,498,000 | |
Fair value as of Ending period | 60,512,000 | 56,360,000 | $ 77,858,000 | |
Prosus Agreement [Member] | ||||
Probability for consummation of business combination | 85.00% | 85.00% | ||
Fair value as of beginning period | 50,481,190 | $ 0 | ||
Change in valuation inputs or other assumptions | (25,948,777) | (21,488,264) | ||
Fair value as of Ending period | $ 24,532,413 | $ 0 | $ 50,481,190 |
COMMITMENTS AND CONTINGENCIES_6
COMMITMENTS AND CONTINGENCIES - Additional Information (Details) - USD ($) | Nov. 10, 2020 | Oct. 14, 2020 | Oct. 13, 2020 | Oct. 12, 2020 | Jul. 01, 2019 | Oct. 31, 2020 | May 31, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Underwriting Fees Payable | $ 21,371,000 | $ 21,371,000 | ||||||||||
Deferred Underwriting Discount, Shares | 7,940,000 | |||||||||||
Deferred Underwriting Upfront Payment | $ 1,588,000 | |||||||||||
Debt Issuance Costs, Net | $ 2,779,000 | |||||||||||
Nominal value per share | $ 10 | |||||||||||
Aggregate redemption price | 41,740,805 | $ 614,838,229 | (72,459,189) | |||||||||
Proceeds from Issuance Initial Public Offering | $ 677,788,000 | |||||||||||
Accounts payable and accrued expenses | $ 745,986 | $ 257,466 | $ 635,483 | $ 257,466 | ||||||||
Warrants price | 11.50 | |||||||||||
Percentage of investment and beneficially owns outstanding | 20.00% | 20.00% | ||||||||||
IPO [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 69,000,000 | |||||||||||
Proceeds from Issuance Initial Public Offering | $ 690,000,000 | |||||||||||
Class A Common Stock [Member] | ||||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||
Aggregate redemption price | $ 420 | $ 6,103 | $ (732) | |||||||||
Newly issued shares | 0 | |||||||||||
Class A Common Stock [Member] | IPO [Member] | ||||||||||||
Newly issued shares | 10,000,000 | |||||||||||
Class B Common Stock [Member] | ||||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||
Aggregate redemption price | $ 0 | $ 0 | $ 0 | |||||||||
Newly issued shares | 8,625,000 | 0 | 17,250,000 | |||||||||
Class C Common Stock [Member] | ||||||||||||
Common stock, par value | $ 0.0001 | |||||||||||
Skillsoft Merger Agreement [Member] | ||||||||||||
Aggregate redemption price | $ 505,000,000 | |||||||||||
Aggregate principal amount to be issued | $ 20,000,000 | |||||||||||
Advanced for expenses incurred | $ 2,000,000 | |||||||||||
Skillsoft Merger Agreement [Member] | Class A Common Stock [Member] | ||||||||||||
Nominal value per share | $ 0.01 | |||||||||||
Skillsoft Merger Agreement [Member] | Class B Common Stock [Member] | ||||||||||||
Nominal value per share | $ 0.01 | |||||||||||
Global Knowledge Merger Agreement [Member] | ||||||||||||
Warrants price | $ 11.50 | $ 11.50 | ||||||||||
Equity interests on issued and outstanding | 100.00% | 100.00% | ||||||||||
Aggregate warrants to be issued | 5,000,000 | 5,000,000 | ||||||||||
Prosus Agreement [Member] | Class A Common Stock [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 40,000,000 | |||||||||||
Prosus Agreement [Member] | Class A Common Stock [Member] | IPO [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 50,000,000 | |||||||||||
Proceeds from Issuance Initial Public Offering | $ 500,000,000 | |||||||||||
SuRo Subscription Agreement [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 1,000,000 | |||||||||||
Lodbrok Subscription Agreement [Member] | ||||||||||||
Nominal value per share | $ 10 | |||||||||||
Newly issued shares | 2,000,000 | |||||||||||
Service Provider Agreement [Member] | ||||||||||||
Success fee | $ 150,000 | $ 150,000 | ||||||||||
Consulting fees | $ 332,476 | 222,742 | ||||||||||
Accounts payable and accrued expenses | $ 9,975 |
STOCKHOLDERS' EQUITY (Details_2
STOCKHOLDERS' EQUITY (Details) - $ / shares | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Oct. 12, 2020 | Dec. 31, 2019 | Jun. 26, 2019 | Jun. 07, 2019 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||
Preferred Stock, Shares Issued | 0 | 0 | 0 | ||||
Preferred Stock, Shares Outstanding | 0 | 0 | 0 | ||||
Sponsor [Member] | |||||||
Equity Method Investment, Ownership Percentage | 20.00% | 20.00% | |||||
Class A Common Stock [Member] | |||||||
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Common Stock, Shares, Issued | 11,090,292 | 15,287,498 | 7,974,075 | ||||
Common Stock, Shares, Outstanding | 11,090,292 | 3,840,000 | 15,287,498 | 7,974,075 | |||
Common Stock, Redemption Shares | 57,909,708 | 53,712,502 | 61,025,925 | ||||
Class B Common Stock [Member] | |||||||
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Common Stock, Shares, Issued | 17,250,000 | 17,250,000 | 17,250,000 | ||||
Common Stock, Shares, Outstanding | 17,250,000 | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 |
WARRANT LIABILITY (Details)_2
WARRANT LIABILITY (Details) - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
WARRANT LIABILITY | ||
Class of Warrant or Right Warrants Expiration Period | 5 years | 5 years |
Class of Warrant or Right Warrants Redemption Price | $ 0.01 | $ 0.01 |
Share Price | $ 18 | $ 18 |
FAIR VALUE MEASUREMENTS (Deta_2
FAIR VALUE MEASUREMENTS (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Level 1 | |||
Assets: | |||
Marketable securities held in Trust Account | $ 697,018,229 | $ 696,957,196 | $ 695,295,418 |
Level 1 | Public Warrants | |||
Liabilities: | |||
Warrant liability | 33,810,000 | 45,310,000 | 32,660,000 |
Level 3 | |||
Liabilities: | |||
Prosus Agreement liability | 24,532,413 | 50,481,190 | |
Conversion option liability | 1,632,013 | 1,604,359 | |
Level 3 | Private Placement Warrants | |||
Liabilities: | |||
Warrant liability | $ 26,702,000 | $ 32,548,000 | $ 23,700,000 |
FAIR VALUE MEASUREMENTS - Fai_2
FAIR VALUE MEASUREMENTS - Fair value of warrant liabilities (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2020 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value as of beginning period | $ 77,858,000 | $ 56,360,000 | |
Change in valuation inputs or other assumptions | (17,346,000) | 18,250,000 | 21,498,000 |
Fair value as of Ending period | 60,512,000 | 56,360,000 | 77,858,000 |
Level 3 | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Transfers in or out of Level 3 from other levels in the fair value hierarchy | 0 | ||
Private Placement Warrants | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value as of beginning period | 32,548,000 | 23,700,000 | |
Change in valuation inputs or other assumptions | (5,846,000) | 7,900,000 | 8,848,000 |
Fair value as of Ending period | 26,702,000 | 23,700,000 | 32,548,000 |
Public Warrants | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value as of beginning period | 45,310,000 | 32,660,000 | |
Change in valuation inputs or other assumptions | (11,500,000) | 10,350,000 | 12,650,000 |
Fair value as of Ending period | $ 33,810,000 | $ 32,660,000 | $ 45,310,000 |
FAIR VALUE MEASUREMENTS - Level
FAIR VALUE MEASUREMENTS - Level 3 Fair Value Measurements Inputs (Details) | 3 Months Ended |
Mar. 31, 2021$ / sharesUSD ($) | |
Prosus Agreement Liability Member | Exercise price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 500 |
Prosus Agreement Liability Member | Underlying value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 524.5 |
Prosus Agreement Liability Member | Term | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.08 |
Prosus Agreement Liability Member | Risk-free rate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.08 |
Conversion Option Liability | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Number of Class A Shares | 1.50% |
Conversion Option Liability | Exercise price | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 1 |
Conversion Option Liability | Underlying warrant value | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 2.09 |
Conversion Option Liability | Volatility | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 115 |
Conversion Option Liability | Term | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.08 |
Conversion Option Liability | Risk-free rate | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.01 |
Conversion Option Liability | Dividend yield | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0 |
At Issuance [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | $ | 5.08 |
At Issuance [Member] | Exercise price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 11.50 |
At Issuance [Member] | Stock price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 10 |
At Issuance [Member] | Volatility | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 25 |
At Issuance [Member] | Probability of completing a Business Combination | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 90 |
At Issuance [Member] | Risk-free rate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.94 |
At Issuance [Member] | Dividend yield | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0 |
At Issuance [Member] | Private Placement Warrants | Exercise price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 11.50 |
At Issuance [Member] | Private Placement Warrants | Stock price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 9.97 |
At Issuance [Member] | Private Placement Warrants | Volatility | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 30 |
At Issuance [Member] | Private Placement Warrants | Probability of completing a Business Combination | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 85 |
At Issuance [Member] | Private Placement Warrants | Risk-free rate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.41 |
At Issuance [Member] | Private Placement Warrants | Dividend yield | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0 |
At Issuance [Member] | Conversion Option Liability | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Number of Class A Shares | 1.50% |
At Issuance [Member] | Conversion Option Liability | Exercise price | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 1 |
At Issuance [Member] | Conversion Option Liability | Underlying warrant value | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 1.92 |
At Issuance [Member] | Conversion Option Liability | Volatility | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 125 |
At Issuance [Member] | Conversion Option Liability | Term | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.28 |
At Issuance [Member] | Conversion Option Liability | Risk-free rate | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.09 |
At Issuance [Member] | Conversion Option Liability | Dividend yield | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0 |
At Inception Member | Prosus Agreement Liability Member | Exercise price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 400 |
At Inception Member | Prosus Agreement Liability Member | Underlying value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 436.8 |
At Inception Member | Prosus Agreement Liability Member | Volatility | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 40 |
At Inception Member | Prosus Agreement Liability Member | Term | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.55 |
At Inception Member | Prosus Agreement Liability Member | Risk-free rate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.12 |
At Inception Member | Prosus Agreement Liability Member | Dividend yield | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0 |
Black-Scholes Valuation | Private Placement Warrants | Exercise price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 11.50 |
Black-Scholes Valuation | Private Placement Warrants | Stock price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 10 |
Black-Scholes Valuation | Private Placement Warrants | Volatility | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 25 |
Black-Scholes Valuation | Private Placement Warrants | Probability of completing a Business Combination | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 90 |
Black-Scholes Valuation | Private Placement Warrants | Term | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 5.08 |
Black-Scholes Valuation | Private Placement Warrants | Risk-free rate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0.94 |
Black-Scholes Valuation | Private Placement Warrants | Dividend yield | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0 |
Black-Scholes Valuation | At Issuance [Member] | Private Placement Warrants | Exercise price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 11.50 |
Black-Scholes Valuation | At Issuance [Member] | Private Placement Warrants | Stock price | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 9.68 |
Black-Scholes Valuation | At Issuance [Member] | Private Placement Warrants | Volatility | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 16.5 |
Black-Scholes Valuation | At Issuance [Member] | Private Placement Warrants | Probability of completing a Business Combination | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 80 |
Black-Scholes Valuation | At Issuance [Member] | Private Placement Warrants | Term | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 5.33 |
Black-Scholes Valuation | At Issuance [Member] | Private Placement Warrants | Risk-free rate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 1.86 |
Black-Scholes Valuation | At Issuance [Member] | Private Placement Warrants | Dividend yield | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Estimated fair value liabilities | 0 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS | Jan. 31, 2020USD ($) |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Current assets: | |
Cash and cash equivalents | $ 18,799,000 |
Restricted cash | 15,005,000 |
Accounts receivable, less reserves of approximately $294 and $696 as of January 31, 2021 and January 31, 2020, respectively | 193,024,000 |
Prepaid expenses and other current assets | 36,422,000 |
Total Current Assets | 263,250,000 |
Property and equipment, net | 17,902,000 |
Goodwill | 1,253,822,000 |
Intangible assets, net | 434,985,000 |
Other assets | 16,306,000 |
TOTAL ASSETS | 1,986,265,000 |
Current liabilities: | |
Current maturities of long-term debt | 981,998,000 |
Borrowings under accounts receivable facility | 84,786,000 |
Loan amounts due to Predecessor parent company | 2,188,938,000 |
Accrued interest due to Predecessor parent company | 1,067,132,000 |
Accounts payable | 14,947,000 |
Accrued compensation | 24,576,000 |
Accrued expenses and other current liabilities | 29,267,000 |
Deferred revenue | 307,383,000 |
Total Current Liabilities | 4,699,027,000 |
Deferred tax liabilities | 37,623,000 |
Deferred revenue - non-current | 3,787,000 |
Other long-term liabilities | 7,572,000 |
Total long-term liabilities | 48,982,000 |
Commitments and contingencies | |
Shareholders' equity (deficit): | |
Common stock value | 138,000 |
Additional paid-in capital | 83,000 |
Retained Earnings (Accumulated Deficit) | (2,761,499,000) |
Accumulated other comprehensive loss | (466,000) |
Total Stockholders' Equity | (2,761,744,000) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,986,265,000 |
Financial Designation, Predecessor and Successor [Fixed List] | Predecessor |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Oct. 12, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jun. 26, 2019 | Jun. 07, 2019 |
Class A Common Stock [Member] | |||||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Common stock, shares, authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||||
Common stock, shares, issued | 11,090,292 | 15,287,498 | 7,974,075 | ||||||
Common stock shares outstanding | 11,090,292 | 3,840,000 | 15,287,498 | 7,974,075 | |||||
Class B Common Stock [Member] | |||||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Common stock, shares, authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||||
Common stock, shares, issued | 17,250,000 | 17,250,000 | 17,250,000 | ||||||
Common stock shares outstanding | 17,250,000 | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Common stock par value | $ 0.01 | $ 1.38 | |||||||
Common stock, shares, authorized | 1,000,000,000 | 1,000,000 | |||||||
Common stock, shares, issued | 4,000,000 | 100,100 | |||||||
Common stock shares outstanding | 4,000,000 | 100,100 | |||||||
Reserve for accounts receivable | $ 322 | $ 294 | $ 696 | ||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | |||||||||
Common stock, shares, authorized | 800,000,000 | ||||||||
Common stock, shares, issued | 3,840,000 | 3,840,000 | |||||||
Common stock shares outstanding | 3,840,000 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | |||||||||
Common stock, shares, authorized | 200,000,000 | ||||||||
Common stock, shares, issued | 160,000 | 160,000 | |||||||
Common stock shares outstanding | 160,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 7 Months Ended | 12 Months Ended | |
Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||
Revenues: | |||
Total revenues | $ 273,851,000 | $ 514,021,000 | $ 534,141,000 |
Operating expenses: | |||
Cost of revenues | 52,160,000 | 96,044,000 | 98,636,000 |
Content and software development | 38,986,000 | 67,951,000 | 57,332,000 |
Selling and marketing | 75,028,000 | 140,785,000 | 150,179,000 |
General and administrative | 37,455,000 | 57,356,000 | 51,421,000 |
Recapitalization and transaction-related costs | 32,099,000 | 16,244,000 | |
Amortization of intangible assets | 34,378,000 | 96,359,000 | 151,752,000 |
Impairment of goodwill and intangible assets | 332,376,000 | 440,598,000 | 16,094,000 |
Restructuring | 1,179,000 | 1,900,000 | 2,073,000 |
Total operating expenses | 603,661,000 | 917,237,000 | 527,487,000 |
Loss from operations | (329,810,000) | (403,216,000) | 6,654,000 |
Other income (expense), net | 1,273,000 | (1,058,000) | (3,340,000) |
Loss on derivative instruments | (5,000) | (4,062,000) | (2,284,000) |
Interest income | 105,000 | 306,000 | 687,000 |
Interest expense, net | (168,341,000) | (429,963,000) | (396,529,000) |
Reorganization items, net | 3,329,245,000 | ||
Loss before benefit from income taxes | 2,832,467,000 | (837,993,000) | (394,812,000) |
(Benefit) provision for income taxes | 68,455,000 | 11,212,000 | 5,027,000 |
Net income (loss) | $ 2,764,012,000 | $ (849,205,000) | $ (399,839,000) |
(Losses) income per share: | |||
Basic and diluted net loss per share, Non-redeemable common stock | $ 27,612.51 | $ (8,483.57) | $ (3,994.40) |
Weighted average common shares outstanding: | |||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 100 | 100 | 100 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | Aug. 27, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 |
Comprehensive (loss) income: | ||||||||||||||||
Net income | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||||||||
Comprehensive (loss) income: | ||||||||||||||||
Net income | $ (849,205,000) | $ (37,405,000) | $ (433,903,000) | $ (93,722,000) | $ 2,764,012,000 | $ 2,764,012,000 | $ (849,205,000) | $ (399,839,000) | ||||||||
Other comprehensive loss - Foreign currency adjustment, net of tax | (228,000) | (629,000) | (682,000) | (2,268,000) | 784,000 | 957,000 | ||||||||||
Comprehensive loss | $ (37,633,000) | $ (434,532,000) | $ (94,404,000) | $ 2,761,744,000 | $ (848,421,000) | $ (398,882,000) |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY (DEFICIT) - USD ($) | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Common Stock [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Additional Paid in Capital [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Accumulated Deficit [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Accumulated Other Comprehensive (Loss) Income | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Loans made to related parties | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Additional Paid in Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Jan. 31, 2018 | $ 138,000 | $ (1,508,411,000) | $ (2,207,000) | $ (5,266,000) | $ (1,515,746,000) | ||||
Balance (in shares) at Jan. 31, 2018 | 100,100 | ||||||||
Share-based compensation | $ 175,000 | 175,000 | |||||||
Distribution to parent company | (175,000) | (2,596,000) | (2,771,000) | ||||||
Loans, and interest, made to related parties | (101,000) | (101,000) | |||||||
Translation adjustment | 957,000 | 957,000 | |||||||
Net income (loss) | (399,839,000) | (399,839,000) | |||||||
Balance at Jan. 31, 2019 | $ 138,000 | (1,910,846,000) | (1,250,000) | (5,367,000) | (1,917,325,000) | ||||
Balance (in shares) at Jan. 31, 2019 | 100,100 | ||||||||
Share-based compensation | 83,000 | 83,000 | |||||||
Translation adjustment | 784,000 | 784,000 | |||||||
Net income (loss) | (849,205,000) | (849,205,000) | |||||||
Reserve on loans made to related parties | $ 5,367,000 | 5,367,000 | |||||||
Cumulative effect of accounting changes | (1,448,000) | (1,448,000) | |||||||
Balance at Jan. 31, 2020 | $ 138,000 | 83,000 | (2,761,499,000) | (466,000) | (2,761,744,000) | ||||
Balance (in shares) at Jan. 31, 2020 | 100,100 | ||||||||
Balance at Apr. 10, 2019 | $ 0 | $ 0 | $ 0 | ||||||
Net income (loss) | (16,497,280) | ||||||||
Balance at Apr. 10, 2019 | 0 | 0 | 0 | ||||||
Net income (loss) | 0 | (14,682,592) | (14,682,592) | ||||||
Issuance of Successor shares | 23,275 | 0 | 25,000 | ||||||
Balance at Dec. 31, 2019 | 19,680,076 | (14,682,592) | 5,000,006 | ||||||
Net income (loss) | 0 | (8,823,514) | (8,823,514) | ||||||
Balance at Mar. 31, 2020 | 28,503,490 | (23,506,106) | 5,000,009 | ||||||
Balance at Dec. 31, 2019 | 19,680,076 | (14,682,592) | 5,000,006 | ||||||
Net income (loss) | (53,585,867) | ||||||||
Balance at Dec. 31, 2019 | 19,680,076 | (14,682,592) | 5,000,006 | ||||||
Net income (loss) | (25,340,816) | ||||||||
Balance at Dec. 31, 2019 | 19,680,076 | (14,682,592) | 5,000,006 | ||||||
Net income (loss) | 0 | (72,459,185) | (72,459,185) | ||||||
Balance at Dec. 31, 2020 | 92,138,533 | (87,141,777) | 5,000,010 | ||||||
Balance at Jan. 31, 2020 | $ 138,000 | 83,000 | (2,761,499,000) | (466,000) | (2,761,744,000) | ||||
Translation adjustment | (629,000) | (629,000) | |||||||
Net income (loss) | (433,903,000) | (433,903,000) | |||||||
Balance at Apr. 30, 2020 | $ 138,000 | 83,000 | (3,195,402,000) | (1,095,000) | (3,196,276,000) | ||||
Balance (in shares) at Apr. 30, 2020 | 100,100 | ||||||||
Balance at Jan. 31, 2020 | $ 138,000 | $ 83,000 | (2,761,499,000) | (466,000) | (2,761,744,000) | ||||
Balance (in shares) at Jan. 31, 2020 | 100,100 | ||||||||
Translation adjustment | (2,268,000) | (2,268,000) | (2,268,000) | ||||||
Net income (loss) | $ 2,764,012,000 | 2,764,012,000 | |||||||
Cancellation of Predecessor equity | (138,000) | (83,000) | 221,000 | ||||||
Cancellation of Predecessor equity (in share) | $ (100,100) | ||||||||
Elimination of Predecessor accumulated other comprehensive loss | $ (2,734,000) | 2,734,000 | |||||||
Issuance of Successor shares | $ 40,000 | $ 666,933,000 | 666,973,000 | ||||||
Issuance of Class B common stock to Sponsor (in shares) | 4,000,000 | ||||||||
Balance at Aug. 27, 2020 | $ 40,000 | 666,933,000 | 666,973,000 | ||||||
Balance (in shares) at Aug. 27, 2020 | 4,000,000 | ||||||||
Balance at Mar. 31, 2020 | 28,503,490 | (23,506,106) | 5,000,009 | ||||||
Balance at Aug. 27, 2020 | $ 40,000 | 666,933,000 | 666,973,000 | ||||||
Translation adjustment | (682,000) | (682,000) | |||||||
Net income (loss) | (93,722,000) | (93,722,000) | |||||||
Impact of Warrant modification | 7,400,000 | 7,400,000 | |||||||
Balance at Jan. 31, 2021 | $ 40,000 | 674,333,000 | (93,722,000) | (682,000) | 579,969,000 | ||||
Balance (in shares) at Jan. 31, 2021 | 4,000,000 | ||||||||
Balance at Dec. 31, 2020 | 92,138,533 | (87,141,777) | 5,000,010 | ||||||
Net income (loss) | 0 | 41,740,801 | 41,740,801 | ||||||
Balance at Mar. 31, 2021 | $ 50,398,148 | $ (45,400,976) | $ 5,000,006 | ||||||
Balance at Jan. 31, 2021 | $ 40,000 | 674,333,000 | (93,722,000) | (682,000) | 579,969,000 | ||||
Translation adjustment | (228,000) | (228,000) | |||||||
Net income (loss) | (37,405,000) | (37,405,000) | |||||||
Balance at Apr. 30, 2021 | $ 40,000 | $ 674,333,000 | $ (131,127,000) | $ (910,000) | $ 542,336,000 | ||||
Balance (in shares) at Apr. 30, 2021 | 4,000,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 5 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Cash flows from operating activities: | ||||
Net (loss) income | $ (93,722,000) | $ 2,764,012,000 | $ (849,205,000) | $ (399,839,000) |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||
Share-based compensation | 83,000 | 175,000 | ||
Depreciation | 3,604,000 | 5,864,000 | 9,716,000 | 12,666,000 |
Amortization of intangible assets | 39,824,000 | 34,378,000 | 96,359,000 | 151,752,000 |
Change in bad debt reserve | 294,000 | 24,000 | (42,000) | 184,000 |
Deferred income tax (benefit) provision | (23,140,000) | 66,234,000 | 5,759,000 | (415,000) |
Non-cash interest expense | 671,000 | 2,407,000 | 5,687,000 | 5,555,000 |
Impairment of goodwill and intangible assets | 332,376,000 | 440,598,000 | 16,094,000 | |
Non-cash reorganization items, net | (3,353,326,000) | |||
Impairment of note receivable | 3,181,000 | |||
Impairment of note receivable from related parties | 5,367,000 | |||
Fair value adjustment on warrants | (2,900,000) | |||
Unrealized loss on derivative instruments | 5,000 | 4,062,000 | 2,284,000 | |
Loss on disposition of assets | 137,000 | 104,000 | 366,000 | |
Right-of-use assets | 2,690,000 | 1,594,000 | ||
Changes in current assets and liabilities: | ||||
Purchase of derivative instruments | (2,418,000) | |||
Accounts receivable | (103,385,000) | 116,478,000 | 23,678,000 | 13,310,000 |
Prepaid expenses and other assets | (6,394,000) | 66,000 | (2,547,000) | (1,707,000) |
Accounts payable | (31,000) | (7,909,000) | (6,581,000) | 6,279,000 |
Accrued expenses and non-current liabilities | 21,190,000 | 145,811,000 | 250,694,000 | 221,496,000 |
Lease liability | (3,272,000) | (2,332,000) | ||
Deferred revenue | 172,614,000 | (101,765,000) | (21,145,000) | (18,904,000) |
Net cash used in operating activities | 8,180,000 | 3,917,000 | (37,413,000) | 10,059,000 |
Cash flows from investing activities: | ||||
Purchases of property and equipment | (2,326,000) | (3,105,000) | (10,353,000) | (14,142,000) |
Internal use software development costs | (2,126,000) | (3,819,000) | (7,047,000) | (8,410,000) |
Net cash provided by investing activities | (4,452,000) | (6,924,000) | (17,400,000) | (22,552,000) |
Cash flows from financing activities: | ||||
Borrowings under DIP Facility | 60,000,000 | |||
Borrowings under Exit Facility | 50,000,000 | |||
Debt issuance costs associated with DIP and Exit Facilities | (19,524,000) | |||
Distribution to parent company | (2,771,000) | |||
Principal repayments of capital lease obligations | (414,000) | (532,000) | (756,000) | |
Repayments of accounts receivable facility, net of borrowings | 32,049,000 | 35,787,000 | (9,798,000) | (61,942,000) |
Borrowings under revolving line of credit, net of repayments | 19,500,000 | 55,400,000 | (26,600,000) | |
Principal payments on First and Second Lien Term Loans | (6,641,000) | (4,938,000) | ||
Net cash provided by financing activities | (32,463,000) | 73,657,000 | 57,801,000 | 27,633,000 |
Effect of exchange rate changes on cash and cash equivalents | 863,000 | (2,139,000) | 348,000 | (535,000) |
Net Change in Cash | (27,872,000) | 68,511,000 | 3,336,000 | 14,605,000 |
Cash, cash equivalents and restricted cash, beginning of period | 102,315,000 | 33,804,000 | 30,468,000 | 15,863,000 |
Cash, cash equivalents and restricted cash, end of period | 74,443,000 | 102,315,000 | 33,804,000 | 30,468,000 |
Supplemental disclosure of cash flow information: | ||||
Cash and cash equivalents | 71,479,000 | 92,009,000 | 18,799,000 | 15,584,000 |
Restricted cash | 2,964,000 | 10,306,000 | 15,005,000 | 14,884,000 |
Cash, cash equivalents and restricted cash, end of period | 74,443,000 | 102,315,000 | 33,804,000 | 30,468,000 |
Supplemental disclosure of cash flow information and non-cash investing and financing activities: | ||||
Cash paid for interest | 18,908,000 | 175,748,000 | 167,670,000 | |
Cash paid for income taxes, net of refunds | 2,336,000 | 913,000 | (2,069,000) | 3,421,000 |
Unpaid capital expenditures | 166,000 | 1,039,000 | $ 170,000 | 889,000 |
Note issued to parent entity for paid in kind interest | 160,000,000 | $ 50,000,000 | ||
Lease liabilities arising from right-of-use assets and tenant improvements recognized upon adoption of new accounting standard | $ 19,415,000 | |||
Modification of warrants and Class B common stock | $ 7,400,000 |
Organization and Description of
Organization and Description of Business | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Organization and Description of Business | SOFTWARE LUXEMBOURG HOLDING (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (1) Organization and Description of Business The Company Software Luxembourg Holding S.A. (“Software Luxembourg”), a public limited liability company incorporated and organized under the laws of the Grand Duchy of Luxembourg, was established on August 27, 2020 for the purpose of acquiring the ownership interest in Pointwell Limited (“Pointwell”), an Irish private limited company, through a plan of reorganization under Chapter 11 subsequent to August 27, 2020. Pointwell is a wholly owned subsidiary of Software Luxembourg, held indirectly through two holding companies, Software Luxembourg Intermediate S.à r.l. and Software Luxembourg Acquisition S.à r.l, both private limited liability companies incorporated and organized under the laws of the Grandy Duchy of Luxembourg. Prior to August 28, 2020, Pointwell had been a direct wholly owned subsidiary of Evergreen Skills Lux S.à r.l., with an ultimate parent company of Evergreen Skills Top Holding Lux, both private limited liability companies incorporated and organized under the laws of the Grandy Duchy of Luxembourg. References to “Successor” or “Successor Company” relate to the consolidated financial position and results of operations of Software Luxembourg subsequent to August 27, 2020. References to “Predecessor” relate to the consolidated financial position and results of operations of Pointwell prior to August 28, 2020. References to the “Company” relate to Software Luxembourg subsequent to August 27, 2020 and Pointwell prior to August 28, 2020. The Company provides, through its Skillsoft and SumTotal brands, cloud-based learning solutions and talent management solutions for customers worldwide, ranging from global enterprises and government entities to mid-sized and small businesses. The Company’s courses, books and videos have been developed by industry-leading learning experts to maximize business skills, performance and talent development. The Company has headquarters in Dublin, Ireland, and other offices in various North American and international locations. References in the accompanying footnotes to the Company’s fiscal year refer to the fiscal year ended January 31 of that year (e.g., fiscal 2021 is the fiscal year ended January 31, 2021). Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. Basis of Financial Statement Preparation The accompanying condensed consolidated financial statements include the accounts of Software Luxembourg Holding S.A (Successor) and Pointwell Limited (Predecessor) and their wholly owned subsidiaries. These financial statements are unaudited. However, in the opinion of management, the condensed consolidated financial statements reflect all normal and recurring adjustments necessary for their fair statement. Interim results are not necessarily indicative of results expected for any other interim period or a full year. We prepared the accompanying unaudited condensed consolidated financial statements in accordance with the instructions for Form 10‑Q and Article 10 of Regulation S-X and, therefore, include all information and footnotes necessary for a complete presentation of operations, comprehensive income (loss), financial position, changes in stockholders’ deficit and cash flows in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying condensed consolidated balance sheet as of January 31, 2021 was derived from our audited consolidated financial statements and does not include all disclosures required by U.S. GAAP for annual financial statements. The audited consolidated financial statements as of and for the year ended January 31, 2021 contains the information and footnotes necessary for such presentation. Accordingly, the financial statements contained in these interim financial statements should be read in conjunction with the audited consolidated financial statements for the year ended January 31, 2021. Use of Estimates Our preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from our estimates. | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (1) The Company Software Luxembourg Holding S.A. (“Software Luxembourg”), a public limited liability company incorporated and organized under the laws of the Grand Duchy of Luxembourg, was established on August 27, 2020 for the purpose of acquiring the ownership interest in Pointwell Limited (“Pointwell”), an Irish private limited company, through a reorganization under Chapter 11 (as discussed further below) subsequent to August 27, 2020. Pointwell is a wholly owned subsidiary of Software Luxembourg, held indirectly through two holding companies, Software Luxembourg Intermediate S.à r.l. and Software Luxembourg Acquisition S.à r.l, both private limited liability companies incorporated and organized under the laws of the Grandy Duchy of Luxembourg. Prior to August 28, 2020, Pointwell had been a direct wholly owned subsidiary of Evergreen Skills Lux S.à r.l., with an ultimate parent company of Evergreen Skills Top Holding Lux, both private limited liability companies incorporated and organized under the laws of the Grandy Duchy of Luxembourg. References to “Successor” or “Successor Company” relate to the consolidated financial position and results of operations of Software Luxembourg subsequent to August 27, 2020. References to “Predecessor” relate to the consolidated financial position and results of operations of Pointwell prior to August 28, 2020. References to the “Company” relate to Software Luxembourg subsequent to August 27, 2020 and Pointwell prior to August 28, 2020. The Company provides, through its Skillsoft and SumTotal brands, cloud-based learning solutions and talent management solutions for customers worldwide, ranging from global enterprises and government entities to mid-sized and small businesses. The Company’s courses, books and videos have been developed by industry-leading learning experts to maximize business skills, performance and talent development. The Company has headquarters in Dublin, Ireland, and other offices in various North American and international locations. References in the accompanying footnotes to the Company’s fiscal year refer to the fiscal year ended January 31 of that year (e.g., fiscal 2021 is the fiscal year ended January 31, 2021). Chapter 11 Proceedings On June 14, 2020 (the “Petition Date”), Pointwell and certain of its subsidiaries, including Skillsoft Corporation (collectively, the “Debtors”), commenced voluntary “prepackaged” petitions for relief (the “Chapter 11 Cases”) under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware (“the Bankruptcy Court”) pursuant to a prepetition restructuring support agreement (the “RSA”) entered into with the substantial majority of its first and second lien lenders with the objective of reducing long-term debt while maintaining normal operations and paying all trade creditors in full. On June 15, 2020, the Debtors filed a plan of reorganization (as amended, the “Plan of Reorganization”) and a related disclosure statement (“the Disclosure Statement”) with the Bankruptcy Court which was subsequently amended by revised filings. In addition to supporting the Plan of Reorganization, certain of the Debtors’ consenting first lien lenders agreed to support the Debtors’ restructuring process by providing the Debtors with $60 million in post-petition financing (the “DIP Facility” and the lenders under such facility, the “DIP Lenders”). The proceeds of the DIP Facility were used to fund (a) the operations of the Debtors, as debtors in possession, during the Chapter 11 Cases, including working capital and general corporate purposes, as well as the payment of professional fees and expenses and required fees and debt service on the DIP Facility, and (b) the operations of certain non-Debtor subsidiaries through “on-lending” or contributions of capital with proceeds from the DIP Facility. In addition, pursuant to the RSA, certain of the consenting first lien lenders agreed to make exit financing available, in the form of First Out Term Loans (as defined below), to the Successor Company in an aggregate principal amount equal to the sum of (i) the aggregate principal amount outstanding under the DIP Facility as of the Effective Date (as defined below) (the “Converted DIP Facility Loans”), and (ii) a cash amount equal to $110 million less the amount of the Converted DIP Facility Loans. The Company’s trade and all other unsecured creditors would not be impaired under the prepackaged Plan, and their votes were not solicited. On June 17, 2020, the Company’s Canadian subsidiary, Skillsoft Canada Ltd., voluntarily commenced parallel recognition proceedings under the Companies’ Creditors Arrangement Act (“CCAA”) with the Court of Queen’s Bench of New Brunswick in Canada seeking recognition and enforcement of the Debtors’ Chapter 11 Cases, including the DIP Facility. On August 6, 2020, the U.S. Bankruptcy Court confirmed the Debtors’ Plan of Reorganization, and on August 17, 2020, the Canadian Court entered an order recognizing and enforcing the Chapter 11 Cases and Plan in Canada. On August 27, 2020 (the “Effective Date”), the Debtors consummated the Plan of Reorganization and emerged from Chapter 11. Upon emergence, the Ordinary Shares of Pointwell as of the Effective Date were cancelled and the ownership interest in Pointwell, which had been a direct wholly owned subsidiary of Evergreen Skills Lux S.à.r.l. with an ultimate holding company of Evergreen Skills Top Holding Lux, was transferred to Software Luxembourg whose shareholders were lenders who had a secured interest in Skillsoft and its affiliates (including Pointwell) prior to the Petition Date. Furthermore, all amounts owed by Pointwell to Evergreen Skills Lux S.à.r.l were cancelled. All claims related to the DIP Facility were discharged and the DIP Facility Lenders received, in full and final satisfaction of such claims, on a dollar for dollar basis, First Out Term Loan (as defined below). All claims related to the Predecessor Company’s outstanding obligations under the variable rate loans and first lien senior notes (collectively, the “Predecessor first lien obligations”) were discharged, and the holders of claims with respect to the Predecessor first lien obligations received, in full and final satisfaction of such claims, its pro rata share of Second Out Term Loans (as defined below) and 3,840,000 Class A ordinary shares of the Successor Company. All claims related to the Predecessor Company’s outstanding obligations under the second lien senior notes (the “Predecessor second lien obligations”) were discharged, and the holders of claims with respect to the Predecessor second lien obligations received, in full and final satisfaction of such claims, 160,000 Class B ordinary shares of the Successor Company and warrants to purchase common shares of the Successor Company, on or before August 27, 2025, which included (i) tranche A warrants to purchase 235,294 ordinary shares at a price of $262.34 per share; and (ii) tranche B warrants to purchase 470,588 ordinary shares at a price of $274.84 per share. The Exit Credit Facility issued to Software Luxembourg and Pointwell of $520 million consists of (i) a $110 million super senior term loan facility (the “First Out Term Loan”), and (ii) a $410 million first lien, second-out term loan facility (the “Second Out Term Loan”). Upon emergence from Chapter 11, the Company adopted fresh-start reporting and became a new entity for financial reporting purposes. As a result of the application of fresh-start reporting and the effects of the implementation of the Plan of Reorganization, the Company’s consolidated financial statements after August 27, 2020 are not comparable with the financial statements prior to August 28, 2020. Upon filing for bankruptcy, the Company applied Accounting Standards Codification (“ASC”) 852, Reorganizations (“ASC 852”) in preparing the consolidated financial statements. ASC 852 requires the financial statements, for periods subsequent to the commencement of the Chapter 11 Cases, to distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Accordingly, certain charges incurred from February 1, 2020 through August 27, 2020 (Predecessor) related to the Chapter 11 Cases, including the write-off of unamortized long-term debt fees and discounts associated with debt classified as liabilities subject to compromise, exit facility and DIP facility rollover financing costs paid upon Effective Date and professional fees incurred directly as a result of the Chapter 11 Cases are recorded as Reorganization items, net in the Predecessor period. ASC 852 requires certain additional reporting for financial statements prepared between the bankruptcy filing date and the date of emergence from bankruptcy, including: · Reclassification of the Debtors’ pre-petition liabilities that are unsecured, under-secured or where it cannot be determined that the liabilities are fully secured, to a separate line item “Liabilities subject to compromise”; and · Segregation of Reorganization items, net as a separate line in the Consolidated Statement of Operations, included within income from continuing operations. The Company’s consolidated financial statements and related footnotes are presented with a blackline division which delineates the lack of comparability between amounts presented after August 27, 2020 and dates prior to August 28, 2020. The Company evaluated the events between August 28, 2020 and August 31, 2020 and concluded that the use of an accounting convenience date of August 31, 2020 (the “Fresh Start Reporting Date”) would not have a material impact on the consolidated financial statements for the Predecessor or Successor Periods. As such, the application of fresh start accounting was based on the consolidated balance sheet as of August 31, 2020. See Note 4 — Fresh-Start Reporting for additional discussion. The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern and contemplate the realization of assets and the satisfaction of liabilities in the normal course of business. The circumstances that led to the Predecessor’s need to pursue a pre- packaged Chapter 11 process were predominately due to the Predecessors’ capital structure, which had a substantial amount of total debt and related annual debt service. Management believes the Company’s new capital structure post emergence mitigates these factors going forward. Following the reorganization, the Company emerged with $520 million in outstanding borrowings under a new credit facility, which is expected to reduce annual interest payments to approximately $45 million. The Company’s projections for post emergence operations are based on the long-range financial plan filed with the RSA as part of the Chapter 11 filing and include assumptions that reflect (i) risks and uncertainties related to potential impacts to the business from COVID‑19; and (ii) potential customer attrition and reduced new business due to concerns about the Company having recently gone through a reorganization. The Company believes that cash on hand, following the reorganization, combined with expected cash flows from operations will be sufficient to fund working capital, debt service and other expected cash needs for at least one year from the issuance of these financial statements on April 9, 2021. Churchill Merger On October 12, 2020, the Company and Churchill Capital Corp II, a Delaware corporation (“Churchill”), entered into an Agreement and Plan of Merger (the “Skillsoft Merger Agreement”) by and between Churchill and the Company. Pursuant to the terms of the Skillsoft Merger Agreement, a business combination between Churchill and Skillsoft will be effected through the merger of the Company with and into Churchill, with Churchill surviving as the surviving company (the “Skillsoft Merger”). At the effective time of the Skillsoft Merger (the “Effective Time”), (a) each Class A share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class A Shares”), outstanding immediately prior to the Effective Time, will be automatically canceled and Churchill will issue as consideration therefor (i) such number of shares of Churchill’s Class A common stock, par value $0.0001 per share (the “Churchill Class A Common Stock”) as would be transferred pursuant to the Class A First Lien Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (ii) Churchill’s Class C common stock, par value $0.0001 per share (the “Churchill Class C Common Stock”), as would be transferred pursuant to the Class C Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (b) each Class B share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class B Shares”), will be automatically canceled and Churchill will issue as consideration therefor such number of shares of Churchill Class A common stock equal to the Per Class B Share Merger Consideration (as defined in the Skillsoft Merger Agreement). Pursuant to the terms of the Skillsoft Merger Agreement, Churchill is required to use commercially reasonable efforts to cause the Churchill Class A Common Stock to be issued in connection with the transactions contemplated by the Skillsoft Merger Agreement (the “Skillsoft Transactions”) to be listed on the New York Stock Exchange (“NYSE”) prior to the closing of the Skillsoft Merger (the “Skillsoft Closing”). Immediately following the Effective Time, Churchill will redeem all of the shares of Class C Common Stock issued to the holders of Skillsoft Class A Shares for an aggregate redemption price of (i) $505,000,000 in cash and (ii) indebtedness under the Existing Second Out Credit Agreement (as defined in the Skillsoft Merger Agreement), as amended by the Existing Second Out Credit Agreement Amendment (as defined in the Skillsoft Merger Agreement), in the aggregate principal amount equal to the sum of $20,000,000 to be issued by the Surviving Corporation (as defined in the Skillsoft Merger Agreement) or one of its subsidiaries, in each case, pro rata among the holders of Churchill Class C Common Stock issued in connection with the Skillsoft Merger. The consummation of the proposed Skillsoft Transactions is subject to the receipt of the requisite approval of (i) the stockholders of Churchill (the “Churchill Stockholder Approval”) and (ii) the shareholders of Skillsoft (the “Skillsoft Shareholder Approval”) and the fulfillment of certain other conditions. |
Summary of Significant Accou_11
Summary of Significant Accounting Policies | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
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 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/A for the year ended December 31, 2020, as filed with the SEC on May 11, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year 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 statement 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 the condensed 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 December 31, 2020. Marketable Securities Held in Trust Account At March 31, 2021 and December 31, 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through March 31, 2021, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which no amounts were withdrawn during the three months ended March 31, 2021. Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common stock and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. Class A Common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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 statements 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 and permanent differences. Net income (Loss) per Share Net income (loss) per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per share, basic and diluted, for Class A 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 the weighted average number of Class A 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 Class A 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 share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) 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 Corporation coverage limit 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 Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature, except for the Company's derivative instruments (see Note 9). Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | NOTE 3. 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 the 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. Cash equivalents consist of mutual funds. The Company did not have any cash equivalents as of December 31, 2020 and 2019. Marketable Securities Held in Trust Account At December 31, 2020 and 2019, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through December 31, 2020, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which $856,250 was withdrawn during the year ended December 31, 2020. Class A common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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. Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common shares and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. 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 statements 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, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses (“NOL) and allow businesses to carry back NOLs arising in 2018, 2019 and 2020 to the five prior years, suspend the excess business loss rules, accelerate refunds of previously generated corporate alternative minimum tax credits, generally loosen the business interest limitation under IRC section 163(j) from 30 percent to 50 percent among other technical corrections included in the Tax Cuts and Jobs Act tax provisions. The Company does not believe that the CARES Act will have a significant impact on Company's financial position or statement of operations. Net Income (Loss) per Common Share Net income (loss) per common share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. The Company has not considered the effect of the warrants sold in the Public Offering and Private Placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per ordinary share. Net income (loss) per common share, basic and diluted, for Class A 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 by the weighted average number of Class A common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income or loss on marketable securities attributable to Class A common stock subject to possible redemption, by the weighted average number of non-redeemable ordinary shares 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 the non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) 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 limit 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, except for the Company’s Derivative Instruments (see Note 6 and 11). 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. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies The Company’s significant accounting policies are discussed in Note 2—Summary of Significant Accounting Policies and Recent Accounting Pronouncements in the company’s audited financial statements for the year ended January 31, 2021. There have been no changes to these policies during the three months ended April 30, 2021. | (2) Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. On June 17, 2020, the Company’s Canadian subsidiary, Skillsoft Canada Ltd., voluntarily commenced parallel recognition proceedings under the Companies’ Creditors Arrangement Act (“CCAA”) with the Court of Queen’s Bench of New Brunswick in Canada seeking recognition and enforcement of the Debtors’ Chapter 11 Cases, including the DIP Facility. This action resulted in the deconsolidation of Skillsoft Canada Ltd. under ASC 810, Consolidation and the Company recognizing its retained noncontrolling interest in the Canadian subsidiary at its fair value of approximately $4.8 million. On August 17, 2020, the Canadian Court entered an order recognizing and enforcing the Chapter 11 Cases and Plan in Canada upon the Effective Date. The Company reconsolidated Skillsoft Canada Ltd and de-recognized the non-controlling interest. The Company applied the guidance in ASC 805, Business Combinations for recognizing a new accounting basis for the Canadian subsidiary. Reclassifications The Company reclassified $16,244 in professional services fees incurred exploring recapitalization, reorganization and other strategic initiatives from General and Administrative expense to Recapitalization and Transaction Fees in the accompanying statement of operations for the year ended January 31, 2020 to conform with current year presentation. Emerging Growth Company Status The Company would currently qualify as an “emerging growth company” (EGC), as defined in the Jumpstart Our Business Startups Act (JOBS Act) and accordingly the Company may choose to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not EGCs. The Company may take advantage of these exemptions until the Company is no longer an EGC under Section 107 of the JOBS Act, which provides that an EGC can take advantage of the extended transition period afforded by the JOBS Act for complying with new or revised accounting standards. The Company has elected to use the extended transition period for complying with new or revised accounting standards and as a result of this election, the consolidated financial statements may not be comparable to companies that comply with public company effective dates. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires 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 revenue and expenses during the reporting period. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Significant estimates and assumptions by management affect the Company’s accounting for the impairment of goodwill and its assessment of other intangible assets for potential impairment, determination of estimated period of economic benefit for deferred commissions and income taxes and related valuation allowances. Significant estimates and assumptions were also made by management in determining the fair value of asset and liabilities as required under the application of fresh-start reporting and in the valuation of warrants. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ from management’s estimates if past experience or other assumptions do not turn out to be substantially accurate. Revenue Recognition On February 1, 2019, the Company adopted ASU 2014‑09, Revenue from Contracts with Customers (Topic 606) and Other Assets and Deferred Costs — Contracts with Customers (Subtopic 340‑40) using the modified retrospective method. Revenue Recognition Policy — After the adoption of ASC 606 Revenue from Contracts with Customers (ASC 606) on February 1, 2019 The Company enters into contracts with customers that provide cloud-based learning solutions and talent management solutions for customers worldwide. These solutions are typically sold on a subscription basis for a fixed term. The Company accounts for a contract when (i) it has approval and commitment from both parties, (ii) the rights of the parties have been identified, (iii) payment terms have been identified, (iv) the contract has commercial substance and (v) collectability of substantially all of the consideration to which the Company will be entitled in exchange for the transfer of goods or services is probable. Approximately one-third of the Company’s revenue recognized each year is related to contracts that have an original duration of one year or less. The Company’s Software as a Service (SaaS) subscription arrangements for learning and talent management solutions generally do not provide customers with the right to take possession of the software supporting the platform or, in the case of learning solutions, to download course content without continuing to incur fees for hosting services and, as a result, are accounted for as service arrangements. Access to the platform and course content represents a series of distinct services as the Company continually provides access to, and fulfill its obligation to, the end customer over the subscription term. The series of distinct services represents a single performance obligation that is satisfied over time. Accordingly, the fixed consideration related to subscription revenue is generally recognized on a straight-line basis over the contract term, beginning on the date that the service is made available to the customer. The Company’s subscription contracts typically vary from one year to three years. The Company’s arrangements are generally non-cancellable and non-refundable. The Company also sells professional services related to its talent management solutions which are typically considered distinct performance obligations and are recognized over time as services are performed. The Company also occasionally sells its talent management solutions by providing perpetual and term-based licenses for on-premise versions of the software. Such arrangements are treated as transfers of intellectual property and the amount of consideration attributable to the delivered licenses are recognized at the point of delivery and the remaining amounts allocated for post contract support are recognized over time. While the vast majority of the Company’s revenue relates to SaaS subscription services where the entire arrangement fee is recognized on a ratable basis over the contractual term, the Company sometimes enter into contractual arrangements that have multiple distinct performance obligations, one or more of which have different periods over which the services or products are delivered. These arrangements may include a combination of subscriptions, products, support and professional services. The Company allocates the transaction price of the arrangement based on the relative estimated standalone selling price, or SSP, of each distinct performance obligation. The Company’s process for determining SSP for each performance obligation, where necessary, involves significant management judgment. In determining SSP, the Company maximizes observable inputs and considers a number of data points, including: · the pricing of standalone sales; · the pricing established by management when setting prices for deliverables that are intended to be sold on a standalone basis; · contractually stated prices for deliverables that are intended to be sold on a standalone basis; and · other pricing factors, such as the geographical region in which the products are sold and expected discounts based on the customer size and type. Determining SSP for performance obligations which the Company rarely or never sell separately also requires significant judgment. In estimating the SSP, the Company considers the likely price that would have resulted from established pricing practices had the deliverable been offered separately and the prices a customer would likely be willing to pay. The Company also sells its cloud-based learning solutions through resellers, where payments are typically based on the solutions sold through to end users. Reseller arrangements of this nature sometimes require the Company to estimate end user activity for a brief period of the contract term, however, amounts estimated and actual amounts subsequently billed have not been material to date. The Company only includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The Company reduces transaction prices for estimated returns and other allowances that represent variable consideration under ASC 606, which the Company estimates based on historical return experience and other relevant factors and records a corresponding refund liability as a component of accrued expenses and other current liabilities. Based on the nature of the Company’s business and product offerings, contingent revenue and other variable consideration are infrequent. While not a common practice for us, in the event the Company grants the customer the option to acquire additional products or services in an arrangement, the Company considers if the option provides a material right to the customer that it would not receive without entering into the contract (e.g., an incremental discount compared to the range of discounts typically given for similar products or services). If a material right is deemed to exist, the Company accounts for the option as a distinct performance obligation and recognizes revenue when those future products or services are transferred or when the option expires. Reimbursements received from customers for out-of-pocket expenses are recorded as revenues, with related costs recorded as cost of revenues. The Company presents revenues net of any taxes collected from customers and remitted to government authorities. The Company applies the practical expedient for contracts with significant financing components that are under one year. The Company applies the practical expedient for the deferral of sales commissions and other contract acquisition costs, which are expensed as incurred, because the amortization period would be one year or less. For deferred contract costs with an expected amortization period of over one year, the Company recognizes such payments over (i) the expected customer relationship period in the case of new customers, which is typically 3 to 5 years for initial commissions, and (ii) the contractual term for existing customers for commissions paid on renewals. As the Company’s contractual agreements predominately call for advanced billing, contract assets are rarely generated. For transaction prices allocated to remaining performance obligations, the Company applies practical expedients and does not disclose quantitative or qualitative information for remaining performance obligations (i) that have original expected durations of one year or less and (ii) where the Company recognizes revenue equal to what it has the right to invoice and that amount corresponds directly with the value to the customer of its performance to date. All remaining performance obligations as of January 31, 2021 qualified for the practical expedient. Revenue Recognition Policy - ASC 605 The Company applied the provisions ASC 605, Revenue Recognition (“ASC 605”) to revenue recognized during the year ended January 31, 2019. The Company commences revenue recognition when all of the following conditions are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the amount of fees to be paid by the customer is fixed or determinable; and (iv) collection is reasonably assured. The majority of SaaS subscription arrangements are accounted for as service arrangements as they do not provide customers with the right to take possession of the software supporting the platform or the right to use downloaded courseware without continuing to pay the full subscription fee which includes fees for hosting services. Revenue for subscription fees is recognized ratably over the subscription term, which typically varies from one to three years. Our on-premise perpetual and term-based licenses are accounted for as software arrangements as the customer takes possession of the software. Revenue for these license fees are recognized ratably over the associated maintenance term. The Company’s arrangements are generally non-cancellable and nonrefundable. Taxes collected from customers are excluded from revenue. For arrangements, with multiple deliverables, the Company evaluates whether the individual deliverables qualify as separate units of accounting. In order to treat deliverables in a multiple-element arrangement as separate units of accounting, the deliverables must have stand-alone value upon delivery and, in situations in which a general right of return exists for the delivered item, delivery or performance of the undelivered item is considered probable and substantially within the Company’s control. The Company’s SaaS subscription services have stand-alone value as it routinely sells subscriptions separately. Professional services included in SaaS service arrangements have stand-alone value as they are routinely sold separately. For such deliverables that have stand-alone value upon delivery, the Company accounts for the deliverables using the relative selling price allocation method. The relative selling price method allocates any discount in the arrangement proportionately to each deliverable on the basis of the deliverable’s estimated selling price. The selling price for each deliverable is based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence (“TPE”) if VSOE is not available, or the Company’s best estimated selling price (“BESP”) if neither VSOE nor TPE are available. For software arrangements, the Company evaluates whether undelivered elements qualify as separate units of accounting. In order to treat the undelivered elements as separate units of accounting, the undelivered elements must have VSOE. The Company’s software arrangements are generally recognized ratably over the maintenance term as the Company does not have VSOE of the fair value of the undelivered maintenance elements. Deferred Revenue The Company records as deferred revenue amounts that have been billed in advance for products or services to be provided. Deferred revenue includes the unrecognized portion of revenue associated with license fees for which the Company has received payment or for which amounts have been billed and are due for payment. Under ASC 605, deferred revenue was not recognized on the balance sheet for outstanding receivables where collection was not probable, fees were not fixed or determinable, or when the customer had termination for convenience rights. Capitalized Commissions After the adoption of ASC 606 on February 1, 2019 In connection with the adoption of ASC 606, the Company implemented new procedures for capitalizing the incremental costs of obtaining customer contracts. The Company capitalizes sales commissions, and associated fringe costs, such as payroll taxes, paid to direct sales personnel and other incremental costs of obtaining contracts with customers, provided the Company expects to recover those costs. The Company determines whether costs should be deferred based on its sales compensation plans, if the commissions are in fact incremental and would not have occurred absent the customer contract. Sales commissions for renewal of a subscription contract are not considered commensurate with the commissions paid for the acquisition of the initial subscription contract given the substantive difference in commission rates between new and renewal contracts. Commissions paid upon the initial acquisition of a contract are amortized over an estimated period of benefit of 3 to 5 years while commissions paid related to renewal contracts are amortized over an estimated average contract term of approximately 12 months. Amortization is recognized on a straight-line basis upon commencement of the transfer of control of the services, commensurate with the pattern of revenue recognition. The period of benefit for commissions paid for the acquisition of initial subscription contracts is determined by taking into consideration the initial estimated customer life and the technological life of the Company’s platform and related significant features. The Company determines the period of benefit for renewal subscription contracts by considering the average contractual term for renewal contracts. Amortization of deferred contract acquisition costs is included within sales and marketing expense in the consolidated statements of operations. Unamortized commission expense of $3.1 and $4.4 million is included in prepaid expenses and other current assets and other assets, respectively, at January 31, 2021 in the accompanying consolidated balance sheets. Unamortized commission expense of $11.2 and $11.7 million is included in prepaid expenses and other current assets and other assets, respectively, at January 31, 2020 in the accompanying consolidated balance sheets. Capitalized Commissions Prior to the adoption of ASC 606 on February 1, 2019 For the year ended January 31, 2019, the Company deferred the recognition of commission expense until such time as the revenue related to the arrangement for which the commission was payable is recognized. Deferred commissions for each contract were amortized in a manner consistent with how revenue is recognized for such contract, often resulting in ratable recognition of expense over the contractual term. Foreign Currency Translation The reporting currency for the Company is the U.S. dollar (“USD”) and the functional currency of the Company’s subsidiaries in the United Kingdom, Canada, Germany, Australia, the Netherlands, France, New Zealand, Singapore, Hong Kong, Japan, Switzerland and India are the currencies of those countries. The functional currency of the Company’s subsidiaries in Ireland is the USD. Assets and liabilities are translated to the USD from the local functional currency at current exchange rates, and income and expense items are translated to the USD using the average rates of exchange prevailing during the year. Gains and losses arising from translation are recorded in other comprehensive income (loss) as a separate component of shareholders’ equity (deficit). Foreign currency gains or losses on transactions denominated in a currency other than an entity’s functional currency are recorded in other income/(expenses) in the accompanying statements of operations. During the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020, and 2019, gains (losses) arising from transactions denominated in foreign currencies other than an entity’s functional currency were approximately $0.2 million, $1.1 million, ($1.0) million and $23 thousand respectively. Cash, Cash Equivalents and Restricted Stock The Company considers all highly liquid investments with original maturities of 90 days or less at the time of purchase to be cash equivalents. At January 31, 2021 and January 31, 2020, the Company did not have any cash equivalents or available for sale investments. At January 31, 2021 and January 31, 2020, the Company had approximately $3.0 million and $15.0 million of restricted cash, respectively, primarily related to the accounts receivable facility. Under the terms of the accounts receivable facility, the Company has three accounts considered restricted, an interest reserve account, a foreign exchange reserve account and a concentration reserve account. The interest reserve account requires three months interest on the greater of the facility balance or facility balance floor (the facility balance floor was $10.0 million as of January 31, 2021). The foreign exchange reserve account requires the Company to restrict cash for an amount equivalent to the change in the translated value on our foreign receivables borrowed from the date the receivable was sold. The concentration account requires the Company to deposit receipts from the receivables sold until the Company submits a monthly reconciliation report. At that time, the funds may be returned if they are replaced with new receivables. Recapitalization and Transaction-related Costs The Company expenses all transactions costs, which primarily consist of professional services and advisory fees related to the recapitalization of the Company, and activities related to the planned merger with Churchill Capital, as they are incurred as a component of operating expenses, other than those classified as Reorganization items, net, in the consolidated statements of operations. Risks and Uncertainties The Company is subject to a number of risks and uncertainties common to companies in similar industries and stages of development, including, but not limited to, the uncertainty of economic, political and market conditions; data security and privacy risk; regulatory risks; management of growth; dependence on key individuals; management of international operations; intellectual property risks; competition from substitute products and services of larger companies; product development risk; ability to keep pace with technological developments and customer adoption of new products. The Company has been closely monitoring the COVID‑19 pandemic and its impact on the business. The Company is operating normally with minimal disruptions to product and service offerings or content and software development. While the online learnings tools the Company offers have many advantages over traditional in person learning in the current environment, some of the Company’s customers in heavily impacted industries have sought to temporarily reduce spending, resulting in requests for reductions in contract size or requests for extended payment terms upon renewal. Property and Equipment The Company records property and equipment at cost. Depreciation and amortization is charged to operations based on the cost of property and equipment over their respective estimated useful lives on a straight-line basis using the half-year convention, as follows: Description Estimated Useful Lives Computer equipment 3 years Furniture and fixtures 5 years Leasehold improvements Lesser of 7 years or life of lease Expenditures for maintenance and repairs are expensed as incurred, while expenditures for renewals or betterments are capitalized. The Company evaluates the carrying amount of our property and equipment whenever changes in circumstances or events indicate that the value of such assets may not be recoverable. As of January 31, 2021, the Company believes the carrying amounts of its property and equipment are recoverable and no impairment exists. Content and Software Development Expenses Content and software development expenses consist primarily of personnel and contractor related expenditures to develop the Company’s content, platform and other product offerings. For content related costs, the Company’s policy is to expense costs as incurred. The Company outsources certain aspects of content production to third parties who produce original content on behalf of Skillsoft. Third party costs incurred in these development efforts with external resources may include prepayments and are recognized as expense in proportion to the level of services completed. Software development costs are expensed as incurred, except for costs attributable to upgrades and enhancements that qualify for capitalization. See policy “Capitalized Software Development Costs” for further discussion on this matter. For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 the Company incurred $11.5 million, $12.6 million, $25.9 million and $20.6 million, respectively of proprietary content development expenses. Capitalized Platform Development Costs The Company capitalizes certain internal use software development costs related to its SaaS platform incurred during the application development stage. Costs related to preliminary project activities and to post-implementation activities are expensed as incurred. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable that the expenditures will result in additional functionality. Internal use software is amortized on a straight-line basis over its estimated useful life, which is generally 5 years. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of the assets. Capitalized costs are recorded as intangible assets in the accompanying balance sheets. Content Partner Royalty Expenses For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 the Company recognized $7.3 million, $9.3 million, $16.5 million and $19.0 million, respectively of royalty expenses for third party content used or provisioned in the Company’s content library. Fair Value of Financial Instruments Financial instruments consist mainly of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, debt interest rate cap derivatives and warrants. The carrying amount of accounts receivable is net of an allowance for doubtful accounts, which is based on historical collections and known credit risks. See Note 19 for discussion related to the fair value of the Company’s borrowing agreements. Deferred Financing Costs and Original Issuance Discounts The Company amortizes deferred debt financing costs (including issuance costs and creditor fees) and original issuance discounts, both recorded as a reduction to the carrying amount of the related debt liability, as interest expense over the terms of the underlying obligations using the effective interest method. Derivative Financial Instruments The Company recognizes all derivatives on the balance sheet at fair value. Derivatives that are not designated as a hedge for accounting purposes must be adjusted to fair value through income. The Company classifies cash inflows and outflows from derivatives within operating activities on the statement of cash flows. The Company did not utilize derivative instruments during the period from August 28, 2020 to January 31, 2021 (Successor). The Company’s objective for utilizing derivative instruments during the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 was to reduce its exposure to fluctuations in cash flows due to changes in the variable interest rates of certain borrowings issued under its credit facility. The Company’s strategy to achieve that objective involves entering into interest rate swaps and caps that are specifically designated to certain variable rate instruments and accounted for as cash flow hedges. The Company has elected to not designate their derivatives as hedging relationships. As such the changes in the fair value of the derivatives are recorded directly in statement of operations. Concentrations of Credit Risk and Off-Balance-Sheet Risk For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019, no customer individually comprised greater than 10% of revenue. As of January 31, 2021 and 2020, no customer individually comprised more than 10% of accounts receivable. The Company considers its customers’ financial condition and generally does not require collateral. The Company maintains a reserve for doubtful accounts and sales credits that is the Company’s best estimate of potentially uncollectible trade receivables. Provisions are made based upon a specific review of all significant outstanding invoices that are considered potentially uncollectible in whole or in part. For those invoices not specifically reviewed or considered uncollectible, provisions are provided at different rates, based upon the age of the receivable, historical experience, and other currently available evidence. The reserve estimates are adjusted as additional information becomes known or payments are made. The Company has no significant off-balance-sheet arrangements nor concentration of credit risks such as foreign exchange contracts, option contracts or other foreign hedging arrangements. Intangible Assets, Goodwill and Indefinite-Lived Intangible Impairment Assessments The Company records intangible assets at cost and amortizes its finite-lived intangible assets, including customer contracts and internally developed software, over their estimated useful life. The Company reviews intangible assets subject to amortization at least annually to determine if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in remaining useful life. Conditions that would indicate impairment and trigger a more frequent impairment assessment include, but are not limited to, a significant adverse change in legal factors or business climate that could affect the value of an asset, or an adverse action or assessment by a regulator. In addition, the Company reviews its indefinite-lived intangible assets, including goodwill and certain trademarks, during the fourth quarter of each year for impairment, or more frequently if certain indicators are present or changes in circumstances suggest that impairment may exist and reassesses their classification as indefinite-lived assets. See Note 6 for a discussion of impairment charges recognized for the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019. Restructuring Charges Liabilities related to an exit or disposal activity are recognized in accordance with ASC Topic 420, Liabilities: Exit or Disposal Cost Obligations . Costs include, but are not limited to, one-time involuntary termination benefits provided to employees under the terms of a benefit arrangement that, in substance, are not an ongoing benefit arrangement or a deferred compensation contract, which are recognized on the communication date and certain contract termination costs, including operating lease termination costs which are recognized on the termination date or cease-use date for ongoing lease payments. In addition, the Company accounts for certain employee-related restructuring charges as an ongoing benefit arrangement in accordance with ASC Topic 712, Compensation — Nonretirement Postemployment Benefits , based on its prior practices and policies for the calculation and payment of severance benefits. The Company recognizes employee-related restructuring charges when the likelihood of future payment is probable, and the amount of the severance benefits is reasonably estimable. The Company recorded facility-related restructuring charges in accordance with ASC 420, before it adopted ASC Topic 842, Leases (“ASC 842”), on February 1, 2021. ASC 842 amended ASC 420 to exclude costs to terminate a contract that is a lease from the scope of ASC 420. The Company evaluates right-of-use (ROU) assets abandonment and impairment in accordance with ASC 360, Property, Plant, and Equipment and recognizes ROU assets abandonment-related amortization and write-offs as restructuring charges in its statement of operations. Advertising Costs Costs incurred for production and communication of advertising initiatives are expensed when incurred. Advertising expenses amounted to approximately $3.7 million, $3.2 million, $5.3 million and $4.0 million for the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 202 |
Chapter 11 Proceedings and Emer
Chapter 11 Proceedings and Emergence | 5 Months Ended |
Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Chapter 11 Proceedings and Emergence | (3) Plan of Reorganization As mentioned in Note 1, on August 6, 2020, the Bankruptcy Court entered an order confirming the Plan of Reorganization and on August 27, 2020, the Debtors emerged from Chapter 11. On or following the Effective Date, pursuant to the Plan of Reorganization, the following occurred: · Transfer of Ownership — Upon emergence, the Ordinary Shares of Pointwell as of the Effective Date were cancelled and the ownership interest in Pointwell, which had been a direct wholly owned subsidiary of Evergreen Skills Lux S.à.r.l. with an ultimate holding company of Evergreen Skills Top Holding Lux, was transferred to the Successor Company Luxembourg whose shareholders were lenders who had a secured interest in Skillsoft and its affiliates prior to the Petition Date. · Loans and Interest due to the Predecessor parent company — All of the Predecessor ‘s outstanding obligations due to its parent company were cancelled or transferred to other legal entities affiliated with prior ownership. · DIP Facility Claims — All claims related to the DIP Facility were discharged and the DIP Facility Lenders received, in full and final satisfaction of such claims, on a dollar for dollar basis, First Out Term Loans. · First Lien Debt Claims — All claims related to the Predecessor first lien obligation were discharged, and the holders of claims with respect to the Predecessor first lien obligations received, in full and final satisfaction of such claims, its pro rata share of: · Second Out Term Loans; and · 3,840,000 Class A ordinary shares of the Successor Company. · Second Lien Debt Claims — All claims related to the Predecessor second lien obligations were discharged, and the holders of claims with respect to the Predecessor second lien obligations received, in full and final satisfaction of such claims: · 160,000 Class B ordinary shares of the Successor Company; and · Warrants to purchase common shares of the Successor Company, including (i) tranche A warrants to purchase 235,294 ordinary shares of the Successor Company at a price of $262.34 per share and (ii) tranche B warrants to purchase 470,588 ordinary shares of the Successor Company at a price of $274.84, in each case pursuant to warrant agreement, dated as of August 27, 2020, between the Successor Company and American Trust Company, as warrant agent. · Exit Credit Facility — The Exit Credit Facility bears interest at a rate equal to LIBOR plus 7.50% per annum, with a LIBOR floor of 1.00%. The First Out Term Loan is due in December 2024 and the Second Out Term Loan is due April 2025. Accounts Receivable Facility On August 27, 2020, the Company amended its accounts receivable facility. In connection with the amendment, additional capacity under the previous accounts receivable facility which had been extended by the private equity sponsor of the Company’s prior owner was eliminated, which reduced the maximum capacity of the facility from $90 million to $75 million. The maturity date for the remaining $75 million facility was extended to the earlier of (i) December 2024 or (ii) 90 days prior to the maturity of any corporate debt. |
Fresh-Start Reporting
Fresh-Start Reporting | 5 Months Ended |
Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Fresh-Start Reporting | (4) Fresh-Start In connection with the Debtors’ emergence from bankruptcy and in accordance with ASC 852, the Company qualified for and adopted fresh-start reporting on the Effective Date. The Company was required to adopt fresh-start reporting because (i) the holders of existing voting shares of the Predecessor Company received less than 50% of the voting shares of the Successor Company and (ii) the reorganization value of the Company’s assets immediately prior to confirmation of the Plan of Reorganization was less than the post-petition liabilities and allowed claims. In accordance with ASC 852, with the application of fresh-start reporting, the Company allocated its reorganization value to its individual assets based on their estimated fair values in conformity with ASC 805. The reorganization value represents the fair value of the Successor Company’s assets before considering liabilities. The excess reorganization value over the fair value of identified tangible and intangible assets is reported as goodwill. As a result of the application of fresh-start reporting and the effects of the implementation of the Plan of Reorganization, the consolidated financial statements after August 27, 2020 are not comparable with the consolidated financial statements prior to August 28, 2020. Reorganization Value As set forth in the Disclosure Statement with respect to the Plan of Reorganization, the enterprise value of the Successor Company was estimated to be between $1.05 billion to $1.25 billion. Management and their valuation advisors estimated this range of enterprise value of the Successor Company. The Company utilized the selected publicly traded companies analysis approach, the discounted cash flow analysis (“DCF”) approach and the selected transactions analysis approach in estimating enterprise value. The use of each approach provides corroboration for the other approaches. To estimate enterprise value utilizing the selected publicly traded companies analysis method, valuation multiples derived from the operating data of publicly-traded benchmark companies to the same operating data of the Company were applied. The selected publicly traded companies analysis identified a group of comparable companies giving consideration to lines of business and markets served, size and geography. The valuation multiples were derived based on historical and projected financial measures of revenue and earnings before interest, taxes, depreciation and amortization and applied to projected operating data of the Company. To estimate enterprise value utilizing the discounted cash flow method, an estimate of future cash flows for the 2021 to 2023 fiscal years with a terminal value was determined and those estimated future cash flows were discounted to present value using a weighted average cost of capital of 11.0% and an expected tax rate of 21%. The expected cash flows for the period 2021 to 2023 with a terminal value were based upon certain financial projections and assumptions provided to the Bankruptcy Court and reflected assumptions regarding growth and margin projections, as applicable, which included expected declines in revenue in fiscals years 2021 and 2022 and a return to growth in fiscal year 2023. For each fiscal year, the Company included assumptions about working capital changes and capital expenditures to derive after-tax cash flows. A terminal value was included, calculated using the terminal multiple method, which estimates a range of values at which the Successor Company will be valued at the end of the Projection Period based on applying a terminal multiple to final year Adjusted EBITDA, which is defined as consolidated operating income adjusted to exclude non-cash compensation expenses, as well as depreciation and amortization, impairment charges and other income (expense), net. To estimate enterprise value utilizing the selected transactions analysis, valuation multiples were derived from an analysis of consideration paid and net debt assumed from publicly disclosed merger or acquisition transactions, and such multiples were applied to the EBITDA of the Successor Company. The selected transactions analysis identified companies and assets involved in publicly disclosed merger and acquisition transactions for which the targets had operating and financial characteristics comparable in certain respects to the Successor Company. After determining the enterprise value range of $1.05‑1.25 billion, the Company needed to determine a point within the range to serve as the basis for determination of the equity value and reorganization value. The Company determined the mid-point of the range represented the appropriate enterprise value and corroborated this amount with a DCF analysis using assumptions consistent with those described above, with an additional 2 years (FY 2024 and 2025) added to the forecast period and then calculated a terminal value using a 3% long-term growth rate and discount rate including a company specific risk premium. This amount ($1.15 billion) served as the starting point for the calculation of the emergence equity value and reorganization value. The following table reconciles the enterprise value per the Disclosure Statement to the fair value of the Successor Company’s equity, as of the Effective Date (in thousands, except per share amounts): Enterprise value (1) $ 1,150,000 Plus: Cash 92,009 Less: Borrowings under accounts receivable facility (48,886) Less: Fair value of debt (514,950) Less: Fair value of warrants (11,200) Implied value of Successor Company common stock $ 666,973 Shares issued upon emergence (Class A and B common stock) 4,000 Per share $ 167 The reconciliation of the Company’s enterprise value to reorganization value as of the Effective Date is as follows (in thousands): Enterprise value(1) $ 1,150,000 Plus: Cash 92,009 Current liabilities (excluding AR facility and Current maturity of long-term debt) 134,257 Deferred tax liabilities 103,930 Other long-term liabilities 7,140 Non-current lease obligations 16,399 Reorganization value $ 1,503,735 (1) Enterprise value includes the value of warrants that are classified as a liability. The enterprise value was estimated using numerous projections and assumptions that are inherently subject to significant uncertainties and resolution of contingencies that are beyond our control. Accordingly, the estimates set forth herein are not necessarily indicative of actual outcomes, and there can be no assurance that the estimates, projections or assumptions will be realized. Adjustments to the enterprise value to derive the equity value and reorganization value also included assumptions about the fair values of the post-emergence borrowings and the fair value of certain liabilities adjusted in fresh-start accounting. Consolidated Balance Sheet (In Thousands) The adjustments set forth in the following consolidated balance sheet as of August 27, 2020 reflect the effect of the consummation of the transactions contemplated by the Plan of Reorganization (reflected in the column “Reorganization — Adjustments”) as well as fair value adjustments as a result of applying fresh- start reporting (reflected in the column “Fresh-Start Adjustments”). The explanatory notes highlight the methods used to determine fair values or other amounts of the assets and liabilities, as well as significant assumptions or inputs. Reorganization Fresh-Start Predecessor Adjustments Adjustments Successor Assets Current assets: Cash and cash equivalents $ 42,341 $ 49,668 (1) $ — $ 92,009 Restricted cash 35,306 (25,000) (1) — 10,306 Accounts receivable 73,607 1,700 (2) (990) (10) 74,317 Prepaid expense and other current assets 39,317 (300) (2) (10,573) (11) 28,444 Total current assets 190,571 26,068 (11,563) 205,076 Property and equipment, net 15,523 500 (2) — 16,023 Goodwill 1,070,674 5,100 (2) (580,639) (12) 495,135 Intangible asset, net 249,962 — 516,124 (13) 766,086 Right-of-use assets 17,454 — 367 (14) 17,821 Other assets 17,313 (3,500) (2) (10,219) (11) 3,594 Total assets $ 1,561,497 $ 28,168 $ (85,930) $ 1,503,735 Liabilities and shareholders’ (deficit) equity Current liabilities: Current maturity of long-term debt $ 60,000 $ (57,400) (3) $ — $ 2,600 Borrowings under accounts receivable facility 48,886 — — 48,886 Accounts payable 7,851 300 (2) — 8,151 Accrued compensation 23,587 1,400 (2) — 24,987 Accrued expenses and other liabilities 12,105 500 (2) — 12,605 Lease liabilities 1,699 3,245 (6) (175) (14) 4,769 Deferred revenue 196,469 2,400 (2) (115,124) (15) 83,745 Total current liabilities 350,597 (49,555) (115,299) 185,743 Long-term debt — 517,400 (3)(4) (5,050) (17) 512,350 Long term lease liabilities 3,732 12,442 (6) 225 (14) 16,399 Warrants — 11,200 (6)(8) — 11,200 Deferred tax liabilities — 30,484 (5)(6) 73,446 (16) 103,930 Deferred revenue – non-current 1,783 — (1,128) (15) 655 Other long-term liabilities 2,289 3,796 (6) 400 (17) 6,485 Total long-term liabilities 7,804 575,322 67,893 651,019 Liabilities subject to compromise 4,472,954 (4,472,954) (6) — — Total liabilities 4,831,355 (3,947,187) (47,406) 836,762 Shareholders’ (deficit) equity: Ordinary shares (Predecessor) 138 (138) (7) — — Additional paid in capital (Predecessor) 83 (83) (7) — — Ordinary shares (Successor) — 40 (6)(8) — 40 Additional paid in capital (Successor) — 666,933 (6)(8) — 666,933 (Accumulated deficit) retained earnings (3,267,346) 3,308,603 (9) (41,257) (17) — Accumulated other comprehensive loss (2,733) — 2,733 (18) — Total shareholder (deficit) equity (3,269,858) 3,975,355 (38,524) 666,973 Total liabilities and shareholders’ (deficit) equity $ 1,561,497 $ 28,168 $ (85,930) $ 1,503,735 Reorganization adjustments In accordance with the Plan of Reorganization, the following adjustments were made (in thousands): (1) The table below reflects the sources and uses of cash on the Effective Date from implementation of the Plan of Reorganization (in thousands): Sources: Release of restricted cash (a) $ 25,000 Additional funding from First Out Term Loan 50,000 Reconsolidation of Canadian subsidiary 1,100 Total sources of cash 76,100 Uses: Exit Facility and DIP Facility rollover financing costs paid upon Effective Date (5,032) Professional success fees paid upon Effective Date (21,400) Total uses of cash (26,432) Net increase in cash $ 49,668 a) A portion of DIP Facility funds from restricted cash was released upon Effective Date (2) On June 17, 2020, the Company’s Canadian subsidiary, Skillsoft Canada Ltd., voluntarily commenced parallel recognition proceedings under the Companies’ Creditors Arrangement Act (“CCAA”) with the Court of Queen’s Bench of New Brunswick in Canada seeking recognition and enforcement of the Debtors’ Chapter 11 Cases, including the DIP Facility. This action resulted in the deconsolidation of Skillsoft Canada Ltd. under ASC 810, and the Company recognizing its retained noncontrolling interest in the Canadian subsidiary at its fair value of $4.8 million. On August 17, 2020, the Canadian Court entered an order recognizing and enforcing the Chapter 11 Cases and Plan in Canada and upon the August 27, 2020 Effective Date, when the Plan of Reorganization was consummated and Pointwell Limited emerged from Chapter 11, the Company reconsolidated Skillsoft Canada Ltd and de-recognized the non-controlling interest. The Company applied guidance ASC 805 for recognizing a new accounting basis for the Canadian subsidiary. Working capital accounts were generally carried over at carrying value which approximated their fair values. Deferred revenue was reduced to an amount intended to approximate the costs to fulfill contractual obligations plus a reasonable margin. Identified intangible assets were recognized based on their fair values using market participant assumptions and goodwill was recorded reflecting synergies from the consolidation by the Company. (3) Reflects the net effect of the conversion of $60 million of the debtor-in-possession financing to First Out Term Loan, net of principal payments of $2.6 million related to the First Out Term Loan and Second Out Term Loan due over the twelve-month period from Effective Date. (4) In accordance with the Plan of Reorganization, the Company entered into the Term Loan Facility Agreement with a principal amount of $520 million. (in thousands) Term Loan Facility: Senior Secured First Out Term Loan $ 110,000 Senior Secured Second Out Term Loan 410,000 Total Debt – Exit facility (a) 520,000 Less: Current portion of Long-term debt (2,600) Long-term debt, net of current portion $ 517,400 (a) The Exit Credit Facility bears interest at a rate equal to LIBOR plus 7.50% per annum, with a LIBOR floor of 1.00%. The First Out Term Loan is due in December 2024 and the Second Out Term Loan is due April 2025. The Exit Credit Facility contains customary provisions and reporting requirements, including prepayment penalties and a maximum leverage covenant that will be first measured January 31, 2022 and each quarter thereafter. Quarterly principal repayments of $1.3 million begin for the quarter ended April 30, 2021 and increase to $2.6 million for the quarter ended April 30, 2022 until maturity. (5) Reflects the reduction of tax basis as a result of cancellation of debt income (CODI) tax attribute and tax basis reduction rules in the US and the discharge of liabilities in non-US Jurisdictions. (6) As part of the Plan of Reorganization, the Bankruptcy Court approved the settlement of claims reported within Liabilities subject to compromise in the Company’s Consolidated balance sheet at their respective allowed claim amounts. The table below indicates the disposition of liabilities subject to compromise (in thousands): Liabilities subject to compromise pre-emergence $ 4,472,954 Reinstated on the Effective Date: Lease liabilities (current and non-current) (15,687) Deferred tax liabilities (26,107) Other long-term liabilities (3,796) Total liabilities reinstated (45,590) Less amounts settled per the Plan of Reorganization Issuance of new debt (410,000) Issuance of warrants (11,200) Equity issued at emergence to creditors in settlement of Liabilities Subject to Compromise (666,973) Total amounts settled (1,088,173) Gain on settlement of Liabilities Subject to Compromise $ 3,339,191 (7) Pursuant to the terms of the Plan of Reorganization, as of the Effective Date, all Predecessor common stock was cancelled without any distribution. (8) In Settlement of the company’s Predecessor first and second lien debt obligations, the holders of the Predecessors first lien received a total of 3,840,000 of Class A common shares. The Predecessor’s second lien holders received a total of 160,000 of Class B common shares and a total of 705,882 warrants to purchase additional common shares. (9) The table reflects the cumulative impact of the reorganization adjustments discussed above (in thousands): Gain on settlement of Liabilities subject to compromise $ 3,339,191 Provision for income taxes (4,377) Professional success fees paid upon Effective Date (21,400) Exit Facility and DIP Facility rollover financing costs paid upon Effective Date (5,032) Cancellation of predecessor shares and additional paid in capital 221 Net impact on Accumulated deficit $ 3,308,603 Fresh-Start Adjustments (10) Reflects the fair value adjustment as of August 27, 2020 made to accounts receivable to reflect management’s best estimate of expected collectability of accounts receivable balances, in connection with fresh-start reporting. (11) This adjustment reflects the write-off of deferred contract cost assets which do not provide economic benefit to the Successor. (12) Predecessor goodwill of $1,075.8 million was eliminated and Successor goodwill of $495.1 million was established based on the calculated reorganization value which was not attributed to specific tangible or identifiable intangible assets. Goodwill arising from the fresh- start accounting is not deductible for tax purposes. (in thousands) Reorganization value of Successor company $ 1,503,735 Less: Fair value of Successor company assets (1,008,600) Reorganization value of Successor company in excess of asset fair value – Goodwill $ 495,135 (13) The Company recorded an adjustment to intangible assets for $516.1 million as follows (in thousands): Estimated fair value Estimated useful life Developed software/ courseware $ 261,600 3 – 5 years Customer contracts/ relationships 279,500 12.4 years Trademarks and trade names 6,300 9.4 years Backlog 90,200 4.4 years Skillsoft trademark 91,500 Indefinite Publishing rights 35,200 5 years Capitalized software 1,786 5 years Total intangible asset upon emergence 766,086 Elimination of historical acquired intangible assets (249,962) Fresh-start adjustment to acquired intangibles assets $ 516,124 Values and useful lives assigned to intangible assets were based on estimated value and use of these assets by a market participant. The customer contracts/relationships and backlog were valued using the income approach. The trademarks and trade names were valued using the relief from royalty method. The developed software/courseware and publishing rights were valued using the replacement cost approach. (14) The operating lease obligation as of August 27, 2020 had been calculated using an incremental borrowing rate of the Predecessor Company, as of the later of the date of adoption of ASC 842 (February 1, 2020) or the lease commencement date. Upon application of fresh-start reporting, the lease obligation was recalculated using the incremental borrowing rate applicable to the Successor Company after emergence from bankruptcy and commensurate to its new capital structure. The Company’s operating lease right-of-use assets were further adjusted to reflect the market value as of August 28, 2020. (15) The fair value of deferred revenue, which principally relates to amounts that have been billed in advance for products or services to be provided, was determined by estimating the fulfillment costs, which represent only those costs that are directly related to fulfilling the legal performance obligation assumed by the Successor. (16) The adjustment represents the establishment of deferred tax liabilities related to book/tax differences created by fresh-start reporting adjustments. The amount is net of the release of the valuation allowance on deferred tax assets, which management believes more likely than not will be realized as a result of future taxable income from the reversal of such deferred tax liabilities (17) The table below reflects the cumulative impact of the fresh-start adjustments as discussed above (in thousands): Fresh-start adjustment to accounts receivable, net $ (990) Fresh-start adjustment to prepaid assets and other assets (including long-term) (20,792) Fresh-start adjustment to goodwill (580,639) Fresh-start adjustment to intangible assets, net 516,124 Fresh-start adjustment to operating lease right-of-use assets and liabilities, net 317 Fresh-start adjustment to deferred revenue (current and non-current) 116,252 Fair value adjustment to debt 5,050 Fair value adjustment to other long-term liabilities (400) Total fresh-start adjustments impacting reorganization items, net 34,922 Elimination of accumulated other comprehensive loss (2,733) Tax impact of fresh-start adjustments (73,446) Net impact on accumulated deficit $ (41,257) (18) Elimination of accumulated other comprehensive loss Reorganization Items, Net Reorganization items incurred as a result of the Chapter 11 cases are presented separately in the accompanying Consolidated Statement of Operations for the period presented, as follows (in thousands): Predecessor February 1, 2020 through August 27, 2020 Gain on settlement of Liabilities subject to compromise $ 3,339,191 Impact of fresh-start adjustments 34,922 Exit Facility and DIP Facility rollover financing costs paid upon Effective Date (5,032) Write-off of pre-petition debt and DIP issuance costs (9,461) Professional success fees paid upon Effective Date (21,399) Professional fees and other bankruptcy related costs (13,076) Gain on Deconsolidation of Canadian subsidiary 4,100 Reorganization items, net $ 3,329,245 Successor Predecessor August 28, 2020 February 1, 2020 through January 31, through August 27, 2021 2020 Cash payment for reorganization items, net $ 784 $ 42,916 |
Intangible Assets
Intangible Assets | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Intangible Assets | (3) Intangible Assets Intangible assets consisted of the following (in thousands): April 30, 2021 January 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Developed software/ courseware $ 267,014 $ 39,459 $ 227,555 $ 265,758 $ 24,669 $ 241,089 Customer contracts/ relationships 279,500 9,114 270,386 279,500 3,627 275,873 Trademarks and trade names 6,300 676 5,624 6,300 455 5,845 Publishing rights 35,200 4,693 30,507 35,200 2,933 32,267 Backlog 90,200 20,842 69,358 90,200 8,141 82,059 Skillsoft trademark 91,500 — 91,500 91,500 — 91,500 Total $ 769,714 $ 74,784 $ 694,930 $ 768,458 $ 39,825 $ 728,633 Amortization expense related to the existing finite-lived intangible assets is expected to be as follows (in thousands): Fiscal Year Amortization Expense 2022 (Remaining 9 months) $ 104,693 2023 120,579 2024 106,172 2025 94,070 2026 64,496 Thereafter 113,420 Total $ 603,430 Amortization expense related to intangible assets in the aggregate was $35.2 million for the three months ended April 30, 2021 and $17.4 million for the three months ended April 30, 2020. Fresh-start Reporting for Intangible Assets In accordance with ASC 852, with the application of fresh-start reporting, the Company allocated its reorganization value to its individual assets based on their estimated fair values in conformity with ASC 805, including those of intangible assets. Intangible assets were measured based upon estimates of the future performance and cash of from the Successor Company at emergence. Values and useful lives assigned to intangible assets were based on estimated value and use of these assets by a market participant. The customer contracts/relationships and backlog were valued using the income approach. The trademarks and trade names were valued using the relief from royalty method. The income approach determines fair value by estimating the after-tax cash flows attributable to an identified asset over its useful life (Level 3 inputs) and then discounting these after-tax cash flows back to a present value. The developed software/courseware and publishing rights were valued using the replacement cost approach. The cost approach determines fair value by estimating the cost to replace or reproduce an asset at current prices and is reduced for functional and economic obsolescence. Impairment Review Requirements The Company reviews intangible assets subject to amortization if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in remaining useful life. The Company reviews indefinite lived intangible assets, including goodwill, on the annual impairment test date or more frequently if there are indicators of impairment. No such indicators were present during the three months ended April 30, 2021. Goodwill in the Predecessor represented the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill for the Successor represents the excess of the reorganization value over the fair value of tangible and intangible assets in fresh start accounting. The Company tests goodwill for impairment during the fourth quarter every year in accordance with ASC 350, Intangibles—Goodwill . The Predecessor performed this test on the first day of the fourth quarter (November 1) and the Successor performs this test on the first day of the last month of the fourth quarter (January 1). In connection with the impairment evaluation, the Company may first consider qualitative factors to determine whether the existence of events or circumstances indicates that it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. Performing a quantitative goodwill impairment test is not necessary if an entity determines based on this assessment that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company fails or elects to bypass the qualitative assessment, the goodwill impairment test must be performed. This test requires a comparison of the carrying value of the reporting unit to its estimated fair value. If the carrying value of a reporting unit’s goodwill exceeds its fair value, an impairment loss equal to the difference is recorded, not to exceed the amount of goodwill allocated to the reporting unit. In determining reporting units, the Company first identifies its operating segments, and then assesses whether any components of these segments constitute a business for which discrete financial information is available and where segment management regularly reviews the operating results of that component. Impairment of Goodwill and Intangible Assets for the Predecessor Period ended April 30, 2020 During the three months ended April 30, 2020, the emergence of COVID‑19 as a global pandemic had an adverse impact on our business. While the online learnings tools the Company offers have many advantages over traditional in person learning in the current environment, some of the Company’s customers in heavily impacted industries have sought to temporarily reduce spending, resulting in reductions in contract sizes and in some cases cancellations when such contracts have come up for renewal. In addition, identifying and pursing opportunities for new customers became much more challenging in this environment. In addition to the uncertainty introduced by COVID‑19, the Company’s over leveraged capital structure continued to create headwinds. In April 2020, the Company received temporary forbearance from its lenders due to a default on amounts owed under the Senior Credit Facility as a long-term consensual solution was being negotiated with lenders. The uncertainty around the Company’s capital structure and future ownership, continued to hurt its business, as new and existing customers displayed apprehension about the ultimate resolution of the Company’s capital structure and its impact on operations, causing delays and sometimes losses in business. The uncertainty surrounding the Company’s capital structure combined with the potential impact that COVID‑19 would have on the Company and the global economy, resulted in a significant decline in the fair value of its reporting units during the first quarter ended April 30, 2020, with the impact being more significant to the SumTotal business on a relative basis due to its smaller scale and forecasted cash flow generation. As part of the Company’s evaluation of impairment indicators based on the circumstances described above as of April 30, 2020, the Company determined its SumTotal long- lived asset group failed the undiscounted cash flow recoverability test. Accordingly, the Company estimated the fair value of its individual long-lived assets to determine if any impairment charges were present. The Company’s estimation of the fair value of definite lived intangible assets included the use of discounted cash flow analyses which reflected estimates of future revenue, customer attrition rates, royalty rates, cash flows, and discount rates. Based on these analyses, the Company concluded the fair values of certain SumTotal intangible assets where lower their current carrying values, accordingly impairment charges of $62.3 million were recognized in the 3 months ended April 30, 2020 (Predecessor). In light of the circumstances above, management also concluded that a triggering event had occurred with respect to the Company’s indefinite-lived Skillsoft trade name as of April 30, 2020. Accordingly, the Company estimated the fair value of the Skillsoft trade name using a discounted cash flow analyses which reflected estimates of future revenue, royalty rates, cash flows, and discount rates. Based on thus analysis, the Company concluded the carrying value of the Skillsoft trade name exceeded its fair value, resulting in an impairment charge of $92.2 million in the 3 months ended April 30, 2020 (Predecessor). In accordance with ASC 350, for goodwill the Company determined triggering events had occurred and performed an impairment test as of April 30, 2020 that compared the estimated fair value of each reporting unit to their respective carrying values. The prospective financial information used for fiscal years 2021, 2022 and 2023 for these impairment tests was consistent with financial projections included in the Plan of Reorganization and future growth rates tracked to terminal growth rate assumptions. The Company considered the results of both a discounted cash flow (“DCF”) analysis and an EBITDA multiple approach. The Company also considered observable debt trading prices for the debt jointly borrowed by its parent entity and the Company’s subsidiary, Skillsoft Corporation, however, by the end of March 2020, most holders were restricted from trading in anticipation of a restructuring and market prices after that period were therefore less reliable. The results of the impairment tests performed indicated that the carrying value of the Skillsoft and SumTotal reporting units exceeded their estimated fair values determined by the Company. Based on the results of the goodwill impairment testing procedures, the Company recorded a $107.9 million goodwill impairment for the Skillsoft reporting unit and a $70.0 million goodwill impairment for the SumTotal reporting unit. In total, as described in detail above, the Company recorded $332.4 million of goodwill and intangible asset impairment charges for the 3 months ended April 30, 2020 (Predecessor), consisting of (i) $62.3 million of impairments of SumTotal definite-lived intangible assets, (ii) an $92.2 million impairment of the Skillsoft trade name, (iii) a $107.9 million goodwill impairment for the Skillsoft reporting unit and (iv) a $70.0 million goodwill impairment for the SumTotal reporting unit. The Company believes that its procedures for estimating gross future cash flows for each intangible asset are reasonable and consistent with current market conditions for each of the dates when impairment testing was performed. A rollforward of goodwill is as follows: Description Skillsoft SumTotal Consolidated Goodwill, net January 31, 2021 (Predecessor) $ 491,654 $ 3,350 $ 495,004 Foreign currency translation adjustment (62) — (62) Goodwill, net April 30, 2021 (Predecessor) $ 491,592 $ 3,350 $ 494,942 Gross goodwill at April 30, 2021 (Successor) and January 31, 2021 (Successor), for the Skillsoft segment was $491.6 million and $491.7 million, respectively. Accumulated impairment losses for the Skillsoft segment at April 30, 2021 (Successor) and January 31, 2021 (Successor) was $0. Gross goodwill at April 30, 2021 (Successor) and January 31, 2021 (Successor), for the SumTotal segment was $3.4 million. Accumulated impairment losses for the SumTotal segment at April 30, 2021 (Successor) and January 31, 2021 (Successor) was $0. | (5) Intangible assets consisted of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Developed software/ courseware $ 265,758 $ 24,669 $ 241,089 $ 157,168 $ 129,663 $ 27,505 Customer contracts/ relationships 279,500 3,627 275,873 670,800 466,972 203,828 Trademarks and trade names 6,300 455 5,845 45,300 27,648 17,652 Publishing rights 35,200 2,933 32,267 — — — Backlog 90,200 8,141 82,059 — — — Skillsoft trademark 91,500 — 91,500 186,000 — 186,000 Total $ 768,458 $ 39,825 $ 728,633 $ 1,059,268 $ 624,283 $ 434,985 Amortization expense related to the existing finite-lived intangible assets is expected to be as follows (in thousands): Amortization Fiscal Year Expense 2022 $ 139,408 2023 120,339 2024 105,910 2025 93,842 2026 64,269 Thereafter 113,365 Total $ 637,133 Amortization expense related to intangible assets in the aggregate was $39.8 million for the period August 28, 2020 through January 31, 2021 (Successor), $34.4 million for the period February 1, 2020 through August 27, 2020 (Predecessor), $96.4 million for the fiscal year ended January 31, 2020, and $151.8 million for the fiscal year ended January 31, 2019. Fresh-start Reporting for Intangible Assets In accordance with ASC 852, with the application of fresh-start reporting, the Company allocated its reorganization value to its individual assets based on their estimated fair values in conformity with ASC 805, including those of intangible assets. Intangible assets were measured based upon estimates of the future performance and cash of from the Successor Company at emergence. Values and useful lives assigned to intangible assets were based on estimated value and use of these assets by a market participant. The customer contracts/relationships and backlog were valued using the income approach. The trademarks and trade names were valued using the relief from royalty method. The income approach determines fair value by estimating the after-tax cash flows attributable to an identified asset over its useful life (Level 3 inputs) and then discounting these after- tax cash flows back to a present value. The developed software/courseware and publishing rights were valued using the replacement cost approach. The cost approach determines fair value by estimating the cost to replace or reproduce an asset at current prices and is reduced for functional and economic obsolescence. Impairment Review Requirements The Company reviews intangible assets subject to amortization if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in remaining useful life. The Company reviews indefinite lived intangible assets, including goodwill, on the annual impairment test date or more frequently if there are indicators of impairment. Goodwill for the Predecessor represented the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill for the Successor represents the excess of the reorganization value over the fair value of tangible and intangible assets in fresh start accounting. The Company tests goodwill for impairment during the fourth quarter every year in accordance with ASC 350, Intangibles — Goodwill . The Predecessor performed this test on the first day of the fourth quarter (November 1) and the Successor performs this test on the first day of the last month of the fourth quarter (January 1). In connection with the impairment evaluation, the Company may first consider qualitative factors to determine whether the existence of events or circumstances indicates that it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. Performing a quantitative goodwill impairment test is not necessary if an entity determines based on this assessment that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company fails or elects to bypass the qualitative assessment, the goodwill impairment test must be performed. This test requires a comparison of the carrying value of the reporting unit to its estimated fair value. If the carrying value of a reporting unit’s goodwill exceeds its fair value, an impairment loss equal to the difference is recorded, not to exceed the amount of goodwill allocated to the reporting unit. In determining reporting units, the Company first identifies its operating segments, and then assesses whether any components of these segments constitute a business for which discrete financial information is available and where segment management regularly reviews the operating results of that component. For the Company’s annual impairment assessments of indefinite-lived intangible assets and goodwill conducted as of January 1, 2021, management considered qualitative factors to determine if it was more likely than not that impairments were present. In performing this qualitative assessment, management noted (i) the recent date of the fresh-start reporting valuation, (ii) the higher valuation suggested by the pending acquisition by Churchill, (iii) in the case of goodwill, a decrease in the carrying value of both reporting units since the original measurement date and (iv) the absence of any other factors that would indicate any declines in fair value. Based on these qualitative factors, management concluded it is not more likely than not that (i) the Skillsoft tradename intangible asset is impaired or (ii) the fair value of the company’s two reporting units are less than their carrying amounts. Impairment of Goodwill and Intangible Assets for the Predecessor Period ended August 27, 2020 During the three months ended April 30, 2020, the emergence of COVID‑19 as a global pandemic had an adverse impact on our business. While the online learnings tools the Company offers have many advantages over traditional in person learning in the current environment, some of the Company’s customers in heavily impacted industries have sought to temporarily reduce spending, resulting in reductions in contract sizes and in some cases cancellations when such contracts have come up for renewal. In addition, identifying and pursing opportunities for new customers became much more challenging in this environment. In addition to the uncertainty introduced by COVID‑19, the Company’s over leveraged capital structure continued to create headwinds. In April 2020, the Company received temporary forbearance from its lenders due to a default on amounts owed under the Senior Credit Facility as a long-term consensual solution was being negotiated with lenders. The uncertainty around the Company’s capital structure and future ownership, continued to hurt its business, as new and existing customers displayed apprehension about the ultimate resolution of the Company’s capital structure and its impact on operations, causing delays and sometimes losses in business. The uncertainty surrounding the Company’s capital structure combined with the potential impact that COVID‑19 would have on the Company and the global economy, resulted in a significant decline in the fair value of its reporting units during the first quarter ended April 30, 2020, with the impact being more significant to the SumTotal business on a relative basis due to its smaller scale and forecasted cash flow generation. As part of the Company’s evaluation of impairment indicators based on the circumstances described above as of April 30, 2020, the Company determined its SumTotal long-lived asset group failed the undiscounted cash flow recoverability test. Accordingly, the Company estimated the fair value of its individual long-lived assets to determine if any impairment charges were present. The Company’s estimation of the fair value of definite lived intangible assets included the use of discounted cash flow analyses which reflected estimates of future revenue, customer attrition rates, royalty rates, cash flows, and discount rates. Based on these analyses, the Company concluded the fair values of certain SumTotal intangible assets where lower their current carrying values, accordingly impairment charges of $62.3 million were recognized for the Predecessor period from February 1, 2020 to August 27, 2020. In light of the circumstances above, management also concluded that a triggering event had occurred with respect to the Company’s indefinite-lived Skillsoft trade name as of April 30, 2020. Accordingly, the Company estimated the fair value of the Skillsoft trade name using a discounted cash flow analyses which reflected estimates of future revenue, royalty rates, cash flows, and discount rates. Based on thus analysis, the Company concluded the carrying value of the Skillsoft trade name exceeded its fair value, resulting in an impairment charge of $92.2 million for the Predecessor period from February 1, 2020 to August 27, 2020. In accordance with ASC 350, for goodwill the Company determined triggering events had occurred and performed an impairment test as of April 30, 2020 that compared the estimated fair value of each reporting unit to their respective carrying values. The prospective financial information used for fiscal years 2021, 2022 and 2023 for these impairment tests was consistent with financial projections included in the Plan of Reorganization and future growth rates tracked to terminal growth rate assumptions. The Company considered the results of both a discounted cash flow (“DCF”) analysis and an EBITDA multiple approach. The Company also considered observable debt trading prices for the debt jointly borrowed by its parent entity and the Company’s subsidiary, Skillsoft Corporation, however, by the end of March 2020, most holders were restricted from trading in anticipation of a restructuring and market prices after that period were therefore less reliable. The results of the impairment tests performed indicated that the carrying value of the Skillsoft and SumTotal reporting units exceeded their estimated fair values determined by the Company. Based on the results of the goodwill impairment testing procedures, the Company recorded a $107.9 million goodwill impairment for the Skillsoft reporting unit and a $70.0 million goodwill impairment for the SumTotal reporting unit. In total, as described in detail above, the Company recorded $332.4 million of goodwill and intangible asset impairment charges for the Predecessor period from February 1, 2020 to August 27, 2020, consisting of (i) $62.3 million of impairments of SumTotal definite-lived intangible assets, (ii) an $92.2 million impairment of the Skillsoft trade name, (iii) a $107.9 million goodwill impairment for the Skillsoft reporting unit and (iv) a $70.0 million goodwill impairment for the SumTotal reporting unit. The Company believes that its procedures for estimating gross future cash flows for each intangible asset are reasonable and consistent with current market conditions for each of the dates when impairment testing was performed. Goodwill Impairment for the Fiscal Year Ended January 31, 2020 During the fiscal year ended January 31, 2020, the Company faced significant market competition. In addition, while the Company continued to make significant investments in contemporary products such as Percipio, attrition rates on legacy products like Skillport remained high. On top of market and competitive dynamics, the Company’s over leveraged capital structure also created additional headwinds. With significant debt maturities in 2021 and 2022, and related downgrades from rating agencies, concerns over the capital structure began to hurt the Company’s business, as new and existing customers displayed apprehension about the ultimate resolution of the Company’s capital structure and its impact on operations, causing delays and sometimes losses in business. The capital structure and heavy debt service also constrained investments in areas such as marketing, where spending was considerably lower than the Company’s competitors, resulting in additional pressure on retaining and attracting customers. The combination of the factors resulted in lower bookings, revenue, profitability and free cash flow generation during the twelve months ended January 31, 2020. In addition, the lower customer base, combined with larger expenditures that would be necessary in marketing activities going forward, resulted in lower expected future cash flows and growth rates going forward. As part of the Company’s evaluation of impairment indicators, described further below, for the year ended January 31, 2020, the Company determined its long-lived asset groups failed the undiscounted cash flow recoverability tests. Accordingly, the Company estimated the fair value of its individual long-lived assets to determine potential impairment charges. The Company’s estimation of the fair value of definite lived intangible assets included the use of discounted cash flow analyses which reflected estimates of future revenue, customer attrition rates, royalty rates, cash flows, and discount rates. Based on these analyses, the Company concluded the fair values of the individual long-lived assets exceeded their current carrying values, accordingly no impairment was recognized for these assets for the year ended January 31, 2020 In accordance with ASC 350, the Company performed an impairment test that compared the estimated fair value of each reporting unit to their respective carrying values. Management considered the results of both a DCF analysis and an EBITDA multiple approach, similar to prior periods. The Company also considered observable debt trading prices for the debt jointly borrowed by its parent entity and its subsidiary, Skillsoft Corporation, after adjusting for a control premium. The results of the impairment tests performed indicated that the carrying values of the Skillsoft and SumTotal reporting units exceeded their estimated fair values determined by the Company. Based on the results of the Company’s impairment testing, the Company recorded $440.6 million of goodwill impairment charges in the fiscal year ended January 31, 2020, including $321.3 million for the Skillsoft reporting unit and $119.3 million for the SumTotal reporting unit. Intangible Asset Impairment for the Fiscal Year Ended January 31, 2019 During the fiscal year ended January 31, 2019, the Company recognized an impairment loss in its Content segment, for the write-off of its Books24x7 tradename finite-lived intangible asset of $15.5 million and its Vodeclic tradename finite-lived intangible asset of $0.6 million. These tradenames were rebranded as part of its overall marketing and branding efforts and were discontinued in the year ended January 31, 2019. As a result of these rebranding efforts, there were no anticipated future cash flows associated with the asset. As a result, the Company has recorded an impairment charge to write-off the remaining unamortized balance of these intangible assets. A rollforward of goodwill is as follows: Description Skillsoft SumTotal Consolidated Goodwill, January 31, 2018 $ — $ — $ 1,693,906 Re-allocation of goodwill upon change in reporting units 1,433,662 260,244 — Foreign currency translation adjustment 385 22 407 Goodwill, January 31, 2019 1,434,047 260,266 1,694,313 Foreign currency translation adjustment 113 (6) 107 Impairment of goodwill (321,340) (119,258) (440,598) Goodwill, net January 31, 2020 (Predecessor) 1,112,820 141,002 1,253,822 Foreign currency translation adjustment (158) (4) (162) Impairment of goodwill (107,934) (69,952) (177,886) Canada deconsolidation (5,100) (5,100) Goodwill, net August 27, 2020 (Predecessor) $ 999,628 $ 71,046 $ 1,070,674 Impact of Fresh-Start Reporting (507,843) (67,696) (575,539) Goodwill, net August 28, 2020 (Successor) $ 491,785 $ 3,350 $ 495,135 Foreign currency translation adjustment (131) (131) Goodwill, net January 31, 2021 (Successor) $ 491,654 $ 3,350 $ 495,004 Gross goodwill at January 31, 2021 (Successor), January 31, 2020 and January 31, 2019 for the Skillsoft segment was $491,654, $1,434,160 and $1,434,047. Accumulated impairment losses for the Skillsoft segment at January 31, 2021 (Successor), January 31, 2020 and January 31, 2019 was $0, $321,340 and $0. Gross goodwill at January 31, 2021 (Successor), January 31, 2020 and January 31, 2019 for the SumTotal segment was $3,350, $260,260 and $260,266. Accumulated impairment losses for the SumTotal segment at January 31, 2021 (Successor), January 31, 2020 and January 31, 2019 was $0, $119,258 and $0. |
Property and Equipment
Property and Equipment | 5 Months Ended |
Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Property and Equipment | (6) Property and equipment consists of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Computer equipment $ 12,455 $ 80,483 Furniture and fixtures 1,894 3,046 Leasehold improvements 3,383 5,220 Construction in progress — 18 17,732 88,767 Less accumulated depreciation and amortization (3,952) (70,865) $ 13,780 $ 17,902 Construction in progress at January 31, 2021 and 2020 consisted primarily of costs related to the purchase of certain assets that have not yet been put into service. Depreciation expense related to property and equipment was $3.6 million, $5.9 million, $9.7 million, and $12.7 million for the period August 28, 2020 through January 31, 2021 (Successor), the period February 1, 2020 through August 27, 2020 (Predecessor), the fiscal year ended January 31, 2020 and the fiscal year ended January 31, 2019, respectively. Amortization expense for assets acquired under finances leases are included in total depreciation expense. |
Taxes
Taxes | 3 Months Ended | 5 Months Ended | 12 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Taxes | NOTE 10. INCOME TAX The following is a summary of the Company's net deferred tax asset (liability): December 31, December 31, 2020 2019 Deferred tax asset (liability) Startup and organizational expenses $ 148,348 $ — Unrealized gain on marketable securities (976) (9,657) Total deferred tax asset (liability) 147,372 (9,657) Valuation Allowance (148,348) — Deferred tax asset (liability), net of allowance $ (976) $ (9,657) The income tax provision consists of the following: December 31, December 31, 2020 2019 Federal Current expense $ 495,442 $ 1,237,860 Deferred (benefit) expense (157,029) 9,657 State and Local Current — — Deferred — — Change in valuation allowance 148,348 — Income tax provision $ 486,761 $ 1,247,517 As of December 31, 2020 and 2019, the Company did not have any of U.S. federal and state 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 period from January 1, 2020 through December 31, 2020, the change in the valuation allowance was $148,348. 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 % % Transaction costs attributable to Initial Public Offering % (1.8) % Loss on conversion option liability (0.5) % % Loss on warrant liability (6.3) % (28.5) % Loss on Prosus agreement (14.7) % % Valuation allowance (0.2) % % Income tax provision (0.7) % (9.3) % 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 and subject to examination by the taxing authorities. The Company considers New York to be a significant state tax jurisdiction. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||
Taxes | (4) Taxes For the Predecessor three months ended April 30, 2020, the Company recorded a tax benefit of $8.9 million on pretax loss of $442.8 million. The tax benefit reflects the impact of non-deductible items, changes in the Company’s valuation allowance on our deferred tax assets and for foreign rate differential. For the Successor three months ended April 30, 2021, the Company recorded a tax benefit of $2.1 million on pretax loss of $39.5 million. The tax benefit reflects current period changes to unrecognized tax positions, foreign rate differential, and changes in the Company’s valuation allowance on our deferred tax assets. | (7) Under the Plan of Reorganization described in Notes 1 and 3, a substantial amount of the Company’s debt was extinguished upon emergence from Chapter 11. This debt extinguishment, along with other effects of the reorganization, resulted in a gain of $3.3 billion recognized for financial reporting purposes. For tax purposes, the income from the cancellation of indebtedness (“CODI”) in the U.S. is generally excluded from taxable income and instead treated as the reduction of certain tax attributes or tax basis in certain assets. As a result, the Company’s U.S. federal net operating loss (“NOL”) and tax credits have been entirely reduced as of January 31, 2021. As a result of the reduction to the Company’s U.S. Federal NOL and tax credits for CODI, as well as the reversal of any deferred taxes that were previously established for liabilities that were discharged in the Plan of Reorganization, the Company recognized a reduction to the related valuation allowance. Further, non-U.S. CODI is not taxable in non-U.S. jurisdictions and the reversal of any deferred taxes in other foreign locations that were previously established for liabilities that were discharged in the Plan of Reorganization, were largely offset by a corresponding reduction to the related valuation allowance. In connection with the Plan of Reorganization, the Company recorded an income tax expense of $4.4 million for reorganization adjustments in the period from February 1, 2020 through August 27, 2020 (Predecessor). These adjustments primarily consist of (i) $18.6 million in tax expense for the reduction in federal and state NOL carryforwards and tax credits from the CODI realized upon emergence; (ii) $8.8 million in tax expense for the reduction in other U.S. attributes not mentioned above; (iii) $106.5 million in tax expense for the reversal of deferred tax assets on liabilities in jurisdictions outside the U.S. discharged in the Plan of Reorganization; (iv) $129.5 million in tax benefit for the reduction in valuation allowance resulting from the adjustments described above. As a result of the fresh start accounting adjustments described in Note 4, there were significant tax adjustments recorded in the period from February 1, 2020 through August 27, 2020 (Predecessor). The Company recognized $73.4 million in income tax expense on a consolidated basis, consisting of $77.2 million of tax expense for the increase in deferred tax liabilities resulting from fresh start accounting adjustments which was partially offset by $3.8 million of a tax benefit for the reduction in valuation allowance on existing deferred tax assets. Significant components of the income tax benefit (provision) consist of the following (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 CURRENT: Luxembourg $ — $ — $ — $ — Ireland (268) 333 1,099 1,559 United States 1,012 588 2,405 652 Other foreign locations 462 1,300 1,949 3,231 Current tax provision 1,206 2,221 5,453 5,442 DEFERRED: Luxembourg 2,594 — — — Ireland (1,856) 43,483 8,533 1,517 United States (19,265) 17,256 (2,693) (1,906) Other foreign locations (4,613) 5,495 (81) (26) Deferred tax (benefit) / provision (23,140) 66,234 5,759 (415) Income tax (benefit) / provision $ (21,934) $ 68,455 $ 11,212 $ 5,027 Current tax provision for the period from August 28, 2020 through January 31, 2021 (Successor) of $1.2 million primarily relates to state income taxes on operating profits generated in certain state jurisdictions during the period. The federal current tax expense for the Successor period was not significant due to the net operating loss carryforwards that were available to offset taxable income since the reduction in certain tax attributes and tax basis in certain assets occurs on the last day of the tax year in which the bankruptcy occurred, which was January 31, 2021. Current tax expense for the period from February 1, 2020 through August 27, 2020 (Predecessor) of $2.2 million primarily consists of other foreign location current taxes payable at countries which serve as limited risk distributors of the Company’s intellectual property as well state taxes for separate state tax filings and unitary state tax provision to return adjustments . Current tax expense for the years ended January 31, 2020 and 2019 primarily consist of state taxes for separate state tax filings and other foreign location current taxes payable at countries which serve as limited risk distributors of the Company’s intellectual property. Deferred tax benefit for the Successor period of $23.1 million primarily relates to the reversal of temporary differences created by basis differences in intangible assets and deferred revenue recorded in fresh-start accounting. Deferred tax provision for the period from February 1, 2020 through August 27, 2020 (Predecessor) of $66.2 million primarily resulted from the recognition of $73.4 million in consolidated tax expense from fresh-start accounting and reorganization items described above being partially offset by a tax benefit recognized upon impairment of the indefinite lived tradename asset described further in Note 5. Deferred tax provision for the year ended January 31, 2020 of $5.7 million related primarily to changes in other foreign country valuation allowances. Deferred tax benefit for the year ended January 31, 2019 of $0.4 million related to provision to return adjustments being partially offset by changes in state tax rates. The following table presents the U.S. and foreign components of (loss) income before income taxes (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Luxembourg $ 9,220 $ — $ — $ — Ireland (3,741) 2,437,738 (645,360) (336,002) United States (86,333) 364,827 (197,600) (62,805) Other foreign locations (34,802) 29,902 4,967 3,995 (Loss) income before income taxes $ (115,656) $ 2,832,467 $ (837,993) $ (394,812) A reconciliation of the relevant statutory rate to the Company’s effective tax rate is as follows: Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Income tax provision (benefit) at Luxembourg (24.9%) / Irish statutory rate (12.5%) (24.9) % 12.5 % (12.5) % (12.5) % Increase (decrease) in tax resulting from: US State income taxes, net of federal benefit (5.7) (0.2) (0.2) (0.8) Foreign rate differential 6.1 (0.2) (1.9) (1.2) Other permanent items (0.1) 0.7 1.2 2.5 Transaction costs (7.6) 0.2 Unrecognized tax benefit (0.4) — 0.2 0.3 Change in valuation allowance 3.5 (4.2) 5.5 9.6 Impairment of goodwill — 0.8 7.9 — Reorganization and fresh start adjustments 9.6 (7.3) — — Other 0.5 0.1 1.2 3.4 Effective tax rate – provision (benefit) (19.0) % 2.4 % 1.4 % 1.3 % The Company recorded $4.6 million of income tax expense in the period from August 28, 2020 through January 31, 2021 (Successor) related to changes in estimates of U.S. NOL and tax credits which will be reduced by CODI for tax year ended January 31, 2021. Deferred income taxes are provided for the effects of temporary differences between the amounts of assets and liabilities recognized for financial reporting purposes and the amounts recognized for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities as of the periods presented were as follows (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 ASSETS: Net operating loss carryforwards $ 13,517 $ 29,753 Deferred interest expense 35,852 145,399 Customer relationships — 6,888 Reserves and accruals 9,038 7,204 Lease liabilities 3,862 — Tax credits 99 5,893 Transaction costs 19,532 4,216 Other intangibles 3,505 7,237 Gross deferred tax assets 85,405 206,590 Less: Valuation allowance (45,567) (160,531) Net deferred tax assets $ 39,838 $ 46,059 LIABILITIES: Intangibles $ (99,587) $ (78,017) Property and equipment, net (2,971) (5,665) Accrued Interest (4,522) — Right-of-use asset (3,141) — Deferred revenue (6,199) — Other (4,426) — Gross deferred tax liabilities (120,846) (83,682) Total net deferred tax liabilities, net $ (81,008) $ (37,623) In assessing the realization of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company considered the scheduled reversal of deferred tax assets and liabilities in assessing the realization of deferred tax assets. Based on this assessment, the Company determined that it is more likely than not that the deferred tax assets in certain significant jurisdictions including France, Ireland, and the United States, will not be realized to the extent they exceed reversal of deferred tax liabilities. As of January 31, 2021, the Company had tax effected NOLs of $13.6 million, comprised of $2.4 million for U.S. state and local taxes, $1.5 million for Ireland, $9.7 million for the rest of the world. The U.S. state and local taxes NOL carryforwards that remain after the impact of CODI expire at various dates through 2030. The Ireland and other foreign location NOL carryforwards are not subject to expiration, while the remainder, if not utilized, will substantially expire at various dates through 2040. As of January 31, 2021, the Company had tax effected interest expense carryforwards of $33.5 million all of which are subject to limitation pursuant to Section 382. As of January 31, 2021, there were $3.9 million of unrecognized tax benefits (“UTBs”) associated with uncertain tax positions and an additional $1.9 million of accrued interest and penalties, all of which, if recognized, would affect the Company’s effective tax rate. The Company accounts for interest and penalties related to uncertain tax positions as part of its provision for income taxes. In the ordinary course of business, the Company’s income tax returns are subject to examination by the tax authorities in certain jurisdictions including the United States and Ireland. With few exceptions, the Company is no longer subject to income tax examination for years before 2017 in these material jurisdictions. Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Unrecognized tax benefits, beginning balances $ 3,768 $ 3,773 $ 2,081 $ 5,035 Increases for tax positions taken during the current period — — — — Increases for tax positions taken during a prior period 37 35 1,987 915 Decreases for tax positions taken during a prior period — (40) (295) (3,736) Other 452 — — — Decreases resulting from the expiration of statute of limitations (339) — — (133) Unrecognized tax benefits, ending balance $ 3,918 $ 3,768 $ 3,773 $ 2,081 The Company generally considers the excess of its financial reporting over its tax basis in its investment in foreign subsidiaries to be essentially permanent in duration and has not computed or recorded significant taxes on repatriations of the earnings of its foreign subsidiaries. As a result of the one-time repatriation tax on foreign earnings required under the 2017 U.S. Tax Cuts and Jobs Act, the prior earnings of its foreign subsidiaries were deemed repatriated. The Company did not record a deferred tax liability for earnings of foreign subsidiaries for the period August 28, 2020 through January 31, 2021 (Successor), the period February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and January 31, 2019 as the Company is permanently reinvested in these jurisdictions. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted and signed into law. Certain provisions of the CARES Act impacted the FY21 and FY20 income tax provision computations of the Company. The CARES Act contains modifications on the limitation of business interest for tax years beginning in 2019 and 2020. The modifications to Section 163(j) increase the allowable business interest deduction from 30% of adjusted taxable income to 50% of adjusted taxable income. This modification increased the Company’s allowable interest expense deduction, reducing taxable income and allowing for the utilization of net operating losses. |
Prepaid expenses and other curr
Prepaid expenses and other current assets | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Prepaid expenses and other current assets | (5) Prepaid Expenses and Other Current Assets Prepaid expense and other current assets in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Deferred commission costs – current $ 4,019 $ 3,147 Refundable income tax 9,618 8,969 Prepaid software maintenance costs 8,370 8,587 Prepaid royalties 2,876 2,958 Other 6,942 6,665 Total prepaid expenses and other current assets $ 31,825 $ 30,326 | (8) Prepaid expense and other current assets in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Deferred commission costs – current $ 3,147 $ 11,195 Refundable income tax 8,969 6,726 Prepaid software maintenance costs 8,587 6,569 Prepaid royalties 2,958 2,294 Employee bonus advance — 1,867 Other 6,665 7,771 Total prepaid expenses and other current assets $ 30,326 $ 36,422 |
Other Assets
Other Assets | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Other Assets | (6) Other Assets Other assets in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Deferred commission costs – non-current $ 5,733 $ 4,437 Other 3,772 4,199 Total other assets $ 9,505 $ 8,636 | (9) Other assets in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Deferred commission costs – non-current $ 4,437 $ 11,692 Non-current refundable income tax — 1,979 Other 4,199 2,635 Total other assets $ 8,636 $ 16,306 |
Accrued Expenses
Accrued Expenses | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Accrued Expenses | (7) Accrued Expenses Accrued expenses in the accompanying consolidated balance sheets consisted of the following (in thousands): April 30, 2021 January 31, 2021 Professional fees $ 6,018 $ 8,832 Accrued sales tax/VAT 2,144 5,379 Accrued royalties 1,961 2,152 Accrued tax 4,727 2,634 Accrued interest 368 491 Other accrued liabilities 3,067 3,637 Total accrued expenses $ 18,285 $ 23,125 | (10) Accrued expenses in the accompanying consolidated balance sheets consisted of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Professional fees $ 8,832 $ 12,947 Accrued sales tax/VAT 5,379 5,824 Accrued royalties 2,152 1,869 Accrued tax 2,634 1,288 Accrued interest 491 274 Other accrued liabilities 3,637 7,065 Total accrued expenses $ 23,125 $ 29,267 |
Restructuring
Restructuring | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Restructuring | (8) Restructuring In connection with strategic initiatives implemented during the three months ended April 30, 2021 (Successor) and April 30, 2020 (Predecessor), the Company’s management approved and initiated plans to reduce its cost structure and better align operating expenses with existing economic conditions and the Company’s operating model. The Company recorded a $0.5 million, and $0.4 million of restructuring charge during the three months ended April 30, 2021 (Successor) and April 30, 2020 (Predecessor), respectively, which is included in the statement of operations as restructuring. Substantially all of this charge represents the severance costs of terminated employees. Activity in the Company’s restructuring accrual was as follows (in thousands): Employee Severance Contractual and Related Costs Obligations Total Restructuring accrual as of January 31, 2021 $ 5,000 $ 171 $ 5,171 Restructuring charges incurred 311 226 537 Payments made (2,049) (298) (2,347) Foreign currency translation adjustment — — — Restructuring accrual as of April 30, 2021 $ 3,262 $ 99 $ 3,361 | (11) In connection with strategic initiatives implemented during the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019, the Company’s management approved and initiated plans to reduce its cost structure and better align operating expenses with existing economic conditions and the Company’s operating model. The Company recorded a $4.3 million, $1.2 million, $1.9 million and $2.1 million of restructuring charge during the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and January 31, 2019, respectively, which is included in the statement of operations as restructuring. Substantially all of this charge represents the severance costs of terminated employees. Activity in the Company’s restructuring accrual was as follows (in thousands): Employee Severance Contractual and Related Costs Obligations Total Restructuring accrual as of January 31, 2018 $ 1,504 $ 25 $ 1,529 Restructuring charges incurred 1,971 102 2,073 Payments made (1,720) (100) (1,820) Foreign currency translation adjustment (42) — (42) Restructuring accrual as of January 31, 2019 $ 1,713 $ 27 $ 1,740 Restructuring charges incurred 1,610 290 1,900 Payments made (2,588) (41) (2,629) Foreign currency translation adjustment 26 — 26 Restructuring accrual as of January 31, 2020 (Predecessor) $ 761 $ 276 $ 1,037 Restructuring charges incurred 1,032 147 1,179 Payments made (559) (154) (713) Foreign currency translation adjustment — — — Restructuring accrual as of August 27, 2020 (Predecessor) $ 1,234 $ 269 $ 1,503 Restructuring charges incurred 4,218 123 4,341 Payments made (452) (221) (673) Foreign currency translation adjustment — — — Restructuring accrual as of January 31, 2021 (Successor) $ 5,000 171 5,171 |
Employee Benefit Plan
Employee Benefit Plan | 5 Months Ended |
Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Employee Benefit Plan | (12) The Company has a 401(k) plan covering all US-based employees of the Company who have met certain eligibility requirements. Under the terms of the 401(k) plan, the employees may elect to make tax- deferred contributions to the 401(k) plan. In addition, the Company may make discretionary contributions to the 401(k) plan. Under this plan, contributions of approximately $1.5 million, $2.0 million, $3.5 million and $3.5 million were made for the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), the fiscal year ended January 31, 2020 and the fiscal year ended January 31, 2019, respectively. In addition, the Company has various retirement and post-employment plans covering certain international employees. Certain of the plans allow the Company to match employee contributions up to a specified percentage as defined by the plans. Under these plans, contributions of approximately $0.6 million, $0.7 million, $1.1 million, and $1.6 million were made for the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), the fiscal year ended January 31, 2020 and the fiscal year ended January 31, 2019, respectively. |
Leases, Commitment and Continge
Leases, Commitment and Contingencies | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Leases, Commitment and Contingencies | (9) Leases, Commitment and Contingencies Leases The Company has entered into a number of facility leases to support its research and development activities, sales operations and other corporate and administrative functions in North America, Europe, and Asia, which qualify as operating leases under U.S. GAAP. The Company also has entered into an equipment lease agreement for its hosting services and storage, which qualifies as finance lease under U.S. GAAP. The Company’s leases have remaining terms of six months to thirteen years. Some of the Company’s leases include options to extend or terminate the lease prior to the end of the agreed upon lease term. For purposes of calculating lease liabilities, lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. During the three months ended April 30, 2021, the Company determined it would exercise the purchase option to purchase all the leased equipment at the end of the finance lease term which is December 31, 2021. Per the lease agreement, the purchase price of the equipment is at its then current fair market value not to exceed 12% of the original equipment cost. As a result, the Company remeasured the finance lease liability by including the purchase price, 12% of the original equipment cost, at the end of lease term, and increased the finance lease liability and related right-of-use asset by $0.4 million as of April 30, 2021. Operating lease and finance lease ROU assets and liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the lease commencement date. As the Company’s operating leases generally do not provide an implicit rate, the Company uses an estimated incremental borrowing rate in determining the present value of future payments. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular location and currency environment. The Company used an implicit rate provided in the equipment lease agreement for its finance lease in determining the present value of future payments. In connection with the Company’s emergence from bankruptcy and in accordance with ASC 852, the Company applied the provisions of fresh start reporting to its Consolidated Financial Statements on the Effective Date. The operating leases are included in the caption “Right of use assets”, “Lease Liabilities”, and “Long-term lease liabilities” on the Company’s consolidated balance sheets as of April 30, 2021. The finance lease is included in the caption “Property and equipment, net” and “Lease Liabilities” on the Company’s consolidated balance sheets as of April 30, 2021. The weighted-average remaining lease term of the Company’s operating leases is 6.7 years and the remaining lease term of its finance lease is 0.7 years as of April 30, 2021 (Successor). Lease costs for minimum lease payments is recognized on a straight-line basis over the lease term. The lease costs were $1.4 million and related cash payments were $1.6 million for the three months ended April 30, 2021 (Successor). The lease costs were $1.6 million and related cash payments were $1.5 million for the three months ended April 30, 2020 (Predecessor). Lease costs are included within content and software development, selling and marketing, and general and administrative lines on the consolidated statements of operations, and the operating leases related cash payments were included in the operating cash flows and the finance lease related cash payments were included in the financing cash flows on the consolidated statements of cash flows. Short-term lease costs and variable lease costs are not material. The table below reconciles the undiscounted future minimum lease payments under non-cancellable leases with terms of more than one year to the total lease liabilities recognized on the consolidated balance sheets as of April 30, 2021 (Successor): Fiscal Year Ended January 31, 2021 (in thousands): Operating Leases Finance Leases 2022 (excluding 3 months ended April 30, 2021) $ 3,898 $ 1,209 2023 4,065 — 2024 3,499 — 2025 2,684 — 2026 1,245 Thereafter 6,245 — Total future minimum lease payments 21,636 1,209 Less effects of discounting (5,692) (93) Total lease liabilities $ 15,944 $ 1,116 Reported as of April 30, 2021 Lease liabilities $ 3,574 $ 1,116 Long-term lease liabilities 12,370 — Total lease liabilities $ 15,944 $ 1,116 Litigation From time to time, the Company is a party to or may be threatened with litigation in the ordinary course of its business. The Company regularly analyzes current information, including, as applicable, the Company’s defense and insurance coverage and, as necessary, provides accruals for probable and estimable liabilities for the eventual disposition of these matters. The Company is presently not a party to any material legal proceedings. | (13) Leases The Company has entered into a number of facility leases to support its research and development activities, sales operations and other corporate and administrative functions in North America, Europe, and Asia, which qualify as operating leases under U.S. GAAP. The Company also has entered into an equipment lease agreement for its hosting services and storage, which qualifies as finance lease under U.S. GAAP. The Company’s leases have remaining terms of nine months to thirteen years. Some of the Company’s leases include options to extend or terminate the lease prior to the end of the agreed upon lease term. For purposes of calculating lease liabilities, lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. During the fourth quarter of fiscal year 2021, the Company determined it would exercise the option to terminate its Paris facility lease on October 31, 2021 which is three years prior to the end of the original lease term. Per the lease agreement, the Company has the right to terminate lease without the landlord’s consent, and the Company only needs to issue a six-month notice to the landlord. As a result, the Company remeasured the lease liability using the revised lease term, and reduced Paris facility related right-of-use (ROU) asset and lease liability by $1.1 million as of January 31, 2021. Operating lease and finance lease ROU assets and liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the lease commencement date. As the Company’s operating leases generally do not provide an implicit rate, the Company uses an estimated incremental borrowing rate in determining the present value of future payments. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular location and currency environment. The Company used an implicit rate provided in the equipment lease agreement for its finance lease in determining the present value of future payments. In connection with the Company’s emergence from bankruptcy and in accordance with ASC 852, the Company applied the provisions of fresh start reporting to its Consolidated Financial Statements on the Effective Date. The operating leases are included in the caption “Right of use assets”, “Lease Liabilities”, and “Long-term lease liabilities” on the Company’s consolidated balance sheets as of January 31, 2021. The finance lease is included in the caption “Property and equipment, net” and “Lease Liabilities” on the Company’s consolidated balance sheets as of January 31, 2021. For the fiscal years ending January 31, 2020 and 2019, the Company accounted for leases in accordance with ASC 840. Under ASC 840, the Company recognized the total related rent expense on a straight-line basis over its expected lease term for operating leases that contained predetermined fixed escalations of the minimum rent, with a deferred asset or liability reported on the balance sheet for the difference between expense and cash paid. Total rent expense for the fiscal year ending January 31, 2020 and 2019 was $5.7 million and $5.4 million, respectively. The weighted-average remaining lease term of the Company’s operating leases is 6.8 years and the remaining lease term of its finance lease is 0.9 years as of January 31, 2021 (Successor). Lease costs for minimum lease payments is recognized on a straight-line basis over the lease term. The lease costs were $3.9 million and related cash payments were $3.6 million for the period from February 1, 2020 through August 27, 2020 (Predecessor). The lease costs were $2.7 million and related cash payments were $2.7 million for the period from August 28, 2020 through January 31, 2021 (Successor). Lease costs are included within content and software development, selling and marketing, and general and administrative lines on the consolidated statements of operations, and the operating leases related cash payments were included in the operating cash flows and the finance lease related cash payments were included in the financing cash flows on the consolidated statements of cash flows. Short-term lease costs and variable lease costs are not material. The table below reconciles the undiscounted future minimum lease payments under non-cancellable leases with terms of more than one year to the total lease liabilities recognized on the consolidated balance sheets as of January 31, 2021 (Successor): Operating Finance As of January 31, 2021 (in thousands): Leases Leases 2022 $ 5,203 $ 1,112 2023 4,070 — 2024 3,514 — 2025 2,697 — Thereafter 7,509 — Total future minimum lease payments 22,993 1,112 Less effects of discounting (6,120) (90) Total lease liabilities $ 16,873 $ 1,022 Reported as of January 31, 2021 Lease liabilities $ 3,718 $ 1,022 Lease liabilities non-current 13,155 — Total lease liabilities $ 16,873 $ 1,022 Litigation From time to time, the Company is a party to or may be threatened with litigation in the ordinary course of its business. The Company regularly analyzes current information, including, as applicable, the Company’s defense and insurance coverage and, as necessary, provides accruals for probable and estimable liabilities for the eventual disposition of these matters. The Company is presently not a party to any material legal proceedings. Guarantees The Company’s software license arrangements and hosting services are typically warranted to perform in a manner consistent with general industry standards that are reasonably applicable and substantially in accordance with the Company’s product documentation under normal use and circumstances. The Company’s arrangements also include certain provisions for indemnifying customers against liabilities if its products or services infringe a third party’s intellectual property rights. The Company has entered into service level agreements with some of its hosted application customers warranting certain levels of uptime reliability and such agreements permit those customers to receive credits against monthly hosting fees or terminate their agreements in the event that the Company fails to meet those levels for an agreed upon period of time. To date, the Company has not incurred any material costs as a result of such indemnifications or commitments and has not accrued any liabilities related to such obligations in the accompanying consolidated financial statements. |
Long-Term Debt
Long-Term Debt | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Long-Term Debt | (10) Long-Term Debt Exit Credit Facility (Successor) Upon emergence from Chapter 11, the Company entered into the Exit Credit Facility of $520 million consisting of (i) a $110 million super senior term loan facility, the First Out Term Loan, and (ii) a $410 million first lien, second-out term loan facility, the Second Out Term Loan. The Exit Credit Facility bears interest at a rate equal to LIBOR plus 7.50% per annum, with a LIBOR floor of 1.00%. The First Out Term loan is due in December 2024 and the Second Out Term Loan is due April 2025. The Exit Credit Facility contains customary provisions and reporting requirements, including prepayment penalties and a maximum leverage covenant that will be first measured January 31, 2022 and each quarter thereafter. Quarterly principal repayments of $1.3 million begin for the quarter ended April 30, 2021 and increase to $2.6 million for the quarter ended April 30, 2022 until maturity. The Company considered the fair value of its external borrowings and believes their carrying values approximate fair value based on the recent fair value assessment done for fresh-start accounting. Minimum principal payments under the exit facility are as follows: Fiscal year ended January 31: 2022 (remaining 9 months) $ 3,900 2023 10,400 2024 10,400 2025 112,700 2026 381,300 Total payments 518,700 Less: Current portion (6,500) Less: Unamortized Fresh-Start Reporting Fair Value Adjustment (4,273) Long-term portion $ 507,927 | (14) Exit Credit Facility (Successor) Upon emergence from Chapter 11, the Company entered into the Exit Credit Facility of $520 million consisting of (i) a $110 million super senior term loan facility, the First Out Term Loan, and (ii) a $410 million first lien, second-out term loan facility, the Second Out Term Loan. The Exit Credit Facility bears interest at a rate equal to LIBOR plus 7.50% per annum, with a LIBOR floor of 1.00%. The First Out Term loan is due in December 2024 and the Second Out Term Loan is due April 2025. The Exit Credit Facility contains customary provisions and reporting requirements, including prepayment penalties and a maximum leverage covenant that will be first measured January 31, 2022 and each quarter thereafter. Quarterly principal repayments of $1.3 million begin for the quarter ended April 30, 2021 and increase to $2.6 million for the quarter ended April 30, 2022 until maturity. The Company ceased to accrue interest expense on long-term debt reclassified as Liabilities subject to compromise as of the Petition Date, resulting in approximately $100.4 million in contractual interest not being accrued for the period from June 14, 2020 to August 27, 2020 (Predecessor). The Company considered the fair value of its external borrowings and believes their carrying values approximate fair value based on the recent fair value assessment done for fresh-start accounting. Minimum principal payments under the exit facility are as follows: Fiscal year ended January 31: 2022 $ 5,200 2023 10,400 2024 10,400 2025 112,700 2026 381,300 Total payments 520,000 Less: Current portion (5,200) Less: Unamortized Fresh-Start Reporting Fair Value Adjustment (4,564) Long-term portion $ 510,236 Senior Credit Facilities (Predecessor) On April 28, 2014, Evergreen Skills Lux S.a.r.l., an affiliated entity, (“Holdings”) and the Company entered into a Senior Credit Facility among Holdings, Skillsoft Corporation, Barclays Bank Plc., Deutsche Bank Securities, Morgan Stanley Senior Funding Inc. the lenders party thereto, and the other agents named therein (the “Senior Credit Facility”). Skillsoft Corporation and Holdings were jointly and severally liable for all borrowings under the Senior Credit Facility. The Senior Credit Facility consisted of a $2,035.0 million term loan facility which consisted of a First Lien ($1,365.0 million) and a Second Lien ($670 million), and a $80.0 million revolving credit facility. The Company initially borrowed $664.1 million of the amounts drawn on the First Lien and $302.4 million of the amounts drawn on the Second Lien. The remainder of amounts the First and Second Liens were drawn by Holdings. As of January 31, 2020, the following amounts were outstanding under the Senior Credit Facilities (in thousands): Payable in Fiscal Year First Lien Second Lien Revolving Credit Total Fiscal 2021 $ 627,536 $ 302,336 60,000 $ 989,872 Total $ 627,536 $ 302,336 60,000 $ 989,872 Outstanding borrowings under the Senior Credit Facility by Holdings at January 31, 2020 totaled approximately $1,030 million, consisting of $662,390 in First Lien amounts due and $367,614 in Second Lien amounts due. The Company was jointly and severally liable for those borrowings. Certain loans due from Pointwell to Holdings at January 31, 2020, (described below) represented the basis of the agreements between Holdings and Pointwell as to the additional amounts Pointwell expected to pay on behalf of Holdings under the Senior Credit Facility. All of the loans and accrued interests under the Senior Credit Facility were discharged upon the emergence from Chapter 11 on August 27, 2020. Loan amounts due to parent entity As noted, Holdings had approximately $1,030 million of debt obligations to third parties that were collateralized by substantially all of the assets of Pointwell and for which its subsidiary, Skillsoft Corporation, was jointly and severally liable. At the time the Skillsoft and SumTotal business were acquired by Pointwell, Holdings issued notes to Pointwell corresponding to Holdings’ borrowings under the Senior Credit Facility as well as other acquisition related debt. Additional loans of $50,000 and $54,000 were executed in the fiscal years ended January 31, 2019 and 2018 in satisfaction of paid in kind interest on certain of the loan amounts due to Holdings. A summary of net loans due to Holdings as of January 31, 2020 was as follows: Weighted Average Maturity Instrument Balance Interest Rate Interest Type Issuance Date Date Series 1 $ 933,615 13.0 % Variable, Compounding Apr 25, 2014 Jan 31, 2045 Series 2 598,787 8.0 % Variable, Simple Apr 25, 2014 Apr 28, 2021 Series 3 327,537 11.5 % Variable, Simple Apr 25, 2014 Apr 28, 2021 Series 4 60,000 13.0 % Variable, Compounding Sep 25, 2014 Sep 30, 2044 Series 5(a) 71,538 8.0 % Variable, Simple Sep 25, 2014 Sep 30, 2044 Series 5(b) 28,461 11.5 % Variable, Simple Sep 25, 2014 Sep 30, 2044 Intra-group Loan Agreement 65,000 12.0 % Variable, Compounding Dec 3, 2015 Nov 3, 2044 Funding Bond # 1 54,000 13.0 % Variable, Simple Jan 31, 2018 Apr 28, 2021 Funding Bond # 2 50,000 13.0 % Variable, Simple Jan 29, 2019 Apr 28, 2021 Total $ 2,188,938 Interest payable on the loans above was payable in kind at the election of Pointwell. Accrued and unpaid interest on the Series Loan Notes was $1,067 million as of January 31, 2020. The loan maturities accelerated in the event of actions such as the Chapter 11 reorganization, accordingly all loan balances and accrued interest were presented as current liabilities in the accompanying balance sheet as of January 31, 2020. Additional loans of $160,000 were executed in the period from February 1 2020 through August 27, 2020 (Predecessor) in satisfaction of paid in kind interest on certain of the loan amounts due to Holdings. Pointwell was separated from Evergreen Skills Lux S.à.r.l. effective August 27, 2020 as a result of the reorganization. In connection with the separation, all amounts due to Holdings were cancelled with no cash consideration transferred by either party. Accounts Receivable Facility (Predecessor and Successor) On December 20, 2018, the Company entered into a $75.0 million receivables credit agreement, with a termination date of the earliest of 5 years from closing or 45 days before the revolving credit facility maturity or 180 days before the maturity of any term indebtedness greater than $75 million. There are four classes of available receivables for sale with advance rates between 50.0% and 85.0%. The lenders require the Company to deposit receipts from sold receivables to a restricted concentration account. Receivables that have been sold to the lenders must be transferred to the restricted concentration account within two business days of being collected by the Company. The Company accounts for these transactions as borrowings, as the assets being transferred contain the rights to future revenues. Under these agreements, the Company receives the net present value of the accounts receivable balances being transferred. The interest rate on borrowings outstanding under these agreements was 4.899% at January 31, 2021. Borrowings and repayments under these agreements are presented as cash flows from financing activities in the accompanying consolidated statements of cash flows. On September 19, 2019, the Company amended the receivables credit agreement to include Class “B” lending. This increased the facility borrowing capacity up to $90.0 million. In conjunction with this, it increased the advance rate to 95% across the four classes of available receivables. All other terms and conditions remained materially the same. On August 27, 2020, the Company amended its accounts receivable facility. In connection with the amendment, additional capacity under the previous accounts receivable facility which had been extended by the private equity sponsor of the Company’s prior owner was eliminated, reducing the maximum capacity of the facility from $90 million to $75 million. The maturity date for the remaining $75 million facility was extended to the earlier of (i) December 2024 or (ii) 90 days prior to the maturity of any corporate debt. The Company submits a monthly reconciliation on each month’s settlement date detailing what was collected from the prior months borrowing base and what receivables are being sold during the new borrowing base period to replenish them. If additional receivables are sold to replenish receipts, the funds from the concentration account will be returned to the Company from the restricted concentration account by the administration agent. The reserve balances were $1.7 million at January 31, 2021 and are classified as restricted cash on the balance sheet. |
Long-Term Liabilities
Long-Term Liabilities | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Long-Term Liabilities | (11) Long-Term Liabilities Other long-term liabilities in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Uncertain tax positions; including interest and penalties – long-term $ 4,374 $ 5,794 Warrants 800 900 Other 216 204 Total other long-term liabilities $ 5,390 $ 6,898 In connection with the Company’s emergence from Chapter 11, lenders holding second lien debt prior to the Petition Date also received warrants to purchase common shares of the Company, on or before August 27, 2025, which included (i) tranche A warrants to purchase 235,294 ordinary shares at a price of $262.34 per share and (ii) tranche B warrants to purchase 470,588 ordinary shares at a price of $274.84. The warrants are classified as a liability under GAAP and are remeasured at each balance sheet date, with changes in fair value being recorded in other income and expense. The Company recognized $0.1 million in other income related to the warrants for the three months ended April 30, 2021 (Successor). | (15) Other long-term liabilities in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Uncertain tax positions; including interest and penalties – long-term $ 5,794 $ 6,025 Warrants 900 — Other 204 1,547 Total other long-term liabilities $ 6,898 $ 7,572 In connection with the Company’s emergence from Chapter 11, lenders holding second lien debt prior to the Petition Date also received warrants to purchase common shares of the Company, on or before August 27, 2025, which included (i) tranche A warrants to purchase 235,294 ordinary shares at a price of $262.34 per share and (ii) tranche B warrants to purchase 470,588 ordinary shares at a price of $274.84. The warrants are classified as a liability under GAAP and are remeasured at each balance sheet date, with changes in fair value being recorded in other income and expense. The Company recognized $2,900 in other income related to the warrants for the period from August 28, 2020 through January 31, 2021 (Successor). |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Shareholders' Equity | NOTE 7. STOCKHOLDERS’ EQUITY Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At March 31, 2021 and December 31, 2020, there were no shares of preferred stock issued or outstanding. Class A Common Stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At March 31, 2021, there were 11,090,292 shares of Class A common stock issued and outstanding, excluding 57,909,708 shares of Class A common stock subject to possible redemption. At December 31, 2020, there were 15,287,498 shares of Class A common stock issued and outstanding, excluding 53,712,502 shares of Class A common stock subject to possible redemption. Class B Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At March 31, 2021 and December 31, 2020, there were 17,250,000 shares of Class B common stock issued and outstanding. Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business Combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, any private placement-equivalent warrants issued, or to be issued, to any seller in a Business Combination. | NOTE 8. STOCKHOLDERS’ EQUITY Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At December 31, 2020 and 2019, there were no shares of preferred stock issued or outstanding. Common Stock Class A Common Stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At December 31, 2020 and 2019, there were 15,287,498 and 7,974,075 shares of Class A common stock issued or outstanding, excluding 53,712,502 and 61,025,925 shares of Class A common stock subject to possible redemption, respectively. Class B Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At December 31, 2020 and 2019, there were 17,250,000 shares of Class B common stock issued and outstanding. Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business Combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, any private placement-equivalent warrants issued, or to be issued, to any seller in a Business Combination. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Shareholders' Equity | (12) Shareholders’ Equity Software Luxembourg Holding S.A. (Successor) Reorganization On August 27, 2020 the Company completed a reorganization. As a result of the reorganization, ownership of the Company was transferred to the Company’s lenders and no consideration or right to future consideration was provided to the former equity holders of Pointwell. In addition, the shared-based compensation plans, described below were cancelled with no consideration provided. In Settlement of the company’s Predecessor first and second lien debt obligations, the holders of the Predecessors first lien received a total of 3,840,000 of Class A common shares. The Predecessor’s second lien holders received a total of 160,000 of Class B common shares and a total of 705,882 warrants to purchase additional common shares (see Note 2 for additional discussion on warrants). Share Capital As of January 31, 2021 the Company’s authorized share capital consisted of 1,000,000,000 common shares with a par value $0.01 each. This consists of 800,000,000 Class A shares and 200,000,000 Class B shares. As of January 31, 2021, 4,000,000 common shares were issued and outstanding. This consists of 3,840,000 Class A shares and 160,000 Class B shares. Any amendment to the share capital of the Company shall be voted upon by the extraordinary general meeting of shareholders upon approval by a majority of the shareholders representing three quarters of the share capital at least. The Company has no authorized share capital which would enable its board of managers to increase the share capital. Each share of the Company is entitled to one vote at ordinary and extraordinary general meetings. The amendments to the articles of association of the Company require the approval of a majority of shareholders representing three quarters of the share capital at least. In case the Company shall have only one single shareholder, the sole shareholder exercises all the powers granted to the general meeting of shareholders. Any legally available amounts to be distributed by the Company in or in respect of any financial period (the Company’s financial year starts on the first of February and ends on the thirty-first of January) may be distributed amongst the holders of shares in proportion to the number of shares held by them. Any decision to distribute legally available amounts shall be adopted either by the board of managers or the general meeting of shareholders of the Company, as the case may be. | (16) Software Luxembourg Holding S.A. (Successor) Reorganization As discussed in Note 3, on August 27, 2020 the Company completed a reorganization. As a result of the reorganization, ownership of the Company was transferred to the Company’s lenders and no consideration or right to future consideration was provided to the former equity holders of Pointwell. In addition, the share-based compensation plans, described below were cancelled with no consideration provided. In Settlement of the company’s Predecessor first and second lien debt obligations, the holders of the Predecessors first lien received a total of 3,840,000 of Class A common shares. The Predecessor’s second lien holders received a total of 160,000 of Class B common shares and a total of 705,882 warrants to purchase additional common shares (see Note 2 for additional discussion on warrants). Share Capital As of January 31, 2021 the Company’s authorized share capital consisted of 1,000,000,000 common shares with a par value $0.01 each. This consists of 800,000,000 Class A Shares and 200,000,000 Class B Shares. As of January 31, 2021, 4,000,000 common shares were issued and outstanding. This consists of 3,840,000 Class A Shares and 160,000 Class B Shares. Any amendment to the share capital of the Company shall be voted upon by the extraordinary general meeting of shareholders upon approval by a majority of the shareholders representing three quarters of the share capital at least. The Company has no authorized share capital which would enable its board of managers to increase the share capital. Each share of the Company is entitled to one vote at ordinary and extraordinary general meetings. The amendments to the articles of association of the Company require the approval of a majority of shareholders representing three quarters of the share capital at least. In case the Company shall have only one single shareholder, the sole shareholder exercises all the powers granted to the general meeting of shareholders. Any legally available amounts to be distributed by the Company in or in respect of any financial period (the Company’s financial year starts on the first of February and ends on the thirty-first of January) may be distributed amongst the holders of shares in proportion to the number of shares held by them. Any decision to distribute legally available amounts shall be adopted either by the board of managers or the general meeting of shareholders of the Company, as the case may be. Pointwell Limited (Predecessor) Share-Based Compensation “B” Ordinary Shares Prior to the reorganization, the Company allowed certain executives to purchase “B” Ordinary shares of the Company’s indirect parent, Evergreen Skills Top Holding Lux S.a.r.l, (“Evergreen”) for $0.01 per share. These shares carried certain transfer restrictions and repurchase rights, which allowed Evergreen, in certain circumstances where the holder’s employment was terminated, to repurchase the shares from the employees at the lower of cost or fair market value. These restrictions lapsed over defined vesting periods over which the executives had to remain employed by the Company. Due to these repurchase features, these share purchases were treated as restricted stock for accounting purposes. The compensation expense associated with these awards was recognized in the Company’s financial statements as a capital contribution over the requisite service period. In conjunction with these purchases, the Company paid the related tax liabilities resulting from the purchases on behalf of certain of the executives in return for recourse notes. The notes were issued by executives purchasing shares for the amounts paid on their behalf to cover tax obligations arising from the purchase of these shares. These notes were due nine years from the date of issuance, but were repayable immediately upon transfer of the shares and bear an interest rate deemed to be a market rate. The notes were collateralized by the underlying shares as well as the assets of the executives. If the borrower disposed of the shares and recognized a capital loss tax benefit on those shares, a portion of the loan would be forgiven if the capital loss benefit recognized was less than the unpaid principal and accrued interest. The amount that would have been forgiven was equal the amount of unpaid principal and interest that was in excess of the capital loss recognized plus an amount equal to the income tax owed by the borrower on the amount of forgiveness granted. During the fiscal year ended January 31, 2020, the Company assessed the likelihood of recovery of the loans based on the value of the underlying stock. Based on that assessment, the Company placed a full impairment reserve against the balance of $5.4 million with the expense recorded within general and administrative expense for the year ended January 31, 2020 in the accompanying statement of operations. Notional Units In fiscal 2015, the Company’s parent company implemented a Notional Equity Plan (“the 2015 Plan”). The 2015 Plan allowed the Company to issue notional units to Skillsoft employees. The notional unit entitled the holder to the right to participate in dividends (if declared) or other distributions of cash paid to holders of ordinary shares (which would occur on the liquidation, IPO or sale of the Company). The notional unit did not convey any rights of ownership of the Company or its parent company and was fully vested at the date of grant. As the notional units were based in part by the price of the Company’s ordinary shares and payments on these awards were linked to the value of the Company’s ordinary shares, these units were subject to accounting as share-based payments. The Company evaluated the performance conditions inherent in the awards and determined that the achievement of those conditions was not probable during the period from February 1, 2020 through August 27, 2020 (Predecessor) and as of January 31, 2020 and 2019. As such no compensation expense had been recognized for those awards. These awards were cancelled as part of the bankruptcy proceedings. The following table summarized the share award activity for the fiscal year ended January 31, 2020: Units Outstanding at January 31, 2019 356,771 Issued — Forfeited (104,007) Outstanding at January 31, 2020 252,764 Cancelled (252,764) Outstanding at August 27, 2020 (Predecessor) — |
Revenue
Revenue | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Revenue | (13) Revenue Disaggregated Revenue and Geography Information The following is a summary of revenues by type for the three months ended April 30, 2021 (Successor) and three months ended April 30, 2020 (Predecessor), (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 SaaS and subscription services $ 78,575 $ 101,089 Software maintenance 4,064 5,260 Professional services 8,191 10,946 Perpetual software licenses 871 1,031 Hardware and other — 3 Total net revenues(1) $ 91,701 $ 118,329 The following table sets forth our revenues by geographic region for the three months ended April 30, 2021 (Successor) and three months ended April 30, 2020 (Predecessor), (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Revenues: United States $ 70,170 $ 93,533 Other Americas 4,461 4,931 Europe, Middle East and Africa 12,113 13,787 Asia-Pacific 4,957 6,078 Total net revenues (1) $ 91,701 $ 118,329 Other than the United States, no single country accounted for more than 10% of revenue for all periods presented. Deferred Revenue Deferred revenue activity for the three months ended April 30, 2021 was as follows (in thousands): Deferred revenue at January 31, 2021 (Successor) $ 260,584 Billings deferred 67,034 Recognition of prior deferred revenue (91,701) Deferred revenue at April 30, 2021 (Successor) $ 235,917 Deferred revenue performance obligations relate predominately to time-based SaaS and subscription services that are billed in advance of services being rendered. Deferred Contract Acquisition Costs Deferred contract acquisition cost activity for the three months ended April 30, 2021 was as follows (in thousands): Deferred contract acquisition costs at January 31, 2021 (Successor) $ 7,584 Contract acquisition costs 5,491 Recognition of contract acquisition costs (3,323) Deferred contract acquisition costs at April 30, 2021 (Successor) $ 9,752 | (17) Revenue Components and Performance Obligations Subscription services The Company offers (i) subscriptions for its content offerings, which includes hosted tools that allow users to access and consume its content offerings and (ii) hosted versions of its SumTotal offerings. The Company’s subscription contracts include standard terms and conditions and typically have terms between one and three years. Annual contracts are usually non-cancellable and non-refundable whereas multi-year contracts sometimes allow customers to cancel early at certain anniversary dates. Billing is usually in advance of services being provided, with payments typically due 30 to 60 days from service commencement. The Company’s subscription arrangements usually do not provide customers with the right to take possession of the software and, as a result, are accounted for over time as service arrangements. Access to the platform represents a series of distinct services as the Company continually provides access to, and fulfill its obligation to, the end customer over the subscription term. The series of distinct services represents a single performance obligation that is satisfied over time. Accordingly, the fixed consideration related to subscription revenue is generally recognized on a straight-line basis over the contract term, beginning on the date that the service is made available to the customer. Professional services The Company provides a variety of professional services that generally consist of implementation, integration, consulting and custom content creation services. Most of the Company’s professional service engagements are short in duration, performed on a fixed fee basis with a standard contract with governing terms and conditions. Billing is usually in advance of services being provided, with payments typically due 30 to 60 days from service commencement, however, some customers will negotiate a final milestone billing upon completion of the project. Each service deliverable generally represents a distinct performance obligation and revenue is recognized over time, typically in proportion of the total hours incurred as a percentage of total estimated hours required to complete the project. Perpetual software licenses, hardware and other While less common and decreasing in favor of SaaS offerings, the Company also offers perpetual licenses for some of its SumTotal product offerings. The Company also, from time to time, resells off the shelf hardware that works in conjunction with certain of its SumTotal solutions. The Company sells these products to customers under a contract and payment terms are generally 30 to 60 days from delivery. Each individual product sold to a customer represents a distinct performance obligation and revenue is recognized at the point in time when control of the product transfers, which is typically when the product is shipped to the customer or, in the case of certain software licenses, when the software license term commences and is accessible by the customer. Software maintenance For customers that previously purchased a perpetual software license for one of the Company’s SumTotal products, the Company offers software maintenance. Software maintenance contracts are provided under the Company’s standard terms and conditions and typically have terms of one year of more. Billing is usually in advance of services being rendered, with payments typically due 30 to 60 days from service commencement. Software maintenance contracts include stand-ready performance obligations to provide software updates, bug fixes and call support. Software maintenance contract performance obligations are satisfied over time and revenue is recognized ratably over the term of the support contract. Disaggregated Revenue and Geography Information The following is a summary of revenues by type for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019 (Predecessor) (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 SaaS and subscription services $ 93,205 $ 234,766 $ 439,791 $ 462,240 Software maintenance 4,770 12,079 23,982 30,161 Professional services 9,546 24,499 45,661 38,043 Perpetual software licenses 1,241 2,486 1,885 3,340 Hardware and other 6 21 2,702 357 Total net revenues (1) $ 108,768 $ 273,851 $ 514,021 $ 534,141 The following table sets forth our revenues by geographic region for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019 (Predecessor) (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Revenues: United States $ 84,248 $ 217,783 $ 405,065 $ 421,746 Other Americas 4,724 8,899 21,925 22,807 Europe, Middle East and Africa 13,934 32,788 61,321 66,244 Asia-Pacific 5,862 14,381 25,710 23,344 Total net revenues (1) $ 108,768 $ 273,851 $ 514,021 $ 534,141 (1) As a result of the Company’s adoption of ASC 606 effective February 1, 2019 using the modified retrospective method, prior period amounts have not been adjusted to conform with ASC 606 and therefore may not be comparable. Other than the United States, no single country accounted for more than 10% of revenue for all periods presented. Deferred Revenue Deferred revenue activity for the period February 1, 2020 through August 27, 2020 (Predecessor) and the period August 28, 2020 through January 31, 2021 (Successor) was as follows (in thousands): Deferred revenue at February 1, 2020 (includes current and non-current components) $ 311,170 Billings deferred 163,333 Recognition of prior deferred revenue (273,851) Deferred revenue at August 27, 2020 200,652 Fresh start reporting fair value adjustment (116,252) Deferred revenue at August 28, 2020 (Successor) 84,400 Billings deferred 284,952 Recognition of prior deferred revenue (108,768) Deferred revenue at January 31, 2021 (Successor) $ 260,584 Deferred revenue performance obligations relate predominately to time-based SaaS and subscription services that are billed in advance of services being rendered. Deferred Contract Acquisition Costs Deferred contract acquisition cost activity for the period February 1, 2020 through August 27, 2020 (Predecessor) and the periods August 28, 2020 through January 31, 2021 (Successor) was as follows (in thousands): Deferred contract acquisition costs at February 1, 2020 $ 22,887 Contract acquisition costs 11,965 Recognition of contract acquisition costs (14,060) Deferred contract acquisition costs at August 27, 2020 (Predecessor) $ 20,792 Fresh start reporting fair value adjustment (20,792) Deferred contract acquisition costs at August 28, 2020 (Successor) — Contract acquisition costs 19,973 Recognition of contract acquisition costs (12,389) Deferred contract acquisition costs at January 31, 2021 (Successor) $ 7,584 |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Agreements | 5 Months Ended |
Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Derivative Instruments and Hedging Agreements | (18) The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company manages financial risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding as well as the use of derivative financial instruments. Specifically, the Company has previously entered into certain derivative financial instruments to manage the variable floating rate interest exposure on the Company’s senior credit facilities. The Company’s derivative financial instrument were used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to a portion of the Company’s borrowings. As a result of the reorganization, the derivative financial instruments have expired, and the Company has not entered into any new arrangements. On December 19, 2017, the Company entered into an interest rate cap for the purpose of locking the interest rate on the term loan debt through January 31, 2020. The notional amount of the cap agreement was approximately $376 million (which increased to $751 million on October 31, 2018 when the interest rate swap expired). The cap agreement fixed the interest rate on the debt at 2.117% from January 31, 2018 through January 31, 2020. The Company paid a premium of $2.3 million to enter into this interest rate cap which represented the initial fair value of the instrument. The Company determines the fair value of the cap each reporting period and marks the instrument to market. On May 4, 2018, the Company terminated the three month LIBOR interest rate cap and purchased a one month LIBOR interest rate cap with the same interest rate, notional amount and term as the previous cap locking in the interest rate on the term loan debt through January 31, 2020. The Company also purchased a one month LIBOR forward starting interest rate cap with a term of January 31, 2020 to April 30, 2021. The notional amount of the cap is approximately $884 million with a rate of 2.869% and hedges 95% of the Company’s term loans. The Company paid a premium of $2.4 million to restructure the interest rate caps which represents the initial fair market value of the instruments. The Company’s financial instruments did not qualify for hedge accounting and, as a result, the Company carries the derivatives at its fair value, which is classified as either an asset or liability, with a corresponding adjustment to the statement of operations. Changes in fair value are recorded through Loss or Gain on derivative instruments on our consolidated statement of operations. The change in the fair value of the derivative was immaterial for the period of February 1, 2020 through August 27, 2020 (Predecessor). As of August 27, 2020, as a result of the reorganization, the interest rate cap was terminated. The following table provides a summary of the changes in fair value of the derivative instruments for the period from February 1, 2020 through August 27, 2020 and the fiscal years ended January 31, 2020 and 2019 (in thousands): Assets Liabilities Balances as of January 31, 2018 $ 4,064 $ (130) Sale of derivative instrument (6,776) — Purchase of derivative instrument 9,194 — Change in fair value of derivative instrument (2,414) 130 Balances as of January 31, 2019 4,068 $ — Change in fair value of derivative instrument (4,062) — Balances as of January 31, 2020 $ 6 $ — Change in fair value of derivative instrument (6) — Balances as of August 27, 2021 $ — $ — The table below presents the fair value of our derivative financial instruments as well as their classification on the consolidated balance sheet as of January 31, 2020: Fair value Balance sheet (in thousands) Derivatives not designated as hedging instruments location January 31, 2020 Interest rate derivative contracts Other assets $ 6 |
Fair Value Measurements_2_3
Fair Value Measurements | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Fair Value Measurements | 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: Level 2: Level 3: The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020 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 $ 697,018,229 $ 696,957,196 Liabilities: Warrant liability-Public Warrants 1 33,810,000 45,310,000 Warrant liability-Private Placement Warrants 3 26,702,000 32,548,000 Prosus Agreement liability 3 24,532,413 50,481,190 Conversion option liability 3 1,632,013 1,604,359 The derivative instruments were accounted for as liabilities in accordance with ASC 815-40 and are measured at fair value at inception and on a recurring basis, with changes in fair value recorded in the consolidated statement of operations. At issuance, the Warrant Liability for Public Warrants and Private Placement Warrants were valued as of June 26, 2019 using a Monte Carlo simulation and Black Scholes model, respectively, which are considered to be a Level 3 fair value measurements. Subsequent to the Public Warrants detachment from the Units, the Public Warrants are valued based on quoted market price, under ticker CCX WS, which is a Level 1 fair value. The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the Warrants is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination was 80% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. As of issuance and March 31, 2021, the estimated fair value of Warrant Liability — Private Placement Warrants were determined using a Black-Scholes valuation and based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.68 $ 10.00 Volatility 16.5 % 25 % Probability of completing a Business Combination 80.0 % 90 % Term 5.33 5.08 Risk-free rate 1.86 % 0.94 % Dividend yield 0.0 % 0.0 % At inception, the Prosus Agreement Liability consisted of two components: a commitment for the First Step Investment and an option for the Second Step Investment. Subsequent to Prosus exercising its Second Step Investment option, the Prosus Agreement Liability represented a commitment. The commitment and option were valued using forward contract valuation methodology and a Black Scholes model, respectively. Both valuation methodologies were considered to be Level 3 fair value measurements. As of inception and March 31, 2021, the estimated fair value of Prosus Agreement Liability was determined based on the following significant inputs: At As of March 31, inception 2021 Exercise price $ 400.0 M $ 500.0 M Underlying value $ 436.8 M $ 524.5 M Volatility 40.0 % N/A Term 0.55 0.08 Risk-free rate 0.12 % 0.08 % Dividend yield 0.00 % N/A The Conversion option liability was valued using a Black Scholes model, which was considered to be a Level 3 fair value measurement. At inception and March 31, 2021, the estimated fair value of Conversion option liability was determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 1.00 $ 1.00 Underlying warrant value $ 1.92 * $ 2.09 * Volatility 125.0 % 115.0 % Number of Class A Shares 1.5 M% 1.5 M% Term 0.28 0.08 Risk-free rate 0.09 % 0.01 % Dividend yield 0.0 % 0.0 % * The underlying warrant value equals the calculated fair value of the private placement warrants as of each date presented and determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.97 $ 10.00 Volatility 30.0 % 25 % Probability of completing a Business Combination 85.0 % 90 % Term 5.28 5.08 Risk-free rate 0.41 % 0.94 % Dividend yield 0.0 % 0.0 % The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrants Warrants Warrant Liabilities January 1, 2021 $ 32,548,000 $ 45,310,000 $ 77,858,000 Change in valuation inputs or other assumptions (5,846,000) (11,500,000) (17,346,000) Fair value as of March 31, 2021 26,702,000 33,810,000 60,512,000 There were no transfers in or out of Level 3 from other levels in the fair value hierarchy. | NOTE 11. 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 and liabilities that are measured at fair value on a recurring basis at December 31, 2020 and 2019, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, December 31, Description Level 2020 2019 Assets: Cash and marketable securities held in Trust Account 1 $ 696,957,196 $ 695,295,418 Liabilities: Warrant Liabilities – Public Warrants 1 45,310,000 32,660,000 Warrant Liabilities – Private Placement Warrants 3 32,548,000 23,700,000 Prosus subscription agreement liability 3 50,481,190 — Conversion option liability 3 1,604,359 — The Derivative Instruments were accounted for as liabilities in accordance with ASC 815-40 and are measured at fair value at inception and on a recurring basis, with changes in fair value recorded in the statement of operations. The Warrants were valued as of July 1, 2019 using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement. The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the Warrants is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination was 80% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable 'blank-check' companies without an identified target. The subsequent measurements of the Public Warrants after the detachment of the Public Warrants from the Units is classified as Level 1 due to the use of an observable market quote in an active market under the ticker CVII.WS. The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrant Liabilities Fair value as of April 11, 2019 (inception) $ — $ — $ — Initial measurement on July 1, 2019 15,800,000 22,310,000 38,110,000 Change in valuation inputs or other assumptions 7,900,000 10,350,000 18,250,000 Fair value as of December 31, 2019 23,700,000 32,660,000 56,360,000 Change in valuation inputs and other assumptions 8,848,000 12,650,000 21,498,000 Fair value as of December 31, 2020 $ 32,548,000 $ 45,310,000 $ 77,858,000 | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Fair Value Measurements | (14) Fair Value Measurements FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) establishes a fair value hierarchy that prioritizes the inputs used to measure fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs. Observable inputs are inputs that reflect the assumptions 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 about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The three levels of the fair value hierarchy established by ASC 820 in order of priority are as follows: · Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. · Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. · Level 3: Unobservable inputs that reflect the Company’s assumptions about the assumptions that market participants would use in pricing the asset or liability. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available. The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of April 30, 2021 and are categorized using the fair value hierarchy (in thousands): Total (Level 3) Warrants to purchase Company common stock $ 800 $ 800 Total assets recorded at fair value $ 800 800 The following table is a reconciliation of Level 3 instruments for which significant unobservable inputs were used to determine fair value: Successor Three months ended April 30, 2021 Balance as of January 31, 2021 $ 900 Impact of warrant modification, recorded in shareholders’ equity — Unrealized gains recognized as other income (100) Balance as of April 30, 2021 $ 800 At each relevant measurement date, the warrants were valued using a probability-based approach that considered management’s estimate of the probability of (i) a Favored Sale, (ii) a sale of the company that did not qualify as a Favored Sale and (iii) warrants being held to maturity, with the last two scenarios utilizing a Black-Scholes model to estimate fair value. The Black-Scholes model relies on a number of key assumptions to calculate estimated fair value. The assumed dividend yield of zero is based on the fact that the Company has never paid cash dividends and has no present expectation to pay cash dividends. Management utilized an equity value of $667 million as an input in all Black-Scholes calculations, consistent with the fresh-start reporting valuation after adjusting for warrants. The volatility input utilized in the non-Favored Sale scenario was 35.0%, consistent with the contractually stated rate, and 31.6% for the held to maturity scenario. The assumed risk-free interest rate is the U.S. Treasury security rate with a term equal to the expected life of the warrant. The assumed expected life is based on the maximum contractual term of the warrants as a make-whole provision compensates holders in the event the awards are settled prior to their exercise or expiration. The Company currently invests excess cash balances primarily in cash deposits held at major banks. The carrying amounts of cash deposits, trade receivables, trade payables and accrued liabilities, as reported on the consolidated balance sheet as of April 30, 2021, approximate their fair value because of the short maturity of those instruments. The Company considered the fair value of its external borrowings and believes their carrying values approximate fair value based on the recent fair value assessment done for fresh-start accounting. When calculating goodwill impairments for the three months ended April 30, 2020 (Predecessor), the Company estimated the fair value of its reporting units using income and market multiple approaches. An income approach, which is generally a discounted cash flow methodology that includes assumptions for, among other things, forecasted revenues, gross profit margins, operating profit margins, working capital cash flow, growth rates, income tax rates, expected tax benefits and long-term discount rates, all of which require significant judgments by management. The market approach considered comparable market data based on multiples of revenue and EBITDA. Management also considered the overall value of the Company implied by the trading prices of debt securities, after adjusting for a control premium, given that the enterprise value of the Company was substantially lower than the carrying value of long-term debt. All of these techniques utilized would be considered Level 3 inputs. | (19) FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) establishes a fair value hierarchy that prioritizes the inputs used to measure fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs. Observable inputs are inputs that reflect the assumptions 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 about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The three levels of the fair value hierarchy established by ASC 820 in order of priority are as follows: · Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. · Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. · Level 3: Unobservable inputs that reflect the Company’s assumptions about the assumptions that market participants would use in pricing the asset or liability. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available. The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of January 31, 2021 and are categorized using the fair value hierarchy (in thousands): Total (Level 3) Warrants to purchase Company common stock $ 900 $ 900 Total assets recorded at fair value $ 900 900 The following table is a reconciliation of Level 3 instruments for which significant unobservable inputs were used to determine fair value: Successor August 28, 2020 through January 31, 2021 Balance as of August 28, 2020 $ 11,200 Impact of warrant modification, recorded in shareholders’ equity (7,400) Unrealized gains recognized as other income (2,900) Balance as of January 31, 2021 $ 900 At each relevant measurement date, the warrants were valued using a probability-based approach that considered management’s estimate of the probability of (i) a Favored Sale, (ii) a sale of the company that did not qualify as a Favored Sale and (iii) warrants being held to maturity, with the last two scenarios utilizing a Black-Scholes model to estimate fair value. The Black-Scholes model relies on a number of key assumptions to calculate estimated fair value. The assumed dividend yield of zero is based on the fact that the Company has never paid cash dividends and has no present expectation to pay cash dividends. Management utilized an equity value of $667 million as an input in all Black-Scholes calculations, consistent with the fresh-start reporting valuation after adjusting for warrants. The volatility input utilized in the non-Favored Sale scenario was 35.0%, consistent with the contractually stated rate, and 31.6% for the held to maturity scenario. The assumed risk-free interest rate is the U.S. Treasury security rate with a term equal to the expected life of the warrant. The assumed expected life is based on the maximum contractual term of the warrants as a make-whole provision compensates holders in the event the awards are settled prior to their exercise or expiration. The Company currently invests excess cash balances primarily in cash deposits held at major banks. The carrying amounts of cash deposits, trade receivables, trade payables and accrued liabilities, as reported on the consolidated balance sheet as of January 31, 2021, approximate their fair value because of the short maturity of those instruments. The Company considered the fair value of its external borrowings and believes their carrying values approximate fair value based on the recent fair value assessment done for fresh-start accounting. When calculating goodwill impairments for the year ended January 31, 2020 and the period from February 1, 2020 through August 27, 2020 (Predecessor), the Company estimated the fair value of its reporting units using income and market multiple approaches. An income approach, which is generally a discounted cash flow methodology that includes assumptions for, among other things, forecasted revenues, gross profit margins, operating profit margins, working capital cash flow, growth rates, income tax rates, expected tax benefits and long-term discount rates, all of which require significant judgments by management. The market approach considered comparable market data based on multiples of revenue and EBITDA. Management also considered the overall value of the Company implied by the trading prices of debt securities, after adjusting for a control premium, given that the enterprise value of the Company was substantially lower than the carrying value of long-term debt. All of these techniques utilized would be considered Level 3 inputs. |
Segment Information
Segment Information | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Segment Information | (15) Segment Information ASC 280, Segment Reporting , establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision makers (CODMs) are its Executive Chairman and Chief Administrative Officer. The Company’s CODMs evaluate results using the operating segment structure is the primary basis for which the allocation of resources and financial results are assessed. The Company has organized its business into two segments: Skillsoft and SumTotal. Both of the Company’s businesses market and sell their offerings globally to businesses of many sizes, government agencies, educational institutions and resellers with a worldwide sales force positioned to offer the combinations that best meet customer needs. The CODMs primarily use revenues and operating income as measures used to evaluate financial results and allocation of resources. The Company allocates certain operating expenses to the reportable segments, including general and administrative costs based on the usage and relative contribution provided to the segments. There are no net revenue transactions between the Company’s reportable segments. The Skillsoft business engages in the sale, marketing and delivery of its content learning solutions, in areas such as Leadership and Business, Technology and Developer and Compliance. In addition, Skillsoft offers Percipio, an intelligent online learning experience platform that delivers an immersive learning experience. It leverages its highly engaging content, curated into nearly 700 learning paths (channels) that are continuously updated to ensure customers always have access to the latest information. The SumTotal business provides a unified, comprehensive and configurable solution that allows organizations to attract, develop and retain the best talent. SumTotal’s solution impacts a company’s workforce throughout the entire employee lifecycle and helps companies succeed in an evolving business climate. SumTotal’s primary solutions are Talent Acquisition, Learning Management, Talent Management and Workforce Management. The following table presents summary results for each of the businesses for the three months ended April 30, 2021 and the three months ended April 30, 2020 (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Skillsoft Revenues $ 67,057 $ 84,318 Operating expenses 93,127 287,917 Operating (loss) income (26,070) (203,599) SumTotal Revenues 24,644 34,011 Operating expenses 26,277 168,157 Operating income (loss) (1,633) (134,146) Consolidated Revenues 91,701 118,329 Operating expenses 119,404 456,074 Operating income (loss) (27,703) (337,745) Total non-operating (expense) income (352) 910 Interest expense, net (11,439) (105,959) Reorganization items, net — — (Provision) benefit for income taxes 2,089 8,891 Net (loss) income $ (37,405) $ (433,903) The Company’s segment assets primarily consist of cash and cash equivalents, accounts receivable, prepaid expenses, deferred taxes, property and equipment, goodwill and intangible assets. The following table sets forth the Company’s segment assets as of April 30, 2021 and January 31, 2021 (in thousands): April 30, 2021 January 31, 2021 Skillsoft $ 1,313,124 $ 1,398,379 SumTotal 144,982 147,358 Corporate — — Consolidated $ 1,458,106 $ 1,545,737 The following table sets forth the Company’s long-lived tangible assets by geographic region for the years ended April 30, 2021 and January 31, 2021 (in thousands): April 30, 2021 January 31, 2021 United States $ 9,019 $ 10,613 Ireland 499 609 Rest of world 2,280 2,558 Total $ 11,798 $ 13,780 | (20) ASC 280, Segment Reporting , establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision- making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision makers (CODMs) are its Executive Chairman and Chief Administrative Officer. The Company’s CODMs evaluate results using the operating segment structure is the primary basis for which the allocation of resources and financial results are assessed. The Company has organized its business into two segments: Skillsoft and SumTotal. Both of the Company’s businesses market and sell their offerings globally to businesses of many sizes, government agencies, educational institutions and resellers with a worldwide sales force positioned to offer the combinations that best meet customer needs. The CODMs primarily use revenues and operating income as measures used to evaluate financial results and allocation of resources. The Company allocates certain operating expenses to the reportable segments, including general and administrative costs based on the usage and relative contribution provided to the segments. There are no net revenue transactions between the Company’s reportable segments. The Skillsoft business engages in the sale, marketing and delivery of its content learning solutions, in areas such as Leadership and Business, Technology and Developer and Compliance. In addition, Skillsoft offers Percipio, an intelligent online learning experience platform that delivers an immersive learning experience. It leverages its highly engaging content, curated into nearly 700 learning paths (channels) that are continuously updated to ensure customers always have access to the latest information. The SumTotal business provides a unified, comprehensive and configurable solution that allows organizations to attract, develop and retain the best talent. SumTotal’s solution impacts a company’s workforce throughout the entire employee lifecycle and helps companies succeed in an evolving business climate. SumTotal’s primary solutions are Talent Acquisition, Learning Management, Talent Management and Workforce Management. The following table presents summary results for each of the businesses for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year ended Year ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Skillsoft Revenues $ 72,425 $ 196,238 $ 362,503 $ 378,316 Operating expenses 158,671 398,178 637,658 364,581 Operating (loss) income (86,246) (201,940) (275,155) 13,735 SumTotal Revenues 36,343 77,613 151,518 155,825 Operating expenses 49,269 205,483 279,579 162,906 Operating income (loss) (12,926) (127,870) (128,061) (7,081) Consolidated Revenues 108,768 273,851 514,021 534,141 Operating expenses 207,940 603,661 917,237 527,487 Operating income (loss) (99,172) (329,810) (403,216) 6,654 Total non-operating (expense) income 3,452 1,268 (5,120) (5,624) Interest expense, net (19,936) (168,236) (429,657) (395,842) Reorganization items, net — 3,329,245 — — (Provision) benefit for income taxes 21,934 (68,455) (11,212) (5,027) Net (loss) income $ (93,722) $ 2,764,012 $ (849,205) $ (399,839) The Company’s segment assets primarily consist of cash and cash equivalents, accounts receivable, prepaid expenses, deferred taxes, property and equipment, goodwill and intangible assets. The following table sets forth the Company’s segment assets as of January 31, 2021 and January 31, 2020 (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Skillsoft $ 1,398,379 $ 1,655,474 SumTotal 147,358 330,785 Corporate — 6 Consolidated $ 1,545,737 $ 1,986,265 The following table sets forth the Company’s long-lived tangible assets by geographic region for the years ended January 31, 2021 and January 31, 2020 (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 United States $ 10,613 $ 13,469 Ireland 609 897 Rest of world 2,558 3,536 Total $ 13,780 $ 17,902 |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Net Income (Loss) Per Share | (16) Net Loss Per Share Basic earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period, plus the dilutive effect of outstanding restricted stock-based awards, stock options, and shares issuable under the employee stock purchase plan using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share (in thousands, except number of shares and per share data): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Net loss $ (37,405) $ (433,903) Weighted average common shares outstanding: Ordinary – Basic and Diluted (Predecessor) * 100 Class A and B – Basic and Diluted (Successor) 4,000 * Net loss per share Loss per share: Ordinary – Basic and Diluted (Predecessor) * $ (4,334.70) Class A and B – Basic and Diluted (Successor) $ (9.35) * * Potential common shares related to participating rights in Notional Units in Evergreen have been excluded as the income generated for three months ended April 30, 2020 (Predecessor) is attributable to gains recognized upon emergence of bankruptcy, which the Notional Units did not participate in as they were cancelled at that time. Warrants to purchase 705,882 common shares have been excluded from the successor period since, for periods of losses, the impact would be anti-dilutive and, for periods of income, no shares would be added to diluted earnings per share under the treasury stock method as the strike price of these awards are above the fair market value of underlying shares for all periods presented. | (21) Basic earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period, plus the dilutive effect of outstanding restricted stock-based awards, stock options, and shares issuable under the employee stock purchase plan using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share (in thousands, except number of shares and per share data): Successor Predecessor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2020 2020 2020 2019 Net (loss) income $ (93,722) $ 2,764,012 $ (849,205) $ (399,839) Weighted average common share outstanding: Ordinary – Basic and Diluted (Predecessor * 100 100 100 Class A – Basic and Diluted 3,840 * * * Class B – Basic and Diluted 160 * * * Net loss per share class (Successor only) Net loss for Class A $ (89,973) * * * Loss on modifications of terms of participation rights held by other shareholders and warrants (5,900) * * * Net loss attributable to Class A $ (95,873) * * * Net loss for Class B $ (3,749) * * * Gain on modifications of terms of participation rights held by other shareholders and warrants 5,900 * * * Net income attributable to Class B $ 2,151 * * * (Losses) income per share: Ordinary – Basic and Diluted (Predecessor) * $ 27,612.51 $ (8,483.57) $ (3,994.40) Class A – Basic and Diluted (Successor) $ (24.97) * * * Class B – Basic and Diluted (Successor) $ 13.44 * * * * Potential common shares related to participating rights in Notional Units in Evergreen have been excluded as the income generated for period from February 1, 2020 through August 27, 2020 (Predecessor) is attributable to gains recognized upon emergence of bankruptcy, which the Notional Units did not participate in as they were cancelled at that time. Potential common shares related to participating rights in Notional Units in Evergreen for the predecessor fiscal years ended January 31, 2020 and 2019 as excluded from earnings per share as they are contingently issuable and the impact would be anti-dilutive. Warrants to purchase 705,882 common shares have been excluded from the successor period since, for periods of losses, the impact would be anti-dilutive and, for periods of income, no shares would be added to diluted earnings per share under the treasury stock method as the strike price of these awards are above the fair market value of underlying shares for all periods presented. |
Related Party Transactions Pred
Related Party Transactions Predecessor Related Party Transactions | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Related Party Transactions | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares In May 2019, the Sponsor purchased 8,625,000 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On June 7, 2019, the Company effected a stock dividend at one-third of one share of Class B common stock for each outstanding share of Class B common stock, resulting in an aggregate of 11,500,000 Founder Shares outstanding. On June 26, 2019, the Company effected a further stock dividend of one-half of a share of Class B common stock for each outstanding share of Class B common stock, resulting in the Sponsor holding an aggregate of 17,250,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the stock dividend. The Founder Shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 7. The Founder Shares included an aggregate of up to 2,250,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, 2,250,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) the date on which the Company completes a liquidation, merger, stock exchange, reorganization or similar transaction after a Business Combination that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A common stock equals or exceeds $12.00 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 at least 150 days after a Business Combination, the Founder Shares will be released form the lock-up. Administrative Support Agreement The Company entered into an agreement, commencing on June 26, 2019 through the earlier of the Company’s consummation of a Business Combination and its liquidation, pursuant to which the Company will pay an affiliate of the Sponsor a total of up to $20,000 per month for office space, administrative and support services. For the three months ended March 31, 2021 and 2020, the Company incurred and paid $60,000 in fees for these services. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor or the Company’s directors and officers 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. 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 either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On November 2, 2020, the Company entered into a convertible promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Promissory Note”). The Convertible Promissory Note is non-interest bearing and payable on the earlier of the date on which the Company consummates a Business Combination or the date that the winding up of the Company is effective. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Promissory Note; however, no proceeds from the Trust Account may be used for such repayment. Up to $1,500,000 of the Convertible Promissory Note may be converted into warrants at a price of $1.00 per warrant at the option of the Sponsor. The warrants would be identical to the Private Placement Warrants. As of March31, 2021 and December 31, 2020, the outstanding balance under the Convertible Promissory Note amounted to an aggregate of $1,500,000. The Company assessed the provisions of the Convertible Promissory Note under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on conversion option liability. The conversion option was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 9). The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the conversion option is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of November 2, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of conversion option: Fair value as of January 1, 2021 $ 1,604,359 Change in valuation inputs and other assumptions 27,624 Fair value as of March 31, 2021 $ 1,632,013 Advisory Fee The Company may engage M. Klein and Company, LLC, an affiliate of the Sponsor, or another affiliate of the Sponsor, as its lead financial advisor in connection with a Business Combination and may pay such affiliate a customary financial advisory fee in an amount that constitutes a market standard financial advisory fee for comparable transactions. | NOTE 6. RELATED PARTY TRANSACTIONS Founder Shares In May 2019, the Sponsor purchased 8,625,000 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On June 7, 2019, the Company effected a stock dividend at one-third of one share of Class B common stock for each outstanding share of Class B common stock, resulting in an aggregate of 11,500,000 Founder Shares outstanding. On June 26, 2019, the Company effected a further stock dividend of one-half of a share of Class B common stock for each outstanding share of Class B common stock, resulting in the Sponsor holding an aggregate of 17,250,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the stock dividend. The Founder Shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 8. The Founder Shares included an aggregate of up to 2,250,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, 2,250,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) the date on which the Company completes a liquidation, merger, stock exchange, reorganization or similar transaction after a Business Combination that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A common stock equals or exceeds $12.00 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 at least 150 days after a Business Combination, the Founder Shares will be released from the lock-up. Promissory Note — Related Party On April 29, 2019, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Promissory Note”). The Promissory Note was non-interest bearing and payable on the earlier of December 31, 2019 or the completion of the Initial Public Offering. The Promissory Note was drawn in the amount of $200,000 and was repaid in full upon the consummation of the Initial Public Offering on July 1, 2019. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or the Company’s officers and directors 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. 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 either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On November 2, 2020, the Company entered into a convertible promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Promissory Note”). The Convertible Promissory Note is non-interest bearing and payable on the earlier of the date on which the Company consummates a Business Combination or the date that the winding up of the Company is effective. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Promissory Note; however, no proceeds from the Trust Account may be used for such repayment. Up to $1,500,000 of the Convertible Promissory Note may be converted into warrants at a price of $1.00 per warrant at the option of the Sponsor. The warrants would be identical to the Private Placement Warrants. As of December 31, 2020, the outstanding balance under the Convertible Promissory Note amounted to an aggregate of $1,500,000. The Company assessed the provisions of the Convertible Promissory Note under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on conversion option liability. The conversion option was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 11). The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the conversion option is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of November 2, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of conversion option: Fair value as of January 1, 2020 $ — Initial measurement on November 2, 2020 1,493,877 Change in valuation inputs and other assumptions 110,482 Fair value as of December 31, 2020 $ 1,604,359 Administrative Support Agreement The Company entered into an agreement whereby, commencing on June 26, 2019 through the earlier of the Company’s consummation of a Business Combination and its liquidation, the Company will pay an affiliate of the Sponsor a total of $20,000 per month for office space, administrative and support services. For the year ended December 31, 2020 and for the period from April 11, 2019 through December 31, 2019, the Company incurred and paid $240,000 and $123,333 of such fees, respectively. Advisory Fee The Company may engage M. Klein and Company, LLC, an affiliate of the Sponsor, or another affiliate of the Sponsor, as its lead financial advisor in connection with a Business Combination and may pay such affiliate a customary financial advisory fee in an amount that constitutes a market standard financial advisory fee for comparable transactions. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Related Party Transactions | (17) Related Party Transactions Successor Related Party Transactions Upon our emergence from Chapter 11 on August 27, 2020, our exit facility consisting of $110 million of First Out Term Loans and $410 million of Second Out Term Loans were financed in whole by our Class A shareholders. Class A shareholders have the ability to trade their debt positions independently from their equity positions, however, as of April 30, 2021, the substantial majority of First Out and Second Out term loans continue to be held by Class A shareholders. | (22) The Company paid the tax obligations for certain current and former executives that purchased “B” ordinary shares in the parent company in return for $5.4 million of recourse notes, which were reserved for in the year ended January 31, 2020. The Company reserved the balance due as a result of certain forgiveness provisions in the event the value of the shares declined. As of January 31, 2020, $9.9 million of outstanding borrowing capacity under the Company’s accounts receivable facility were loaned by the private equity sponsor of Evergreen Skills Lux S.A.R.L., who was a related party. As of January 31, 2020 and 2019, the Company had loans of $2,189 million in outstanding borrowings from Holdings. As of January 31, 2020 and 2019, the Company had accrued interest of $1,067 million and $787 million, respectively, related to these borrowings. Successor Related Party Transactions Upon our emergence from Chapter 11 on August 27, 2020, our exit facility consisting of $110 million of First Out Term Loans and $410 million of Second Out Term Loans were financed in whole by our Class A shareholders. Class A shareholders have the ability to trade their debt positions independently from their equity positions, however, as of January 31, 2021, the substantial majority of First Out and Second Out term loans continue to be held by Class A shareholders. |
Subsequent Events_2_3
Subsequent Events | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Subsequent Events | NOTE 10. 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, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements, except as set forth below. On May 3, 2021, the Company was informed by Prosus that Prosus received notice from CFIUS that it has concluded all action under Section 721 of the Defense Production Act of 1950 and determined that there are no unresolved national security concerns with respect to the Prosus PIPE Investment. | NOTE 12. 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 and in Note 2, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. On January 22, 2021, the Company entered into an amendment (the “Merger Agreement Amendment”), to which amends and restates in its entirety the definition of “Applicable Majority” in the Skillsoft Merger Agreement. The definition of “Applicable Majority” is used in the Skillsoft Merger Agreement. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Subsequent Events | (18) Subsequent Events The Company has evaluated subsequent events through June 11, 2021 the date the financial statements were issued. Churchill Merger On October 12, 2020, the Company and Churchill Capital Corp II, a Delaware corporation (“Churchill”), entered into an Agreement and Plan of Merger (the “Skillsoft Merger Agreement”) by and between Churchill and the Company. Pursuant to the terms of the Skillsoft Merger Agreement, a business combination between Churchill and Skillsoft will be effected through the merger of the Company with and into Churchill, with Churchill surviving as the surviving company (the “Skillsoft Merger”). At the effective time of the Skillsoft Merger (the “Effective Time”), (a) each Class A share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class A Shares”), outstanding immediately prior to the Effective Time, will be automatically canceled and Churchill will issue as consideration therefor (i) such number of shares of Churchill’s Class A common stock, par value $0.0001 per share (the “Churchill Class A Common Stock”) as would be transferred pursuant to the Class A First Lien Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (ii) Churchill’s Class C common stock, par value $0.0001 per share (the “Churchill Class C Common Stock”), as would be transferred pursuant to the Class C Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (b) each Class B share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class B Shares”), will be automatically canceled and Churchill will issue as consideration therefor such number of shares of Churchill Class A common stock equal to the Per Class B Share Merger Consideration (as defined in the Skillsoft Merger Agreement). Pursuant to the terms of the Skillsoft Merger Agreement, Churchill is required to use commercially reasonable efforts to cause the Churchill Class A Common Stock to be issued in connection with the transactions contemplated by the Skillsoft Merger Agreement (the “Skillsoft Transactions”) to be listed on the New York Stock Exchange (“NYSE”) prior to the closing of the Skillsoft Merger (the “Skillsoft Closing”). Immediately following the Effective Time, Churchill will redeem all of the shares of Class C Common Stock issued to the holders of Skillsoft Class A Shares for an aggregate redemption price of (i) $505,000,000 in cash and (ii) indebtedness under the Existing Second Out Credit Agreement (as defined in the Skillsoft Merger Agreement), as amended by the Existing Second Out Credit Agreement Amendment (as defined in the Skillsoft Merger Agreement), in the aggregate principal amount equal to the sum of $20,000,000 to be issued by the Surviving Corporation (as defined in the Skillsoft Merger Agreement) or one of its subsidiaries, in each case, pro rata among the holders of Churchill Class C Common Stock issued in connection with the Skillsoft Merger. The transaction closed effective June 11, 2021. | (23) The Company has evaluated subsequent events through April 9, 2021 the date the financial statements were issued. |
Summary of Significant Accou_12
Summary of Significant Accounting Policies (Policies) | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Use of Estimates | Use of Estimates The preparation of the condensed 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 the 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. | ||
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, except for the Company's derivative instruments (see Note 9). | 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, except for the Company’s Derivative Instruments (see Note 6 and 11). | ||
Derivative Financial Instruments | Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common stock and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. | |||
Concentrations of Credit Risk and Off-Balance-Sheet Risk | 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 Corporation coverage limit of $250,000. The Company has not experienced losses on this account. | 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 limit of $250,000. The Company has not experienced losses on this account. | ||
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 statements 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 and permanent differences. | 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 statements 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, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses (“NOL) and allow businesses to carry back NOLs arising in 2018, 2019 and 2020 to the five prior years, suspend the excess business loss rules, accelerate refunds of previously generated corporate alternative minimum tax credits, generally loosen the business interest limitation under IRC section 163(j) from 30 percent to 50 percent among other technical corrections included in the Tax Cuts and Jobs Act tax provisions. The Company does not believe that the CARES Act will have a significant impact on Company's financial position or statement of operations. | ||
Recently Adopted Accounting Pronouncements | Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements. Management does not believe that any other 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. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. On June 17, 2020, the Company’s Canadian subsidiary, Skillsoft Canada Ltd., voluntarily commenced parallel recognition proceedings under the Companies’ Creditors Arrangement Act (“CCAA”) with the Court of Queen’s Bench of New Brunswick in Canada seeking recognition and enforcement of the Debtors’ Chapter 11 Cases, including the DIP Facility. This action resulted in the deconsolidation of Skillsoft Canada Ltd. under ASC 810, Consolidation and the Company recognizing its retained noncontrolling interest in the Canadian subsidiary at its fair value of approximately $4.8 million. On August 17, 2020, the Canadian Court entered an order recognizing and enforcing the Chapter 11 Cases and Plan in Canada upon the Effective Date. The Company reconsolidated Skillsoft Canada Ltd and de-recognized the non-controlling interest. The Company applied the guidance in ASC 805, Business Combinations for recognizing a new accounting basis for the Canadian subsidiary. | ||
Reclassifications | Reclassifications The Company reclassified $16,244 in professional services fees incurred exploring recapitalization, reorganization and other strategic initiatives from General and Administrative expense to Recapitalization and Transaction Fees in the accompanying statement of operations for the year ended January 31, 2020 to conform with current year presentation. | |||
Emerging Growth Company Status | Emerging Growth Company Status The Company would currently qualify as an “emerging growth company” (EGC), as defined in the Jumpstart Our Business Startups Act (JOBS Act) and accordingly the Company may choose to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not EGCs. The Company may take advantage of these exemptions until the Company is no longer an EGC under Section 107 of the JOBS Act, which provides that an EGC can take advantage of the extended transition period afforded by the JOBS Act for complying with new or revised accounting standards. The Company has elected to use the extended transition period for complying with new or revised accounting standards and as a result of this election, the consolidated financial statements may not be comparable to companies that comply with public company effective dates. | |||
Use of Estimates | Use of Estimates Our preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from our estimates. | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires 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 revenue and expenses during the reporting period. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Significant estimates and assumptions by management affect the Company’s accounting for the impairment of goodwill and its assessment of other intangible assets for potential impairment, determination of estimated period of economic benefit for deferred commissions and income taxes and related valuation allowances. Significant estimates and assumptions were also made by management in determining the fair value of asset and liabilities as required under the application of fresh-start reporting and in the valuation of warrants. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ from management’s estimates if past experience or other assumptions do not turn out to be substantially accurate. | ||
Revenue Recognition | Revenue Recognition On February 1, 2019, the Company adopted ASU 2014‑09, Revenue from Contracts with Customers (Topic 606) and Other Assets and Deferred Costs — Contracts with Customers (Subtopic 340‑40) using the modified retrospective method. Revenue Recognition Policy — After the adoption of ASC 606 Revenue from Contracts with Customers (ASC 606) on February 1, 2019 The Company enters into contracts with customers that provide cloud-based learning solutions and talent management solutions for customers worldwide. These solutions are typically sold on a subscription basis for a fixed term. The Company accounts for a contract when (i) it has approval and commitment from both parties, (ii) the rights of the parties have been identified, (iii) payment terms have been identified, (iv) the contract has commercial substance and (v) collectability of substantially all of the consideration to which the Company will be entitled in exchange for the transfer of goods or services is probable. Approximately one-third of the Company’s revenue recognized each year is related to contracts that have an original duration of one year or less. The Company’s Software as a Service (SaaS) subscription arrangements for learning and talent management solutions generally do not provide customers with the right to take possession of the software supporting the platform or, in the case of learning solutions, to download course content without continuing to incur fees for hosting services and, as a result, are accounted for as service arrangements. Access to the platform and course content represents a series of distinct services as the Company continually provides access to, and fulfill its obligation to, the end customer over the subscription term. The series of distinct services represents a single performance obligation that is satisfied over time. Accordingly, the fixed consideration related to subscription revenue is generally recognized on a straight-line basis over the contract term, beginning on the date that the service is made available to the customer. The Company’s subscription contracts typically vary from one year to three years. The Company’s arrangements are generally non-cancellable and non-refundable. The Company also sells professional services related to its talent management solutions which are typically considered distinct performance obligations and are recognized over time as services are performed. The Company also occasionally sells its talent management solutions by providing perpetual and term-based licenses for on-premise versions of the software. Such arrangements are treated as transfers of intellectual property and the amount of consideration attributable to the delivered licenses are recognized at the point of delivery and the remaining amounts allocated for post contract support are recognized over time. While the vast majority of the Company’s revenue relates to SaaS subscription services where the entire arrangement fee is recognized on a ratable basis over the contractual term, the Company sometimes enter into contractual arrangements that have multiple distinct performance obligations, one or more of which have different periods over which the services or products are delivered. These arrangements may include a combination of subscriptions, products, support and professional services. The Company allocates the transaction price of the arrangement based on the relative estimated standalone selling price, or SSP, of each distinct performance obligation. The Company’s process for determining SSP for each performance obligation, where necessary, involves significant management judgment. In determining SSP, the Company maximizes observable inputs and considers a number of data points, including: · the pricing of standalone sales; · the pricing established by management when setting prices for deliverables that are intended to be sold on a standalone basis; · contractually stated prices for deliverables that are intended to be sold on a standalone basis; and · other pricing factors, such as the geographical region in which the products are sold and expected discounts based on the customer size and type. Determining SSP for performance obligations which the Company rarely or never sell separately also requires significant judgment. In estimating the SSP, the Company considers the likely price that would have resulted from established pricing practices had the deliverable been offered separately and the prices a customer would likely be willing to pay. The Company also sells its cloud-based learning solutions through resellers, where payments are typically based on the solutions sold through to end users. Reseller arrangements of this nature sometimes require the Company to estimate end user activity for a brief period of the contract term, however, amounts estimated and actual amounts subsequently billed have not been material to date. The Company only includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The Company reduces transaction prices for estimated returns and other allowances that represent variable consideration under ASC 606, which the Company estimates based on historical return experience and other relevant factors and records a corresponding refund liability as a component of accrued expenses and other current liabilities. Based on the nature of the Company’s business and product offerings, contingent revenue and other variable consideration are infrequent. While not a common practice for us, in the event the Company grants the customer the option to acquire additional products or services in an arrangement, the Company considers if the option provides a material right to the customer that it would not receive without entering into the contract (e.g., an incremental discount compared to the range of discounts typically given for similar products or services). If a material right is deemed to exist, the Company accounts for the option as a distinct performance obligation and recognizes revenue when those future products or services are transferred or when the option expires. Reimbursements received from customers for out-of-pocket expenses are recorded as revenues, with related costs recorded as cost of revenues. The Company presents revenues net of any taxes collected from customers and remitted to government authorities. The Company applies the practical expedient for contracts with significant financing components that are under one year. The Company applies the practical expedient for the deferral of sales commissions and other contract acquisition costs, which are expensed as incurred, because the amortization period would be one year or less. For deferred contract costs with an expected amortization period of over one year, the Company recognizes such payments over (i) the expected customer relationship period in the case of new customers, which is typically 3 to 5 years for initial commissions, and (ii) the contractual term for existing customers for commissions paid on renewals. As the Company’s contractual agreements predominately call for advanced billing, contract assets are rarely generated. For transaction prices allocated to remaining performance obligations, the Company applies practical expedients and does not disclose quantitative or qualitative information for remaining performance obligations (i) that have original expected durations of one year or less and (ii) where the Company recognizes revenue equal to what it has the right to invoice and that amount corresponds directly with the value to the customer of its performance to date. All remaining performance obligations as of January 31, 2021 qualified for the practical expedient. Revenue Recognition Policy - ASC 605 The Company applied the provisions ASC 605, Revenue Recognition (“ASC 605”) to revenue recognized during the year ended January 31, 2019. The Company commences revenue recognition when all of the following conditions are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the amount of fees to be paid by the customer is fixed or determinable; and (iv) collection is reasonably assured. The majority of SaaS subscription arrangements are accounted for as service arrangements as they do not provide customers with the right to take possession of the software supporting the platform or the right to use downloaded courseware without continuing to pay the full subscription fee which includes fees for hosting services. Revenue for subscription fees is recognized ratably over the subscription term, which typically varies from one to three years. Our on-premise perpetual and term-based licenses are accounted for as software arrangements as the customer takes possession of the software. Revenue for these license fees are recognized ratably over the associated maintenance term. The Company’s arrangements are generally non-cancellable and nonrefundable. Taxes collected from customers are excluded from revenue. For arrangements, with multiple deliverables, the Company evaluates whether the individual deliverables qualify as separate units of accounting. In order to treat deliverables in a multiple-element arrangement as separate units of accounting, the deliverables must have stand-alone value upon delivery and, in situations in which a general right of return exists for the delivered item, delivery or performance of the undelivered item is considered probable and substantially within the Company’s control. The Company’s SaaS subscription services have stand-alone value as it routinely sells subscriptions separately. Professional services included in SaaS service arrangements have stand-alone value as they are routinely sold separately. For such deliverables that have stand-alone value upon delivery, the Company accounts for the deliverables using the relative selling price allocation method. The relative selling price method allocates any discount in the arrangement proportionately to each deliverable on the basis of the deliverable’s estimated selling price. The selling price for each deliverable is based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence (“TPE”) if VSOE is not available, or the Company’s best estimated selling price (“BESP”) if neither VSOE nor TPE are available. For software arrangements, the Company evaluates whether undelivered elements qualify as separate units of accounting. In order to treat the undelivered elements as separate units of accounting, the undelivered elements must have VSOE. The Company’s software arrangements are generally recognized ratably over the maintenance term as the Company does not have VSOE of the fair value of the undelivered maintenance elements. Deferred Revenue The Company records as deferred revenue amounts that have been billed in advance for products or services to be provided. Deferred revenue includes the unrecognized portion of revenue associated with license fees for which the Company has received payment or for which amounts have been billed and are due for payment. Under ASC 605, deferred revenue was not recognized on the balance sheet for outstanding receivables where collection was not probable, fees were not fixed or determinable, or when the customer had termination for convenience rights. Capitalized Commissions After the adoption of ASC 606 on February 1, 2019 In connection with the adoption of ASC 606, the Company implemented new procedures for capitalizing the incremental costs of obtaining customer contracts. The Company capitalizes sales commissions, and associated fringe costs, such as payroll taxes, paid to direct sales personnel and other incremental costs of obtaining contracts with customers, provided the Company expects to recover those costs. The Company determines whether costs should be deferred based on its sales compensation plans, if the commissions are in fact incremental and would not have occurred absent the customer contract. Sales commissions for renewal of a subscription contract are not considered commensurate with the commissions paid for the acquisition of the initial subscription contract given the substantive difference in commission rates between new and renewal contracts. Commissions paid upon the initial acquisition of a contract are amortized over an estimated period of benefit of 3 to 5 years while commissions paid related to renewal contracts are amortized over an estimated average contract term of approximately 12 months. Amortization is recognized on a straight-line basis upon commencement of the transfer of control of the services, commensurate with the pattern of revenue recognition. The period of benefit for commissions paid for the acquisition of initial subscription contracts is determined by taking into consideration the initial estimated customer life and the technological life of the Company’s platform and related significant features. The Company determines the period of benefit for renewal subscription contracts by considering the average contractual term for renewal contracts. Amortization of deferred contract acquisition costs is included within sales and marketing expense in the consolidated statements of operations. Unamortized commission expense of $3.1 and $4.4 million is included in prepaid expenses and other current assets and other assets, respectively, at January 31, 2021 in the accompanying consolidated balance sheets. Unamortized commission expense of $11.2 and $11.7 million is included in prepaid expenses and other current assets and other assets, respectively, at January 31, 2020 in the accompanying consolidated balance sheets. Capitalized Commissions Prior to the adoption of ASC 606 on February 1, 2019 For the year ended January 31, 2019, the Company deferred the recognition of commission expense until such time as the revenue related to the arrangement for which the commission was payable is recognized. Deferred commissions for each contract were amortized in a manner consistent with how revenue is recognized for such contract, often resulting in ratable recognition of expense over the contractual term. | |||
Foreign Currency Translation | Foreign Currency Translation The reporting currency for the Company is the U.S. dollar (“USD”) and the functional currency of the Company’s subsidiaries in the United Kingdom, Canada, Germany, Australia, the Netherlands, France, New Zealand, Singapore, Hong Kong, Japan, Switzerland and India are the currencies of those countries. The functional currency of the Company’s subsidiaries in Ireland is the USD. Assets and liabilities are translated to the USD from the local functional currency at current exchange rates, and income and expense items are translated to the USD using the average rates of exchange prevailing during the year. Gains and losses arising from translation are recorded in other comprehensive income (loss) as a separate component of shareholders’ equity (deficit). Foreign currency gains or losses on transactions denominated in a currency other than an entity’s functional currency are recorded in other income/(expenses) in the accompanying statements of operations. During the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020, and 2019, gains (losses) arising from transactions denominated in foreign currencies other than an entity’s functional currency were approximately $0.2 million, $1.1 million, ($1.0) million and $23 thousand respectively. | |||
Cash, Cash Equivalents and Restricted Stock | Cash, Cash Equivalents and Restricted Stock The Company considers all highly liquid investments with original maturities of 90 days or less at the time of purchase to be cash equivalents. At January 31, 2021 and January 31, 2020, the Company did not have any cash equivalents or available for sale investments. At January 31, 2021 and January 31, 2020, the Company had approximately $3.0 million and $15.0 million of restricted cash, respectively, primarily related to the accounts receivable facility. Under the terms of the accounts receivable facility, the Company has three accounts considered restricted, an interest reserve account, a foreign exchange reserve account and a concentration reserve account. The interest reserve account requires three months interest on the greater of the facility balance or facility balance floor (the facility balance floor was $10.0 million as of January 31, 2021). The foreign exchange reserve account requires the Company to restrict cash for an amount equivalent to the change in the translated value on our foreign receivables borrowed from the date the receivable was sold. The concentration account requires the Company to deposit receipts from the receivables sold until the Company submits a monthly reconciliation report. At that time, the funds may be returned if they are replaced with new receivables. | |||
Recapitalization and Transaction-related Costs | Recapitalization and Transaction-related Costs The Company expenses all transactions costs, which primarily consist of professional services and advisory fees related to the recapitalization of the Company, and activities related to the planned merger with Churchill Capital, as they are incurred as a component of operating expenses, other than those classified as Reorganization items, net, in the consolidated statements of operations. | |||
Risks and Uncertainties | Risks and Uncertainties The Company is subject to a number of risks and uncertainties common to companies in similar industries and stages of development, including, but not limited to, the uncertainty of economic, political and market conditions; data security and privacy risk; regulatory risks; management of growth; dependence on key individuals; management of international operations; intellectual property risks; competition from substitute products and services of larger companies; product development risk; ability to keep pace with technological developments and customer adoption of new products. The Company has been closely monitoring the COVID‑19 pandemic and its impact on the business. The Company is operating normally with minimal disruptions to product and service offerings or content and software development. While the online learnings tools the Company offers have many advantages over traditional in person learning in the current environment, some of the Company’s customers in heavily impacted industries have sought to temporarily reduce spending, resulting in requests for reductions in contract size or requests for extended payment terms upon renewal. | |||
Property and Equipment | Property and Equipment The Company records property and equipment at cost. Depreciation and amortization is charged to operations based on the cost of property and equipment over their respective estimated useful lives on a straight-line basis using the half-year convention, as follows: Description Estimated Useful Lives Computer equipment 3 years Furniture and fixtures 5 years Leasehold improvements Lesser of 7 years or life of lease Expenditures for maintenance and repairs are expensed as incurred, while expenditures for renewals or betterments are capitalized. The Company evaluates the carrying amount of our property and equipment whenever changes in circumstances or events indicate that the value of such assets may not be recoverable. As of January 31, 2021, the Company believes the carrying amounts of its property and equipment are recoverable and no impairment exists. | |||
Content and Software Development Expenses | Content and Software Development Expenses Content and software development expenses consist primarily of personnel and contractor related expenditures to develop the Company’s content, platform and other product offerings. For content related costs, the Company’s policy is to expense costs as incurred. The Company outsources certain aspects of content production to third parties who produce original content on behalf of Skillsoft. Third party costs incurred in these development efforts with external resources may include prepayments and are recognized as expense in proportion to the level of services completed. Software development costs are expensed as incurred, except for costs attributable to upgrades and enhancements that qualify for capitalization. See policy “Capitalized Software Development Costs” for further discussion on this matter. For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 the Company incurred $11.5 million, $12.6 million, $25.9 million and $20.6 million, respectively of proprietary content development expenses. | |||
Capitalized Platform Development Costs | Capitalized Platform Development Costs The Company capitalizes certain internal use software development costs related to its SaaS platform incurred during the application development stage. Costs related to preliminary project activities and to post-implementation activities are expensed as incurred. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable that the expenditures will result in additional functionality. Internal use software is amortized on a straight-line basis over its estimated useful life, which is generally 5 years. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of the assets. Capitalized costs are recorded as intangible assets in the accompanying balance sheets. | |||
Content Partner Royalty Expenses | Content Partner Royalty Expenses For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 the Company recognized $7.3 million, $9.3 million, $16.5 million and $19.0 million, respectively of royalty expenses for third party content used or provisioned in the Company’s content library. | |||
Fair Value of Financial Instruments | Fair Value of Financial Instruments Financial instruments consist mainly of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, debt interest rate cap derivatives and warrants. The carrying amount of accounts receivable is net of an allowance for doubtful accounts, which is based on historical collections and known credit risks. See Note 19 for discussion related to the fair value of the Company’s borrowing agreements. | |||
Deferred Financing Costs and Original Issuance Discounts | Deferred Financing Costs and Original Issuance Discounts The Company amortizes deferred debt financing costs (including issuance costs and creditor fees) and original issuance discounts, both recorded as a reduction to the carrying amount of the related debt liability, as interest expense over the terms of the underlying obligations using the effective interest method. | |||
Derivative Financial Instruments | Derivative Financial Instruments The Company recognizes all derivatives on the balance sheet at fair value. Derivatives that are not designated as a hedge for accounting purposes must be adjusted to fair value through income. The Company classifies cash inflows and outflows from derivatives within operating activities on the statement of cash flows. The Company did not utilize derivative instruments during the period from August 28, 2020 to January 31, 2021 (Successor). The Company’s objective for utilizing derivative instruments during the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 was to reduce its exposure to fluctuations in cash flows due to changes in the variable interest rates of certain borrowings issued under its credit facility. The Company’s strategy to achieve that objective involves entering into interest rate swaps and caps that are specifically designated to certain variable rate instruments and accounted for as cash flow hedges. The Company has elected to not designate their derivatives as hedging relationships. As such the changes in the fair value of the derivatives are recorded directly in statement of operations. | |||
Concentrations of Credit Risk and Off-Balance-Sheet Risk | Concentrations of Credit Risk and Off-Balance-Sheet Risk For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019, no customer individually comprised greater than 10% of revenue. As of January 31, 2021 and 2020, no customer individually comprised more than 10% of accounts receivable. The Company considers its customers’ financial condition and generally does not require collateral. The Company maintains a reserve for doubtful accounts and sales credits that is the Company’s best estimate of potentially uncollectible trade receivables. Provisions are made based upon a specific review of all significant outstanding invoices that are considered potentially uncollectible in whole or in part. For those invoices not specifically reviewed or considered uncollectible, provisions are provided at different rates, based upon the age of the receivable, historical experience, and other currently available evidence. The reserve estimates are adjusted as additional information becomes known or payments are made. The Company has no significant off-balance-sheet arrangements nor concentration of credit risks such as foreign exchange contracts, option contracts or other foreign hedging arrangements. | |||
Intangible Assets, Goodwill and Indefinite-Lived Intangible Impairment Assessments | Intangible Assets, Goodwill and Indefinite-Lived Intangible Impairment Assessments The Company records intangible assets at cost and amortizes its finite-lived intangible assets, including customer contracts and internally developed software, over their estimated useful life. The Company reviews intangible assets subject to amortization at least annually to determine if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in remaining useful life. Conditions that would indicate impairment and trigger a more frequent impairment assessment include, but are not limited to, a significant adverse change in legal factors or business climate that could affect the value of an asset, or an adverse action or assessment by a regulator. In addition, the Company reviews its indefinite-lived intangible assets, including goodwill and certain trademarks, during the fourth quarter of each year for impairment, or more frequently if certain indicators are present or changes in circumstances suggest that impairment may exist and reassesses their classification as indefinite-lived assets. See Note 6 for a discussion of impairment charges recognized for the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019. | |||
Restructuring Charges | Restructuring Charges Liabilities related to an exit or disposal activity are recognized in accordance with ASC Topic 420, Liabilities: Exit or Disposal Cost Obligations . Costs include, but are not limited to, one-time involuntary termination benefits provided to employees under the terms of a benefit arrangement that, in substance, are not an ongoing benefit arrangement or a deferred compensation contract, which are recognized on the communication date and certain contract termination costs, including operating lease termination costs which are recognized on the termination date or cease-use date for ongoing lease payments. In addition, the Company accounts for certain employee-related restructuring charges as an ongoing benefit arrangement in accordance with ASC Topic 712, Compensation — Nonretirement Postemployment Benefits , based on its prior practices and policies for the calculation and payment of severance benefits. The Company recognizes employee-related restructuring charges when the likelihood of future payment is probable, and the amount of the severance benefits is reasonably estimable. The Company recorded facility-related restructuring charges in accordance with ASC 420, before it adopted ASC Topic 842, Leases (“ASC 842”), on February 1, 2021. ASC 842 amended ASC 420 to exclude costs to terminate a contract that is a lease from the scope of ASC 420. The Company evaluates right-of-use (ROU) assets abandonment and impairment in accordance with ASC 360, Property, Plant, and Equipment and recognizes ROU assets abandonment-related amortization and write-offs as restructuring charges in its statement of operations. | |||
Advertising Costs | Advertising Costs Costs incurred for production and communication of advertising initiatives are expensed when incurred. Advertising expenses amounted to approximately $3.7 million, $3.2 million, $5.3 million and $4.0 million for the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019, respectively. | |||
Income Taxes | Income Taxes The Company provides for deferred income taxes resulting from temporary differences between the basis of its assets and liabilities for financial reporting purposes as compared to tax purposes, using rates expected to be in effect when such differences reverse. The Company records valuation allowances to reduce deferred tax assets to the amount that is more likely than not to be realized. The Company follows the authoritative guidance on accounting for and disclosure of uncertainty in tax positions which requires the Company to determine whether a tax position of the Company is more likely than not to be sustained upon examination, including resolution of any related appeals of litigation processes, based on the technical merits of the position. For tax positions meeting the more likely than not threshold, the tax amount recognized in the financial statements is reduced to the largest benefit that has a greater than fifty percent likelihood of being realized upon the ultimate settlement with the relevant taxing authority. Interest and penalties related to uncertain tax positions is included in the provision for income taxes in the consolidated statement of operations. | |||
Stock-based Compensation | Stock-based Compensation The following summarizes the allocation of share-based compensation (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year ended Year ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Cost of revenues $ — $ — $ — $ — Content and software development — — 6 23 Selling and marketing — — 77 110 General and administrative — — — 42 | |||
Warrants | Warrants In connection with the Company’s emergence from Chapter 11, lenders holding second lien debt prior to the Petition Date also received warrants to purchase common shares of the Successor Company on or before August 27, 2025, which included (i) tranche A warrants to purchase 235,294 ordinary shares at an exercise price of $262.34 per share and (ii) tranche B warrants to purchase 470,588 ordinary shares at an exercise price of $274.84. The warrants become exercisable at a date (“the Common Share Trigger Date”) the earliest to occur of: (i) one month following the Effective Date or two weeks following delivery of the fiscal 2020 audited financial statements of Predecessor to a potential buyer, unless an agreement is reached for a sale of the Company meeting certain conditions (hereinafter referred to as a “Favored Sale” and described further below) prior to those dates; (ii) a sale of the Company which did not qualify as a Favored Sale; (iii) the termination of an agreement for a Favored Sale; or (iv) The warrants also include a provision whereby, in the event of a Favored Sale, the warrants would be cancelled for no consideration, however, in such an event, the holders of Class B shares would receive a higher share of any consideration paid in the form of common stock by the acquiring company. The conditions of the Favored Sale were established in anticipation of a Churchill merger and mirror the ultimate agreement executed on October 12, 2020.The Board of Directors and required level of warrant holders amended the warrants such that the deadline a Favored Sale to occur was extended to October 12, 2020. In the event of a sale of the company that occurred prior to the expiration of the warrants that did not qualify as a Favored Sale, the warrant holders would be eligible for a cash payment equal to the Black- Scholes value of the awards as of that date using a contractually stated volatility of 35%. The warrants are classified as a liability and are remeasured at each balance sheet date, with changes in fair value being recorded in other income and expenses. At each relevant measurement date, the warrants were valued using a probability-based approach that considered management’s estimate of the probability of (i) a Favored Sale occurring by the required date, (ii) a sale of the company that did not qualify as a Favored Sale and (iii) warrants being held to maturity, with the last two scenarios utilizing a Black-Scholes model to estimate fair value. Management utilized the equity value as of date of emergence as an input in all Black- Scholes calculations, consistent with the fresh-start reporting valuation after adjusting for warrants. The volatility input utilized in the non-Favored Sale scenario was 35.0%, consistent with the contractually stated rate, and 31.6% for the held-to-maturity scenario. The Company also applied risk-free interest rates using treasury rates commensurate with the expected term, which was the remaining contractual term at each measurement date and assumed no dividend yield. The amendment to extend the date by which a Favored Sale could occur represented a modification to both the warrants and the participation right held by the Class B holders. Management measured the impact of the modification to both the freestanding warrants and the participation right held by the Class B holders by comparing their fair values immediately before and after the modification. The net impact of the increase in the value of the participation right held by Class B stockholders, of $13.3 million, and the decrease in the value of the warrants, of $7.4 million, is reflected as a decrease of $5.9 million in earnings attributable to Class A common stockholders and an increase to $5.9 million earnings attributable to Class B common stockholders for earnings per share purposes. The $7.4 million decrease in the value of warrants is reflected as a capital contribution and is reflected as an increase to additional-paid-in-capital in the period from August 28, 2020 through January 31, 2021 (Successor). | |||
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements On February 1, 2020, the Company adopted ASC Topic 842, Leases (“ASC 842”) using the modified retrospective transition approach, as provided by ASU No. 2018‑11, Leases — Targeted Improvements (“ASU 2018‑11”). The Company elected the package of practical expedients, which among other things, which allowed the Company to not reassess whether expired or existing contracts are or contain leases and to carry forward the historical lease classification for those leases that commenced prior to the date of adoption. For all lease arrangements, the Company accounts for lease and non-lease components as a single lease component. Leases with an initial term of 12 months or less are not recorded on the balance sheet as the Company recognizes lease expense on a straight-line basis over the lease term. Results for reporting periods beginning after February 1, 2020 are presented under ASC 842, while prior periods have not been adjusted and continue to be reported in accordance with the Company’s historic accounting under previous GAAP. The primary impact of ASC 842 is that substantially all of the Company’s leases are recognized on the balance sheet, by recording right-of-use assets and short-term and long-term lease liabilities. The new standard does not have a material impact on the Company’s consolidated statement of operations and cash flows, and the effects of applying ASC 842 as a cumulative-effect adjustment to retained earnings as of February 1, 2020 was immaterial. A summary of the changes to balance sheet line items that resulted from the adoption of ASC 842 as of February 1, 2020 is as follows (in thousands): As of February 1, 2020 As Impact of Previously Adoption of Reported Topic 842 As Adjusted Assets: Right of use assets $ — $ 19,415 $ 19,415 Liabilities: Accrued expenses and other current liabilities $ 29,267 $ (2,116) $ 27,151 Lease liabilities 3,500 3,500 Long-term lease liabilities — 18,031 18,031 On February 1, 2019, the Company adopted ASU 2014‑09, Revenue from Contracts with Customers (Topic 606) and Other Assets and Deferred Costs — Contracts with Customers (Subtopic 340‑40), which supersedes nearly all existing revenue recognition guidance. The core principle behind ASC 606 is that an entity should recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for delivering those goods and services. To achieve this core principle, the guidance provides a model, which involves a five-step process that includes identifying the contract with the customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction prices to the performance obligations in the contract, and recognizing revenue when (or as) the entity satisfies the performance obligations. The standard also provides guidance on the recognition of costs related to obtaining customer contracts. The Company adopted the standard using the modified retrospective adoption method applied to those contracts that were not completed as of that date and applied a practical expedient by reflecting the aggregate effect of any modifications that occurred for those contracts prior to the adoption date. Upon adoption, the Company recognized the cumulative effect of adopting the standard as an adjustment to the opening balance of stockholder’s deficit. The comparative information for the year ended January 31, 2019 has not been restated and continues to be reported under the accounting standards in effect for that period. The adoption of ASC 606 resulted in an acceleration in timing of the Company’s revenue for certain performance obligations. A summary of the changes to balance sheet line items that resulted from the adoption of ASC 606 as of February 1, 2019 is as follows (in thousands): As of February 1, 2019 Prior to Adoption Impact of Adoption of Topic 606 of Topic 606 (3) As Adjusted Assets: Prepaid expenses and other current assets (1) $ 52,456 $ (15,523) $ 36,933 Other long-term assets (1) 6,037 10,131 16,168 Total assets 2,545,175 (5,392) 2,539,783 Liabilities: Deferred revenue, current (2) 337,086 (3,859) 333,227 Total current liabilities 494,032 (3,859) 490,173 Deferred tax liabilities 31,949 (85) 31,864 Total long-term liabilities 3,968,468 (85) 3,968,383 Shareholder’s deficit: Accumulated deficit (1,910,846) (1,448) (1,912,294) Total shareholder’s deficit (1,917,325) (1,448) (1,918,773) (1) The net decrease in total assets of $(5,392) is due to changes in how commissions paid at the point of sale are now recognized over the expected period of economic benefit (versus the contractual term) and how commissions paid on renewals or upon future scheduled billings in committed contracts are recognized as expense. Commissions paid on renewals are recognized over the renewal term and commissions payable upon future scheduled billings in committed contract are expensed over the period of service if they require substantive future service from the employees. (2) (3) The impact of adopting Topic 606 on the Company’s consolidated financial statements was as follows (in thousands): As of January 31, 2020 Impact of Adoption Under Previous As Reported of Topic 606 (3) GAAP Assets: Prepaid expenses and other current assets $ 36,422 $ 12,028 $ 48,450 Other long-term assets 16,300 (11,692) 4,608 Total assets 1,986,265 336 1,986,601 Liabilities: Deferred revenue, current 307,383 8,075 315,458 Total current liabilities 4,699,027 8,075 4,707,102 Deferred revenue, non-current 3,787 (3,787) — Total long-term liabilities 48,982 (3,787) 45,195 Shareholder’s deficit: Accumulated deficit (2,761,499) (3,952) (2,765,451) Total shareholders’ deficit (2,761,744) (3,952) (2,765,696) Total revenues $ 514,021 $ (429) $ 513,592 Selling and marketing 140,785 5,056 145,841 Operating loss (403,216) (5,485) (408,701) Loss before income taxes (837,993) (5,485) (843,478) Provision for income taxes 11,212 (85) 11,127 Net loss (849,205) (5,400) (854,605) |
Summary of Significant Accou_13
Summary of Significant Accounting Policies (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 5 Months Ended |
Jan. 31, 2021 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Schedule of estimated useful lives of the assets | cost of property and equipment over their respective estimated useful lives on a straight-line basis using the half-year convention, as follows: Description Estimated Useful Lives Computer equipment 3 years Furniture and fixtures 5 years Leasehold improvements Lesser of 7 years or life of lease |
Schedule of allocation of share-based compensation | The following summarizes the allocation of share-based compensation (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year ended Year ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Cost of revenues $ — $ — $ — $ — Content and software development — — 6 23 Selling and marketing — — 77 110 General and administrative — — — 42 |
Schedule of changes to balance sheet line items and impact of financial statement on adoption of new ASU | A summary of the changes to balance sheet line items that resulted from the adoption of ASC 842 as of February 1, 2020 is as follows (in thousands): As of February 1, 2020 As Impact of Previously Adoption of Reported Topic 842 As Adjusted Assets: Right of use assets $ — $ 19,415 $ 19,415 Liabilities: Accrued expenses and other current liabilities $ 29,267 $ (2,116) $ 27,151 Lease liabilities 3,500 3,500 Long-term lease liabilities — 18,031 18,031 A summary of the changes to balance sheet line items that resulted from the adoption of ASC 606 as of February 1, 2019 is as follows (in thousands): As of February 1, 2019 Prior to Adoption Impact of Adoption of Topic 606 of Topic 606 (3) As Adjusted Assets: Prepaid expenses and other current assets (1) $ 52,456 $ (15,523) $ 36,933 Other long-term assets (1) 6,037 10,131 16,168 Total assets 2,545,175 (5,392) 2,539,783 Liabilities: Deferred revenue, current (2) 337,086 (3,859) 333,227 Total current liabilities 494,032 (3,859) 490,173 Deferred tax liabilities 31,949 (85) 31,864 Total long-term liabilities 3,968,468 (85) 3,968,383 Shareholder’s deficit: Accumulated deficit (1,910,846) (1,448) (1,912,294) Total shareholder’s deficit (1,917,325) (1,448) (1,918,773) (1) The net decrease in total assets of $(5,392) is due to changes in how commissions paid at the point of sale are now recognized over the expected period of economic benefit (versus the contractual term) and how commissions paid on renewals or upon future scheduled billings in committed contracts are recognized as expense. Commissions paid on renewals are recognized over the renewal term and commissions payable upon future scheduled billings in committed contract are expensed over the period of service if they require substantive future service from the employees. (2) (3) The impact of adopting Topic 606 on the Company’s consolidated financial statements was as follows (in thousands): As of January 31, 2020 Impact of Adoption Under Previous As Reported of Topic 606 (3) GAAP Assets: Prepaid expenses and other current assets $ 36,422 $ 12,028 $ 48,450 Other long-term assets 16,300 (11,692) 4,608 Total assets 1,986,265 336 1,986,601 Liabilities: Deferred revenue, current 307,383 8,075 315,458 Total current liabilities 4,699,027 8,075 4,707,102 Deferred revenue, non-current 3,787 (3,787) — Total long-term liabilities 48,982 (3,787) 45,195 Shareholder’s deficit: Accumulated deficit (2,761,499) (3,952) (2,765,451) Total shareholders’ deficit (2,761,744) (3,952) (2,765,696) Total revenues $ 514,021 $ (429) $ 513,592 Selling and marketing 140,785 5,056 145,841 Operating loss (403,216) (5,485) (408,701) Loss before income taxes (837,993) (5,485) (843,478) Provision for income taxes 11,212 (85) 11,127 Net loss (849,205) (5,400) (854,605) |
Fresh-Start Reporting (Tables)
Fresh-Start Reporting (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 5 Months Ended |
Jan. 31, 2021 | |
Summary of fair value of the Successor Company's equity as of the Effective Date | The following table reconciles the enterprise value per the Disclosure Statement to the fair value of the Successor Company’s equity, as of the Effective Date (in thousands, except per share amounts): Enterprise value (1) $ 1,150,000 Plus: Cash 92,009 Less: Borrowings under accounts receivable facility (48,886) Less: Fair value of debt (514,950) Less: Fair value of warrants (11,200) Implied value of Successor Company common stock $ 666,973 Shares issued upon emergence (Class A and B common stock) 4,000 Per share $ 167 |
Summary of reconciliation of the Company's enterprise value to reorganization value as of the Effective Date | The reconciliation of the Company’s enterprise value to reorganization value as of the Effective Date is as follows (in thousands): Enterprise value(1) $ 1,150,000 Plus: Cash 92,009 Current liabilities (excluding AR facility and Current maturity of long-term debt) 134,257 Deferred tax liabilities 103,930 Other long-term liabilities 7,140 Non-current lease obligations 16,399 Reorganization value $ 1,503,735 (1) Enterprise value includes the value of warrants that are classified as a liability. |
Summary of adjustments set forth in the consolidated balance sheet | Reorganization Fresh-Start Predecessor Adjustments Adjustments Successor Assets Current assets: Cash and cash equivalents $ 42,341 $ 49,668 (1) $ — $ 92,009 Restricted cash 35,306 (25,000) (1) — 10,306 Accounts receivable 73,607 1,700 (2) (990) (10) 74,317 Prepaid expense and other current assets 39,317 (300) (2) (10,573) (11) 28,444 Total current assets 190,571 26,068 (11,563) 205,076 Property and equipment, net 15,523 500 (2) — 16,023 Goodwill 1,070,674 5,100 (2) (580,639) (12) 495,135 Intangible asset, net 249,962 — 516,124 (13) 766,086 Right-of-use assets 17,454 — 367 (14) 17,821 Other assets 17,313 (3,500) (2) (10,219) (11) 3,594 Total assets $ 1,561,497 $ 28,168 $ (85,930) $ 1,503,735 Liabilities and shareholders’ (deficit) equity Current liabilities: Current maturity of long-term debt $ 60,000 $ (57,400) (3) $ — $ 2,600 Borrowings under accounts receivable facility 48,886 — — 48,886 Accounts payable 7,851 300 (2) — 8,151 Accrued compensation 23,587 1,400 (2) — 24,987 Accrued expenses and other liabilities 12,105 500 (2) — 12,605 Lease liabilities 1,699 3,245 (6) (175) (14) 4,769 Deferred revenue 196,469 2,400 (2) (115,124) (15) 83,745 Total current liabilities 350,597 (49,555) (115,299) 185,743 Long-term debt — 517,400 (3)(4) (5,050) (17) 512,350 Long term lease liabilities 3,732 12,442 (6) 225 (14) 16,399 Warrants — 11,200 (6)(8) — 11,200 Deferred tax liabilities — 30,484 (5)(6) 73,446 (16) 103,930 Deferred revenue – non-current 1,783 — (1,128) (15) 655 Other long-term liabilities 2,289 3,796 (6) 400 (17) 6,485 Total long-term liabilities 7,804 575,322 67,893 651,019 Liabilities subject to compromise 4,472,954 (4,472,954) (6) — — Total liabilities 4,831,355 (3,947,187) (47,406) 836,762 Shareholders’ (deficit) equity: Ordinary shares (Predecessor) 138 (138) (7) — — Additional paid in capital (Predecessor) 83 (83) (7) — — Ordinary shares (Successor) — 40 (6)(8) — 40 Additional paid in capital (Successor) — 666,933 (6)(8) — 666,933 (Accumulated deficit) retained earnings (3,267,346) 3,308,603 (9) (41,257) (17) — Accumulated other comprehensive loss (2,733) — 2,733 (18) — Total shareholder (deficit) equity (3,269,858) 3,975,355 (38,524) 666,973 Total liabilities and shareholders’ (deficit) equity $ 1,561,497 $ 28,168 $ (85,930) $ 1,503,735 |
Summary of sources and uses of cash on the Effective Date from implementation of the Plan of Reorganization | (1) The table below reflects the sources and uses of cash on the Effective Date from implementation of the Plan of Reorganization (in thousands): Sources: Release of restricted cash (a) $ 25,000 Additional funding from First Out Term Loan 50,000 Reconsolidation of Canadian subsidiary 1,100 Total sources of cash 76,100 Uses: Exit Facility and DIP Facility rollover financing costs paid upon Effective Date (5,032) Professional success fees paid upon Effective Date (21,400) Total uses of cash (26,432) Net increase in cash $ 49,668 a) A portion of DIP Facility funds from restricted cash was released upon Effective Date |
Summary of term loan facility agreement in accordance with the Plan of Reorganization | (in thousands) Term Loan Facility: Senior Secured First Out Term Loan $ 110,000 Senior Secured Second Out Term Loan 410,000 Total Debt – Exit facility (a) 520,000 Less: Current portion of Long-term debt (2,600) Long-term debt, net of current portion $ 517,400 (a) The Exit Credit Facility bears interest at a rate equal to LIBOR plus 7.50% per annum, with a LIBOR floor of 1.00%. The First Out Term Loan is due in December 2024 and the Second Out Term Loan is due April 2025. The Exit Credit Facility contains customary provisions and reporting requirements, including prepayment penalties and a maximum leverage covenant that will be first measured January 31, 2022 and each quarter thereafter. Quarterly principal repayments of $1.3 million begin for the quarter ended April 30, 2021 and increase to $2.6 million for the quarter ended April 30, 2022 until maturity. |
Summary of disposition of liabilities subject to compromise | The table below indicates the disposition of liabilities subject to compromise (in thousands): Liabilities subject to compromise pre-emergence $ 4,472,954 Reinstated on the Effective Date: Lease liabilities (current and non-current) (15,687) Deferred tax liabilities (26,107) Other long-term liabilities (3,796) Total liabilities reinstated (45,590) Less amounts settled per the Plan of Reorganization Issuance of new debt (410,000) Issuance of warrants (11,200) Equity issued at emergence to creditors in settlement of Liabilities Subject to Compromise (666,973) Total amounts settled (1,088,173) Gain on settlement of Liabilities Subject to Compromise $ 3,339,191 |
Summary of cumulative impact of the reorganization adjustments | (1) The table reflects the cumulative impact of the reorganization adjustments discussed above (in thousands): Gain on settlement of Liabilities subject to compromise $ 3,339,191 Provision for income taxes (4,377) Professional success fees paid upon Effective Date (21,400) Exit Facility and DIP Facility rollover financing costs paid upon Effective Date (5,032) Cancellation of predecessor shares and additional paid in capital 221 Net impact on Accumulated deficit $ 3,308,603 |
Summary of reorganization value of Successor company in excess of asset fair value - Goodwill | (in thousands) Reorganization value of Successor company $ 1,503,735 Less: Fair value of Successor company assets (1,008,600) Reorganization value of Successor company in excess of asset fair value – Goodwill $ 495,135 |
Summary of fresh-start adjustment to acquired intangibles assets | (1) The Company recorded an adjustment to intangible assets for $516.1 million as follows (in thousands): Estimated fair value Estimated useful life Developed software/ courseware $ 261,600 3 – 5 years Customer contracts/ relationships 279,500 12.4 years Trademarks and trade names 6,300 9.4 years Backlog 90,200 4.4 years Skillsoft trademark 91,500 Indefinite Publishing rights 35,200 5 years Capitalized software 1,786 5 years Total intangible asset upon emergence 766,086 Elimination of historical acquired intangible assets (249,962) Fresh-start adjustment to acquired intangibles assets $ 516,124 |
Summary of cumulative impact of the fresh-start adjustments | (1) The table below reflects the cumulative impact of the fresh-start adjustments as discussed above (in thousands): Fresh-start adjustment to accounts receivable, net $ (990) Fresh-start adjustment to prepaid assets and other assets (including long-term) (20,792) Fresh-start adjustment to goodwill (580,639) Fresh-start adjustment to intangible assets, net 516,124 Fresh-start adjustment to operating lease right-of-use assets and liabilities, net 317 Fresh-start adjustment to deferred revenue (current and non-current) 116,252 Fair value adjustment to debt 5,050 Fair value adjustment to other long-term liabilities (400) Total fresh-start adjustments impacting reorganization items, net 34,922 Elimination of accumulated other comprehensive loss (2,733) Tax impact of fresh-start adjustments (73,446) Net impact on accumulated deficit $ (41,257) |
Summary of reorganization items incurred as a result of the Chapter 11 cases | Reorganization items incurred as a result of the Chapter 11 cases are presented separately in the accompanying Consolidated Statement of Operations for the period presented, as follows (in thousands): Predecessor February 1, 2020 through August 27, 2020 Gain on settlement of Liabilities subject to compromise $ 3,339,191 Impact of fresh-start adjustments 34,922 Exit Facility and DIP Facility rollover financing costs paid upon Effective Date (5,032) Write-off of pre-petition debt and DIP issuance costs (9,461) Professional success fees paid upon Effective Date (21,399) Professional fees and other bankruptcy related costs (13,076) Gain on Deconsolidation of Canadian subsidiary 4,100 Reorganization items, net $ 3,329,245 Successor Predecessor August 28, 2020 February 1, 2020 through January 31, through August 27, 2021 2020 Cash payment for reorganization items, net $ 784 $ 42,916 |
Intangible Assets (Tables)
Intangible Assets (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Schedule of intangible assets | Intangible assets consisted of the following (in thousands): April 30, 2021 January 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Developed software/ courseware $ 267,014 $ 39,459 $ 227,555 $ 265,758 $ 24,669 $ 241,089 Customer contracts/ relationships 279,500 9,114 270,386 279,500 3,627 275,873 Trademarks and trade names 6,300 676 5,624 6,300 455 5,845 Publishing rights 35,200 4,693 30,507 35,200 2,933 32,267 Backlog 90,200 20,842 69,358 90,200 8,141 82,059 Skillsoft trademark 91,500 — 91,500 91,500 — 91,500 Total $ 769,714 $ 74,784 $ 694,930 $ 768,458 $ 39,825 $ 728,633 | Intangible assets consisted of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Developed software/ courseware $ 265,758 $ 24,669 $ 241,089 $ 157,168 $ 129,663 $ 27,505 Customer contracts/ relationships 279,500 3,627 275,873 670,800 466,972 203,828 Trademarks and trade names 6,300 455 5,845 45,300 27,648 17,652 Publishing rights 35,200 2,933 32,267 — — — Backlog 90,200 8,141 82,059 — — — Skillsoft trademark 91,500 — 91,500 186,000 — 186,000 Total $ 768,458 $ 39,825 $ 728,633 $ 1,059,268 $ 624,283 $ 434,985 |
Schedule of amortization expense related to the existing finite-lived intangible assets | Amortization expense related to the existing finite-lived intangible assets is expected to be as follows (in thousands): Fiscal Year Amortization Expense 2022 (Remaining 9 months) $ 104,693 2023 120,579 2024 106,172 2025 94,070 2026 64,496 Thereafter 113,420 Total $ 603,430 | Amortization expense related to the existing finite-lived intangible assets is expected to be as follows (in thousands): Amortization Fiscal Year Expense 2022 $ 139,408 2023 120,339 2024 105,910 2025 93,842 2026 64,269 Thereafter 113,365 Total $ 637,133 |
Schedule of goodwill | Description Skillsoft SumTotal Consolidated Goodwill, net January 31, 2021 (Predecessor) $ 491,654 $ 3,350 $ 495,004 Foreign currency translation adjustment (62) — (62) Goodwill, net April 30, 2021 (Predecessor) $ 491,592 $ 3,350 $ 494,942 | Description Skillsoft SumTotal Consolidated Goodwill, January 31, 2018 $ — $ — $ 1,693,906 Re-allocation of goodwill upon change in reporting units 1,433,662 260,244 — Foreign currency translation adjustment 385 22 407 Goodwill, January 31, 2019 1,434,047 260,266 1,694,313 Foreign currency translation adjustment 113 (6) 107 Impairment of goodwill (321,340) (119,258) (440,598) Goodwill, net January 31, 2020 (Predecessor) 1,112,820 141,002 1,253,822 Foreign currency translation adjustment (158) (4) (162) Impairment of goodwill (107,934) (69,952) (177,886) Canada deconsolidation (5,100) (5,100) Goodwill, net August 27, 2020 (Predecessor) $ 999,628 $ 71,046 $ 1,070,674 Impact of Fresh-Start Reporting (507,843) (67,696) (575,539) Goodwill, net August 28, 2020 (Successor) $ 491,785 $ 3,350 $ 495,135 Foreign currency translation adjustment (131) (131) Goodwill, net January 31, 2021 (Successor) $ 491,654 $ 3,350 $ 495,004 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 5 Months Ended |
Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Schedule of property and equipment | Property and equipment consists of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Computer equipment $ 12,455 $ 80,483 Furniture and fixtures 1,894 3,046 Leasehold improvements 3,383 5,220 Construction in progress — 18 17,732 88,767 Less accumulated depreciation and amortization (3,952) (70,865) $ 13,780 $ 17,902 |
Taxes (Tables)
Taxes (Tables) | 5 Months Ended | 12 Months Ended |
Jan. 31, 2021 | Dec. 31, 2020 | |
Schedule of significant components of the income tax benefit (provision) | The income tax provision consists of the following: December 31, December 31, 2020 2019 Federal Current expense $ 495,442 $ 1,237,860 Deferred (benefit) expense (157,029) 9,657 State and Local Current — — Deferred — — Change in valuation allowance 148,348 — Income tax provision $ 486,761 $ 1,247,517 | |
Schedule of reconciliation of the relevant statutory rate to the effective tax rate | 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 % % Transaction costs attributable to Initial Public Offering % (1.8) % Loss on conversion option liability (0.5) % % Loss on warrant liability (6.3) % (28.5) % Loss on Prosus agreement (14.7) % % Valuation allowance (0.2) % % Income tax provision (0.7) % (9.3) % | |
Schedule of deferred tax assets and liabilities | The following is a summary of the Company's net deferred tax asset (liability): December 31, December 31, 2020 2019 Deferred tax asset (liability) Startup and organizational expenses $ 148,348 $ — Unrealized gain on marketable securities (976) (9,657) Total deferred tax asset (liability) 147,372 (9,657) Valuation Allowance (148,348) — Deferred tax asset (liability), net of allowance $ (976) $ (9,657) | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of significant components of the income tax benefit (provision) | Significant components of the income tax benefit (provision) consist of the following (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 CURRENT: Luxembourg $ — $ — $ — $ — Ireland (268) 333 1,099 1,559 United States 1,012 588 2,405 652 Other foreign locations 462 1,300 1,949 3,231 Current tax provision 1,206 2,221 5,453 5,442 DEFERRED: Luxembourg 2,594 — — — Ireland (1,856) 43,483 8,533 1,517 United States (19,265) 17,256 (2,693) (1,906) Other foreign locations (4,613) 5,495 (81) (26) Deferred tax (benefit) / provision (23,140) 66,234 5,759 (415) Income tax (benefit) / provision $ (21,934) $ 68,455 $ 11,212 $ 5,027 | |
Schedule of U.S. and foreign components of (loss) income before income taxes | The following table presents the U.S. and foreign components of (loss) income before income taxes (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Luxembourg $ 9,220 $ — $ — $ — Ireland (3,741) 2,437,738 (645,360) (336,002) United States (86,333) 364,827 (197,600) (62,805) Other foreign locations (34,802) 29,902 4,967 3,995 (Loss) income before income taxes $ (115,656) $ 2,832,467 $ (837,993) $ (394,812) | |
Schedule of reconciliation of the relevant statutory rate to the effective tax rate | Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Income tax provision (benefit) at Luxembourg (24.9%) / Irish statutory rate (12.5%) (24.9) % 12.5 % (12.5) % (12.5) % Increase (decrease) in tax resulting from: US State income taxes, net of federal benefit (5.7) (0.2) (0.2) (0.8) Foreign rate differential 6.1 (0.2) (1.9) (1.2) Other permanent items (0.1) 0.7 1.2 2.5 Transaction costs (7.6) 0.2 Unrecognized tax benefit (0.4) — 0.2 0.3 Change in valuation allowance 3.5 (4.2) 5.5 9.6 Impairment of goodwill — 0.8 7.9 — Reorganization and fresh start adjustments 9.6 (7.3) — — Other 0.5 0.1 1.2 3.4 Effective tax rate – provision (benefit) (19.0) % 2.4 % 1.4 % 1.3 % | |
Schedule of deferred tax assets and liabilities | Significant components of the Company’s deferred tax assets and liabilities as of the periods presented were as follows (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 ASSETS: Net operating loss carryforwards $ 13,517 $ 29,753 Deferred interest expense 35,852 145,399 Customer relationships — 6,888 Reserves and accruals 9,038 7,204 Lease liabilities 3,862 — Tax credits 99 5,893 Transaction costs 19,532 4,216 Other intangibles 3,505 7,237 Gross deferred tax assets 85,405 206,590 Less: Valuation allowance (45,567) (160,531) Net deferred tax assets $ 39,838 $ 46,059 LIABILITIES: Intangibles $ (99,587) $ (78,017) Property and equipment, net (2,971) (5,665) Accrued Interest (4,522) — Right-of-use asset (3,141) — Deferred revenue (6,199) — Other (4,426) — Gross deferred tax liabilities (120,846) (83,682) Total net deferred tax liabilities, net $ (81,008) $ (37,623) | |
Schedule of unrecognized tax benefits | Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Unrecognized tax benefits, beginning balances $ 3,768 $ 3,773 $ 2,081 $ 5,035 Increases for tax positions taken during the current period — — — — Increases for tax positions taken during a prior period 37 35 1,987 915 Decreases for tax positions taken during a prior period — (40) (295) (3,736) Other 452 — — — Decreases resulting from the expiration of statute of limitations (339) — — (133) Unrecognized tax benefits, ending balance $ 3,918 $ 3,768 $ 3,773 $ 2,081 |
Prepaid expenses and other cu_2
Prepaid expenses and other current assets (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of prepaid expenses and other current assets | Prepaid expense and other current assets in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Deferred commission costs – current $ 4,019 $ 3,147 Refundable income tax 9,618 8,969 Prepaid software maintenance costs 8,370 8,587 Prepaid royalties 2,876 2,958 Other 6,942 6,665 Total prepaid expenses and other current assets $ 31,825 $ 30,326 | Prepaid expense and other current assets in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Deferred commission costs – current $ 3,147 $ 11,195 Refundable income tax 8,969 6,726 Prepaid software maintenance costs 8,587 6,569 Prepaid royalties 2,958 2,294 Employee bonus advance — 1,867 Other 6,665 7,771 Total prepaid expenses and other current assets $ 30,326 $ 36,422 |
Other Assets (Tables)
Other Assets (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of other assets | Other assets in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Deferred commission costs – non-current $ 5,733 $ 4,437 Other 3,772 4,199 Total other assets $ 9,505 $ 8,636 | Other assets in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Deferred commission costs – non-current $ 4,437 $ 11,692 Non-current refundable income tax — 1,979 Other 4,199 2,635 Total other assets $ 8,636 $ 16,306 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of accrued expenses | Accrued expenses in the accompanying consolidated balance sheets consisted of the following (in thousands): April 30, 2021 January 31, 2021 Professional fees $ 6,018 $ 8,832 Accrued sales tax/VAT 2,144 5,379 Accrued royalties 1,961 2,152 Accrued tax 4,727 2,634 Accrued interest 368 491 Other accrued liabilities 3,067 3,637 Total accrued expenses $ 18,285 $ 23,125 | Accrued expenses in the accompanying consolidated balance sheets consisted of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Professional fees $ 8,832 $ 12,947 Accrued sales tax/VAT 5,379 5,824 Accrued royalties 2,152 1,869 Accrued tax 2,634 1,288 Accrued interest 491 274 Other accrued liabilities 3,637 7,065 Total accrued expenses $ 23,125 $ 29,267 |
Restructuring (Tables)
Restructuring (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of Activity in the Company's restructuring accrual | Activity in the Company’s restructuring accrual was as follows (in thousands): Employee Severance Contractual and Related Costs Obligations Total Restructuring accrual as of January 31, 2021 $ 5,000 $ 171 $ 5,171 Restructuring charges incurred 311 226 537 Payments made (2,049) (298) (2,347) Foreign currency translation adjustment — — — Restructuring accrual as of April 30, 2021 $ 3,262 $ 99 $ 3,361 | Activity in the Company’s restructuring accrual was as follows (in thousands): Employee Severance Contractual and Related Costs Obligations Total Restructuring accrual as of January 31, 2018 $ 1,504 $ 25 $ 1,529 Restructuring charges incurred 1,971 102 2,073 Payments made (1,720) (100) (1,820) Foreign currency translation adjustment (42) — (42) Restructuring accrual as of January 31, 2019 $ 1,713 $ 27 $ 1,740 Restructuring charges incurred 1,610 290 1,900 Payments made (2,588) (41) (2,629) Foreign currency translation adjustment 26 — 26 Restructuring accrual as of January 31, 2020 (Predecessor) $ 761 $ 276 $ 1,037 Restructuring charges incurred 1,032 147 1,179 Payments made (559) (154) (713) Foreign currency translation adjustment — — — Restructuring accrual as of August 27, 2020 (Predecessor) $ 1,234 $ 269 $ 1,503 Restructuring charges incurred 4,218 123 4,341 Payments made (452) (221) (673) Foreign currency translation adjustment — — — Restructuring accrual as of January 31, 2021 (Successor) $ 5,000 171 5,171 |
Leases, Commitment and Contin_2
Leases, Commitment and Contingencies (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of undiscounted future minimum lease payments under non-cancellable leases | The table below reconciles the undiscounted future minimum lease payments under non-cancellable leases with terms of more than one year to the total lease liabilities recognized on the consolidated balance sheets as of April 30, 2021 (Successor): Fiscal Year Ended January 31, 2021 (in thousands): Operating Leases Finance Leases 2022 (excluding 3 months ended April 30, 2021) $ 3,898 $ 1,209 2023 4,065 — 2024 3,499 — 2025 2,684 — 2026 1,245 Thereafter 6,245 — Total future minimum lease payments 21,636 1,209 Less effects of discounting (5,692) (93) Total lease liabilities $ 15,944 $ 1,116 Reported as of April 30, 2021 Lease liabilities $ 3,574 $ 1,116 Long-term lease liabilities 12,370 — Total lease liabilities $ 15,944 $ 1,116 | Operating Finance As of January 31, 2021 (in thousands): Leases Leases 2022 $ 5,203 $ 1,112 2023 4,070 — 2024 3,514 — 2025 2,697 — Thereafter 7,509 — Total future minimum lease payments 22,993 1,112 Less effects of discounting (6,120) (90) Total lease liabilities $ 16,873 $ 1,022 Reported as of January 31, 2021 Lease liabilities $ 3,718 $ 1,022 Lease liabilities non-current 13,155 — Total lease liabilities $ 16,873 $ 1,022 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Schedule of maturities of long term debt | Fiscal year ended January 31: 2022 (remaining 9 months) $ 3,900 2023 10,400 2024 10,400 2025 112,700 2026 381,300 Total payments 518,700 Less: Current portion (6,500) Less: Unamortized Fresh-Start Reporting Fair Value Adjustment (4,273) Long-term portion $ 507,927 | Fiscal year ended January 31: 2022 $ 5,200 2023 10,400 2024 10,400 2025 112,700 2026 381,300 Total payments 520,000 Less: Current portion (5,200) Less: Unamortized Fresh-Start Reporting Fair Value Adjustment (4,564) Long-term portion $ 510,236 |
Schedule of amounts outstanding under Senior Credit Facilities | Payable in Fiscal Year First Lien Second Lien Revolving Credit Total Fiscal 2021 $ 627,536 $ 302,336 60,000 $ 989,872 Total $ 627,536 $ 302,336 60,000 $ 989,872 | |
Scheuled of summary of net loans | Weighted Average Maturity Instrument Balance Interest Rate Interest Type Issuance Date Date Series 1 $ 933,615 13.0 % Variable, Compounding Apr 25, 2014 Jan 31, 2045 Series 2 598,787 8.0 % Variable, Simple Apr 25, 2014 Apr 28, 2021 Series 3 327,537 11.5 % Variable, Simple Apr 25, 2014 Apr 28, 2021 Series 4 60,000 13.0 % Variable, Compounding Sep 25, 2014 Sep 30, 2044 Series 5(a) 71,538 8.0 % Variable, Simple Sep 25, 2014 Sep 30, 2044 Series 5(b) 28,461 11.5 % Variable, Simple Sep 25, 2014 Sep 30, 2044 Intra-group Loan Agreement 65,000 12.0 % Variable, Compounding Dec 3, 2015 Nov 3, 2044 Funding Bond # 1 54,000 13.0 % Variable, Simple Jan 31, 2018 Apr 28, 2021 Funding Bond # 2 50,000 13.0 % Variable, Simple Jan 29, 2019 Apr 28, 2021 Total $ 2,188,938 |
Long-Term Liabilities (Tables)
Long-Term Liabilities (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of other noncurrent liabilites | Other long-term liabilities in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Uncertain tax positions; including interest and penalties – long-term $ 4,374 $ 5,794 Warrants 800 900 Other 216 204 Total other long-term liabilities $ 5,390 $ 6,898 | Other long-term liabilities in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Uncertain tax positions; including interest and penalties – long-term $ 5,794 $ 6,025 Warrants 900 — Other 204 1,547 Total other long-term liabilities $ 6,898 $ 7,572 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 5 Months Ended |
Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Schedule of share award activity | The following table summarized the share award activity for the fiscal year ended January 31, 2020: Units Outstanding at January 31, 2019 356,771 Issued — Forfeited (104,007) Outstanding at January 31, 2020 252,764 Cancelled (252,764) Outstanding at August 27, 2020 (Predecessor) — |
Revenue (Tables)
Revenue (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Schedule of disaggregated revenue | The following is a summary of revenues by type for the three months ended April 30, 2021 (Successor) and three months ended April 30, 2020 (Predecessor), (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 SaaS and subscription services $ 78,575 $ 101,089 Software maintenance 4,064 5,260 Professional services 8,191 10,946 Perpetual software licenses 871 1,031 Hardware and other — 3 Total net revenues(1) $ 91,701 $ 118,329 The following table sets forth our revenues by geographic region for the three months ended April 30, 2021 (Successor) and three months ended April 30, 2020 (Predecessor), (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Revenues: United States $ 70,170 $ 93,533 Other Americas 4,461 4,931 Europe, Middle East and Africa 12,113 13,787 Asia-Pacific 4,957 6,078 Total net revenues (1) $ 91,701 $ 118,329 | The following is a summary of revenues by type for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019 (Predecessor) (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 SaaS and subscription services $ 93,205 $ 234,766 $ 439,791 $ 462,240 Software maintenance 4,770 12,079 23,982 30,161 Professional services 9,546 24,499 45,661 38,043 Perpetual software licenses 1,241 2,486 1,885 3,340 Hardware and other 6 21 2,702 357 Total net revenues (1) $ 108,768 $ 273,851 $ 514,021 $ 534,141 The following table sets forth our revenues by geographic region for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019 (Predecessor) (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Revenues: United States $ 84,248 $ 217,783 $ 405,065 $ 421,746 Other Americas 4,724 8,899 21,925 22,807 Europe, Middle East and Africa 13,934 32,788 61,321 66,244 Asia-Pacific 5,862 14,381 25,710 23,344 Total net revenues (1) $ 108,768 $ 273,851 $ 514,021 $ 534,141 (1) As a result of the Company’s adoption of ASC 606 effective February 1, 2019 using the modified retrospective method, prior period amounts have not been adjusted to conform with ASC 606 and therefore may not be comparable. |
Schedule of deferred revenue | Deferred revenue activity for the three months ended April 30, 2021 was as follows (in thousands): Deferred revenue at January 31, 2021 (Successor) $ 260,584 Billings deferred 67,034 Recognition of prior deferred revenue (91,701) Deferred revenue at April 30, 2021 (Successor) $ 235,917 | Deferred revenue activity for the period February 1, 2020 through August 27, 2020 (Predecessor) and the period August 28, 2020 through January 31, 2021 (Successor) was as follows (in thousands): Deferred revenue at February 1, 2020 (includes current and non-current components) $ 311,170 Billings deferred 163,333 Recognition of prior deferred revenue (273,851) Deferred revenue at August 27, 2020 200,652 Fresh start reporting fair value adjustment (116,252) Deferred revenue at August 28, 2020 (Successor) 84,400 Billings deferred 284,952 Recognition of prior deferred revenue (108,768) Deferred revenue at January 31, 2021 (Successor) $ 260,584 |
Schedule of deferred contract acquisition costs | Deferred contract acquisition cost activity for the three months ended April 30, 2021 was as follows (in thousands): Deferred contract acquisition costs at January 31, 2021 (Successor) $ 7,584 Contract acquisition costs 5,491 Recognition of contract acquisition costs (3,323) Deferred contract acquisition costs at April 30, 2021 (Successor) $ 9,752 | Deferred contract acquisition cost activity for the period February 1, 2020 through August 27, 2020 (Predecessor) and the periods August 28, 2020 through January 31, 2021 (Successor) was as follows (in thousands): Deferred contract acquisition costs at February 1, 2020 $ 22,887 Contract acquisition costs 11,965 Recognition of contract acquisition costs (14,060) Deferred contract acquisition costs at August 27, 2020 (Predecessor) $ 20,792 Fresh start reporting fair value adjustment (20,792) Deferred contract acquisition costs at August 28, 2020 (Successor) — Contract acquisition costs 19,973 Recognition of contract acquisition costs (12,389) Deferred contract acquisition costs at January 31, 2021 (Successor) $ 7,584 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Agreements (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 5 Months Ended |
Jan. 31, 2021 | |
Schedule Of Fair Value Of Derivative Assets And Derivative Liabilities, Other Derivatives Not Designated As Hedging Instruments | The following table provides a summary of the changes in fair value of the derivative instruments for the period from February 1, 2020 through August 27, 2020 and the fiscal years ended January 31, 2020 and 2019 (in thousands): Assets Liabilities Balances as of January 31, 2018 $ 4,064 $ (130) Sale of derivative instrument (6,776) — Purchase of derivative instrument 9,194 — Change in fair value of derivative instrument (2,414) 130 Balances as of January 31, 2019 4,068 $ — Change in fair value of derivative instrument (4,062) — Balances as of January 31, 2020 $ 6 $ — Change in fair value of derivative instrument (6) — Balances as of August 27, 2021 $ — $ — |
Derivatives Not Designated as Hedging Instruments | Fair value Balance sheet (in thousands) Derivatives not designated as hedging instruments location January 31, 2020 Interest rate derivative contracts Other assets $ 6 |
Fair Value Measurements (Tabl_3
Fair Value Measurements (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Schedule of company's assets and liabilities that are measured at fair value on a recurring basis | The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of April 30, 2021 and are categorized using the fair value hierarchy (in thousands): Total (Level 3) Warrants to purchase Company common stock $ 800 $ 800 Total assets recorded at fair value $ 800 800 | The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of January 31, 2021 and are categorized using the fair value hierarchy (in thousands): Total (Level 3) Warrants to purchase Company common stock $ 900 $ 900 Total assets recorded at fair value $ 900 900 |
Schedule of reconciliation of Level 3 instruments | The following table is a reconciliation of Level 3 instruments for which significant unobservable inputs were used to determine fair value: Successor Three months ended April 30, 2021 Balance as of January 31, 2021 $ 900 Impact of warrant modification, recorded in shareholders’ equity — Unrealized gains recognized as other income (100) Balance as of April 30, 2021 $ 800 | Successor August 28, 2020 through January 31, 2021 Balance as of August 28, 2020 $ 11,200 Impact of warrant modification, recorded in shareholders’ equity (7,400) Unrealized gains recognized as other income (2,900) Balance as of January 31, 2021 $ 900 |
Segment Information (Tables)
Segment Information (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Summary company's segment results and segment assets | The following table presents summary results for each of the businesses for the three months ended April 30, 2021 and the three months ended April 30, 2020 (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Skillsoft Revenues $ 67,057 $ 84,318 Operating expenses 93,127 287,917 Operating (loss) income (26,070) (203,599) SumTotal Revenues 24,644 34,011 Operating expenses 26,277 168,157 Operating income (loss) (1,633) (134,146) Consolidated Revenues 91,701 118,329 Operating expenses 119,404 456,074 Operating income (loss) (27,703) (337,745) Total non-operating (expense) income (352) 910 Interest expense, net (11,439) (105,959) Reorganization items, net — — (Provision) benefit for income taxes 2,089 8,891 Net (loss) income $ (37,405) $ (433,903) The Company’s segment assets primarily consist of cash and cash equivalents, accounts receivable, prepaid expenses, deferred taxes, property and equipment, goodwill and intangible assets. The following table sets forth the Company’s segment assets as of April 30, 2021 and January 31, 2021 (in thousands): April 30, 2021 January 31, 2021 Skillsoft $ 1,313,124 $ 1,398,379 SumTotal 144,982 147,358 Corporate — — Consolidated $ 1,458,106 $ 1,545,737 | The following table presents summary results for each of the businesses for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year ended Year ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Skillsoft Revenues $ 72,425 $ 196,238 $ 362,503 $ 378,316 Operating expenses 158,671 398,178 637,658 364,581 Operating (loss) income (86,246) (201,940) (275,155) 13,735 SumTotal Revenues 36,343 77,613 151,518 155,825 Operating expenses 49,269 205,483 279,579 162,906 Operating income (loss) (12,926) (127,870) (128,061) (7,081) Consolidated Revenues 108,768 273,851 514,021 534,141 Operating expenses 207,940 603,661 917,237 527,487 Operating income (loss) (99,172) (329,810) (403,216) 6,654 Total non-operating (expense) income 3,452 1,268 (5,120) (5,624) Interest expense, net (19,936) (168,236) (429,657) (395,842) Reorganization items, net — 3,329,245 — — (Provision) benefit for income taxes 21,934 (68,455) (11,212) (5,027) Net (loss) income $ (93,722) $ 2,764,012 $ (849,205) $ (399,839) The Company’s segment assets primarily consist of cash and cash equivalents, accounts receivable, prepaid expenses, deferred taxes, property and equipment, goodwill and intangible assets. The following table sets forth the Company’s segment assets as of January 31, 2021 and January 31, 2020 (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Skillsoft $ 1,398,379 $ 1,655,474 SumTotal 147,358 330,785 Corporate — 6 Consolidated $ 1,545,737 $ 1,986,265 |
Schedule company's long-lived tangible assets by geographic region | The following table sets forth the Company’s long-lived tangible assets by geographic region for the years ended April 30, 2021 and January 31, 2021 (in thousands): April 30, 2021 January 31, 2021 United States $ 9,019 $ 10,613 Ireland 499 609 Rest of world 2,280 2,558 Total $ 11,798 $ 13,780 | Successor Predecessor January 31, 2021 January 31, 2020 United States $ 10,613 $ 13,469 Ireland 609 897 Rest of world 2,558 3,536 Total $ 13,780 $ 17,902 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Schedule of basic and diluted loss per share | The following table reflects the calculation of basic and diluted net income (loss) per share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) | The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Schedule of basic and diluted loss per share | The following table sets forth the computation of basic and diluted earnings per share (in thousands, except number of shares and per share data): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Net loss $ (37,405) $ (433,903) Weighted average common shares outstanding: Ordinary – Basic and Diluted (Predecessor) * 100 Class A and B – Basic and Diluted (Successor) 4,000 * Net loss per share Loss per share: Ordinary – Basic and Diluted (Predecessor) * $ (4,334.70) Class A and B – Basic and Diluted (Successor) $ (9.35) * | The following table sets forth the computation of basic and diluted earnings per share (in thousands, except number of shares and per share data): Successor Predecessor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2020 2020 2020 2019 Net (loss) income $ (93,722) $ 2,764,012 $ (849,205) $ (399,839) Weighted average common share outstanding: Ordinary – Basic and Diluted (Predecessor * 100 100 100 Class A – Basic and Diluted 3,840 * * * Class B – Basic and Diluted 160 * * * Net loss per share class (Successor only) Net loss for Class A $ (89,973) * * * Loss on modifications of terms of participation rights held by other shareholders and warrants (5,900) * * * Net loss attributable to Class A $ (95,873) * * * Net loss for Class B $ (3,749) * * * Gain on modifications of terms of participation rights held by other shareholders and warrants 5,900 * * * Net income attributable to Class B $ 2,151 * * * (Losses) income per share: Ordinary – Basic and Diluted (Predecessor) * $ 27,612.51 $ (8,483.57) $ (3,994.40) Class A – Basic and Diluted (Successor) $ (24.97) * * * Class B – Basic and Diluted (Successor) $ 13.44 * * * |
Organization and Description _2
Organization and Description of Business (Details) | Oct. 12, 2020USD ($)$ / shares | Aug. 27, 2020USD ($)company$ / sharesshares | Mar. 31, 2021USD ($)$ / sharesshares | Jan. 31, 2021USD ($)$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Apr. 30, 2021USD ($)shares | Jan. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019$ / sharesshares | Sep. 19, 2019USD ($) | Jul. 01, 2019$ / shares | Jun. 26, 2019shares | Jun. 07, 2019shares |
Converted debt amount | $ 1,500,000 | $ 1,500,000 | ||||||||||
Warrant purchase price | $ / shares | $ 11.50 | |||||||||||
Class A Common Stock [Member] | ||||||||||||
Ordinary shares of successor company | shares | 11,090,292 | 3,840,000 | 15,287,498 | 7,974,075 | ||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||
Class B Common Stock [Member] | ||||||||||||
Ordinary shares of successor company | shares | 17,250,000 | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 | ||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||||
Class C Common Stock [Member] | ||||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | 0.0001 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||||
Number of holding companies | company | 2 | |||||||||||
Post-petition financing for plan of reorganization | $ 1,088,173,000 | |||||||||||
Ordinary shares of successor company | shares | 4,000,000 | 100,100 | ||||||||||
Number of ordinary shares issued | shares | 705,882 | 705,882 | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,030,000,000 | $ 90,000,000 | ||||||||||
Outstanding borrowings | $ 2,035,000,000 | |||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.01 | $ 1.38 | ||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Agreement and Plan of Merger | ||||||||||||
Nominal value per share | $ / shares | 0.01 | |||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | |||||||||||
Aggregate principal amount | $ 20,000,000 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Tranche A | ||||||||||||
Number of ordinary shares issued | shares | 235,294 | 235,294 | ||||||||||
Warrant purchase price | $ / shares | $ 262.34 | $ 262.34 | ||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Tranche B | ||||||||||||
Number of ordinary shares issued | shares | 470,588 | 470,588 | ||||||||||
Warrant purchase price | $ / shares | $ 274.84 | $ 274.84 | ||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | ||||||||||||
Ordinary shares of successor company | shares | 3,840,000 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | Agreement and Plan of Merger | ||||||||||||
Nominal value per share | $ / shares | $ 0.01 | |||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | 0.0001 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | ||||||||||||
Ordinary shares of successor company | shares | 160,000 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | Agreement and Plan of Merger | ||||||||||||
Nominal value per share | $ / shares | 0.01 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class C Common Stock [Member] | Agreement and Plan of Merger | ||||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | DIP Facility | ||||||||||||
Post-petition financing for plan of reorganization | $ 60,000,000 | |||||||||||
Converted debt amount | 110,000,000 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Exit Credit Facility | ||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 520,000,000 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | First Out Term Loans | ||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 110,000,000 | |||||||||||
Outstanding borrowings | $ 110,000,000 | $ 110,000,000 | ||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Second Out Term Loan Facility | ||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 410,000,000 | |||||||||||
Outstanding borrowings | $ 410,000,000 | $ 410,000,000 | ||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | New Credit Facility | ||||||||||||
Outstanding borrowings | 520,000,000 | |||||||||||
Annual interest payments | $ 45,000,000 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Existing Second Out Credit Agreement | Agreement and Plan of Merger | ||||||||||||
Aggregate redemption price, cash | $ 505,000,000 |
Summary of Significant Accou_14
Summary of Significant Accounting Policies - Property and equipment (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 5 Months Ended |
Jan. 31, 2021 | |
Computer equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 7 years |
Summary of Significant Accou_15
Summary of Significant Accounting Policies - Share-based compensation (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 5 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Allocated share-based compensation | $ 0 | |||
Cost of revenues | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Allocated share-based compensation | 0 | $ 0 | ||
Developed software/ courseware | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Allocated share-based compensation | 0 | 0 | $ 6 | $ 23 |
Selling and marketing | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Allocated share-based compensation | 0 | 0 | $ 77 | 110 |
General and administrative | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Allocated share-based compensation | $ 0 | $ 0 | $ 42 |
Summary of Significant Accou_16
Summary of Significant Accounting Policies - Balance sheet (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Feb. 01, 2020 | Jan. 31, 2020 |
Assets [Abstract] | ||||
Right of use assets | $ 14,654 | $ 15,131 | ||
Accrued expenses and other current liabilities | 18,285 | 23,125 | $ 29,267 | |
Lease liabilities | 4,690 | 4,740 | ||
Long term lease liabilities | $ 12,370 | $ 13,155 | ||
Impact of Adoption | ||||
Assets [Abstract] | ||||
Right of use assets | $ 19,415 | |||
Accrued expenses and other current liabilities | (2,116) | |||
Lease liabilities | 3,500 | |||
Long term lease liabilities | 18,031 | |||
As Adjusted | ||||
Assets [Abstract] | ||||
Right of use assets | 19,415 | |||
Accrued expenses and other current liabilities | 27,151 | |||
Lease liabilities | 3,500 | |||
Long term lease liabilities | 18,031 | |||
ASU 2018-11 | ||||
Assets [Abstract] | ||||
Accrued expenses and other current liabilities | $ 29,267 |
Summary of Significant Accou_17
Summary of Significant Accounting Policies - Consolidated Financial Statements (Details) - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | Aug. 27, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 | Apr. 10, 2019 | Feb. 01, 2019 | Jan. 31, 2018 |
Assets [Abstract] | |||||||||||||||||||
TOTAL ASSETS | $ 699,511,963 | $ 697,836,358 | $ 700,925,360 | $ 697,836,358 | |||||||||||||||
Liabilities [Abstract] | |||||||||||||||||||
Total Current Liabilities | 3,976,699 | 257,466 | 3,835,144 | 257,466 | |||||||||||||||
Stockholders' Equity Attributable to Parent [Abstract] | |||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (45,400,976) | (14,682,592) | (87,141,777) | (14,682,592) | |||||||||||||||
Total Stockholders' Equity | 5,000,006 | $ 5,000,009 | 5,000,006 | 5,000,010 | 5,000,006 | $ 0 | |||||||||||||
Operating loss | (1,584,933) | (301,863) | (744,859) | (906,903) | |||||||||||||||
Loss before income taxes | 41,743,223 | (8,418,705) | (13,435,075) | (71,972,424) | |||||||||||||||
Income Tax Expense (Benefit) | 2,422 | 404,809 | 1,247,517 | 486,761 | 1,247,517 | ||||||||||||||
Net income (loss) | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||||||||||||
Assets [Abstract] | |||||||||||||||||||
Prepaid expenses and other current assets | $ 36,422,000 | $ 31,825,000 | $ 30,326,000 | $ 36,422,000 | $ 52,456,000 | $ 36,933,000 | |||||||||||||
Other long-term assets | 16,306,000 | 9,505,000 | 8,636,000 | 16,306,000 | 6,037,000 | 16,168,000 | |||||||||||||
TOTAL ASSETS | 1,986,265,000 | 1,458,106,000 | 1,545,737,000 | 1,986,265,000 | 2,545,175,000 | 2,539,783,000 | |||||||||||||
Liabilities [Abstract] | |||||||||||||||||||
Deferred revenue, current | 307,383,000 | 234,069,000 | 257,549,000 | 307,383,000 | 337,086,000 | 333,227,000 | |||||||||||||
Total Current Liabilities | 4,699,027,000 | 310,573,000 | 351,436,000 | 4,699,027,000 | 494,032,000 | 490,173,000 | |||||||||||||
Deferred revenue, non-current | 3,787,000 | 1,848,000 | 3,035,000 | 3,787,000 | 31,949,000 | 31,864,000 | |||||||||||||
Total long-term liabilities | 48,982,000 | 605,197,000 | 614,332,000 | 48,982,000 | 3,968,468,000 | 3,968,383,000 | |||||||||||||
Stockholders' Equity Attributable to Parent [Abstract] | |||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (2,761,499,000) | (131,127,000) | (93,722,000) | (2,761,499,000) | (1,910,846,000) | (1,912,294,000) | |||||||||||||
Total Stockholders' Equity | (2,761,744,000) | 542,336,000 | $ (3,196,276,000) | 579,969,000 | $ 666,973,000 | (2,761,744,000) | (1,917,325,000) | (1,918,773,000) | $ (1,515,746,000) | ||||||||||
Total revenues | 514,021,000 | 91,701,000 | 118,329,000 | 108,768,000 | 273,851,000 | 514,021,000 | 534,141,000 | ||||||||||||
Selling and marketing | 140,785,000 | 28,502,000 | 32,737,000 | 55,285,000 | 75,028,000 | 140,785,000 | 150,179,000 | ||||||||||||
Operating loss | (403,216,000) | (27,703,000) | (337,745,000) | (99,172,000) | $ (329,810,000) | (329,810,000) | (403,216,000) | 6,654,000 | |||||||||||
Loss before income taxes | (837,993,000) | (39,494,000) | (442,794,000) | (115,656,000) | 2,832,467,000 | (837,993,000) | (394,812,000) | ||||||||||||
Income Tax Expense (Benefit) | 11,212,000 | 2,089,000 | 8,891,000 | (21,934,000) | 68,455,000 | 68,455,000 | 11,212,000 | 5,027,000 | |||||||||||
Net income (loss) | (849,205,000) | $ (37,405,000) | $ (433,903,000) | $ (93,722,000) | $ 2,764,012,000 | $ 2,764,012,000 | (849,205,000) | $ (399,839,000) | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Impact of Adoption of Topic 606 | |||||||||||||||||||
Assets [Abstract] | |||||||||||||||||||
Prepaid expenses and other current assets | 12,028,000 | 12,028,000 | (15,523,000) | ||||||||||||||||
Other long-term assets | (11,692,000) | (11,692,000) | 10,131,000 | ||||||||||||||||
TOTAL ASSETS | 336,000 | 336,000 | (5,392,000) | ||||||||||||||||
Liabilities [Abstract] | |||||||||||||||||||
Deferred revenue, current | 8,075,000 | 8,075,000 | (3,859,000) | ||||||||||||||||
Total Current Liabilities | 8,075,000 | 8,075,000 | (3,859,000) | ||||||||||||||||
Deferred revenue, non-current | (3,787,000) | (3,787,000) | (85,000) | ||||||||||||||||
Total long-term liabilities | (3,787,000) | (3,787,000) | (85,000) | ||||||||||||||||
Stockholders' Equity Attributable to Parent [Abstract] | |||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (3,952,000) | (3,952,000) | (1,448,000) | ||||||||||||||||
Total Stockholders' Equity | (3,952,000) | (3,952,000) | $ (1,448,000) | ||||||||||||||||
Total revenues | (429,000) | ||||||||||||||||||
Selling and marketing | 5,056,000 | ||||||||||||||||||
Operating loss | (5,485,000) | ||||||||||||||||||
Loss before income taxes | (5,485,000) | ||||||||||||||||||
Income Tax Expense (Benefit) | (85,000) | ||||||||||||||||||
Net income (loss) | (5,400,000) | ||||||||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Under Previous GAAP | |||||||||||||||||||
Assets [Abstract] | |||||||||||||||||||
Prepaid expenses and other current assets | 48,450,000 | 48,450,000 | |||||||||||||||||
Other long-term assets | 4,608,000 | 4,608,000 | |||||||||||||||||
TOTAL ASSETS | 1,986,601,000 | 1,986,601,000 | |||||||||||||||||
Liabilities [Abstract] | |||||||||||||||||||
Deferred revenue, current | 315,458,000 | 315,458,000 | |||||||||||||||||
Total Current Liabilities | 4,707,102,000 | 4,707,102,000 | |||||||||||||||||
Total long-term liabilities | 45,195,000 | 45,195,000 | |||||||||||||||||
Stockholders' Equity Attributable to Parent [Abstract] | |||||||||||||||||||
Retained Earnings (Accumulated Deficit) | (2,765,451,000) | (2,765,451,000) | |||||||||||||||||
Total Stockholders' Equity | (2,765,696,000) | $ (2,765,696,000) | |||||||||||||||||
Total revenues | 513,592,000 | ||||||||||||||||||
Selling and marketing | 145,841,000 | ||||||||||||||||||
Operating loss | (408,701,000) | ||||||||||||||||||
Loss before income taxes | (843,478,000) | ||||||||||||||||||
Income Tax Expense (Benefit) | 11,127,000 | ||||||||||||||||||
Net income (loss) | $ (854,605,000) |
Summary of significant accou_18
Summary of significant accounting policies - Additional information (Details) | 3 Months Ended | 5 Months Ended | 6 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Mar. 31, 2020USD ($) | Jan. 31, 2021USD ($)$ / sharesshares | Jun. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Aug. 27, 2020USD ($)$ / sharesshares | Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2020USD ($) | Jan. 31, 2020USD ($) | Jan. 31, 2019USD ($) | Apr. 30, 2021USD ($)shares | Jun. 17, 2020USD ($) | Jul. 01, 2019$ / shares | |
Financing Receivable, Impaired [Line Items] | |||||||||||||
Warrant purchase price | $ / shares | $ 11.50 | ||||||||||||
Loss on Derivative Liabilities | $ (10,346,000) | $ (54,982,000) | $ (17,878,000) | $ (26,644,000) | $ (18,250,000) | $ (73,583,549) | |||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Fair value of retained noncontrolling interest in the Canadian subsidiary | $ 4,800,000 | ||||||||||||
Reclassification of General and Administrative expense to Recapitalization and Transaction Fees | $ 16,244,000 | ||||||||||||
Restricted cash | $ 2,964,000 | $ 10,306,000 | 15,005,000 | $ 14,884,000 | $ 2,656,000 | ||||||||
Facility balance floor | 10,000,000 | ||||||||||||
Royalty expense | 7,300,000 | 9,300,000 | 16,500,000 | 19,000,000 | |||||||||
Advertising expenses | $ 3,700,000 | $ 3,200,000 | 5,300,000 | $ 4,000,000 | |||||||||
Number of warrants to purchase additional common shares | shares | 705,882 | 705,882 | |||||||||||
Loss on Derivative Liabilities | $ (2,900,000) | ||||||||||||
Increase decrease earnings attributable | $ (41,257,000) | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Minimum [Member] | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Contractual terms (in years) | 3 years | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Maximum [Member] | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Contractual terms (in years) | 5 years | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Net impact of increase in value of participation right | $ 13,300,000 | ||||||||||||
Loss on Derivative Liabilities | 7,400,000 | ||||||||||||
Increase decrease earnings attributable | 5,900,000 | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Loss on Derivative Liabilities | 7,400,000 | ||||||||||||
Increase decrease earnings attributable | $ 5,900,000 | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Volatility | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Measurement input rate | 35 | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Non-Favored Sale scenario | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Measurement input rate | 35 | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Held-to-maturity scenario | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Measurement input rate | 31.60 | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Prepaid expenses and other current assets | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Unamortized commission expense | $ 3,100,000 | 11,200,000 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Other assets | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Unamortized commission expense | $ 4,400,000 | $ 11,700,000 | |||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Tranche A | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Number of warrants to purchase additional common shares | shares | 235,294 | ||||||||||||
Warrant purchase price | $ / shares | $ 262.34 | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Tranche B | |||||||||||||
Financing Receivable, Impaired [Line Items] | |||||||||||||
Number of warrants to purchase additional common shares | shares | 470,588 | 470,588 | |||||||||||
Warrant purchase price | $ / shares | $ 274.84 | $ 274.84 |
Chapter 11 Proceedings and Em_2
Chapter 11 Proceedings and Emergence (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 5 Months Ended | ||||||||
Apr. 30, 2021 | Jan. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Aug. 27, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jul. 01, 2019 | Jun. 26, 2019 | Jun. 07, 2019 | |
Warrant purchase price | $ 11.50 | |||||||||
Class A Common Stock [Member] | ||||||||||
Ordinary shares of successor company | 3,840,000 | 11,090,292 | 15,287,498 | 7,974,075 | ||||||
Class B Common Stock [Member] | ||||||||||
Ordinary shares of successor company | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 | ||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||
Ordinary shares of successor company | 4,000,000 | 100,100 | ||||||||
Number of ordinary shares issued | 705,882 | 705,882 | ||||||||
Remaining borrowing of credit facility | $ 75 | |||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Maximum [Member] | ||||||||||
Current borrowing capacity of credit facility | 90 | |||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Minimum [Member] | ||||||||||
Current borrowing capacity of credit facility | $ 75 | |||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | LIBOR | ||||||||||
Interest rate on credit facility | 7.50% | 7.50% | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Exit Credit Facility | LIBOR floor | ||||||||||
Interest rate on credit facility | 1.00% | |||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Exit Credit Facility | LIBOR | ||||||||||
Interest rate on credit facility | 7.50% | |||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Tranche A | ||||||||||
Number of ordinary shares issued | 235,294 | 235,294 | ||||||||
Warrant purchase price | $ 262.34 | $ 262.34 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Tranche B | ||||||||||
Number of ordinary shares issued | 470,588 | 470,588 | ||||||||
Warrant purchase price | $ 274.84 | $ 274.84 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | ||||||||||
Ordinary shares of successor company | 3,840,000 | |||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | ||||||||||
Ordinary shares of successor company | 160,000 |
Fresh Start Reporting (Details)
Fresh Start Reporting (Details) $ in Thousands | 5 Months Ended |
Jan. 31, 2021USD ($) | |
Maximum [Member] | |
Fresh-Start Adjustment [Line Items] | |
Enterprise value | $ 1,250,000 |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Fresh-Start Adjustment [Line Items] | |
Enterprise value | $ 1,150,000 |
Weighted average cost of capital | 11.00% |
Expected tax rate | 21.00% |
Discount rate | 3.00% |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Minimum [Member] | |
Fresh-Start Adjustment [Line Items] | |
Enterprise value | $ 1,050,000 |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Maximum [Member] | |
Fresh-Start Adjustment [Line Items] | |
Enterprise value | $ 1,250,000 |
Fresh Start Reporting - Disclos
Fresh Start Reporting - Disclosure Statement To Fair Value Of Successor Company's Equity (Details) - USD ($) | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Apr. 10, 2019 | Dec. 31, 2018 |
Plus: Cash | $ 2,382,560 | $ 3,873,865 | $ 2,014,521 | $ 2,238,275 | $ 2,238,275 | $ 0 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||
Enterprise value(1) | $ 1,150,000,000 | ||||||
Plus: Cash | 92,009,000 | ||||||
Less: Borrowings under accounts receivable facility | (48,886,000) | ||||||
Less: Fair value of debt | (514,950,000) | ||||||
Less: Fair value of warrants | (11,200,000) | ||||||
Implied value of Successor Company common stock | $ 666,973,000 | ||||||
Shares issued upon emergence (Class A and B common stock) | 4,000 | ||||||
Per share | $ 167 |
Fresh Start Reporting - Reconci
Fresh Start Reporting - Reconciliation of Company's Enterprise Value to Reorganization Value (Details) - USD ($) | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Apr. 10, 2019 | Dec. 31, 2018 |
Plus: Cash | $ 2,382,560 | $ 3,873,865 | $ 2,014,521 | $ 2,238,275 | $ 2,238,275 | $ 0 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||
Enterprise value(1) | $ 1,150,000,000 | ||||||
Plus: Cash | 92,009,000 | ||||||
Current liabilities (excluding AR facility and Current maturity of long-term debt) | 134,257,000 | ||||||
Deferred tax liabilities | 103,930,000 | ||||||
Other long-term liabilities | 7,140,000 | ||||||
Non-current lease obligations | 16,399,000 | ||||||
Reorganization value | $ 1,503,735,000 |
Fresh Start Reporting - Consoli
Fresh Start Reporting - Consolidated balance sheet (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 5 Months Ended | |
Jan. 31, 2021 | Sep. 30, 2020 | |
Current assets: | ||
Accounts receivable | $ (990) | |
Goodwill | (580,639) | |
Current liabilities: | ||
Deferred revenue | 116,252 | |
Long-term debt | 5,050 | |
Deferred tax liabilities | (73,446) | $ 77,200 |
Total long-term liabilities | 400 | |
Fresh-Start Adjustment, Increase (Decrease), Long-term Debt | 5,050 | |
Shareholders' equity (deficit): | ||
(Accumulated deficit) retained earnings | (41,257) | |
Accumulated other comprehensive loss | (2,733) | |
Plan Of Reorganization [Member] | ||
Current assets: | ||
Cash and cash equivalents | 42,341 | |
Restricted cash | 35,306 | |
Accounts receivable | 73,607 | |
Prepaid expense and other current assets | 39,317 | |
Total current assets | 190,571 | |
Property and equipment, net | 15,523 | |
Goodwill | 1,070,674 | |
Intangible assets, net | 249,962 | |
Right of use assets | 17,454 | |
Other assets | 17,313 | |
Total assets | 1,561,497 | |
Current liabilities: | ||
Current maturities of long-term debt | 60,000 | |
Borrowings under accounts receivable facility | 48,886 | |
Accounts payable | 7,851 | |
Accrued compensation | 23,587 | |
Accrued expenses and other liabilities | 12,105 | |
Lease liabilities | 1,699 | |
Deferred revenue | 196,469 | |
Total current liabilities | 350,597 | |
Long term lease liabilities | 3,732 | |
Deferred revenue - non-current | 1,783 | |
Other long-term liabilities | 2,289 | |
Total long-term liabilities | 7,804 | |
Liabilities subject to compromise | 4,472,954 | |
Total liabilities | 4,831,355 | |
Shareholders' equity (deficit): | ||
Ordinary shares (Predecessor) | 138 | |
Additional paid in capital (Predecessor) | 83 | |
(Accumulated deficit) retained earnings | (3,267,346) | |
Accumulated other comprehensive loss | (2,733) | |
Total shareholder (deficit) equity | (3,269,858) | |
Total liabilities and shareholders' (deficit) equity | 1,561,497 | |
Reorganization Adjustments | ||
Current assets: | ||
Cash and cash equivalents | 49,668 | |
Restricted cash | (25,000) | |
Accounts receivable | 1,700 | |
Prepaid expense and other current assets | (300) | |
Total current assets | 26,068 | |
Property and equipment, net | 500 | |
Goodwill | 5,100 | |
Other assets | (3,500) | |
Total assets | 28,168 | |
Current liabilities: | ||
Current maturities of long-term debt | (57,400) | |
Accounts payable | 300 | |
Accrued compensation | 1,400 | |
Accrued expenses and other liabilities | 500 | |
Lease liabilities | 3,245 | |
Deferred revenue | 2,400 | |
Total current liabilities | (49,555) | |
Long-term debt | 517,400 | |
Long term lease liabilities | 12,442 | |
Warrants | 11,200 | |
Deferred tax liabilities | 30,484 | |
Other long-term liabilities | 3,796 | |
Total long-term liabilities | 575,322 | |
Fresh-Start Adjustment, Increase (Decrease), Long-term Debt | 517,400 | |
Liabilities subject to compromise | (4,472,954) | |
Total liabilities | (3,947,187) | |
Shareholders' equity (deficit): | ||
Ordinary shares (Predecessor) | (138) | |
Additional paid in capital (Predecessor) | (83) | |
Ordinary shares (Successor) | 40 | |
Additional paid in capital (Successor) | 666,933 | |
(Accumulated deficit) retained earnings | 3,308,603 | |
Total shareholder (deficit) equity | 3,975,355 | |
Total liabilities and shareholders' (deficit) equity | 28,168 | |
Fresh-Start Adjustments | ||
Current assets: | ||
Accounts receivable | (990) | |
Prepaid expense and other current assets | (10,573) | |
Total current assets | (11,563) | |
Goodwill | (580,639) | |
Intangible assets, net | 516,124 | |
Right of use assets | 367 | |
Other assets | (10,219) | |
Total assets | (85,930) | |
Current liabilities: | ||
Lease liabilities | (175) | |
Deferred revenue | (115,124) | |
Total current liabilities | (115,299) | |
Long-term debt | (5,050) | |
Long term lease liabilities | 225 | |
Deferred tax liabilities | 73,446 | |
Deferred revenue - non-current | (1,128) | |
Other long-term liabilities | 400 | |
Total long-term liabilities | 67,893 | |
Fresh-Start Adjustment, Increase (Decrease), Long-term Debt | (5,050) | |
Total liabilities | (47,406) | |
Shareholders' equity (deficit): | ||
(Accumulated deficit) retained earnings | (41,257) | |
Accumulated other comprehensive loss | 2,733 | |
Total shareholder (deficit) equity | (38,524) | |
Total liabilities and shareholders' (deficit) equity | (85,930) | |
Reorganization [Member] | ||
Current assets: | ||
Cash and cash equivalents | 92,009 | |
Restricted cash | 10,306 | |
Accounts receivable | 74,317 | |
Prepaid expense and other current assets | 28,444 | |
Total current assets | 205,076 | |
Property and equipment, net | 16,023 | |
Goodwill | 495,135 | |
Intangible assets, net | 766,086 | |
Right of use assets | 17,821 | |
Other assets | 3,594 | |
Total assets | 1,503,735 | |
Current liabilities: | ||
Current maturities of long-term debt | 2,600 | |
Borrowings under accounts receivable facility | 48,886 | |
Accounts payable | 8,151 | |
Accrued compensation | 24,987 | |
Accrued expenses and other liabilities | 12,605 | |
Lease liabilities | 4,769 | |
Deferred revenue | 83,745 | |
Total current liabilities | 185,743 | |
Long-term debt | 512,350 | |
Long term lease liabilities | 16,399 | |
Warrants | 11,200 | |
Deferred tax liabilities | 103,930 | |
Deferred revenue - non-current | 655 | |
Other long-term liabilities | 6,485 | |
Total long-term liabilities | 651,019 | |
Fresh-Start Adjustment, Increase (Decrease), Long-term Debt | 512,350 | |
Total liabilities | 836,762 | |
Shareholders' equity (deficit): | ||
Ordinary shares (Successor) | 40 | |
Additional paid in capital (Successor) | 666,933 | |
Total shareholder (deficit) equity | 666,973 | |
Total liabilities and shareholders' (deficit) equity | $ 1,503,735 |
Fresh Start Reporting - Reorgan
Fresh Start Reporting - Reorganization adjustments (Details) - USD ($) $ in Thousands | Jun. 17, 2020 | Jan. 31, 2021 |
Uses: | ||
Noncontrolling interest recognized | $ 4,800 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Sources: | ||
Release of restricted cash | $ 25,000 | |
Additional funding from First Out Term Loan | 50,000 | |
Reconsolidation of Canadian subsidiary | 1,100 | |
Total sources of cash | 76,100 | |
Uses: | ||
Exit Facility and DIP Facility rollover financing costs paid upon Effective Date | (5,032) | |
Professional success fees paid upon Effective Date | (21,400) | |
Total uses of cash | (26,432) | |
Net increase in cash | 49,668 | |
Debtor-in-possession financing | 60,000 | |
Principal payments related to term loan | $ 2,600 |
Fresh Start Reporting - Team lo
Fresh Start Reporting - Team loan facility agreement (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 5 Months Ended | ||
Apr. 30, 2022 | Apr. 30, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | Jan. 31, 2021 | |
Total Debt - Exit facility | $ 520,000 | ||||
Less: Current portion of Long-term debt | (2,600) | ||||
Long-term debt, net of current portion | $ 517,400 | ||||
Quarterly principal repayments | $ 2,600 | $ 1,300 | |||
LIBOR | |||||
Basis spread on variable rate (as a percent) | 7.50% | 7.50% | |||
Exit Credit Facility | |||||
Quarterly principal repayments | $ 2,600 | $ 1,300 | |||
Exit Credit Facility | LIBOR | |||||
Basis spread on variable rate (as a percent) | 7.50% | ||||
Floor rate | 1.00% | ||||
First out term loan facility | |||||
Total Debt - Exit facility | $ 110,000 | ||||
Second-out term loan facility | |||||
Total Debt - Exit facility | $ 410,000 |
Fresh Start Reporting - Disposi
Fresh Start Reporting - Disposition of liabilities (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 5 Months Ended | 7 Months Ended |
Jan. 31, 2021 | Aug. 27, 2020 | |
Disposition of liabilities subject to compromise | ||
Liabilities subject to compromise pre-emergence | $ 4,472,954 | |
Reinstated on the Effective Date: | ||
Lease liabilities (current and non-current) | (15,687) | |
Deferred tax liabilities | (26,107) | |
Other long-term liabilities | (3,796) | |
Total liabilities reinstated | (45,590) | |
Less amounts settled per the Plan of Reorganization | ||
Issuance of new debt | (410,000) | |
Issuance of warrants | (11,200) | |
Equity issued at emergence to creditors in settlement of Liabilities Subject to Compromise | (666,973) | |
Total amounts settled | (1,088,173) | |
Gain on settlement of Liabilities Subject to Compromise | $ 3,339,191 | $ 3,339,191 |
Fresh Start Reporting - Settlem
Fresh Start Reporting - Settlement of the company's Predecessor first and second lien debt obligations (Details) - shares | 1 Months Ended | 3 Months Ended | 5 Months Ended | 9 Months Ended | |
May 31, 2019 | Mar. 31, 2020 | Jan. 31, 2021 | Dec. 31, 2019 | Apr. 30, 2021 | |
Class A Common Stock [Member] | |||||
Debt Instrument [Line Items] | |||||
Newly issued shares | 0 | ||||
Class B Common Stock [Member] | |||||
Debt Instrument [Line Items] | |||||
Newly issued shares | 8,625,000 | 0 | 17,250,000 | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||
Debt Instrument [Line Items] | |||||
Number of warrants to purchase additional common shares | 705,882 | 705,882 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | First Lien | |||||
Debt Instrument [Line Items] | |||||
Newly issued shares | 3,840,000 | ||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | Second Lien | |||||
Debt Instrument [Line Items] | |||||
Newly issued shares | 160,000 |
Fresh Start Reporting - Cumulat
Fresh Start Reporting - Cumulative impact of reorganization adjustments (Details) - USD ($) | 5 Months Ended | 7 Months Ended | |||||||
Jan. 31, 2021 | Aug. 27, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Feb. 01, 2019 | Jan. 31, 2019 | |
Fresh-Start Adjustment [Line Items] | |||||||||
Net impact on Accumulated deficit | $ (45,400,976) | $ (87,141,777) | $ (14,682,592) | ||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Fresh-Start Adjustment [Line Items] | |||||||||
Gain on settlement of Liabilities Subject to Compromise | $ 3,339,191,000 | $ 3,339,191,000 | |||||||
Professional success fees paid upon Effective Date | (21,400,000) | ||||||||
Exit Facility and DIP Facility rollover financing costs paid upon Effective Date | (5,032,000) | ||||||||
Net impact on Accumulated deficit | (93,722,000) | $ (131,127,000) | $ (2,761,499,000) | $ (1,912,294,000) | $ (1,910,846,000) | ||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Reorganization Adjustments | |||||||||
Fresh-Start Adjustment [Line Items] | |||||||||
Gain on settlement of Liabilities Subject to Compromise | 3,339,191,000 | ||||||||
Provision for income taxes | (4,377,000) | ||||||||
Professional success fees paid upon Effective Date | (21,400,000) | ||||||||
Exit Facility and DIP Facility rollover financing costs paid upon Effective Date | (5,032,000) | ||||||||
Cancellation of predecessor shares and additional paid in capital | 221,000 | ||||||||
Net impact on Accumulated deficit | $ 3,308,603,000 |
Fresh Start Reporting - Fresh-s
Fresh Start Reporting - Fresh-start adjustments (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) $ in Thousands | Jan. 31, 2021USD ($) |
Goodwill eliminated | $ 1,075,800 |
Goodwill established based on the calculated reorganization value | 495,100 |
Reorganization value of Successor company | 1,503,735 |
Less: Fair value of Successor company assets | (1,008,600) |
Reorganization Value Of Successor Company Excess Of Asset Fair Value Goodwill | $ 495,135 |
Fresh Start Reporting - Adjustm
Fresh Start Reporting - Adjustment to intangible assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) $ in Thousands | 5 Months Ended |
Jan. 31, 2021USD ($) | |
Fresh-Start Adjustment [Line Items] | |
Total intangible asset upon emergence | $ 766,086 |
Elimination of historical acquired intangible assets | (249,962) |
Fresh-start adjustment to acquired intangibles assets | 516,124 |
Skillsoft trademark | |
Fresh-Start Adjustment [Line Items] | |
Total intangible asset upon emergence | 91,500 |
Developed software/ courseware | |
Fresh-Start Adjustment [Line Items] | |
Total intangible asset upon emergence | $ 261,600 |
Developed software/ courseware | Minimum [Member] | |
Fresh-Start Adjustment [Line Items] | |
Estimated useful life | 3 years |
Developed software/ courseware | Maximum [Member] | |
Fresh-Start Adjustment [Line Items] | |
Estimated useful life | 5 years |
Customer contracts/ relationships | |
Fresh-Start Adjustment [Line Items] | |
Estimated useful life | 12 years 4 months 24 days |
Total intangible asset upon emergence | $ 279,500 |
Trademarks and trade names | |
Fresh-Start Adjustment [Line Items] | |
Estimated useful life | 9 years 4 months 24 days |
Total intangible asset upon emergence | $ 6,300 |
Backlog | |
Fresh-Start Adjustment [Line Items] | |
Estimated useful life | 4 years 4 months 24 days |
Total intangible asset upon emergence | $ 90,200 |
Publishing rights | |
Fresh-Start Adjustment [Line Items] | |
Estimated useful life | 5 years |
Total intangible asset upon emergence | $ 35,200 |
Capitalized software | |
Fresh-Start Adjustment [Line Items] | |
Estimated useful life | 5 years |
Total intangible asset upon emergence | $ 1,786 |
Fresh Start Reporting - Cumul_2
Fresh Start Reporting - Cumulative impact of fresh-start adjustments (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Jan. 31, 2021 | Sep. 30, 2020 | Aug. 27, 2020 |
Fresh-Start Adjustment [Line Items] | |||
Fresh-start adjustment to accounts receivable, net | $ (990) | ||
Fresh-start adjustment to prepaid assets and other assets (including long-term) | (20,792) | ||
Fresh-start adjustment to goodwill | (580,639) | ||
Fresh-start adjustment to intangible assets, net | 516,124 | ||
Fresh-start adjustment to operating lease right-of-use assets and liabilities, net | 317 | ||
Fresh-start adjustment to deferred revenue (current and non-current) | 116,252 | ||
Fair value adjustment to debt | 5,050 | ||
Fair value adjustment to other long-term liabilities | 400 | ||
Total fresh-start adjustments impacting reorganization items, net | 34,922 | $ 34,922 | |
Elimination of accumulated other comprehensive loss | (2,733) | ||
Deferred tax liabilities | (73,446) | $ 77,200 | |
Net impact on accumulated deficit | $ (41,257) |
Fresh Start Reporting - Reorg_2
Fresh Start Reporting - Reorganization items, net (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 5 Months Ended | 7 Months Ended | |
Jan. 31, 2021 | Aug. 31, 2020 | Aug. 27, 2020 | |
Gain on settlement of Liabilities Subject to Compromise | $ 3,339,191 | $ 3,339,191 | |
Impact of fresh-start adjustments | 34,922 | 34,922 | |
Exit Facility and DIP Facility rollover financing costs paid upon Effective Date | (5,032) | ||
Write-off of pre-petition debt and DIP issuance costs | (9,461) | ||
Professional success fees paid upon Effective Date | (21,399) | ||
Professional fees and other bankruptcy related costs | (13,076) | ||
Gain on Deconsolidation of Canadian subsidiary | 4,100 | ||
Reorganization items, net | $ (3,329,245) | 3,329,245 | |
Cash payment for reorganization items, net | $ 784 | $ 42,916 |
Intangible Assets - Intangible
Intangible Assets - Intangible assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 |
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Accumulated Amortization, Finite-lived | $ 74,784 | $ 39,825 | $ 624,283 |
Net Carrying Amount, Finite-lived | 603,430 | 637,133 | |
Gross Carrying Amount, Intangible assets | 769,714 | 768,458 | 1,059,268 |
Net Carrying Amount, Intangible assets | 694,930 | 728,633 | 434,985 |
Skillsoft trademark | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Carrying Amount, Indefinite-lived | 91,500 | 186,000 | |
Gross Carrying Amount, Intangible assets | 91,500 | 91,500 | |
Net Carrying Amount, Intangible assets | 91,500 | 91,500 | |
Developed software/ courseware | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 267,014 | 265,758 | 157,168 |
Accumulated Amortization, Finite-lived | 39,459 | 24,669 | 129,663 |
Net Carrying Amount, Finite-lived | 227,555 | 241,089 | 27,505 |
Customer contracts/ relationships | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 279,500 | 279,500 | 670,800 |
Accumulated Amortization, Finite-lived | 9,114 | 3,627 | 466,972 |
Net Carrying Amount, Finite-lived | 270,386 | 275,873 | 203,828 |
Trademarks and trade names | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 6,300 | 6,300 | 45,300 |
Accumulated Amortization, Finite-lived | 676 | 455 | 27,648 |
Net Carrying Amount, Finite-lived | 5,624 | 5,845 | $ 17,652 |
Publishing rights | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 35,200 | 35,200 | |
Accumulated Amortization, Finite-lived | 4,693 | 2,933 | |
Net Carrying Amount, Finite-lived | 30,507 | 32,267 | |
Backlog | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 90,200 | 90,200 | |
Accumulated Amortization, Finite-lived | 20,842 | 8,141 | |
Net Carrying Amount, Finite-lived | $ 69,358 | $ 82,059 |
Intangible Assets - Amortizatio
Intangible Assets - Amortization expense (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Amortization expense related to the existing finite-lived intangible assets | ||||||
2022 | $ 104,693 | $ 139,408 | ||||
2023 | 120,579 | 120,339 | ||||
2024 | 106,172 | 105,910 | ||||
2025 | 94,070 | 93,842 | ||||
2026 | 64,496 | 64,269 | ||||
Thereafter | 113,420 | 113,365 | ||||
Total | 603,430 | 637,133 | ||||
Amortization expense related to intangible assets | $ 34,943 | $ 17,370 | $ 39,824 | $ 34,378 | $ 96,359 | $ 151,752 |
Intangible Assets (Details)
Intangible Assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Goodwill [Line Items] | ||||||
Amortization expense related to intangible assets | $ 34,943 | $ 17,370 | $ 39,824 | $ 34,378 | $ 96,359 | $ 151,752 |
Impairment charges of indefinite-lived intangible assets | 332,376 | 332,376 | 440,598 | 16,094 | ||
Goodwill impairment | 177,886 | 440,598 | ||||
Goodwill and intangible asset impairment charges | 332,376 | 332,376 | 440,598 | 16,094 | ||
Books24x7 tradename | ||||||
Goodwill [Line Items] | ||||||
Impairment charges of definite lived intangible assets | 15,500 | |||||
Vodeclic tradename | ||||||
Goodwill [Line Items] | ||||||
Impairment charges of definite lived intangible assets | $ 600 | |||||
Skillsoft reporting unit | ||||||
Goodwill [Line Items] | ||||||
Impairment charges of indefinite-lived intangible assets | 92,200 | 92,200 | ||||
Goodwill impairment | 107,900 | 107,900 | 107,934 | 321,340 | ||
Goodwill and intangible asset impairment charges | 92,200 | |||||
SumTotal reporting unit | ||||||
Goodwill [Line Items] | ||||||
Impairment charges of definite lived intangible assets | 62,300 | 62,300 | ||||
Goodwill impairment | $ 70,000 | 70,000 | $ 69,952 | $ 119,258 | ||
Goodwill and intangible asset impairment charges | $ 62,300 |
Intangible Assets - rollforward
Intangible Assets - rollforward of goodwill - (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Goodwill [Line Items] | ||||||
Goodwill, Beginning balance | $ 495,004,000 | $ 1,253,822,000 | $ 495,135,000 | $ 1,253,822,000 | $ 1,694,313,000 | $ 1,693,906,000 |
Re-allocation of goodwill upon change in reporting units | 0 | |||||
Impact of Fresh-Start Reporting | (575,539,000) | |||||
Foreign currency translation adjustment | (62,000) | (131,000) | (162,000) | 107,000 | 407,000 | |
Impairment of goodwill | (177,886,000) | (440,598,000) | ||||
Canada deconsolidation | (5,100,000) | |||||
Goodwill, Ending balance | 494,942,000 | 495,004,000 | 1,070,674,000 | 1,253,822,000 | 1,694,313,000 | |
Skillsoft reporting unit | ||||||
Goodwill [Line Items] | ||||||
Goodwill, Beginning balance | 491,654,000 | 1,112,820,000 | 491,785,000 | 1,112,820,000 | 1,434,047,000 | 0 |
Re-allocation of goodwill upon change in reporting units | 1,433,662,000 | |||||
Impact of Fresh-Start Reporting | (507,843,000) | |||||
Foreign currency translation adjustment | (62,000) | (131,000) | (158,000) | 113,000 | 385,000 | |
Impairment of goodwill | (107,900,000) | (107,900,000) | (107,934,000) | (321,340,000) | ||
Canada deconsolidation | (5,100,000) | |||||
Goodwill, Ending balance | 491,592,000 | 491,654,000 | 999,628,000 | 1,112,820,000 | 1,434,047,000 | |
Accumulated impairment losses | 0 | 0 | 321,340 | 0 | ||
SumTotal reporting unit | ||||||
Goodwill [Line Items] | ||||||
Goodwill, Beginning balance | 3,350,000 | 141,002,000 | 3,350,000 | 141,002,000 | 260,266,000 | 0 |
Re-allocation of goodwill upon change in reporting units | 260,244,000 | |||||
Impact of Fresh-Start Reporting | (67,696,000) | |||||
Foreign currency translation adjustment | 0 | (4,000) | (6,000) | 22,000 | ||
Impairment of goodwill | (70,000,000) | $ (70,000,000) | (69,952,000) | (119,258,000) | ||
Canada deconsolidation | 0 | |||||
Goodwill, Ending balance | $ 3,350,000 | 3,350,000 | $ 71,046,000 | 141,002,000 | 260,266,000 | |
Accumulated impairment losses | $ 0 | $ 119,258 | $ 0 |
Property and Equipment (Details
Property and Equipment (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment, gross | $ 17,732 | $ 88,767 | ||||
Less accumulated depreciation and amortization | (3,952) | (70,865) | ||||
Property and equipment, net | $ 11,798 | 13,780 | 17,902 | |||
Depreciation expense | $ 2,419 | $ 2,631 | 3,604 | $ 5,864 | 9,716 | $ 12,666 |
Computer equipment | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment, gross | 12,455 | 80,483 | ||||
Furniture and fixtures | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment, gross | 1,894 | 3,046 | ||||
Leasehold improvements | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment, gross | $ 3,383 | 5,220 | ||||
Construction in progress | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Property and equipment, gross | $ 18 |
Taxes (Details)
Taxes (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 5 Months Ended | 8 Months Ended |
Jan. 31, 2021 | Sep. 30, 2020 | |
Debt extinguishment | $ 3,300,000 | |
Amount of income tax expense in connection with Reorganization | $ 4,400 | |
Amount of income tax expense for the reduction in federal and state NOL carryforwards and tax credits in connection with Reorganization | 18,600 | |
Amount of income tax expense for the reduction in other U.S. attributes in connection with Reorganization | 8,800 | |
Amount of income tax expense for the reduction in reversal of deferred tax assets on liabilities in jurisdictions in connection with Reorganization | 106,500 | |
Amount of income tax benefit for the reduction in valuation allowances in connection with Reorganization | 129,500 | |
Fresh start accounting adjustments, income tax expense | 73,400 | |
Fresh start accounting adjustments, tax expense for the increase in deferred tax liabilities | $ (73,446) | 77,200 |
Fresh start accounting adjustments, tax benefit for the reduction in valuation allowance | $ 3,800 |
Taxes - components of the incom
Taxes - components of the income tax benefit (provision) (Details) - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Aug. 31, 2020 | Aug. 27, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 |
DEFERRED: | |||||||||||||
Deferred income tax benefit | $ (976) | $ (14,050) | $ (8,681) | $ 9,657 | |||||||||
(Benefit) provision for income taxes | $ 2,422 | $ 404,809 | $ 1,247,517 | $ 486,761 | $ 1,247,517 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||||||
CURRENT: | |||||||||||||
Current tax provision | $ 1,206,000 | $ 2,221,000 | $ 5,453,000 | $ 5,442,000 | |||||||||
DEFERRED: | |||||||||||||
Deferred income tax benefit | (23,140,000) | 66,234,000 | 5,759,000 | (415,000) | |||||||||
(Benefit) provision for income taxes | $ 11,212,000 | $ 2,089,000 | $ 8,891,000 | (21,934,000) | $ 68,455,000 | 68,455,000 | 11,212,000 | 5,027,000 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Luxembourg | |||||||||||||
DEFERRED: | |||||||||||||
Deferred income tax benefit | 2,594,000 | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Ireland | |||||||||||||
CURRENT: | |||||||||||||
Current tax provision | (268,000) | 333,000 | 1,099,000 | 1,559,000 | |||||||||
DEFERRED: | |||||||||||||
Deferred income tax benefit | (1,856,000) | 43,483,000 | 8,533,000 | 1,517,000 | |||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | United States | |||||||||||||
CURRENT: | |||||||||||||
Current tax provision | 1,012,000 | 588,000 | 2,405,000 | 652,000 | |||||||||
DEFERRED: | |||||||||||||
Deferred income tax benefit | (19,265,000) | 17,256,000 | (2,693,000) | (1,906,000) | |||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Other foreign locations | |||||||||||||
CURRENT: | |||||||||||||
Current tax provision | 462,000 | 1,300,000 | 1,949,000 | 3,231,000 | |||||||||
DEFERRED: | |||||||||||||
Deferred income tax benefit | $ (4,613,000) | $ 5,495,000 | $ (81,000) | $ (26,000) |
Taxes - U.S. and foreign compon
Taxes - U.S. and foreign components of (loss) income before income taxes (Details) - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Jan. 31, 2019 |
Income Tax Disclosure [Line Items] | |||||||||||
Income (loss) before income taxes | $ 41,743,223 | $ (8,418,705) | $ (13,435,075) | $ (71,972,424) | |||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Income (loss) before income taxes | $ (837,993,000) | $ (39,494,000) | $ (442,794,000) | $ (115,656,000) | $ 2,832,467,000 | $ (837,993,000) | $ (394,812,000) | ||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Luxembourg | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Income (loss) before income taxes | 9,220,000 | ||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Ireland | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Income (loss) before income taxes | (3,741,000) | 2,437,738,000 | (645,360,000) | (336,002,000) | |||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | United States | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Income (loss) before income taxes | (86,333,000) | 364,827,000 | (197,600,000) | (62,805,000) | |||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Other foreign locations | |||||||||||
Income Tax Disclosure [Line Items] | |||||||||||
Income (loss) before income taxes | $ (34,802,000) | $ 29,902,000 | $ 4,967,000 | $ 3,995,000 |
Taxes - Company's effective tax
Taxes - Company's effective tax rate (Details) $ in Millions | 5 Months Ended | 7 Months Ended | 12 Months Ended | |||
Jan. 31, 2021USD ($) | Aug. 27, 2020 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 | |
US State income taxes, net of federal benefit | 0.00% | 0.00% | ||||
Change in valuation allowance | (0.20%) | 0.00% | ||||
Effective tax rate - provision (benefit) | (0.70%) | (9.30%) | ||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Income tax provision (benefit) at Luxembourg (24.9%) / Irish statutory rate (12.5%) | (24.9) | 12.5 | (12.5) | (12.5) | ||
US State income taxes, net of federal benefit | (5.70%) | (0.20%) | (0.20%) | (0.80%) | ||
Foreign rate differential | 6.10% | (0.20%) | (1.90%) | (1.20%) | ||
Other permanent items | (0.10%) | 0.70% | 1.20% | 2.50% | ||
Transaction costs | (7.60%) | 0.20% | ||||
Unrecognized tax benefit | (0.40%) | 0.20% | 0.30% | |||
Change in valuation allowance | 3.50% | (4.20%) | 5.50% | 9.60% | ||
Impairment of goodwill | 0.80% | 7.90% | ||||
Reorganization and fresh start adjustments | 9.60% | (7.30%) | ||||
Other | 0.50% | 0.10% | 1.20% | 3.40% | ||
Effective tax rate - provision (benefit) | (19.00%) | 2.40% | 1.40% | 1.30% | ||
Income tax expense related to changes in estimates of U.S. NOL and tax credits | $ 4.6 |
Taxes - Company's deferred tax
Taxes - Company's deferred tax assets and liabilities (Details) - USD ($) | Apr. 30, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 |
LIABILITIES: | |||||
Total net deferred tax liabilities, net | $ (976) | $ (9,657) | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||
ASSETS: | |||||
Net operating loss carryforwards | $ 13,517,000 | $ 29,753,000 | |||
Deferred interest expense | 35,852,000 | 145,399,000 | |||
Customer relationships | 6,888,000 | ||||
Reserves and accruals | 9,038,000 | 7,204,000 | |||
Lease liabilities | 3,862,000 | ||||
Tax credits | 99,000 | 5,893,000 | |||
Transaction costs | 19,532,000 | 4,216,000 | |||
Other intangibles | 3,505,000 | 7,237,000 | |||
Gross deferred tax assets | 85,405,000 | 206,590,000 | |||
Less: Valuation allowance | (45,567,000) | (160,531,000) | |||
Net deferred tax assets | 39,838,000 | 46,059,000 | |||
LIABILITIES: | |||||
Intangibles | (99,587,000) | (78,017,000) | |||
Property and equipment, net | (2,971,000) | (5,665,000) | |||
Accrued Interest | (4,522,000) | ||||
Right-of-use asset | (3,141,000) | ||||
Deferred revenue | (6,199,000) | ||||
Other | (4,426,000) | ||||
Gross deferred tax liabilities | $ (77,662,000) | (81,008,000) | |||
Gross deferred tax liabilities | (120,846,000) | (83,682,000) | |||
Total net deferred tax liabilities, net | $ (81,008,000) | $ (37,623,000) |
Taxes - Additional Information
Taxes - Additional Information (Details) - USD ($) | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Aug. 27, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 | Jan. 31, 2018 |
Operating Loss Carryforwards [Line Items] | |||||||||
Unrecognized tax benefits | $ 0 | $ 0 | $ 0 | ||||||
Accrued interest and penalties | $ 0 | $ 0 | $ 0 | ||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Operating Loss Carryforwards [Line Items] | |||||||||
Tax effected NOLs | $ 13,600,000 | ||||||||
Interest Expense Carryforwards | 33,500,000 | ||||||||
Unrecognized tax benefits | 3,918,000 | $ 3,768,000 | $ 3,768,000 | $ 3,773,000 | $ 2,081,000 | $ 5,035,000 | |||
Accrued interest and penalties | 1,900,000 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | U.S. state and local taxes | |||||||||
Operating Loss Carryforwards [Line Items] | |||||||||
Tax effected NOLs | 2,400,000 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Ireland | |||||||||
Operating Loss Carryforwards [Line Items] | |||||||||
Tax effected NOLs | 1,500,000 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Rest of the world | |||||||||
Operating Loss Carryforwards [Line Items] | |||||||||
Tax effected NOLs | $ 9,700,000 |
Taxes - Unrecognized tax benfit
Taxes - Unrecognized tax benfits (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 5 Months Ended | 8 Months Ended | 12 Months Ended | |
Jan. 31, 2021 | Sep. 30, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Unrecognized tax benefits, beginning balances | $ 3,768 | $ 3,773 | $ 2,081 | $ 5,035 |
Increases for tax positions taken during a prior period | 37 | 35 | 1,987 | 915 |
Decreases for tax positions taken during a prior period | (40) | (295) | (3,736) | |
Other | 452 | |||
Decreases resulting from the expiration of statute of limitations | (339) | (133) | ||
Unrecognized tax benefits, ending balance | $ 3,918 | $ 3,768 | $ 3,773 | $ 2,081 |
Prepaid expenses and other cu_3
Prepaid expenses and other current assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 | Feb. 01, 2019 | Jan. 31, 2019 |
Deferred commission costs - current | $ 4,019 | $ 3,147 | $ 11,195 | ||
Refundable income tax | 9,618 | 8,969 | 6,726 | ||
Prepaid software maintenance costs | 8,370 | 8,587 | 6,569 | ||
Prepaid royalties | 2,876 | 2,958 | 2,294 | ||
Employee bonus advance | 1,867 | ||||
Other | 6,942 | 6,665 | 7,771 | ||
Total prepaid expenses and other current assets | $ 31,825 | $ 30,326 | $ 36,422 | $ 36,933 | $ 52,456 |
Other Assets (Details)
Other Assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 | Feb. 01, 2019 | Jan. 31, 2019 |
Deferred commission costs - non-current | $ 5,733 | $ 4,437 | $ 11,692 | ||
Non-current refundable income tax | 1,979 | ||||
Other | 3,772 | 4,199 | 2,635 | ||
Total other assets | $ 9,505 | $ 8,636 | $ 16,306 | $ 16,168 | $ 6,037 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Jan. 31, 2020 |
Income taxes payable | $ 98,700 | $ 95,302 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||
Professional fees | $ 6,018,000 | $ 8,832,000 | $ 12,947,000 | ||
Accrued sales tax/VAT | 2,144,000 | 5,379,000 | 5,824,000 | ||
Accrued royalties | 1,961,000 | 2,152,000 | 1,869,000 | ||
Income taxes payable | 4,727,000 | 2,634,000 | 1,288,000 | ||
Accrued interest | 368,000 | 491,000 | 274,000 | ||
Other accrued liabilities | 3,067,000 | 3,637,000 | 7,065,000 | ||
Total accrued expenses | $ 18,285,000 | $ 23,125,000 | $ 29,267,000 |
Restructuring (Details)
Restructuring (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Restructuring Reserve [Roll Forward] | ||||||
Restructuring accrual as of January 31, 2021 | $ 5,171 | $ 1,037 | $ 1,503 | $ 1,037 | $ 1,740 | $ 1,529 |
Restructuring charges incurred | 537 | 370 | 4,341 | 1,179 | 1,900 | 2,073 |
Payments made | (2,347) | (673) | (713) | (2,629) | (1,820) | |
Foreign currency translation adjustment | 26 | (42) | ||||
Restructuring accrual as of April 30, 2021 | 3,361 | 5,171 | 1,503 | 1,037 | 1,740 | |
Employee Severance and Related Costs | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Restructuring accrual as of January 31, 2021 | 5,000 | 761 | 1,234 | 761 | 1,713 | 1,504 |
Restructuring charges incurred | 311 | 4,218 | 1,032 | 1,610 | 1,971 | |
Payments made | (2,049) | (452) | (559) | (2,588) | (1,720) | |
Foreign currency translation adjustment | 26 | (42) | ||||
Restructuring accrual as of April 30, 2021 | 3,262 | 5,000 | 1,234 | 761 | 1,713 | |
Contractual Obligations | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Restructuring accrual as of January 31, 2021 | 171 | $ 276 | 269 | 276 | 27 | 25 |
Restructuring charges incurred | 226 | 123 | 147 | 290 | 102 | |
Payments made | (298) | (221) | (154) | (41) | (100) | |
Restructuring accrual as of April 30, 2021 | $ 99 | $ 171 | $ 269 | $ 276 | $ 27 |
Restructuring - Restructuring c
Restructuring - Restructuring charges (Details) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Restructuring charges incurred | $ 537 | $ 370 | $ 4,341 | $ 1,179 | $ 1,900 | $ 2,073 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Millions | 5 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Defined benefit plan contribution | $ 3.5 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Defined benefit plan contribution | $ 1.5 | $ 2 | $ 3.5 | |
Retirement and post-employment plans contribution | $ 0.6 | $ 0.7 | $ 1.1 | $ 1.6 |
Leases, Commitment and Contin_3
Leases, Commitment and Contingencies (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) | Apr. 30, 2021 | Jan. 31, 2021 |
Operating Leases | ||
2022 | $ 4,065,000 | $ 5,203,000 |
2023 | 3,499,000 | 4,070,000 |
2024 | 2,684,000 | 3,514,000 |
2025 | 1,245,000 | 2,697,000 |
Thereafter | 7,509,000 | |
Total future minimum lease payments | 21,636,000 | 22,993,000 |
Less effects of discounting | (5,692,000) | (6,120,000) |
Total lease liabilities | 15,944,000 | 16,873,000 |
Reported as of January 31, 2021 | ||
Lease liabilities | 3,574,000 | 3,718,000 |
Lease liabilities non-current | 12,370,000 | 13,155,000 |
Total lease liabilities | 15,944,000 | 16,873,000 |
Finance Leases | ||
2022 | 1,112,000 | |
Total future minimum lease payments | 1,209,000 | 1,112,000 |
Less effects of discounting | (93,000) | (90,000) |
Total lease liabilities | 1,116,000 | 1,022,000 |
Reported as of January 31, 2021 | ||
Lease liabilities | 1,116,000 | 1,022,000 |
Total lease liabilities | $ 1,116,000 | $ 1,022,000 |
Leases, Commitment and Contin_4
Leases, Commitment and Contingencies - Additional Information (Details) - USD ($) | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | 16 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | Apr. 30, 2021 | |
Lessee, Lease, Description [Line Items] | |||||||
Option to extend lease | True | ||||||
Option to terminate lease | True | ||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Option to extend lease | True | ||||||
Option to terminate lease | True | ||||||
Remaining lease term at the time of exercise of option to terminate paris facility lease | 3 years | ||||||
Term of notice to landlord to exercise the lease termination option | 6 months | ||||||
Finance lease, right of use assets | $ 400,000 | $ 1,100,000 | $ 400,000 | ||||
Finance Lease liability | $ 1,116,000 | $ 1,022,000 | $ 1,116,000 | ||||
Total rent expense | $ 5,700,000 | $ 5,400,000 | |||||
Weighted-average remaining lease term of operating leases | 6 years 8 months 12 days | 6 years 9 months 18 days | 6 years 8 months 12 days | ||||
Remaining lease term of finance lease | 8 months 12 days | 10 months 24 days | 8 months 12 days | ||||
Lease costs | $ 1,400,000 | $ 1,600,000 | $ 2,700,000 | $ 3,900,000 | |||
Payment of lease cost related amounts | $ 1,600,000 | $ 1,500,000 | $ 2,700,000 | $ 3,600,000 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Maximum [Member] | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Company's leases, remaining lease term | 13 years | 13 months | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Minimum [Member] | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Company's leases, remaining lease term | 6 months | 9 months |
Long-Term Debt -Minimum princip
Long-Term Debt -Minimum principal payments (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 |
Debt Instrument [Line Items] | |||
2022 | $ 3,900 | $ 5,200 | |
2023 | 10,400 | 10,400 | |
2024 | 10,400 | 10,400 | |
2025 | 112,700 | 112,700 | |
2026 | 381,300 | 381,300 | |
Total payments | 518,700 | 520,000 | |
Less: Current portion | (6,500) | (5,200) | $ (981,998) |
Less: Unamortized Fresh-Start Reporting Fair Value Adjustment | (4,273) | (4,564) | |
Long-term portion | $ 507,927 | $ 510,236 |
Long-Term Debt - Senior Credit
Long-Term Debt - Senior Credit Facilities (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) $ in Thousands | Jan. 31, 2021USD ($) |
Debt Instrument [Line Items] | |
Amount outstanding under the Senior Credit Facilities | $ 989,872 |
Fiscal 2021 | |
Debt Instrument [Line Items] | |
Amount outstanding under the Senior Credit Facilities | 989,872 |
First Lien | |
Debt Instrument [Line Items] | |
Amount outstanding under the Senior Credit Facilities | 627,536 |
First Lien | Fiscal 2021 | |
Debt Instrument [Line Items] | |
Amount outstanding under the Senior Credit Facilities | 627,536 |
Second Lien | |
Debt Instrument [Line Items] | |
Amount outstanding under the Senior Credit Facilities | 302,336 |
Second Lien | Fiscal 2021 | |
Debt Instrument [Line Items] | |
Amount outstanding under the Senior Credit Facilities | 302,336 |
Revolving Credit | |
Debt Instrument [Line Items] | |
Amount outstanding under the Senior Credit Facilities | 60,000 |
Revolving Credit | Fiscal 2021 | |
Debt Instrument [Line Items] | |
Amount outstanding under the Senior Credit Facilities | $ 60,000 |
Long-Term Debt - Net loans (Det
Long-Term Debt - Net loans (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Jan. 31, 2021 | Jan. 31, 2020 |
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 2,188,938 | $ 2,188,938 |
Series 1 | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 933,615 | |
Debt, Weighted Average Interest Rate | 13.00% | |
Series 2 | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 598,787 | |
Debt, Weighted Average Interest Rate | 8.00% | |
Series 3 | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 327,537 | |
Debt, Weighted Average Interest Rate | 11.50% | |
Series 4 | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 60,000 | |
Debt, Weighted Average Interest Rate | 13.00% | |
Series 5(a) | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 71,538 | |
Debt, Weighted Average Interest Rate | 8.00% | |
Series 5(b) | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 28,461 | |
Debt, Weighted Average Interest Rate | 11.50% | |
Intra-group Loan Agreement | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 65,000 | |
Debt, Weighted Average Interest Rate | 12.00% | |
Funding Bond # 1 | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 54,000 | |
Debt, Weighted Average Interest Rate | 13.00% | |
Funding Bond # 2 | ||
Debt Instrument [Line Items] | ||
Loan amounts due to Predecessor parent company | $ 50,000 | |
Debt, Weighted Average Interest Rate | 13.00% |
Long-Term Debt - Accounts reciv
Long-Term Debt - Accounts recivable Facility (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Aug. 27, 2020 | Dec. 20, 2018 | Apr. 30, 2022 | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 | Sep. 19, 2019 | Jan. 31, 2019 | Jan. 31, 2018 |
Debt Instrument [Line Items] | |||||||||
Exit Credit Facility | $ 520,000 | $ 520,000 | |||||||
LIBOR Floor Rate | 1.00% | 1.00% | |||||||
Instrument amount | $ 2,600 | $ 1,300 | |||||||
Contractual interest | $ 100,400 | ||||||||
Senior credit facility | $ 2,035,000 | ||||||||
Outstanding borrowings | $ 1,030,000 | $ 90,000 | |||||||
Additionla loans | $ 160 | $ 50,000 | $ 54,000 | ||||||
Debt instrument accrued and unpaid interest | 1,067,000 | ||||||||
Long term accounts and loan receivable | $ 75,000 | ||||||||
Amount indebtedness | $ 75,000 | ||||||||
Advance Rate | 95.00% | ||||||||
interest rate | 4.899% | ||||||||
Maturity period for remaning amount of credit facility | 90 days | ||||||||
Reserve balances | $ 1,700 | ||||||||
Scenario 1 | |||||||||
Debt Instrument [Line Items] | |||||||||
Termination period | 5 years | ||||||||
Scenario 2 | |||||||||
Debt Instrument [Line Items] | |||||||||
Termination period | 45 days | ||||||||
Scenario 3 | |||||||||
Debt Instrument [Line Items] | |||||||||
Termination period | 180 days | ||||||||
Maximum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Outstanding borrowings | $ 90,000 | ||||||||
Advance Rate | 85.00% | ||||||||
Minimum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Outstanding borrowings | $ 75,000 | ||||||||
Advance Rate | 50.00% | ||||||||
Third party | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument collateral amount | $ 1,030,000 | ||||||||
LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate (as a percent) | 7.50% | 7.50% | |||||||
First out term loan facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Exit Credit Facility | $ 110,000 | $ 110,000 | |||||||
Second-out term loan facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Exit Credit Facility | $ 410,000 | 410,000 | |||||||
First Lien | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior credit facility | 1,365,000 | ||||||||
Initially borrowings | 664,100 | ||||||||
Outstanding borrowings | 662,390 | ||||||||
Second Lien | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior credit facility | 670,000 | ||||||||
Initially borrowings | 302,400 | ||||||||
Outstanding borrowings | $ 367,614 | ||||||||
Revolving Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior credit facility | $ 80,000 |
Long-Term Liabilities - consoli
Long-Term Liabilities - consolidated balance sheets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 |
Uncertain tax positions; including interest and penalties - long-term | $ 4,374 | $ 5,794 | $ 6,025 |
Warrant Liabilities | 800 | 900 | |
Other | 204 | 1,547 | |
Total other long-term liabilities | $ 5,390 | $ 6,898 | $ 7,572 |
Long-Term Liabilities - Warrent
Long-Term Liabilities - Warrent (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 5 Months Ended | |
Apr. 30, 2021 | Jan. 31, 2021 | Jul. 01, 2019 | |
Warrant purchase price | $ 11.50 | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||
Number of ordinary shares issued | 705,882 | 705,882 | |
Warrants Other Income | $ 100 | $ 2,900 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Tranche A warrants | |||
Number of ordinary shares issued | 235,294 | 235,294 | |
Warrant purchase price | $ 262.34 | $ 262.34 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Tranche B warrants | |||
Number of ordinary shares issued | 470,588 | 470,588 | |
Warrant purchase price | $ 274.84 | $ 274.84 |
Shareholders' Equity - Share aw
Shareholders' Equity - Share award activity (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - shares | 7 Months Ended | 12 Months Ended |
Aug. 27, 2020 | Jan. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding at January 31, 2019 | 252,764 | 356,771 |
Cancelled | (252,764) | (104,007) |
Outstanding at January 31, 2020 | 252,764 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 5 Months Ended | ||||||||
Jan. 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Oct. 12, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jun. 26, 2019 | Jun. 07, 2019 | |
Class A Common Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 11,090,292 | 15,287,498 | 7,974,075 | ||||||
Common shares authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Common stock shares outstanding | 3,840,000 | 11,090,292 | 15,287,498 | 7,974,075 | |||||
Class B Common Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 17,250,000 | 17,250,000 | 17,250,000 | ||||||
Common shares authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Common stock shares outstanding | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 4,000,000 | 100,100 | |||||||
Number of warrants to purchase additional common shares | 705,882 | 705,882 | |||||||
Common shares authorized | 1,000,000,000 | 1,000,000 | |||||||
Common stock par value | $ 0.01 | $ 1.38 | |||||||
Common stock shares outstanding | 4,000,000 | 100,100 | |||||||
Share based compensation expense | $ 0 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 3,840,000 | 3,840,000 | |||||||
Common shares authorized | 800,000,000 | ||||||||
Common stock shares outstanding | 3,840,000 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 160,000 | 160,000 | |||||||
Common shares authorized | 200,000,000 | ||||||||
Common stock shares outstanding | 160,000 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Current and former executives | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
"Purchase of ordinary shares reserved in | $ 5,400 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Evergreen | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock par value | $ 0.01 |
Revenue - Disaggregated revenue
Revenue - Disaggregated revenue and geography information (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Jan. 31, 2020 | Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 |
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | $ 514,021 | $ 91,701 | $ 118,329 | $ 108,768 | $ 273,851 | $ 514,021 | $ 534,141 |
SaaS and subscription services | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 78,575 | 101,089 | 93,205 | 234,766 | 439,791 | 462,240 | |
Software maintenance | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 4,064 | 5,260 | 4,770 | 12,079 | 23,982 | 30,161 | |
Professional services | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 8,191 | 10,946 | 9,546 | 24,499 | 45,661 | 38,043 | |
Perpetual software licenses | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 871 | 1,031 | 1,241 | 2,486 | 1,885 | 3,340 | |
Hardware and other | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 3 | 6 | 21 | 2,702 | 357 | ||
United States | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 70,170 | 93,533 | 84,248 | 217,783 | 405,065 | 421,746 | |
Other Americas | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 4,461 | 4,931 | 4,724 | 8,899 | 21,925 | 22,807 | |
Europe, Middle East and Africa | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 12,113 | 13,787 | 13,934 | 32,788 | 61,321 | 66,244 | |
Asia-Pacific | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | $ 4,957 | $ 6,078 | $ 5,862 | $ 14,381 | $ 25,710 | $ 23,344 |
Revenue - Deferred revenue (Det
Revenue - Deferred revenue (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | Aug. 27, 2020 | |
Movement in Deferred Revenue [Roll Forward] | |||
Deferred revenue, Beginning balance | $ 260,584 | $ 84,400 | $ 311,170 |
Billings deferred | 67,034 | 284,952 | 163,333 |
Recognition of prior deferred revenue | (91,701) | (108,768) | (273,851) |
Fresh start reporting fair value adjustment | (116,252) | ||
Deferred revenue, Ending balance | $ 235,917 | $ 260,584 | $ 200,652 |
Revenue - Deferred contract acq
Revenue - Deferred contract acquisition cost (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | Aug. 27, 2020 | |
Movement Analysis of Deferred Policy Acquisition Costs [Roll Forward] | |||
Deferred contract acquisition costs at beginning balance | $ 7,584 | $ 20,792 | $ 22,887 |
Contract acquisition costs | 5,491 | 19,973 | 11,965 |
Recognition of contract acquisition costs | (12,389) | (14,060) | |
Fresh start reporting fair value adjustment | (20,792) | ||
Deferred contract acquisition costs at ending balance | $ 9,752 | $ 7,584 | $ 20,792 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 5 Months Ended |
Jan. 31, 2021 | |
Maximum [Member] | SaaS and subscription services | |
Disaggregation of Revenue [Line Items] | |
Credit period from commencement of services | 60 days |
Maximum [Member] | Software maintenance | |
Disaggregation of Revenue [Line Items] | |
Credit period from commencement of services | 60 days |
Maximum [Member] | Professional services | |
Disaggregation of Revenue [Line Items] | |
Credit period from commencement of services | 60 days |
Maximum [Member] | Perpetual software licenses | |
Disaggregation of Revenue [Line Items] | |
Credit period from commencement of services | 60 days |
Minimum [Member] | SaaS and subscription services | |
Disaggregation of Revenue [Line Items] | |
Credit period from commencement of services | 30 days |
Minimum [Member] | Software maintenance | |
Disaggregation of Revenue [Line Items] | |
Credit period from commencement of services | 30 days |
Minimum [Member] | Professional services | |
Disaggregation of Revenue [Line Items] | |
Credit period from commencement of services | 30 days |
Minimum [Member] | Perpetual software licenses | |
Disaggregation of Revenue [Line Items] | |
Credit period from commencement of services | 30 days |
Derivative Instruments and He_3
Derivative Instruments and Hedging Agreements - Changes in fair value of the derivative instruments (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 7 Months Ended | 12 Months Ended | |
Aug. 31, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Beginning balance | $ 6 | $ 4,068 | $ 4,064 |
Sale of derivative instrument | (6,776) | ||
Purchase of derivative instrument | 9,194 | ||
Change in fair value of derivative instrument | (6) | (4,062) | (2,414) |
Ending balance | 0 | 6 | 4,068 |
Beginning balance | 0 | 0 | (130) |
Change in fair value of derivative instrument | 130 | ||
Ending balance | $ 0 | $ 0 | $ 0 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Agreements - Fair value of our derivative financial instruments (Details) $ in Thousands | Jan. 31, 2020USD ($) |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Interest Rate Cap | Not Designated as Hedging Instrument [Member] | Other assets | |
Derivatives, Fair Value [Line Items] | |
Interest rate derivative contracts | $ 6 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Agreements - National amount of cap agreement and LIBOR interest rate cap (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Millions | Oct. 31, 2018 | May 04, 2018 | Dec. 19, 2017 |
One month LIBOR interest rate cap | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | $ 884 | ||
Cap interest rate | 2.869% | ||
Premium paid | $ 2.4 | ||
Interest Rate Cap | |||
Derivatives, Fair Value [Line Items] | |||
Notional amount | $ 751 | $ 376 | |
Cap interest rate | 2.117% | ||
Premium paid | $ 2.3 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and liabilities that are measured at fair value on a recurring basis (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | $ 800 | $ 900 |
Recurring member | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | 800 | 900 |
Total assets recorded at fair value | 800 | 900 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | 800 | 900 |
Total assets recorded at fair value | $ 800 | $ 900 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Level 3 instruments (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 12 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value as of beginning period | $ 900 | $ 11,200 | |
Impact of warrant modification, recorded in shareholders' equity | (7,400) | ||
Unrealized gains recognized as other income | (100) | (2,900) | |
Fair value as of Ending period | $ 800 | $ 900 | $ 900 |
Fair Value, Recurring Basis, Unobservable Input Reconciliation, Liability, Gain (Loss), Statement of Income [Extensible List] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Fair Value Measurements - Addit
Fair Value Measurements - Additional information (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) $ in Millions | Apr. 30, 2021USD ($) | Jan. 31, 2021USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity value used as an input in Black-Scholes calculations | $ 667 | $ 667 |
Dividend yield | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input | 0 | 0 |
Volatility | Non-Favored Sale scenario | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input | 35 | 35 |
Volatility | Held-to-maturity scenario | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input | 31.6 | 31.6 |
Segment Information - Segment r
Segment Information - Segment results (Details) - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | Aug. 27, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 |
Segment Reporting Information [Line Items] | ||||||||||||||||
Formation and operating costs | $ 1,584,933 | $ 301,863 | $ 744,859 | $ 2,906,903 | ||||||||||||
Operating income (loss) | (1,584,933) | (301,863) | (744,859) | (906,903) | ||||||||||||
Total non-operating (expense) income | 43,328,156 | (8,116,842) | (12,690,216) | (71,065,521) | ||||||||||||
Benefit from income taxes | (2,422) | (404,809) | (1,247,517) | (486,761) | $ (1,247,517) | |||||||||||
Net income | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||
Revenues | $ 91,701,000 | $ 118,329,000 | $ 108,768,000 | $ 273,851,000 | $ 514,021,000 | $ 534,141,000 | ||||||||||
Formation and operating costs | 119,404,000 | 456,074,000 | 207,940,000 | 603,661,000 | $ 603,661,000 | 917,237,000 | 527,487,000 | |||||||||
Operating income (loss) | $ (403,216,000) | (27,703,000) | (337,745,000) | (99,172,000) | (329,810,000) | (329,810,000) | (403,216,000) | 6,654,000 | ||||||||
Total non-operating (expense) income | (352,000) | 910,000 | 3,452,000 | 1,268,000 | (5,120,000) | (5,624,000) | ||||||||||
Interest expense, net | (11,439,000) | (105,959,000) | (19,936,000) | (168,236,000) | (429,657,000) | (395,842,000) | ||||||||||
Reorganization Items | 3,329,245,000 | (3,329,245,000) | ||||||||||||||
Benefit from income taxes | (11,212,000) | (2,089,000) | (8,891,000) | 21,934,000 | (68,455,000) | (68,455,000) | (11,212,000) | (5,027,000) | ||||||||
Net income | $ (849,205,000) | (37,405,000) | (433,903,000) | (93,722,000) | 2,764,012,000 | $ 2,764,012,000 | (849,205,000) | (399,839,000) | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Skillsoft | ||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||
Revenues | 67,057,000 | 84,318,000 | 72,425,000 | 196,238,000 | 362,503,000 | 378,316,000 | ||||||||||
Formation and operating costs | 93,127,000 | 287,917,000 | 158,671,000 | 398,178,000 | 637,658,000 | 364,581,000 | ||||||||||
Operating income (loss) | (26,070,000) | (203,599,000) | (86,246,000) | (201,940,000) | (275,155,000) | 13,735,000 | ||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | SumTotal | ||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||
Revenues | 24,644,000 | 34,011,000 | 36,343,000 | 77,613,000 | 151,518,000 | 155,825,000 | ||||||||||
Formation and operating costs | 26,277,000 | 168,157,000 | 49,269,000 | 205,483,000 | 279,579,000 | 162,906,000 | ||||||||||
Operating income (loss) | $ (1,633,000) | $ (134,146,000) | $ (12,926,000) | $ (127,870,000) | $ (128,061,000) | $ (7,081,000) |
Segment Information - Segment a
Segment Information - Segment assets (Details) - USD ($) | Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Feb. 01, 2019 | Jan. 31, 2019 |
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | $ 699,511,963 | $ 700,925,360 | $ 697,836,358 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | $ 1,458,106,000 | $ 1,545,737,000 | $ 1,986,265,000 | $ 2,539,783,000 | $ 2,545,175,000 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Skillsoft | ||||||||
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | 1,313,124,000 | 1,398,379,000 | 1,655,474,000 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | SumTotal | ||||||||
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | $ 144,982,000 | $ 147,358,000 | 330,785,000 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Corporate | ||||||||
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | $ 6,000 |
Segment Information - Long-live
Segment Information - Long-lived tangible assets by geographic region (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 |
Segment Reporting Information [Line Items] | |||
Total | $ 11,798 | $ 13,780 | $ 17,902 |
United States | |||
Segment Reporting Information [Line Items] | |||
Total | 9,019 | 10,613 | 13,469 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Total | 499 | 609 | 897 |
Rest of world | |||
Segment Reporting Information [Line Items] | |||
Total | $ 2,280 | $ 2,558 | $ 3,536 |
Net Income (Loss) Per Share (De
Net Income (Loss) Per Share (Details) - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | Aug. 27, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 |
Net income | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | ||||||||||||
(Losses) income per share: | ||||||||||||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 1.28 | $ (0.41) | $ (0.91) | $ (2.68) | ||||||||||||
Class A Common Stock [Member] | ||||||||||||||||
Net income | $ 0 | $ 0 | $ 0 | $ 0 | ||||||||||||
Class B Common Stock [Member] | ||||||||||||||||
Net income | $ 0 | $ 0 | $ 0 | $ 0 | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||||||||
Net income | $ (849,205,000) | $ (37,405,000) | $ (433,903,000) | $ (93,722,000) | $ 2,764,012,000 | $ 2,764,012,000 | $ (849,205,000) | $ (399,839,000) | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 100 | 100 | 100 | 100 | ||||||||||||
Loss on modifications of terms of participation rights held by other shareholders and warrants | (5,900,000) | |||||||||||||||
Gain on modifications of terms of participation rights held by other shareholders and warrants | 5,900,000 | |||||||||||||||
(Losses) income per share: | ||||||||||||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ (4,334.70) | $ 27,612.51 | $ (8,483.57) | $ (3,994.40) | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | ||||||||||||||||
Net income | $ (89,973,000) | |||||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 3,840 | |||||||||||||||
Net Income (Loss) attributable | $ (95,873,000) | |||||||||||||||
(Losses) income per share: | ||||||||||||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ (24.97) | |||||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | ||||||||||||||||
Net income | $ (3,749,000) | |||||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 160 | |||||||||||||||
Loss on modifications of terms of participation rights held by other shareholders and warrants | $ 5,900,000 | |||||||||||||||
Net Income (Loss) attributable | 2,151,000 | |||||||||||||||
Gain on modifications of terms of participation rights held by other shareholders and warrants | $ 5,900,000 | |||||||||||||||
(Losses) income per share: | ||||||||||||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 13.44 |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Additional Information (Details) - shares | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Warrant [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities | 705,882 | 705,882 |
Related Party Transactions Pr_2
Related Party Transactions Predecessor Related Party Transactions (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Dec. 02, 2019 | Mar. 31, 2019 | Mar. 02, 2019 | Jan. 31, 2019 | Dec. 31, 2018 | Dec. 02, 2018 | Mar. 31, 2018 | Mar. 02, 2018 |
Related Party Transaction [Line Items] | |||||||||||||
Outstanding borrowing capacity | $ 75,000 | ||||||||||||
Accrued interest | $ 368 | $ 491 | $ 274 | ||||||||||
Outstanding borrowings | 2,035,000 | ||||||||||||
Holdings | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Accrued interest | 1,067,000 | $ 787,000 | |||||||||||
Outstanding borrowings | $ 2,189,000 | $ 2,189,000 | $ 2,189,000 | $ 2,189,000 | $ 2,189,000 | $ 2,189,000 | $ 2,189,000 | $ 2,189,000 | $ 2,189,000 | $ 2,189,000 | |||
Current and former executives | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Purchase of B ordinary shares reserved in return of recourse notes | 5,400 | ||||||||||||
First Out Term Loans | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Outstanding borrowings | 110,000 | 110,000 | |||||||||||
Second Out Term Loan Facility | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Outstanding borrowings | $ 410,000 | $ 410,000 | |||||||||||
Accounts receivable facility | Private equity sponsor of Evergreen Skills Lux S.A.R.L | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Outstanding borrowing capacity | $ 9,900 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jan. 31, 2021 | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||||||
Total Current Assets | $ 2,493,734 | $ 3,968,164 | $ 2,540,940 | |||
TOTAL ASSETS | 699,511,963 | 700,925,360 | 697,836,358 | |||
Current liabilities: | ||||||
Total Current Liabilities | 3,976,699 | 3,835,144 | 257,466 | |||
Commitments and contingencies | ||||||
Shareholders' equity (deficit): | ||||||
Additional paid-in capital | 50,398,148 | 92,138,533 | 19,680,076 | |||
Retained Earnings (Accumulated Deficit) | (45,400,976) | (87,141,777) | (14,682,592) | |||
Total Stockholders' Equity | 5,000,006 | 5,000,010 | 5,000,006 | |||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 699,511,963 | 700,925,360 | 697,836,358 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Current assets: | ||||||
Cash and cash equivalents | $ 71,479,000 | $ 18,799,000 | $ 105,004,000 | |||
Restricted cash | 2,964,000 | 15,005,000 | 2,656,000 | |||
Accounts receivable, less reserves of approximately $322 and $294 as of April 30, 2021 and January 31, 2021, respectively | 179,784,000 | 193,024,000 | 92,792,000 | |||
Prepaid expenses and other current assets | 30,326,000 | 36,422,000 | 31,825,000 | |||
Total Current Assets | 284,553,000 | 263,250,000 | 232,277,000 | |||
Property and equipment, net | 13,780,000 | 17,902,000 | 11,798,000 | |||
Goodwill | 495,004,000 | 1,253,822,000 | 494,942,000 | |||
Intangible assets, net | 728,633,000 | 434,985,000 | 694,930,000 | |||
Right of use assets | 15,131,000 | 14,654,000 | ||||
Other assets | 8,636,000 | 16,306,000 | 9,505,000 | |||
TOTAL ASSETS | 1,545,737,000 | 1,986,265,000 | 1,458,106,000 | |||
Current liabilities: | ||||||
Current maturities of long-term debt | 5,200,000 | 981,998,000 | 6,500,000 | |||
Borrowings under accounts receivable facility | 17,022,000 | 84,786,000 | 14,190,000 | |||
Accounts payable | 7,425,000 | 14,947,000 | 9,898,000 | |||
Accrued compensation | 36,375,000 | 24,576,000 | 22,941,000 | |||
Accrued expenses and other current liabilities | 23,125,000 | 29,267,000 | 18,285,000 | |||
Lease liabilities | 4,740,000 | 4,690,000 | ||||
Deferred revenue | 257,549,000 | 307,383,000 | 234,069,000 | |||
Total Current Liabilities | 351,436,000 | 4,699,027,000 | 310,573,000 | |||
Long-term debt | 510,236,000 | 507,927,000 | ||||
Deferred tax liabilities | 81,008,000 | 77,662,000 | ||||
Long term lease liabilities | 13,155,000 | 12,370,000 | ||||
Deferred revenue - non-current | 3,035,000 | 3,787,000 | 1,848,000 | |||
Other long-term liabilities | 6,898,000 | 7,572,000 | 5,390,000 | |||
Total long-term liabilities | 614,332,000 | 48,982,000 | 605,197,000 | |||
Commitments and contingencies | ||||||
Shareholders' equity (deficit): | ||||||
Common stock value | 40,000 | 138,000 | 40,000 | |||
Additional paid-in capital | 674,333,000 | 83,000 | 674,333,000 | |||
Retained Earnings (Accumulated Deficit) | (93,722,000) | (2,761,499,000) | (131,127,000) | |||
Accumulated other comprehensive loss | (682,000) | (466,000) | (910,000) | |||
Total Stockholders' Equity | 579,969,000 | (2,761,744,000) | 542,336,000 | |||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,545,737,000 | $ 1,986,265,000 | $ 1,458,106,000 | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | ||||
Class A Common Stock [Member] | ||||||
Shareholders' equity (deficit): | ||||||
Common stock value | 1,109 | 1,529 | 797 | |||
Total Stockholders' Equity | 1,109 | 1,529 | 797 | |||
Class B Common Stock [Member] | ||||||
Shareholders' equity (deficit): | ||||||
Common stock value | 1,725 | 1,725 | 1,725 | |||
Total Stockholders' Equity | $ 1,725 | $ 1,725 | $ 1,725 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Oct. 12, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jun. 26, 2019 | Jun. 07, 2019 |
Class A Common Stock [Member] | |||||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Common stock, shares, authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||||
Common stock, shares, issued | 11,090,292 | 15,287,498 | 7,974,075 | ||||||
Common stock shares outstanding | 11,090,292 | 3,840,000 | 15,287,498 | 7,974,075 | |||||
Class B Common Stock [Member] | |||||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Common stock, shares, authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||||
Common stock, shares, issued | 17,250,000 | 17,250,000 | 17,250,000 | ||||||
Common stock shares outstanding | 17,250,000 | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Common stock par value | $ 0.01 | $ 1.38 | |||||||
Common stock, shares, authorized | 1,000,000,000 | 1,000,000 | |||||||
Common stock, shares, issued | 4,000,000 | 100,100 | |||||||
Common stock shares outstanding | 4,000,000 | 100,100 | |||||||
Reserve for accounts receivable | $ 322 | $ 294 | $ 696 | ||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | |||||||||
Common stock, shares, authorized | 800,000,000 | ||||||||
Common stock, shares, issued | 3,840,000 | 3,840,000 | |||||||
Common stock shares outstanding | 3,840,000 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | |||||||||
Common stock, shares, authorized | 200,000,000 | ||||||||
Common stock, shares, issued | 160,000 | 160,000 | |||||||
Common stock shares outstanding | 160,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Revenues: | ||||||
Total revenues | $ 91,701,000 | $ 118,329,000 | $ 108,768,000 | $ 273,851,000 | $ 514,021,000 | $ 534,141,000 |
Operating expenses: | ||||||
Cost of revenues | 24,521,000 | 24,214,000 | 40,898,000 | 52,160,000 | 96,044,000 | 98,636,000 |
Content and software development | 16,607,000 | 16,943,000 | 30,028,000 | 38,986,000 | 67,951,000 | 57,332,000 |
Selling and marketing | 28,502,000 | 32,737,000 | 55,285,000 | 75,028,000 | 140,785,000 | 150,179,000 |
General and administrative | 12,362,000 | 15,688,000 | 21,636,000 | 37,455,000 | 57,356,000 | 51,421,000 |
Recapitalization and transaction-related costs | 1,932,000 | 16,376,000 | 15,928,000 | 32,099,000 | 16,244,000 | |
Amortization of intangible assets | 34,943,000 | 17,370,000 | 39,824,000 | 34,378,000 | 96,359,000 | 151,752,000 |
Impairment of goodwill and intangible assets | 332,376,000 | 332,376,000 | 440,598,000 | 16,094,000 | ||
Restructuring | 537,000 | 370,000 | 4,341,000 | 1,179,000 | 1,900,000 | 2,073,000 |
Total operating expenses | 119,404,000 | 456,074,000 | ||||
Loss from operations | (27,703,000) | (337,745,000) | (99,172,000) | (329,810,000) | (403,216,000) | 6,654,000 |
Other income (expense), net | (352,000) | 910,000 | 3,452,000 | 1,273,000 | (1,058,000) | (3,340,000) |
Interest income | 10,000 | 19,000 | 24,000 | 105,000 | 306,000 | 687,000 |
Interest expense, net | (11,449,000) | (105,978,000) | (19,960,000) | (168,341,000) | (429,963,000) | (396,529,000) |
Loss before benefit from income taxes | (39,494,000) | (442,794,000) | (115,656,000) | 2,832,467,000 | (837,993,000) | (394,812,000) |
Benefit from income taxes | (2,089,000) | (8,891,000) | 21,934,000 | (68,455,000) | (11,212,000) | (5,027,000) |
Net income (loss) | $ (37,405,000) | $ (433,903,000) | (93,722,000) | $ 2,764,012,000 | $ (849,205,000) | $ (399,839,000) |
Loss per share: | ||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ (4,334.70) | $ 27,612.51 | $ (8,483.57) | $ (3,994.40) | ||
Weighted average common share outstanding: | ||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 100 | 100 | 100 | 100 | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A Common Stock [Member] | ||||||
Operating expenses: | ||||||
Net income (loss) | $ (89,973,000) | |||||
Loss per share: | ||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ (24.97) | |||||
Weighted average common share outstanding: | ||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 3,840 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class B Common Stock [Member] | ||||||
Operating expenses: | ||||||
Net income (loss) | $ (3,749,000) | |||||
Loss per share: | ||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 13.44 | |||||
Weighted average common share outstanding: | ||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 160 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Class A and B | ||||||
Loss per share: | ||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ (9.35) | |||||
Weighted average common share outstanding: | ||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 4,000 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | Aug. 27, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 |
Comprehensive loss: | ||||||||||||||||
Net income (loss) | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||||||||
Comprehensive loss: | ||||||||||||||||
Net income (loss) | $ (849,205,000) | $ (37,405,000) | $ (433,903,000) | $ (93,722,000) | $ 2,764,012,000 | $ 2,764,012,000 | $ (849,205,000) | $ (399,839,000) | ||||||||
Other comprehensive loss - Foreign currency adjustment, net of tax | (228,000) | (629,000) | (682,000) | (2,268,000) | 784,000 | 957,000 | ||||||||||
Comprehensive loss | $ (37,633,000) | $ (434,532,000) | $ (94,404,000) | $ 2,761,744,000 | $ (848,421,000) | $ (398,882,000) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY (DEFICIT) - USD ($) | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Common Stock [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Additional Paid in Capital [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Accumulated Deficit [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Accumulated Other Comprehensive (Loss) Income | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR)Loans made to related parties | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Additional Paid in Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Jan. 31, 2018 | $ 138,000 | $ (1,508,411,000) | $ (2,207,000) | $ (5,266,000) | $ (1,515,746,000) | ||||
Balance (in shares) at Jan. 31, 2018 | 100,100 | ||||||||
Translation adjustment | 957,000 | 957,000 | |||||||
Net income (loss) | (399,839,000) | (399,839,000) | |||||||
Balance at Jan. 31, 2019 | $ 138,000 | (1,910,846,000) | (1,250,000) | $ (5,367,000) | (1,917,325,000) | ||||
Balance (in shares) at Jan. 31, 2019 | 100,100 | ||||||||
Translation adjustment | 784,000 | 784,000 | |||||||
Net income (loss) | (849,205,000) | (849,205,000) | |||||||
Balance at Jan. 31, 2020 | $ 138,000 | $ 83,000 | (2,761,499,000) | (466,000) | (2,761,744,000) | ||||
Balance (in shares) at Jan. 31, 2020 | 100,100 | ||||||||
Balance at Apr. 10, 2019 | $ 0 | $ 0 | $ 0 | ||||||
Net income (loss) | (16,497,280) | ||||||||
Balance at Apr. 10, 2019 | 0 | 0 | 0 | ||||||
Net income (loss) | 0 | (14,682,592) | (14,682,592) | ||||||
Balance at Dec. 31, 2019 | 19,680,076 | (14,682,592) | 5,000,006 | ||||||
Net income (loss) | 0 | (8,823,514) | (8,823,514) | ||||||
Balance at Mar. 31, 2020 | 28,503,490 | (23,506,106) | 5,000,009 | ||||||
Balance at Dec. 31, 2019 | 19,680,076 | (14,682,592) | 5,000,006 | ||||||
Net income (loss) | (53,585,867) | ||||||||
Balance at Dec. 31, 2019 | 19,680,076 | (14,682,592) | 5,000,006 | ||||||
Net income (loss) | (25,340,816) | ||||||||
Balance at Dec. 31, 2019 | 19,680,076 | (14,682,592) | 5,000,006 | ||||||
Net income (loss) | 0 | (72,459,185) | (72,459,185) | ||||||
Balance at Dec. 31, 2020 | 92,138,533 | (87,141,777) | 5,000,010 | ||||||
Balance at Jan. 31, 2020 | $ 138,000 | 83,000 | (2,761,499,000) | (466,000) | (2,761,744,000) | ||||
Translation adjustment | (629,000) | (629,000) | |||||||
Net income (loss) | (433,903,000) | (433,903,000) | |||||||
Balance at Apr. 30, 2020 | $ 138,000 | 83,000 | (3,195,402,000) | (1,095,000) | (3,196,276,000) | ||||
Balance (in shares) at Apr. 30, 2020 | 100,100 | ||||||||
Balance at Jan. 31, 2020 | $ 138,000 | 83,000 | (2,761,499,000) | (466,000) | (2,761,744,000) | ||||
Balance (in shares) at Jan. 31, 2020 | 100,100 | ||||||||
Translation adjustment | (2,268,000) | (2,268,000) | (2,268,000) | ||||||
Net income (loss) | 2,764,012,000 | 2,764,012,000 | |||||||
Balance at Aug. 27, 2020 | $ 40,000 | 666,933,000 | 666,973,000 | ||||||
Balance (in shares) at Aug. 27, 2020 | 4,000,000 | ||||||||
Balance at Mar. 31, 2020 | 28,503,490 | (23,506,106) | 5,000,009 | ||||||
Balance at Aug. 27, 2020 | $ 40,000 | 666,933,000 | 666,973,000 | ||||||
Translation adjustment | (682,000) | (682,000) | |||||||
Net income (loss) | (93,722,000) | (93,722,000) | |||||||
Balance at Jan. 31, 2021 | $ 40,000 | 674,333,000 | (93,722,000) | (682,000) | 579,969,000 | ||||
Balance (in shares) at Jan. 31, 2021 | 4,000,000 | ||||||||
Balance at Dec. 31, 2020 | 92,138,533 | (87,141,777) | 5,000,010 | ||||||
Net income (loss) | 0 | 41,740,801 | 41,740,801 | ||||||
Balance at Mar. 31, 2021 | $ 50,398,148 | $ (45,400,976) | $ 5,000,006 | ||||||
Balance at Jan. 31, 2021 | $ 40,000 | 674,333,000 | (93,722,000) | (682,000) | 579,969,000 | ||||
Translation adjustment | (228,000) | (228,000) | |||||||
Net income (loss) | (37,405,000) | (37,405,000) | |||||||
Balance at Apr. 30, 2021 | $ 40,000 | $ 674,333,000 | $ (131,127,000) | $ (910,000) | $ 542,336,000 | ||||
Balance (in shares) at Apr. 30, 2021 | 4,000,000 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Cash flows from operating activities: | ||||||
Net (loss) income | $ (37,405,000) | $ (433,903,000) | $ (93,722,000) | $ 2,764,012,000 | $ (849,205,000) | $ (399,839,000) |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||
Depreciation | 2,419,000 | 2,631,000 | 3,604,000 | 5,864,000 | 9,716,000 | 12,666,000 |
Amortization of intangible assets | 34,943,000 | 17,370,000 | 39,824,000 | 34,378,000 | 96,359,000 | 151,752,000 |
Change in bad debt reserve | (293,000) | (240,000) | 294,000 | 24,000 | (42,000) | 184,000 |
Benefit from income taxes | (3,355,000) | (9,880,000) | ||||
Non-cash interest expense | 335,000 | 1,415,000 | 671,000 | 2,407,000 | 5,687,000 | 5,555,000 |
Impairment of goodwill and intangible assets | 332,376,000 | 332,376,000 | 440,598,000 | 16,094,000 | ||
Right-of-use assets | 477,000 | 1,235,000 | 2,690,000 | 1,594,000 | ||
Changes in current assets and liabilities: | ||||||
Accounts receivable | 87,373,000 | 79,329,000 | (103,385,000) | 116,478,000 | 23,678,000 | 13,310,000 |
Prepaid expenses and other assets | (2,481,000) | (3,377,000) | (6,394,000) | 66,000 | (2,547,000) | (1,707,000) |
Accounts payable | 2,781,000 | (1,962,000) | (31,000) | (7,909,000) | (6,581,000) | 6,279,000 |
Accrued expenses and non-current liabilities | (19,422,000) | 85,679,000 | 21,190,000 | 145,811,000 | 250,694,000 | 221,496,000 |
Lease liability | (864,000) | (1,480,000) | (3,272,000) | (2,332,000) | ||
Deferred revenue | (24,832,000) | (44,429,000) | 172,614,000 | (101,765,000) | (21,145,000) | (18,904,000) |
Net cash used in operating activities | 39,676,000 | 24,764,000 | 8,180,000 | 3,917,000 | (37,413,000) | 10,059,000 |
Cash flows from investing activities: | ||||||
Purchases of property and equipment | (386,000) | (1,827,000) | (2,326,000) | (3,105,000) | (10,353,000) | (14,142,000) |
Internal use software development costs | (1,494,000) | (1,917,000) | (2,126,000) | (3,819,000) | (7,047,000) | (8,410,000) |
Net cash provided by investing activities | (1,880,000) | (3,744,000) | (4,452,000) | (6,924,000) | (17,400,000) | (22,552,000) |
Cash flows from financing activities: | ||||||
Borrowings under DIP Facility | 60,000,000 | |||||
Borrowings under Exit Facility | 50,000,000 | |||||
Debt issuance costs associated with DIP and Exit Facilities | (19,524,000) | |||||
Distribution to parent company | (2,771,000) | |||||
Principal repayments of capital lease obligations | (263,000) | (222,000) | (414,000) | (532,000) | (756,000) | |
Repayments of accounts receivable facility, net of borrowings | (2,876,000) | (13,003,000) | ||||
Borrowings under revolving line of credit, net of repayments | 19,500,000 | 19,500,000 | 55,400,000 | (26,600,000) | ||
Principal payments on Term Loans | (1,300,000) | (6,641,000) | (4,938,000) | |||
Net cash provided by financing activities | (4,439,000) | 6,275,000 | (32,463,000) | 73,657,000 | 57,801,000 | 27,633,000 |
Effect of exchange rate changes on cash and cash equivalents | (140,000) | (1,602,000) | 863,000 | (2,139,000) | 348,000 | (535,000) |
Net Change in Cash | 33,217,000 | 25,693,000 | (27,872,000) | 68,511,000 | 3,336,000 | 14,605,000 |
Cash, cash equivalents and restricted cash, beginning of period | 74,443,000 | 33,804,000 | 102,315,000 | 33,804,000 | 30,468,000 | 15,863,000 |
Cash, cash equivalents and restricted cash, end of period | 107,660,000 | 59,497,000 | 74,443,000 | 102,315,000 | 33,804,000 | 30,468,000 |
Supplemental disclosure of cash flow information: | ||||||
Cash and cash equivalents | 105,004,000 | 47,000,000 | 71,479,000 | 92,009,000 | 18,799,000 | 15,584,000 |
Restricted cash | 2,656,000 | 12,497,000 | ||||
Cash, cash equivalents and restricted cash, end of period | 107,660,000 | 59,497,000 | 74,443,000 | 102,315,000 | 33,804,000 | 30,468,000 |
Supplemental disclosure of cash flow information and non-cash investing and financing activities: | ||||||
Cash paid for interest | 11,050,000 | 18,908,000 | 175,748,000 | 167,670,000 | ||
Cash paid for income taxes, net of refunds | 838,000 | 516,000 | 2,336,000 | 913,000 | (2,069,000) | 3,421,000 |
Unpaid capital expenditures | $ 212,000 | 572,000 | $ 166,000 | 1,039,000 | $ 170,000 | $ 889,000 |
Lease liabilities arising from right-of-use assets and tenant improvements recognized upon adoption of new accounting standard | $ 19,415,000 | $ 19,415,000 |
Organization and Description _3
Organization and Description of Business | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Organization and Description of Business | SOFTWARE LUXEMBOURG HOLDING (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (1) Organization and Description of Business The Company Software Luxembourg Holding S.A. (“Software Luxembourg”), a public limited liability company incorporated and organized under the laws of the Grand Duchy of Luxembourg, was established on August 27, 2020 for the purpose of acquiring the ownership interest in Pointwell Limited (“Pointwell”), an Irish private limited company, through a plan of reorganization under Chapter 11 subsequent to August 27, 2020. Pointwell is a wholly owned subsidiary of Software Luxembourg, held indirectly through two holding companies, Software Luxembourg Intermediate S.à r.l. and Software Luxembourg Acquisition S.à r.l, both private limited liability companies incorporated and organized under the laws of the Grandy Duchy of Luxembourg. Prior to August 28, 2020, Pointwell had been a direct wholly owned subsidiary of Evergreen Skills Lux S.à r.l., with an ultimate parent company of Evergreen Skills Top Holding Lux, both private limited liability companies incorporated and organized under the laws of the Grandy Duchy of Luxembourg. References to “Successor” or “Successor Company” relate to the consolidated financial position and results of operations of Software Luxembourg subsequent to August 27, 2020. References to “Predecessor” relate to the consolidated financial position and results of operations of Pointwell prior to August 28, 2020. References to the “Company” relate to Software Luxembourg subsequent to August 27, 2020 and Pointwell prior to August 28, 2020. The Company provides, through its Skillsoft and SumTotal brands, cloud-based learning solutions and talent management solutions for customers worldwide, ranging from global enterprises and government entities to mid-sized and small businesses. The Company’s courses, books and videos have been developed by industry-leading learning experts to maximize business skills, performance and talent development. The Company has headquarters in Dublin, Ireland, and other offices in various North American and international locations. References in the accompanying footnotes to the Company’s fiscal year refer to the fiscal year ended January 31 of that year (e.g., fiscal 2021 is the fiscal year ended January 31, 2021). Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. Basis of Financial Statement Preparation The accompanying condensed consolidated financial statements include the accounts of Software Luxembourg Holding S.A (Successor) and Pointwell Limited (Predecessor) and their wholly owned subsidiaries. These financial statements are unaudited. However, in the opinion of management, the condensed consolidated financial statements reflect all normal and recurring adjustments necessary for their fair statement. Interim results are not necessarily indicative of results expected for any other interim period or a full year. We prepared the accompanying unaudited condensed consolidated financial statements in accordance with the instructions for Form 10‑Q and Article 10 of Regulation S-X and, therefore, include all information and footnotes necessary for a complete presentation of operations, comprehensive income (loss), financial position, changes in stockholders’ deficit and cash flows in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying condensed consolidated balance sheet as of January 31, 2021 was derived from our audited consolidated financial statements and does not include all disclosures required by U.S. GAAP for annual financial statements. The audited consolidated financial statements as of and for the year ended January 31, 2021 contains the information and footnotes necessary for such presentation. Accordingly, the financial statements contained in these interim financial statements should be read in conjunction with the audited consolidated financial statements for the year ended January 31, 2021. Use of Estimates Our preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from our estimates. | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (1) The Company Software Luxembourg Holding S.A. (“Software Luxembourg”), a public limited liability company incorporated and organized under the laws of the Grand Duchy of Luxembourg, was established on August 27, 2020 for the purpose of acquiring the ownership interest in Pointwell Limited (“Pointwell”), an Irish private limited company, through a reorganization under Chapter 11 (as discussed further below) subsequent to August 27, 2020. Pointwell is a wholly owned subsidiary of Software Luxembourg, held indirectly through two holding companies, Software Luxembourg Intermediate S.à r.l. and Software Luxembourg Acquisition S.à r.l, both private limited liability companies incorporated and organized under the laws of the Grandy Duchy of Luxembourg. Prior to August 28, 2020, Pointwell had been a direct wholly owned subsidiary of Evergreen Skills Lux S.à r.l., with an ultimate parent company of Evergreen Skills Top Holding Lux, both private limited liability companies incorporated and organized under the laws of the Grandy Duchy of Luxembourg. References to “Successor” or “Successor Company” relate to the consolidated financial position and results of operations of Software Luxembourg subsequent to August 27, 2020. References to “Predecessor” relate to the consolidated financial position and results of operations of Pointwell prior to August 28, 2020. References to the “Company” relate to Software Luxembourg subsequent to August 27, 2020 and Pointwell prior to August 28, 2020. The Company provides, through its Skillsoft and SumTotal brands, cloud-based learning solutions and talent management solutions for customers worldwide, ranging from global enterprises and government entities to mid-sized and small businesses. The Company’s courses, books and videos have been developed by industry-leading learning experts to maximize business skills, performance and talent development. The Company has headquarters in Dublin, Ireland, and other offices in various North American and international locations. References in the accompanying footnotes to the Company’s fiscal year refer to the fiscal year ended January 31 of that year (e.g., fiscal 2021 is the fiscal year ended January 31, 2021). Chapter 11 Proceedings On June 14, 2020 (the “Petition Date”), Pointwell and certain of its subsidiaries, including Skillsoft Corporation (collectively, the “Debtors”), commenced voluntary “prepackaged” petitions for relief (the “Chapter 11 Cases”) under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware (“the Bankruptcy Court”) pursuant to a prepetition restructuring support agreement (the “RSA”) entered into with the substantial majority of its first and second lien lenders with the objective of reducing long-term debt while maintaining normal operations and paying all trade creditors in full. On June 15, 2020, the Debtors filed a plan of reorganization (as amended, the “Plan of Reorganization”) and a related disclosure statement (“the Disclosure Statement”) with the Bankruptcy Court which was subsequently amended by revised filings. In addition to supporting the Plan of Reorganization, certain of the Debtors’ consenting first lien lenders agreed to support the Debtors’ restructuring process by providing the Debtors with $60 million in post-petition financing (the “DIP Facility” and the lenders under such facility, the “DIP Lenders”). The proceeds of the DIP Facility were used to fund (a) the operations of the Debtors, as debtors in possession, during the Chapter 11 Cases, including working capital and general corporate purposes, as well as the payment of professional fees and expenses and required fees and debt service on the DIP Facility, and (b) the operations of certain non-Debtor subsidiaries through “on-lending” or contributions of capital with proceeds from the DIP Facility. In addition, pursuant to the RSA, certain of the consenting first lien lenders agreed to make exit financing available, in the form of First Out Term Loans (as defined below), to the Successor Company in an aggregate principal amount equal to the sum of (i) the aggregate principal amount outstanding under the DIP Facility as of the Effective Date (as defined below) (the “Converted DIP Facility Loans”), and (ii) a cash amount equal to $110 million less the amount of the Converted DIP Facility Loans. The Company’s trade and all other unsecured creditors would not be impaired under the prepackaged Plan, and their votes were not solicited. On June 17, 2020, the Company’s Canadian subsidiary, Skillsoft Canada Ltd., voluntarily commenced parallel recognition proceedings under the Companies’ Creditors Arrangement Act (“CCAA”) with the Court of Queen’s Bench of New Brunswick in Canada seeking recognition and enforcement of the Debtors’ Chapter 11 Cases, including the DIP Facility. On August 6, 2020, the U.S. Bankruptcy Court confirmed the Debtors’ Plan of Reorganization, and on August 17, 2020, the Canadian Court entered an order recognizing and enforcing the Chapter 11 Cases and Plan in Canada. On August 27, 2020 (the “Effective Date”), the Debtors consummated the Plan of Reorganization and emerged from Chapter 11. Upon emergence, the Ordinary Shares of Pointwell as of the Effective Date were cancelled and the ownership interest in Pointwell, which had been a direct wholly owned subsidiary of Evergreen Skills Lux S.à.r.l. with an ultimate holding company of Evergreen Skills Top Holding Lux, was transferred to Software Luxembourg whose shareholders were lenders who had a secured interest in Skillsoft and its affiliates (including Pointwell) prior to the Petition Date. Furthermore, all amounts owed by Pointwell to Evergreen Skills Lux S.à.r.l were cancelled. All claims related to the DIP Facility were discharged and the DIP Facility Lenders received, in full and final satisfaction of such claims, on a dollar for dollar basis, First Out Term Loan (as defined below). All claims related to the Predecessor Company’s outstanding obligations under the variable rate loans and first lien senior notes (collectively, the “Predecessor first lien obligations”) were discharged, and the holders of claims with respect to the Predecessor first lien obligations received, in full and final satisfaction of such claims, its pro rata share of Second Out Term Loans (as defined below) and 3,840,000 Class A ordinary shares of the Successor Company. All claims related to the Predecessor Company’s outstanding obligations under the second lien senior notes (the “Predecessor second lien obligations”) were discharged, and the holders of claims with respect to the Predecessor second lien obligations received, in full and final satisfaction of such claims, 160,000 Class B ordinary shares of the Successor Company and warrants to purchase common shares of the Successor Company, on or before August 27, 2025, which included (i) tranche A warrants to purchase 235,294 ordinary shares at a price of $262.34 per share; and (ii) tranche B warrants to purchase 470,588 ordinary shares at a price of $274.84 per share. The Exit Credit Facility issued to Software Luxembourg and Pointwell of $520 million consists of (i) a $110 million super senior term loan facility (the “First Out Term Loan”), and (ii) a $410 million first lien, second-out term loan facility (the “Second Out Term Loan”). Upon emergence from Chapter 11, the Company adopted fresh-start reporting and became a new entity for financial reporting purposes. As a result of the application of fresh-start reporting and the effects of the implementation of the Plan of Reorganization, the Company’s consolidated financial statements after August 27, 2020 are not comparable with the financial statements prior to August 28, 2020. Upon filing for bankruptcy, the Company applied Accounting Standards Codification (“ASC”) 852, Reorganizations (“ASC 852”) in preparing the consolidated financial statements. ASC 852 requires the financial statements, for periods subsequent to the commencement of the Chapter 11 Cases, to distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Accordingly, certain charges incurred from February 1, 2020 through August 27, 2020 (Predecessor) related to the Chapter 11 Cases, including the write-off of unamortized long-term debt fees and discounts associated with debt classified as liabilities subject to compromise, exit facility and DIP facility rollover financing costs paid upon Effective Date and professional fees incurred directly as a result of the Chapter 11 Cases are recorded as Reorganization items, net in the Predecessor period. ASC 852 requires certain additional reporting for financial statements prepared between the bankruptcy filing date and the date of emergence from bankruptcy, including: · Reclassification of the Debtors’ pre-petition liabilities that are unsecured, under-secured or where it cannot be determined that the liabilities are fully secured, to a separate line item “Liabilities subject to compromise”; and · Segregation of Reorganization items, net as a separate line in the Consolidated Statement of Operations, included within income from continuing operations. The Company’s consolidated financial statements and related footnotes are presented with a blackline division which delineates the lack of comparability between amounts presented after August 27, 2020 and dates prior to August 28, 2020. The Company evaluated the events between August 28, 2020 and August 31, 2020 and concluded that the use of an accounting convenience date of August 31, 2020 (the “Fresh Start Reporting Date”) would not have a material impact on the consolidated financial statements for the Predecessor or Successor Periods. As such, the application of fresh start accounting was based on the consolidated balance sheet as of August 31, 2020. See Note 4 — Fresh-Start Reporting for additional discussion. The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern and contemplate the realization of assets and the satisfaction of liabilities in the normal course of business. The circumstances that led to the Predecessor’s need to pursue a pre- packaged Chapter 11 process were predominately due to the Predecessors’ capital structure, which had a substantial amount of total debt and related annual debt service. Management believes the Company’s new capital structure post emergence mitigates these factors going forward. Following the reorganization, the Company emerged with $520 million in outstanding borrowings under a new credit facility, which is expected to reduce annual interest payments to approximately $45 million. The Company’s projections for post emergence operations are based on the long-range financial plan filed with the RSA as part of the Chapter 11 filing and include assumptions that reflect (i) risks and uncertainties related to potential impacts to the business from COVID‑19; and (ii) potential customer attrition and reduced new business due to concerns about the Company having recently gone through a reorganization. The Company believes that cash on hand, following the reorganization, combined with expected cash flows from operations will be sufficient to fund working capital, debt service and other expected cash needs for at least one year from the issuance of these financial statements on April 9, 2021. Churchill Merger On October 12, 2020, the Company and Churchill Capital Corp II, a Delaware corporation (“Churchill”), entered into an Agreement and Plan of Merger (the “Skillsoft Merger Agreement”) by and between Churchill and the Company. Pursuant to the terms of the Skillsoft Merger Agreement, a business combination between Churchill and Skillsoft will be effected through the merger of the Company with and into Churchill, with Churchill surviving as the surviving company (the “Skillsoft Merger”). At the effective time of the Skillsoft Merger (the “Effective Time”), (a) each Class A share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class A Shares”), outstanding immediately prior to the Effective Time, will be automatically canceled and Churchill will issue as consideration therefor (i) such number of shares of Churchill’s Class A common stock, par value $0.0001 per share (the “Churchill Class A Common Stock”) as would be transferred pursuant to the Class A First Lien Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (ii) Churchill’s Class C common stock, par value $0.0001 per share (the “Churchill Class C Common Stock”), as would be transferred pursuant to the Class C Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (b) each Class B share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class B Shares”), will be automatically canceled and Churchill will issue as consideration therefor such number of shares of Churchill Class A common stock equal to the Per Class B Share Merger Consideration (as defined in the Skillsoft Merger Agreement). Pursuant to the terms of the Skillsoft Merger Agreement, Churchill is required to use commercially reasonable efforts to cause the Churchill Class A Common Stock to be issued in connection with the transactions contemplated by the Skillsoft Merger Agreement (the “Skillsoft Transactions”) to be listed on the New York Stock Exchange (“NYSE”) prior to the closing of the Skillsoft Merger (the “Skillsoft Closing”). Immediately following the Effective Time, Churchill will redeem all of the shares of Class C Common Stock issued to the holders of Skillsoft Class A Shares for an aggregate redemption price of (i) $505,000,000 in cash and (ii) indebtedness under the Existing Second Out Credit Agreement (as defined in the Skillsoft Merger Agreement), as amended by the Existing Second Out Credit Agreement Amendment (as defined in the Skillsoft Merger Agreement), in the aggregate principal amount equal to the sum of $20,000,000 to be issued by the Surviving Corporation (as defined in the Skillsoft Merger Agreement) or one of its subsidiaries, in each case, pro rata among the holders of Churchill Class C Common Stock issued in connection with the Skillsoft Merger. The consummation of the proposed Skillsoft Transactions is subject to the receipt of the requisite approval of (i) the stockholders of Churchill (the “Churchill Stockholder Approval”) and (ii) the shareholders of Skillsoft (the “Skillsoft Shareholder Approval”) and the fulfillment of certain other conditions. |
Summary of Significant Accou_19
Summary of Significant Accounting Policies | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
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 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/A for the year ended December 31, 2020, as filed with the SEC on May 11, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year 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 statement 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 the condensed 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 December 31, 2020. Marketable Securities Held in Trust Account At March 31, 2021 and December 31, 2020, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through March 31, 2021, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which no amounts were withdrawn during the three months ended March 31, 2021. Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common stock and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. Class A Common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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 statements 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 and permanent differences. Net income (Loss) per Share Net income (loss) per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per share, basic and diluted, for Class A 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 the weighted average number of Class A 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 Class A 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 share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) 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 Corporation coverage limit 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 Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature, except for the Company's derivative instruments (see Note 9). Recent Accounting Standards In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements. | NOTE 3. 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 the 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. Cash equivalents consist of mutual funds. The Company did not have any cash equivalents as of December 31, 2020 and 2019. Marketable Securities Held in Trust Account At December 31, 2020 and 2019, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills. Through December 31, 2020, the Company withdrew an aggregate of $2,246,250 of interest earned on the Trust Account to pay its income taxes and for permitted withdrawals, of which $856,250 was withdrawn during the year ended December 31, 2020. Class A common Stock Subject to Possible Redemption The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A 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 Class A 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, Class A 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. Derivative Liabilities The Company accounts for debt and equity issuances as either equity-classified or liability-classified instruments based on an assessment of the instruments 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 instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the instruments meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own common shares and whether the holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the instruments and as of each subsequent quarterly period end date while the instruments are outstanding. For issued or modified instruments that meet all of the criteria for equity classification, the instruments are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, the instruments 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 instruments are recognized as a non-cash gain or loss on the statements of operations. 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 statements 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, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses (“NOL) and allow businesses to carry back NOLs arising in 2018, 2019 and 2020 to the five prior years, suspend the excess business loss rules, accelerate refunds of previously generated corporate alternative minimum tax credits, generally loosen the business interest limitation under IRC section 163(j) from 30 percent to 50 percent among other technical corrections included in the Tax Cuts and Jobs Act tax provisions. The Company does not believe that the CARES Act will have a significant impact on Company's financial position or statement of operations. Net Income (Loss) per Common Share Net income (loss) per common share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. The Company has not considered the effect of the warrants sold in the Public Offering and Private Placement to purchase an aggregate of 38,800,000 shares of common stock in the calculation of diluted loss per share, since the exercise of the warrants into shares of common stock is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The Company’s statement of operations includes a presentation of income (loss) per share for Class A common stock subject to possible redemption in a manner similar to the two-class method of income (loss) per ordinary share. Net income (loss) per common share, basic and diluted, for Class A 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 by the weighted average number of Class A common stock subject to possible redemption outstanding since original issuance. Net income (loss) per share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income or loss on marketable securities attributable to Class A common stock subject to possible redemption, by the weighted average number of non-redeemable ordinary shares 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 the non-redeemable shares’ proportionate interest. The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) 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 limit 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, except for the Company’s Derivative Instruments (see Note 6 and 11). 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. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies The Company’s significant accounting policies are discussed in Note 2—Summary of Significant Accounting Policies and Recent Accounting Pronouncements in the company’s audited financial statements for the year ended January 31, 2021. There have been no changes to these policies during the three months ended April 30, 2021. | (2) Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. On June 17, 2020, the Company’s Canadian subsidiary, Skillsoft Canada Ltd., voluntarily commenced parallel recognition proceedings under the Companies’ Creditors Arrangement Act (“CCAA”) with the Court of Queen’s Bench of New Brunswick in Canada seeking recognition and enforcement of the Debtors’ Chapter 11 Cases, including the DIP Facility. This action resulted in the deconsolidation of Skillsoft Canada Ltd. under ASC 810, Consolidation and the Company recognizing its retained noncontrolling interest in the Canadian subsidiary at its fair value of approximately $4.8 million. On August 17, 2020, the Canadian Court entered an order recognizing and enforcing the Chapter 11 Cases and Plan in Canada upon the Effective Date. The Company reconsolidated Skillsoft Canada Ltd and de-recognized the non-controlling interest. The Company applied the guidance in ASC 805, Business Combinations for recognizing a new accounting basis for the Canadian subsidiary. Reclassifications The Company reclassified $16,244 in professional services fees incurred exploring recapitalization, reorganization and other strategic initiatives from General and Administrative expense to Recapitalization and Transaction Fees in the accompanying statement of operations for the year ended January 31, 2020 to conform with current year presentation. Emerging Growth Company Status The Company would currently qualify as an “emerging growth company” (EGC), as defined in the Jumpstart Our Business Startups Act (JOBS Act) and accordingly the Company may choose to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not EGCs. The Company may take advantage of these exemptions until the Company is no longer an EGC under Section 107 of the JOBS Act, which provides that an EGC can take advantage of the extended transition period afforded by the JOBS Act for complying with new or revised accounting standards. The Company has elected to use the extended transition period for complying with new or revised accounting standards and as a result of this election, the consolidated financial statements may not be comparable to companies that comply with public company effective dates. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires 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 revenue and expenses during the reporting period. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Significant estimates and assumptions by management affect the Company’s accounting for the impairment of goodwill and its assessment of other intangible assets for potential impairment, determination of estimated period of economic benefit for deferred commissions and income taxes and related valuation allowances. Significant estimates and assumptions were also made by management in determining the fair value of asset and liabilities as required under the application of fresh-start reporting and in the valuation of warrants. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ from management’s estimates if past experience or other assumptions do not turn out to be substantially accurate. Revenue Recognition On February 1, 2019, the Company adopted ASU 2014‑09, Revenue from Contracts with Customers (Topic 606) and Other Assets and Deferred Costs — Contracts with Customers (Subtopic 340‑40) using the modified retrospective method. Revenue Recognition Policy — After the adoption of ASC 606 Revenue from Contracts with Customers (ASC 606) on February 1, 2019 The Company enters into contracts with customers that provide cloud-based learning solutions and talent management solutions for customers worldwide. These solutions are typically sold on a subscription basis for a fixed term. The Company accounts for a contract when (i) it has approval and commitment from both parties, (ii) the rights of the parties have been identified, (iii) payment terms have been identified, (iv) the contract has commercial substance and (v) collectability of substantially all of the consideration to which the Company will be entitled in exchange for the transfer of goods or services is probable. Approximately one-third of the Company’s revenue recognized each year is related to contracts that have an original duration of one year or less. The Company’s Software as a Service (SaaS) subscription arrangements for learning and talent management solutions generally do not provide customers with the right to take possession of the software supporting the platform or, in the case of learning solutions, to download course content without continuing to incur fees for hosting services and, as a result, are accounted for as service arrangements. Access to the platform and course content represents a series of distinct services as the Company continually provides access to, and fulfill its obligation to, the end customer over the subscription term. The series of distinct services represents a single performance obligation that is satisfied over time. Accordingly, the fixed consideration related to subscription revenue is generally recognized on a straight-line basis over the contract term, beginning on the date that the service is made available to the customer. The Company’s subscription contracts typically vary from one year to three years. The Company’s arrangements are generally non-cancellable and non-refundable. The Company also sells professional services related to its talent management solutions which are typically considered distinct performance obligations and are recognized over time as services are performed. The Company also occasionally sells its talent management solutions by providing perpetual and term-based licenses for on-premise versions of the software. Such arrangements are treated as transfers of intellectual property and the amount of consideration attributable to the delivered licenses are recognized at the point of delivery and the remaining amounts allocated for post contract support are recognized over time. While the vast majority of the Company’s revenue relates to SaaS subscription services where the entire arrangement fee is recognized on a ratable basis over the contractual term, the Company sometimes enter into contractual arrangements that have multiple distinct performance obligations, one or more of which have different periods over which the services or products are delivered. These arrangements may include a combination of subscriptions, products, support and professional services. The Company allocates the transaction price of the arrangement based on the relative estimated standalone selling price, or SSP, of each distinct performance obligation. The Company’s process for determining SSP for each performance obligation, where necessary, involves significant management judgment. In determining SSP, the Company maximizes observable inputs and considers a number of data points, including: · the pricing of standalone sales; · the pricing established by management when setting prices for deliverables that are intended to be sold on a standalone basis; · contractually stated prices for deliverables that are intended to be sold on a standalone basis; and · other pricing factors, such as the geographical region in which the products are sold and expected discounts based on the customer size and type. Determining SSP for performance obligations which the Company rarely or never sell separately also requires significant judgment. In estimating the SSP, the Company considers the likely price that would have resulted from established pricing practices had the deliverable been offered separately and the prices a customer would likely be willing to pay. The Company also sells its cloud-based learning solutions through resellers, where payments are typically based on the solutions sold through to end users. Reseller arrangements of this nature sometimes require the Company to estimate end user activity for a brief period of the contract term, however, amounts estimated and actual amounts subsequently billed have not been material to date. The Company only includes estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The Company reduces transaction prices for estimated returns and other allowances that represent variable consideration under ASC 606, which the Company estimates based on historical return experience and other relevant factors and records a corresponding refund liability as a component of accrued expenses and other current liabilities. Based on the nature of the Company’s business and product offerings, contingent revenue and other variable consideration are infrequent. While not a common practice for us, in the event the Company grants the customer the option to acquire additional products or services in an arrangement, the Company considers if the option provides a material right to the customer that it would not receive without entering into the contract (e.g., an incremental discount compared to the range of discounts typically given for similar products or services). If a material right is deemed to exist, the Company accounts for the option as a distinct performance obligation and recognizes revenue when those future products or services are transferred or when the option expires. Reimbursements received from customers for out-of-pocket expenses are recorded as revenues, with related costs recorded as cost of revenues. The Company presents revenues net of any taxes collected from customers and remitted to government authorities. The Company applies the practical expedient for contracts with significant financing components that are under one year. The Company applies the practical expedient for the deferral of sales commissions and other contract acquisition costs, which are expensed as incurred, because the amortization period would be one year or less. For deferred contract costs with an expected amortization period of over one year, the Company recognizes such payments over (i) the expected customer relationship period in the case of new customers, which is typically 3 to 5 years for initial commissions, and (ii) the contractual term for existing customers for commissions paid on renewals. As the Company’s contractual agreements predominately call for advanced billing, contract assets are rarely generated. For transaction prices allocated to remaining performance obligations, the Company applies practical expedients and does not disclose quantitative or qualitative information for remaining performance obligations (i) that have original expected durations of one year or less and (ii) where the Company recognizes revenue equal to what it has the right to invoice and that amount corresponds directly with the value to the customer of its performance to date. All remaining performance obligations as of January 31, 2021 qualified for the practical expedient. Revenue Recognition Policy - ASC 605 The Company applied the provisions ASC 605, Revenue Recognition (“ASC 605”) to revenue recognized during the year ended January 31, 2019. The Company commences revenue recognition when all of the following conditions are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the amount of fees to be paid by the customer is fixed or determinable; and (iv) collection is reasonably assured. The majority of SaaS subscription arrangements are accounted for as service arrangements as they do not provide customers with the right to take possession of the software supporting the platform or the right to use downloaded courseware without continuing to pay the full subscription fee which includes fees for hosting services. Revenue for subscription fees is recognized ratably over the subscription term, which typically varies from one to three years. Our on-premise perpetual and term-based licenses are accounted for as software arrangements as the customer takes possession of the software. Revenue for these license fees are recognized ratably over the associated maintenance term. The Company’s arrangements are generally non-cancellable and nonrefundable. Taxes collected from customers are excluded from revenue. For arrangements, with multiple deliverables, the Company evaluates whether the individual deliverables qualify as separate units of accounting. In order to treat deliverables in a multiple-element arrangement as separate units of accounting, the deliverables must have stand-alone value upon delivery and, in situations in which a general right of return exists for the delivered item, delivery or performance of the undelivered item is considered probable and substantially within the Company’s control. The Company’s SaaS subscription services have stand-alone value as it routinely sells subscriptions separately. Professional services included in SaaS service arrangements have stand-alone value as they are routinely sold separately. For such deliverables that have stand-alone value upon delivery, the Company accounts for the deliverables using the relative selling price allocation method. The relative selling price method allocates any discount in the arrangement proportionately to each deliverable on the basis of the deliverable’s estimated selling price. The selling price for each deliverable is based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence (“TPE”) if VSOE is not available, or the Company’s best estimated selling price (“BESP”) if neither VSOE nor TPE are available. For software arrangements, the Company evaluates whether undelivered elements qualify as separate units of accounting. In order to treat the undelivered elements as separate units of accounting, the undelivered elements must have VSOE. The Company’s software arrangements are generally recognized ratably over the maintenance term as the Company does not have VSOE of the fair value of the undelivered maintenance elements. Deferred Revenue The Company records as deferred revenue amounts that have been billed in advance for products or services to be provided. Deferred revenue includes the unrecognized portion of revenue associated with license fees for which the Company has received payment or for which amounts have been billed and are due for payment. Under ASC 605, deferred revenue was not recognized on the balance sheet for outstanding receivables where collection was not probable, fees were not fixed or determinable, or when the customer had termination for convenience rights. Capitalized Commissions After the adoption of ASC 606 on February 1, 2019 In connection with the adoption of ASC 606, the Company implemented new procedures for capitalizing the incremental costs of obtaining customer contracts. The Company capitalizes sales commissions, and associated fringe costs, such as payroll taxes, paid to direct sales personnel and other incremental costs of obtaining contracts with customers, provided the Company expects to recover those costs. The Company determines whether costs should be deferred based on its sales compensation plans, if the commissions are in fact incremental and would not have occurred absent the customer contract. Sales commissions for renewal of a subscription contract are not considered commensurate with the commissions paid for the acquisition of the initial subscription contract given the substantive difference in commission rates between new and renewal contracts. Commissions paid upon the initial acquisition of a contract are amortized over an estimated period of benefit of 3 to 5 years while commissions paid related to renewal contracts are amortized over an estimated average contract term of approximately 12 months. Amortization is recognized on a straight-line basis upon commencement of the transfer of control of the services, commensurate with the pattern of revenue recognition. The period of benefit for commissions paid for the acquisition of initial subscription contracts is determined by taking into consideration the initial estimated customer life and the technological life of the Company’s platform and related significant features. The Company determines the period of benefit for renewal subscription contracts by considering the average contractual term for renewal contracts. Amortization of deferred contract acquisition costs is included within sales and marketing expense in the consolidated statements of operations. Unamortized commission expense of $3.1 and $4.4 million is included in prepaid expenses and other current assets and other assets, respectively, at January 31, 2021 in the accompanying consolidated balance sheets. Unamortized commission expense of $11.2 and $11.7 million is included in prepaid expenses and other current assets and other assets, respectively, at January 31, 2020 in the accompanying consolidated balance sheets. Capitalized Commissions Prior to the adoption of ASC 606 on February 1, 2019 For the year ended January 31, 2019, the Company deferred the recognition of commission expense until such time as the revenue related to the arrangement for which the commission was payable is recognized. Deferred commissions for each contract were amortized in a manner consistent with how revenue is recognized for such contract, often resulting in ratable recognition of expense over the contractual term. Foreign Currency Translation The reporting currency for the Company is the U.S. dollar (“USD”) and the functional currency of the Company’s subsidiaries in the United Kingdom, Canada, Germany, Australia, the Netherlands, France, New Zealand, Singapore, Hong Kong, Japan, Switzerland and India are the currencies of those countries. The functional currency of the Company’s subsidiaries in Ireland is the USD. Assets and liabilities are translated to the USD from the local functional currency at current exchange rates, and income and expense items are translated to the USD using the average rates of exchange prevailing during the year. Gains and losses arising from translation are recorded in other comprehensive income (loss) as a separate component of shareholders’ equity (deficit). Foreign currency gains or losses on transactions denominated in a currency other than an entity’s functional currency are recorded in other income/(expenses) in the accompanying statements of operations. During the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020, and 2019, gains (losses) arising from transactions denominated in foreign currencies other than an entity’s functional currency were approximately $0.2 million, $1.1 million, ($1.0) million and $23 thousand respectively. Cash, Cash Equivalents and Restricted Stock The Company considers all highly liquid investments with original maturities of 90 days or less at the time of purchase to be cash equivalents. At January 31, 2021 and January 31, 2020, the Company did not have any cash equivalents or available for sale investments. At January 31, 2021 and January 31, 2020, the Company had approximately $3.0 million and $15.0 million of restricted cash, respectively, primarily related to the accounts receivable facility. Under the terms of the accounts receivable facility, the Company has three accounts considered restricted, an interest reserve account, a foreign exchange reserve account and a concentration reserve account. The interest reserve account requires three months interest on the greater of the facility balance or facility balance floor (the facility balance floor was $10.0 million as of January 31, 2021). The foreign exchange reserve account requires the Company to restrict cash for an amount equivalent to the change in the translated value on our foreign receivables borrowed from the date the receivable was sold. The concentration account requires the Company to deposit receipts from the receivables sold until the Company submits a monthly reconciliation report. At that time, the funds may be returned if they are replaced with new receivables. Recapitalization and Transaction-related Costs The Company expenses all transactions costs, which primarily consist of professional services and advisory fees related to the recapitalization of the Company, and activities related to the planned merger with Churchill Capital, as they are incurred as a component of operating expenses, other than those classified as Reorganization items, net, in the consolidated statements of operations. Risks and Uncertainties The Company is subject to a number of risks and uncertainties common to companies in similar industries and stages of development, including, but not limited to, the uncertainty of economic, political and market conditions; data security and privacy risk; regulatory risks; management of growth; dependence on key individuals; management of international operations; intellectual property risks; competition from substitute products and services of larger companies; product development risk; ability to keep pace with technological developments and customer adoption of new products. The Company has been closely monitoring the COVID‑19 pandemic and its impact on the business. The Company is operating normally with minimal disruptions to product and service offerings or content and software development. While the online learnings tools the Company offers have many advantages over traditional in person learning in the current environment, some of the Company’s customers in heavily impacted industries have sought to temporarily reduce spending, resulting in requests for reductions in contract size or requests for extended payment terms upon renewal. Property and Equipment The Company records property and equipment at cost. Depreciation and amortization is charged to operations based on the cost of property and equipment over their respective estimated useful lives on a straight-line basis using the half-year convention, as follows: Description Estimated Useful Lives Computer equipment 3 years Furniture and fixtures 5 years Leasehold improvements Lesser of 7 years or life of lease Expenditures for maintenance and repairs are expensed as incurred, while expenditures for renewals or betterments are capitalized. The Company evaluates the carrying amount of our property and equipment whenever changes in circumstances or events indicate that the value of such assets may not be recoverable. As of January 31, 2021, the Company believes the carrying amounts of its property and equipment are recoverable and no impairment exists. Content and Software Development Expenses Content and software development expenses consist primarily of personnel and contractor related expenditures to develop the Company’s content, platform and other product offerings. For content related costs, the Company’s policy is to expense costs as incurred. The Company outsources certain aspects of content production to third parties who produce original content on behalf of Skillsoft. Third party costs incurred in these development efforts with external resources may include prepayments and are recognized as expense in proportion to the level of services completed. Software development costs are expensed as incurred, except for costs attributable to upgrades and enhancements that qualify for capitalization. See policy “Capitalized Software Development Costs” for further discussion on this matter. For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 the Company incurred $11.5 million, $12.6 million, $25.9 million and $20.6 million, respectively of proprietary content development expenses. Capitalized Platform Development Costs The Company capitalizes certain internal use software development costs related to its SaaS platform incurred during the application development stage. Costs related to preliminary project activities and to post-implementation activities are expensed as incurred. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable that the expenditures will result in additional functionality. Internal use software is amortized on a straight-line basis over its estimated useful life, which is generally 5 years. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of the assets. Capitalized costs are recorded as intangible assets in the accompanying balance sheets. Content Partner Royalty Expenses For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 the Company recognized $7.3 million, $9.3 million, $16.5 million and $19.0 million, respectively of royalty expenses for third party content used or provisioned in the Company’s content library. Fair Value of Financial Instruments Financial instruments consist mainly of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, debt interest rate cap derivatives and warrants. The carrying amount of accounts receivable is net of an allowance for doubtful accounts, which is based on historical collections and known credit risks. See Note 19 for discussion related to the fair value of the Company’s borrowing agreements. Deferred Financing Costs and Original Issuance Discounts The Company amortizes deferred debt financing costs (including issuance costs and creditor fees) and original issuance discounts, both recorded as a reduction to the carrying amount of the related debt liability, as interest expense over the terms of the underlying obligations using the effective interest method. Derivative Financial Instruments The Company recognizes all derivatives on the balance sheet at fair value. Derivatives that are not designated as a hedge for accounting purposes must be adjusted to fair value through income. The Company classifies cash inflows and outflows from derivatives within operating activities on the statement of cash flows. The Company did not utilize derivative instruments during the period from August 28, 2020 to January 31, 2021 (Successor). The Company’s objective for utilizing derivative instruments during the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 was to reduce its exposure to fluctuations in cash flows due to changes in the variable interest rates of certain borrowings issued under its credit facility. The Company’s strategy to achieve that objective involves entering into interest rate swaps and caps that are specifically designated to certain variable rate instruments and accounted for as cash flow hedges. The Company has elected to not designate their derivatives as hedging relationships. As such the changes in the fair value of the derivatives are recorded directly in statement of operations. Concentrations of Credit Risk and Off-Balance-Sheet Risk For the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019, no customer individually comprised greater than 10% of revenue. As of January 31, 2021 and 2020, no customer individually comprised more than 10% of accounts receivable. The Company considers its customers’ financial condition and generally does not require collateral. The Company maintains a reserve for doubtful accounts and sales credits that is the Company’s best estimate of potentially uncollectible trade receivables. Provisions are made based upon a specific review of all significant outstanding invoices that are considered potentially uncollectible in whole or in part. For those invoices not specifically reviewed or considered uncollectible, provisions are provided at different rates, based upon the age of the receivable, historical experience, and other currently available evidence. The reserve estimates are adjusted as additional information becomes known or payments are made. The Company has no significant off-balance-sheet arrangements nor concentration of credit risks such as foreign exchange contracts, option contracts or other foreign hedging arrangements. Intangible Assets, Goodwill and Indefinite-Lived Intangible Impairment Assessments The Company records intangible assets at cost and amortizes its finite-lived intangible assets, including customer contracts and internally developed software, over their estimated useful life. The Company reviews intangible assets subject to amortization at least annually to determine if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in remaining useful life. Conditions that would indicate impairment and trigger a more frequent impairment assessment include, but are not limited to, a significant adverse change in legal factors or business climate that could affect the value of an asset, or an adverse action or assessment by a regulator. In addition, the Company reviews its indefinite-lived intangible assets, including goodwill and certain trademarks, during the fourth quarter of each year for impairment, or more frequently if certain indicators are present or changes in circumstances suggest that impairment may exist and reassesses their classification as indefinite-lived assets. See Note 6 for a discussion of impairment charges recognized for the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019. Restructuring Charges Liabilities related to an exit or disposal activity are recognized in accordance with ASC Topic 420, Liabilities: Exit or Disposal Cost Obligations . Costs include, but are not limited to, one-time involuntary termination benefits provided to employees under the terms of a benefit arrangement that, in substance, are not an ongoing benefit arrangement or a deferred compensation contract, which are recognized on the communication date and certain contract termination costs, including operating lease termination costs which are recognized on the termination date or cease-use date for ongoing lease payments. In addition, the Company accounts for certain employee-related restructuring charges as an ongoing benefit arrangement in accordance with ASC Topic 712, Compensation — Nonretirement Postemployment Benefits , based on its prior practices and policies for the calculation and payment of severance benefits. The Company recognizes employee-related restructuring charges when the likelihood of future payment is probable, and the amount of the severance benefits is reasonably estimable. The Company recorded facility-related restructuring charges in accordance with ASC 420, before it adopted ASC Topic 842, Leases (“ASC 842”), on February 1, 2021. ASC 842 amended ASC 420 to exclude costs to terminate a contract that is a lease from the scope of ASC 420. The Company evaluates right-of-use (ROU) assets abandonment and impairment in accordance with ASC 360, Property, Plant, and Equipment and recognizes ROU assets abandonment-related amortization and write-offs as restructuring charges in its statement of operations. Advertising Costs Costs incurred for production and communication of advertising initiatives are expensed when incurred. Advertising expenses amounted to approximately $3.7 million, $3.2 million, $5.3 million and $4.0 million for the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 202 |
Intangible Assets_2
Intangible Assets | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Intangible Assets | (3) Intangible Assets Intangible assets consisted of the following (in thousands): April 30, 2021 January 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Developed software/ courseware $ 267,014 $ 39,459 $ 227,555 $ 265,758 $ 24,669 $ 241,089 Customer contracts/ relationships 279,500 9,114 270,386 279,500 3,627 275,873 Trademarks and trade names 6,300 676 5,624 6,300 455 5,845 Publishing rights 35,200 4,693 30,507 35,200 2,933 32,267 Backlog 90,200 20,842 69,358 90,200 8,141 82,059 Skillsoft trademark 91,500 — 91,500 91,500 — 91,500 Total $ 769,714 $ 74,784 $ 694,930 $ 768,458 $ 39,825 $ 728,633 Amortization expense related to the existing finite-lived intangible assets is expected to be as follows (in thousands): Fiscal Year Amortization Expense 2022 (Remaining 9 months) $ 104,693 2023 120,579 2024 106,172 2025 94,070 2026 64,496 Thereafter 113,420 Total $ 603,430 Amortization expense related to intangible assets in the aggregate was $35.2 million for the three months ended April 30, 2021 and $17.4 million for the three months ended April 30, 2020. Fresh-start Reporting for Intangible Assets In accordance with ASC 852, with the application of fresh-start reporting, the Company allocated its reorganization value to its individual assets based on their estimated fair values in conformity with ASC 805, including those of intangible assets. Intangible assets were measured based upon estimates of the future performance and cash of from the Successor Company at emergence. Values and useful lives assigned to intangible assets were based on estimated value and use of these assets by a market participant. The customer contracts/relationships and backlog were valued using the income approach. The trademarks and trade names were valued using the relief from royalty method. The income approach determines fair value by estimating the after-tax cash flows attributable to an identified asset over its useful life (Level 3 inputs) and then discounting these after-tax cash flows back to a present value. The developed software/courseware and publishing rights were valued using the replacement cost approach. The cost approach determines fair value by estimating the cost to replace or reproduce an asset at current prices and is reduced for functional and economic obsolescence. Impairment Review Requirements The Company reviews intangible assets subject to amortization if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in remaining useful life. The Company reviews indefinite lived intangible assets, including goodwill, on the annual impairment test date or more frequently if there are indicators of impairment. No such indicators were present during the three months ended April 30, 2021. Goodwill in the Predecessor represented the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill for the Successor represents the excess of the reorganization value over the fair value of tangible and intangible assets in fresh start accounting. The Company tests goodwill for impairment during the fourth quarter every year in accordance with ASC 350, Intangibles—Goodwill . The Predecessor performed this test on the first day of the fourth quarter (November 1) and the Successor performs this test on the first day of the last month of the fourth quarter (January 1). In connection with the impairment evaluation, the Company may first consider qualitative factors to determine whether the existence of events or circumstances indicates that it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. Performing a quantitative goodwill impairment test is not necessary if an entity determines based on this assessment that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company fails or elects to bypass the qualitative assessment, the goodwill impairment test must be performed. This test requires a comparison of the carrying value of the reporting unit to its estimated fair value. If the carrying value of a reporting unit’s goodwill exceeds its fair value, an impairment loss equal to the difference is recorded, not to exceed the amount of goodwill allocated to the reporting unit. In determining reporting units, the Company first identifies its operating segments, and then assesses whether any components of these segments constitute a business for which discrete financial information is available and where segment management regularly reviews the operating results of that component. Impairment of Goodwill and Intangible Assets for the Predecessor Period ended April 30, 2020 During the three months ended April 30, 2020, the emergence of COVID‑19 as a global pandemic had an adverse impact on our business. While the online learnings tools the Company offers have many advantages over traditional in person learning in the current environment, some of the Company’s customers in heavily impacted industries have sought to temporarily reduce spending, resulting in reductions in contract sizes and in some cases cancellations when such contracts have come up for renewal. In addition, identifying and pursing opportunities for new customers became much more challenging in this environment. In addition to the uncertainty introduced by COVID‑19, the Company’s over leveraged capital structure continued to create headwinds. In April 2020, the Company received temporary forbearance from its lenders due to a default on amounts owed under the Senior Credit Facility as a long-term consensual solution was being negotiated with lenders. The uncertainty around the Company’s capital structure and future ownership, continued to hurt its business, as new and existing customers displayed apprehension about the ultimate resolution of the Company’s capital structure and its impact on operations, causing delays and sometimes losses in business. The uncertainty surrounding the Company’s capital structure combined with the potential impact that COVID‑19 would have on the Company and the global economy, resulted in a significant decline in the fair value of its reporting units during the first quarter ended April 30, 2020, with the impact being more significant to the SumTotal business on a relative basis due to its smaller scale and forecasted cash flow generation. As part of the Company’s evaluation of impairment indicators based on the circumstances described above as of April 30, 2020, the Company determined its SumTotal long- lived asset group failed the undiscounted cash flow recoverability test. Accordingly, the Company estimated the fair value of its individual long-lived assets to determine if any impairment charges were present. The Company’s estimation of the fair value of definite lived intangible assets included the use of discounted cash flow analyses which reflected estimates of future revenue, customer attrition rates, royalty rates, cash flows, and discount rates. Based on these analyses, the Company concluded the fair values of certain SumTotal intangible assets where lower their current carrying values, accordingly impairment charges of $62.3 million were recognized in the 3 months ended April 30, 2020 (Predecessor). In light of the circumstances above, management also concluded that a triggering event had occurred with respect to the Company’s indefinite-lived Skillsoft trade name as of April 30, 2020. Accordingly, the Company estimated the fair value of the Skillsoft trade name using a discounted cash flow analyses which reflected estimates of future revenue, royalty rates, cash flows, and discount rates. Based on thus analysis, the Company concluded the carrying value of the Skillsoft trade name exceeded its fair value, resulting in an impairment charge of $92.2 million in the 3 months ended April 30, 2020 (Predecessor). In accordance with ASC 350, for goodwill the Company determined triggering events had occurred and performed an impairment test as of April 30, 2020 that compared the estimated fair value of each reporting unit to their respective carrying values. The prospective financial information used for fiscal years 2021, 2022 and 2023 for these impairment tests was consistent with financial projections included in the Plan of Reorganization and future growth rates tracked to terminal growth rate assumptions. The Company considered the results of both a discounted cash flow (“DCF”) analysis and an EBITDA multiple approach. The Company also considered observable debt trading prices for the debt jointly borrowed by its parent entity and the Company’s subsidiary, Skillsoft Corporation, however, by the end of March 2020, most holders were restricted from trading in anticipation of a restructuring and market prices after that period were therefore less reliable. The results of the impairment tests performed indicated that the carrying value of the Skillsoft and SumTotal reporting units exceeded their estimated fair values determined by the Company. Based on the results of the goodwill impairment testing procedures, the Company recorded a $107.9 million goodwill impairment for the Skillsoft reporting unit and a $70.0 million goodwill impairment for the SumTotal reporting unit. In total, as described in detail above, the Company recorded $332.4 million of goodwill and intangible asset impairment charges for the 3 months ended April 30, 2020 (Predecessor), consisting of (i) $62.3 million of impairments of SumTotal definite-lived intangible assets, (ii) an $92.2 million impairment of the Skillsoft trade name, (iii) a $107.9 million goodwill impairment for the Skillsoft reporting unit and (iv) a $70.0 million goodwill impairment for the SumTotal reporting unit. The Company believes that its procedures for estimating gross future cash flows for each intangible asset are reasonable and consistent with current market conditions for each of the dates when impairment testing was performed. A rollforward of goodwill is as follows: Description Skillsoft SumTotal Consolidated Goodwill, net January 31, 2021 (Predecessor) $ 491,654 $ 3,350 $ 495,004 Foreign currency translation adjustment (62) — (62) Goodwill, net April 30, 2021 (Predecessor) $ 491,592 $ 3,350 $ 494,942 Gross goodwill at April 30, 2021 (Successor) and January 31, 2021 (Successor), for the Skillsoft segment was $491.6 million and $491.7 million, respectively. Accumulated impairment losses for the Skillsoft segment at April 30, 2021 (Successor) and January 31, 2021 (Successor) was $0. Gross goodwill at April 30, 2021 (Successor) and January 31, 2021 (Successor), for the SumTotal segment was $3.4 million. Accumulated impairment losses for the SumTotal segment at April 30, 2021 (Successor) and January 31, 2021 (Successor) was $0. | (5) Intangible assets consisted of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Developed software/ courseware $ 265,758 $ 24,669 $ 241,089 $ 157,168 $ 129,663 $ 27,505 Customer contracts/ relationships 279,500 3,627 275,873 670,800 466,972 203,828 Trademarks and trade names 6,300 455 5,845 45,300 27,648 17,652 Publishing rights 35,200 2,933 32,267 — — — Backlog 90,200 8,141 82,059 — — — Skillsoft trademark 91,500 — 91,500 186,000 — 186,000 Total $ 768,458 $ 39,825 $ 728,633 $ 1,059,268 $ 624,283 $ 434,985 Amortization expense related to the existing finite-lived intangible assets is expected to be as follows (in thousands): Amortization Fiscal Year Expense 2022 $ 139,408 2023 120,339 2024 105,910 2025 93,842 2026 64,269 Thereafter 113,365 Total $ 637,133 Amortization expense related to intangible assets in the aggregate was $39.8 million for the period August 28, 2020 through January 31, 2021 (Successor), $34.4 million for the period February 1, 2020 through August 27, 2020 (Predecessor), $96.4 million for the fiscal year ended January 31, 2020, and $151.8 million for the fiscal year ended January 31, 2019. Fresh-start Reporting for Intangible Assets In accordance with ASC 852, with the application of fresh-start reporting, the Company allocated its reorganization value to its individual assets based on their estimated fair values in conformity with ASC 805, including those of intangible assets. Intangible assets were measured based upon estimates of the future performance and cash of from the Successor Company at emergence. Values and useful lives assigned to intangible assets were based on estimated value and use of these assets by a market participant. The customer contracts/relationships and backlog were valued using the income approach. The trademarks and trade names were valued using the relief from royalty method. The income approach determines fair value by estimating the after-tax cash flows attributable to an identified asset over its useful life (Level 3 inputs) and then discounting these after- tax cash flows back to a present value. The developed software/courseware and publishing rights were valued using the replacement cost approach. The cost approach determines fair value by estimating the cost to replace or reproduce an asset at current prices and is reduced for functional and economic obsolescence. Impairment Review Requirements The Company reviews intangible assets subject to amortization if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in remaining useful life. The Company reviews indefinite lived intangible assets, including goodwill, on the annual impairment test date or more frequently if there are indicators of impairment. Goodwill for the Predecessor represented the excess of the purchase price in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill for the Successor represents the excess of the reorganization value over the fair value of tangible and intangible assets in fresh start accounting. The Company tests goodwill for impairment during the fourth quarter every year in accordance with ASC 350, Intangibles — Goodwill . The Predecessor performed this test on the first day of the fourth quarter (November 1) and the Successor performs this test on the first day of the last month of the fourth quarter (January 1). In connection with the impairment evaluation, the Company may first consider qualitative factors to determine whether the existence of events or circumstances indicates that it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. Performing a quantitative goodwill impairment test is not necessary if an entity determines based on this assessment that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company fails or elects to bypass the qualitative assessment, the goodwill impairment test must be performed. This test requires a comparison of the carrying value of the reporting unit to its estimated fair value. If the carrying value of a reporting unit’s goodwill exceeds its fair value, an impairment loss equal to the difference is recorded, not to exceed the amount of goodwill allocated to the reporting unit. In determining reporting units, the Company first identifies its operating segments, and then assesses whether any components of these segments constitute a business for which discrete financial information is available and where segment management regularly reviews the operating results of that component. For the Company’s annual impairment assessments of indefinite-lived intangible assets and goodwill conducted as of January 1, 2021, management considered qualitative factors to determine if it was more likely than not that impairments were present. In performing this qualitative assessment, management noted (i) the recent date of the fresh-start reporting valuation, (ii) the higher valuation suggested by the pending acquisition by Churchill, (iii) in the case of goodwill, a decrease in the carrying value of both reporting units since the original measurement date and (iv) the absence of any other factors that would indicate any declines in fair value. Based on these qualitative factors, management concluded it is not more likely than not that (i) the Skillsoft tradename intangible asset is impaired or (ii) the fair value of the company’s two reporting units are less than their carrying amounts. Impairment of Goodwill and Intangible Assets for the Predecessor Period ended August 27, 2020 During the three months ended April 30, 2020, the emergence of COVID‑19 as a global pandemic had an adverse impact on our business. While the online learnings tools the Company offers have many advantages over traditional in person learning in the current environment, some of the Company’s customers in heavily impacted industries have sought to temporarily reduce spending, resulting in reductions in contract sizes and in some cases cancellations when such contracts have come up for renewal. In addition, identifying and pursing opportunities for new customers became much more challenging in this environment. In addition to the uncertainty introduced by COVID‑19, the Company’s over leveraged capital structure continued to create headwinds. In April 2020, the Company received temporary forbearance from its lenders due to a default on amounts owed under the Senior Credit Facility as a long-term consensual solution was being negotiated with lenders. The uncertainty around the Company’s capital structure and future ownership, continued to hurt its business, as new and existing customers displayed apprehension about the ultimate resolution of the Company’s capital structure and its impact on operations, causing delays and sometimes losses in business. The uncertainty surrounding the Company’s capital structure combined with the potential impact that COVID‑19 would have on the Company and the global economy, resulted in a significant decline in the fair value of its reporting units during the first quarter ended April 30, 2020, with the impact being more significant to the SumTotal business on a relative basis due to its smaller scale and forecasted cash flow generation. As part of the Company’s evaluation of impairment indicators based on the circumstances described above as of April 30, 2020, the Company determined its SumTotal long-lived asset group failed the undiscounted cash flow recoverability test. Accordingly, the Company estimated the fair value of its individual long-lived assets to determine if any impairment charges were present. The Company’s estimation of the fair value of definite lived intangible assets included the use of discounted cash flow analyses which reflected estimates of future revenue, customer attrition rates, royalty rates, cash flows, and discount rates. Based on these analyses, the Company concluded the fair values of certain SumTotal intangible assets where lower their current carrying values, accordingly impairment charges of $62.3 million were recognized for the Predecessor period from February 1, 2020 to August 27, 2020. In light of the circumstances above, management also concluded that a triggering event had occurred with respect to the Company’s indefinite-lived Skillsoft trade name as of April 30, 2020. Accordingly, the Company estimated the fair value of the Skillsoft trade name using a discounted cash flow analyses which reflected estimates of future revenue, royalty rates, cash flows, and discount rates. Based on thus analysis, the Company concluded the carrying value of the Skillsoft trade name exceeded its fair value, resulting in an impairment charge of $92.2 million for the Predecessor period from February 1, 2020 to August 27, 2020. In accordance with ASC 350, for goodwill the Company determined triggering events had occurred and performed an impairment test as of April 30, 2020 that compared the estimated fair value of each reporting unit to their respective carrying values. The prospective financial information used for fiscal years 2021, 2022 and 2023 for these impairment tests was consistent with financial projections included in the Plan of Reorganization and future growth rates tracked to terminal growth rate assumptions. The Company considered the results of both a discounted cash flow (“DCF”) analysis and an EBITDA multiple approach. The Company also considered observable debt trading prices for the debt jointly borrowed by its parent entity and the Company’s subsidiary, Skillsoft Corporation, however, by the end of March 2020, most holders were restricted from trading in anticipation of a restructuring and market prices after that period were therefore less reliable. The results of the impairment tests performed indicated that the carrying value of the Skillsoft and SumTotal reporting units exceeded their estimated fair values determined by the Company. Based on the results of the goodwill impairment testing procedures, the Company recorded a $107.9 million goodwill impairment for the Skillsoft reporting unit and a $70.0 million goodwill impairment for the SumTotal reporting unit. In total, as described in detail above, the Company recorded $332.4 million of goodwill and intangible asset impairment charges for the Predecessor period from February 1, 2020 to August 27, 2020, consisting of (i) $62.3 million of impairments of SumTotal definite-lived intangible assets, (ii) an $92.2 million impairment of the Skillsoft trade name, (iii) a $107.9 million goodwill impairment for the Skillsoft reporting unit and (iv) a $70.0 million goodwill impairment for the SumTotal reporting unit. The Company believes that its procedures for estimating gross future cash flows for each intangible asset are reasonable and consistent with current market conditions for each of the dates when impairment testing was performed. Goodwill Impairment for the Fiscal Year Ended January 31, 2020 During the fiscal year ended January 31, 2020, the Company faced significant market competition. In addition, while the Company continued to make significant investments in contemporary products such as Percipio, attrition rates on legacy products like Skillport remained high. On top of market and competitive dynamics, the Company’s over leveraged capital structure also created additional headwinds. With significant debt maturities in 2021 and 2022, and related downgrades from rating agencies, concerns over the capital structure began to hurt the Company’s business, as new and existing customers displayed apprehension about the ultimate resolution of the Company’s capital structure and its impact on operations, causing delays and sometimes losses in business. The capital structure and heavy debt service also constrained investments in areas such as marketing, where spending was considerably lower than the Company’s competitors, resulting in additional pressure on retaining and attracting customers. The combination of the factors resulted in lower bookings, revenue, profitability and free cash flow generation during the twelve months ended January 31, 2020. In addition, the lower customer base, combined with larger expenditures that would be necessary in marketing activities going forward, resulted in lower expected future cash flows and growth rates going forward. As part of the Company’s evaluation of impairment indicators, described further below, for the year ended January 31, 2020, the Company determined its long-lived asset groups failed the undiscounted cash flow recoverability tests. Accordingly, the Company estimated the fair value of its individual long-lived assets to determine potential impairment charges. The Company’s estimation of the fair value of definite lived intangible assets included the use of discounted cash flow analyses which reflected estimates of future revenue, customer attrition rates, royalty rates, cash flows, and discount rates. Based on these analyses, the Company concluded the fair values of the individual long-lived assets exceeded their current carrying values, accordingly no impairment was recognized for these assets for the year ended January 31, 2020 In accordance with ASC 350, the Company performed an impairment test that compared the estimated fair value of each reporting unit to their respective carrying values. Management considered the results of both a DCF analysis and an EBITDA multiple approach, similar to prior periods. The Company also considered observable debt trading prices for the debt jointly borrowed by its parent entity and its subsidiary, Skillsoft Corporation, after adjusting for a control premium. The results of the impairment tests performed indicated that the carrying values of the Skillsoft and SumTotal reporting units exceeded their estimated fair values determined by the Company. Based on the results of the Company’s impairment testing, the Company recorded $440.6 million of goodwill impairment charges in the fiscal year ended January 31, 2020, including $321.3 million for the Skillsoft reporting unit and $119.3 million for the SumTotal reporting unit. Intangible Asset Impairment for the Fiscal Year Ended January 31, 2019 During the fiscal year ended January 31, 2019, the Company recognized an impairment loss in its Content segment, for the write-off of its Books24x7 tradename finite-lived intangible asset of $15.5 million and its Vodeclic tradename finite-lived intangible asset of $0.6 million. These tradenames were rebranded as part of its overall marketing and branding efforts and were discontinued in the year ended January 31, 2019. As a result of these rebranding efforts, there were no anticipated future cash flows associated with the asset. As a result, the Company has recorded an impairment charge to write-off the remaining unamortized balance of these intangible assets. A rollforward of goodwill is as follows: Description Skillsoft SumTotal Consolidated Goodwill, January 31, 2018 $ — $ — $ 1,693,906 Re-allocation of goodwill upon change in reporting units 1,433,662 260,244 — Foreign currency translation adjustment 385 22 407 Goodwill, January 31, 2019 1,434,047 260,266 1,694,313 Foreign currency translation adjustment 113 (6) 107 Impairment of goodwill (321,340) (119,258) (440,598) Goodwill, net January 31, 2020 (Predecessor) 1,112,820 141,002 1,253,822 Foreign currency translation adjustment (158) (4) (162) Impairment of goodwill (107,934) (69,952) (177,886) Canada deconsolidation (5,100) (5,100) Goodwill, net August 27, 2020 (Predecessor) $ 999,628 $ 71,046 $ 1,070,674 Impact of Fresh-Start Reporting (507,843) (67,696) (575,539) Goodwill, net August 28, 2020 (Successor) $ 491,785 $ 3,350 $ 495,135 Foreign currency translation adjustment (131) (131) Goodwill, net January 31, 2021 (Successor) $ 491,654 $ 3,350 $ 495,004 Gross goodwill at January 31, 2021 (Successor), January 31, 2020 and January 31, 2019 for the Skillsoft segment was $491,654, $1,434,160 and $1,434,047. Accumulated impairment losses for the Skillsoft segment at January 31, 2021 (Successor), January 31, 2020 and January 31, 2019 was $0, $321,340 and $0. Gross goodwill at January 31, 2021 (Successor), January 31, 2020 and January 31, 2019 for the SumTotal segment was $3,350, $260,260 and $260,266. Accumulated impairment losses for the SumTotal segment at January 31, 2021 (Successor), January 31, 2020 and January 31, 2019 was $0, $119,258 and $0. |
Taxes_2
Taxes | 3 Months Ended | 5 Months Ended | 12 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Taxes | NOTE 10. INCOME TAX The following is a summary of the Company's net deferred tax asset (liability): December 31, December 31, 2020 2019 Deferred tax asset (liability) Startup and organizational expenses $ 148,348 $ — Unrealized gain on marketable securities (976) (9,657) Total deferred tax asset (liability) 147,372 (9,657) Valuation Allowance (148,348) — Deferred tax asset (liability), net of allowance $ (976) $ (9,657) The income tax provision consists of the following: December 31, December 31, 2020 2019 Federal Current expense $ 495,442 $ 1,237,860 Deferred (benefit) expense (157,029) 9,657 State and Local Current — — Deferred — — Change in valuation allowance 148,348 — Income tax provision $ 486,761 $ 1,247,517 As of December 31, 2020 and 2019, the Company did not have any of U.S. federal and state 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 period from January 1, 2020 through December 31, 2020, the change in the valuation allowance was $148,348. 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 % % Transaction costs attributable to Initial Public Offering % (1.8) % Loss on conversion option liability (0.5) % % Loss on warrant liability (6.3) % (28.5) % Loss on Prosus agreement (14.7) % % Valuation allowance (0.2) % % Income tax provision (0.7) % (9.3) % 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 and subject to examination by the taxing authorities. The Company considers New York to be a significant state tax jurisdiction. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||
Taxes | (4) Taxes For the Predecessor three months ended April 30, 2020, the Company recorded a tax benefit of $8.9 million on pretax loss of $442.8 million. The tax benefit reflects the impact of non-deductible items, changes in the Company’s valuation allowance on our deferred tax assets and for foreign rate differential. For the Successor three months ended April 30, 2021, the Company recorded a tax benefit of $2.1 million on pretax loss of $39.5 million. The tax benefit reflects current period changes to unrecognized tax positions, foreign rate differential, and changes in the Company’s valuation allowance on our deferred tax assets. | (7) Under the Plan of Reorganization described in Notes 1 and 3, a substantial amount of the Company’s debt was extinguished upon emergence from Chapter 11. This debt extinguishment, along with other effects of the reorganization, resulted in a gain of $3.3 billion recognized for financial reporting purposes. For tax purposes, the income from the cancellation of indebtedness (“CODI”) in the U.S. is generally excluded from taxable income and instead treated as the reduction of certain tax attributes or tax basis in certain assets. As a result, the Company’s U.S. federal net operating loss (“NOL”) and tax credits have been entirely reduced as of January 31, 2021. As a result of the reduction to the Company’s U.S. Federal NOL and tax credits for CODI, as well as the reversal of any deferred taxes that were previously established for liabilities that were discharged in the Plan of Reorganization, the Company recognized a reduction to the related valuation allowance. Further, non-U.S. CODI is not taxable in non-U.S. jurisdictions and the reversal of any deferred taxes in other foreign locations that were previously established for liabilities that were discharged in the Plan of Reorganization, were largely offset by a corresponding reduction to the related valuation allowance. In connection with the Plan of Reorganization, the Company recorded an income tax expense of $4.4 million for reorganization adjustments in the period from February 1, 2020 through August 27, 2020 (Predecessor). These adjustments primarily consist of (i) $18.6 million in tax expense for the reduction in federal and state NOL carryforwards and tax credits from the CODI realized upon emergence; (ii) $8.8 million in tax expense for the reduction in other U.S. attributes not mentioned above; (iii) $106.5 million in tax expense for the reversal of deferred tax assets on liabilities in jurisdictions outside the U.S. discharged in the Plan of Reorganization; (iv) $129.5 million in tax benefit for the reduction in valuation allowance resulting from the adjustments described above. As a result of the fresh start accounting adjustments described in Note 4, there were significant tax adjustments recorded in the period from February 1, 2020 through August 27, 2020 (Predecessor). The Company recognized $73.4 million in income tax expense on a consolidated basis, consisting of $77.2 million of tax expense for the increase in deferred tax liabilities resulting from fresh start accounting adjustments which was partially offset by $3.8 million of a tax benefit for the reduction in valuation allowance on existing deferred tax assets. Significant components of the income tax benefit (provision) consist of the following (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 CURRENT: Luxembourg $ — $ — $ — $ — Ireland (268) 333 1,099 1,559 United States 1,012 588 2,405 652 Other foreign locations 462 1,300 1,949 3,231 Current tax provision 1,206 2,221 5,453 5,442 DEFERRED: Luxembourg 2,594 — — — Ireland (1,856) 43,483 8,533 1,517 United States (19,265) 17,256 (2,693) (1,906) Other foreign locations (4,613) 5,495 (81) (26) Deferred tax (benefit) / provision (23,140) 66,234 5,759 (415) Income tax (benefit) / provision $ (21,934) $ 68,455 $ 11,212 $ 5,027 Current tax provision for the period from August 28, 2020 through January 31, 2021 (Successor) of $1.2 million primarily relates to state income taxes on operating profits generated in certain state jurisdictions during the period. The federal current tax expense for the Successor period was not significant due to the net operating loss carryforwards that were available to offset taxable income since the reduction in certain tax attributes and tax basis in certain assets occurs on the last day of the tax year in which the bankruptcy occurred, which was January 31, 2021. Current tax expense for the period from February 1, 2020 through August 27, 2020 (Predecessor) of $2.2 million primarily consists of other foreign location current taxes payable at countries which serve as limited risk distributors of the Company’s intellectual property as well state taxes for separate state tax filings and unitary state tax provision to return adjustments . Current tax expense for the years ended January 31, 2020 and 2019 primarily consist of state taxes for separate state tax filings and other foreign location current taxes payable at countries which serve as limited risk distributors of the Company’s intellectual property. Deferred tax benefit for the Successor period of $23.1 million primarily relates to the reversal of temporary differences created by basis differences in intangible assets and deferred revenue recorded in fresh-start accounting. Deferred tax provision for the period from February 1, 2020 through August 27, 2020 (Predecessor) of $66.2 million primarily resulted from the recognition of $73.4 million in consolidated tax expense from fresh-start accounting and reorganization items described above being partially offset by a tax benefit recognized upon impairment of the indefinite lived tradename asset described further in Note 5. Deferred tax provision for the year ended January 31, 2020 of $5.7 million related primarily to changes in other foreign country valuation allowances. Deferred tax benefit for the year ended January 31, 2019 of $0.4 million related to provision to return adjustments being partially offset by changes in state tax rates. The following table presents the U.S. and foreign components of (loss) income before income taxes (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Luxembourg $ 9,220 $ — $ — $ — Ireland (3,741) 2,437,738 (645,360) (336,002) United States (86,333) 364,827 (197,600) (62,805) Other foreign locations (34,802) 29,902 4,967 3,995 (Loss) income before income taxes $ (115,656) $ 2,832,467 $ (837,993) $ (394,812) A reconciliation of the relevant statutory rate to the Company’s effective tax rate is as follows: Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Income tax provision (benefit) at Luxembourg (24.9%) / Irish statutory rate (12.5%) (24.9) % 12.5 % (12.5) % (12.5) % Increase (decrease) in tax resulting from: US State income taxes, net of federal benefit (5.7) (0.2) (0.2) (0.8) Foreign rate differential 6.1 (0.2) (1.9) (1.2) Other permanent items (0.1) 0.7 1.2 2.5 Transaction costs (7.6) 0.2 Unrecognized tax benefit (0.4) — 0.2 0.3 Change in valuation allowance 3.5 (4.2) 5.5 9.6 Impairment of goodwill — 0.8 7.9 — Reorganization and fresh start adjustments 9.6 (7.3) — — Other 0.5 0.1 1.2 3.4 Effective tax rate – provision (benefit) (19.0) % 2.4 % 1.4 % 1.3 % The Company recorded $4.6 million of income tax expense in the period from August 28, 2020 through January 31, 2021 (Successor) related to changes in estimates of U.S. NOL and tax credits which will be reduced by CODI for tax year ended January 31, 2021. Deferred income taxes are provided for the effects of temporary differences between the amounts of assets and liabilities recognized for financial reporting purposes and the amounts recognized for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities as of the periods presented were as follows (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 ASSETS: Net operating loss carryforwards $ 13,517 $ 29,753 Deferred interest expense 35,852 145,399 Customer relationships — 6,888 Reserves and accruals 9,038 7,204 Lease liabilities 3,862 — Tax credits 99 5,893 Transaction costs 19,532 4,216 Other intangibles 3,505 7,237 Gross deferred tax assets 85,405 206,590 Less: Valuation allowance (45,567) (160,531) Net deferred tax assets $ 39,838 $ 46,059 LIABILITIES: Intangibles $ (99,587) $ (78,017) Property and equipment, net (2,971) (5,665) Accrued Interest (4,522) — Right-of-use asset (3,141) — Deferred revenue (6,199) — Other (4,426) — Gross deferred tax liabilities (120,846) (83,682) Total net deferred tax liabilities, net $ (81,008) $ (37,623) In assessing the realization of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company considered the scheduled reversal of deferred tax assets and liabilities in assessing the realization of deferred tax assets. Based on this assessment, the Company determined that it is more likely than not that the deferred tax assets in certain significant jurisdictions including France, Ireland, and the United States, will not be realized to the extent they exceed reversal of deferred tax liabilities. As of January 31, 2021, the Company had tax effected NOLs of $13.6 million, comprised of $2.4 million for U.S. state and local taxes, $1.5 million for Ireland, $9.7 million for the rest of the world. The U.S. state and local taxes NOL carryforwards that remain after the impact of CODI expire at various dates through 2030. The Ireland and other foreign location NOL carryforwards are not subject to expiration, while the remainder, if not utilized, will substantially expire at various dates through 2040. As of January 31, 2021, the Company had tax effected interest expense carryforwards of $33.5 million all of which are subject to limitation pursuant to Section 382. As of January 31, 2021, there were $3.9 million of unrecognized tax benefits (“UTBs”) associated with uncertain tax positions and an additional $1.9 million of accrued interest and penalties, all of which, if recognized, would affect the Company’s effective tax rate. The Company accounts for interest and penalties related to uncertain tax positions as part of its provision for income taxes. In the ordinary course of business, the Company’s income tax returns are subject to examination by the tax authorities in certain jurisdictions including the United States and Ireland. With few exceptions, the Company is no longer subject to income tax examination for years before 2017 in these material jurisdictions. Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Unrecognized tax benefits, beginning balances $ 3,768 $ 3,773 $ 2,081 $ 5,035 Increases for tax positions taken during the current period — — — — Increases for tax positions taken during a prior period 37 35 1,987 915 Decreases for tax positions taken during a prior period — (40) (295) (3,736) Other 452 — — — Decreases resulting from the expiration of statute of limitations (339) — — (133) Unrecognized tax benefits, ending balance $ 3,918 $ 3,768 $ 3,773 $ 2,081 The Company generally considers the excess of its financial reporting over its tax basis in its investment in foreign subsidiaries to be essentially permanent in duration and has not computed or recorded significant taxes on repatriations of the earnings of its foreign subsidiaries. As a result of the one-time repatriation tax on foreign earnings required under the 2017 U.S. Tax Cuts and Jobs Act, the prior earnings of its foreign subsidiaries were deemed repatriated. The Company did not record a deferred tax liability for earnings of foreign subsidiaries for the period August 28, 2020 through January 31, 2021 (Successor), the period February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and January 31, 2019 as the Company is permanently reinvested in these jurisdictions. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted and signed into law. Certain provisions of the CARES Act impacted the FY21 and FY20 income tax provision computations of the Company. The CARES Act contains modifications on the limitation of business interest for tax years beginning in 2019 and 2020. The modifications to Section 163(j) increase the allowable business interest deduction from 30% of adjusted taxable income to 50% of adjusted taxable income. This modification increased the Company’s allowable interest expense deduction, reducing taxable income and allowing for the utilization of net operating losses. |
Prepaid Expenses and Other Cu_4
Prepaid Expenses and Other Current Assets | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Prepaid Expenses and Other Current Assets | (5) Prepaid Expenses and Other Current Assets Prepaid expense and other current assets in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Deferred commission costs – current $ 4,019 $ 3,147 Refundable income tax 9,618 8,969 Prepaid software maintenance costs 8,370 8,587 Prepaid royalties 2,876 2,958 Other 6,942 6,665 Total prepaid expenses and other current assets $ 31,825 $ 30,326 | (8) Prepaid expense and other current assets in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Deferred commission costs – current $ 3,147 $ 11,195 Refundable income tax 8,969 6,726 Prepaid software maintenance costs 8,587 6,569 Prepaid royalties 2,958 2,294 Employee bonus advance — 1,867 Other 6,665 7,771 Total prepaid expenses and other current assets $ 30,326 $ 36,422 |
Other Assets_2
Other Assets | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Other Assets | (6) Other Assets Other assets in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Deferred commission costs – non-current $ 5,733 $ 4,437 Other 3,772 4,199 Total other assets $ 9,505 $ 8,636 | (9) Other assets in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Deferred commission costs – non-current $ 4,437 $ 11,692 Non-current refundable income tax — 1,979 Other 4,199 2,635 Total other assets $ 8,636 $ 16,306 |
Accrued Expenses_2
Accrued Expenses | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Accrued Expenses | (7) Accrued Expenses Accrued expenses in the accompanying consolidated balance sheets consisted of the following (in thousands): April 30, 2021 January 31, 2021 Professional fees $ 6,018 $ 8,832 Accrued sales tax/VAT 2,144 5,379 Accrued royalties 1,961 2,152 Accrued tax 4,727 2,634 Accrued interest 368 491 Other accrued liabilities 3,067 3,637 Total accrued expenses $ 18,285 $ 23,125 | (10) Accrued expenses in the accompanying consolidated balance sheets consisted of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Professional fees $ 8,832 $ 12,947 Accrued sales tax/VAT 5,379 5,824 Accrued royalties 2,152 1,869 Accrued tax 2,634 1,288 Accrued interest 491 274 Other accrued liabilities 3,637 7,065 Total accrued expenses $ 23,125 $ 29,267 |
Restructuring_2
Restructuring | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Restructuring | (8) Restructuring In connection with strategic initiatives implemented during the three months ended April 30, 2021 (Successor) and April 30, 2020 (Predecessor), the Company’s management approved and initiated plans to reduce its cost structure and better align operating expenses with existing economic conditions and the Company’s operating model. The Company recorded a $0.5 million, and $0.4 million of restructuring charge during the three months ended April 30, 2021 (Successor) and April 30, 2020 (Predecessor), respectively, which is included in the statement of operations as restructuring. Substantially all of this charge represents the severance costs of terminated employees. Activity in the Company’s restructuring accrual was as follows (in thousands): Employee Severance Contractual and Related Costs Obligations Total Restructuring accrual as of January 31, 2021 $ 5,000 $ 171 $ 5,171 Restructuring charges incurred 311 226 537 Payments made (2,049) (298) (2,347) Foreign currency translation adjustment — — — Restructuring accrual as of April 30, 2021 $ 3,262 $ 99 $ 3,361 | (11) In connection with strategic initiatives implemented during the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019, the Company’s management approved and initiated plans to reduce its cost structure and better align operating expenses with existing economic conditions and the Company’s operating model. The Company recorded a $4.3 million, $1.2 million, $1.9 million and $2.1 million of restructuring charge during the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and January 31, 2019, respectively, which is included in the statement of operations as restructuring. Substantially all of this charge represents the severance costs of terminated employees. Activity in the Company’s restructuring accrual was as follows (in thousands): Employee Severance Contractual and Related Costs Obligations Total Restructuring accrual as of January 31, 2018 $ 1,504 $ 25 $ 1,529 Restructuring charges incurred 1,971 102 2,073 Payments made (1,720) (100) (1,820) Foreign currency translation adjustment (42) — (42) Restructuring accrual as of January 31, 2019 $ 1,713 $ 27 $ 1,740 Restructuring charges incurred 1,610 290 1,900 Payments made (2,588) (41) (2,629) Foreign currency translation adjustment 26 — 26 Restructuring accrual as of January 31, 2020 (Predecessor) $ 761 $ 276 $ 1,037 Restructuring charges incurred 1,032 147 1,179 Payments made (559) (154) (713) Foreign currency translation adjustment — — — Restructuring accrual as of August 27, 2020 (Predecessor) $ 1,234 $ 269 $ 1,503 Restructuring charges incurred 4,218 123 4,341 Payments made (452) (221) (673) Foreign currency translation adjustment — — — Restructuring accrual as of January 31, 2021 (Successor) $ 5,000 171 5,171 |
Leases, Commitment and Contin_5
Leases, Commitment and Contingencies | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Leases, Commitment and Contingencies | (9) Leases, Commitment and Contingencies Leases The Company has entered into a number of facility leases to support its research and development activities, sales operations and other corporate and administrative functions in North America, Europe, and Asia, which qualify as operating leases under U.S. GAAP. The Company also has entered into an equipment lease agreement for its hosting services and storage, which qualifies as finance lease under U.S. GAAP. The Company’s leases have remaining terms of six months to thirteen years. Some of the Company’s leases include options to extend or terminate the lease prior to the end of the agreed upon lease term. For purposes of calculating lease liabilities, lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. During the three months ended April 30, 2021, the Company determined it would exercise the purchase option to purchase all the leased equipment at the end of the finance lease term which is December 31, 2021. Per the lease agreement, the purchase price of the equipment is at its then current fair market value not to exceed 12% of the original equipment cost. As a result, the Company remeasured the finance lease liability by including the purchase price, 12% of the original equipment cost, at the end of lease term, and increased the finance lease liability and related right-of-use asset by $0.4 million as of April 30, 2021. Operating lease and finance lease ROU assets and liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the lease commencement date. As the Company’s operating leases generally do not provide an implicit rate, the Company uses an estimated incremental borrowing rate in determining the present value of future payments. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular location and currency environment. The Company used an implicit rate provided in the equipment lease agreement for its finance lease in determining the present value of future payments. In connection with the Company’s emergence from bankruptcy and in accordance with ASC 852, the Company applied the provisions of fresh start reporting to its Consolidated Financial Statements on the Effective Date. The operating leases are included in the caption “Right of use assets”, “Lease Liabilities”, and “Long-term lease liabilities” on the Company’s consolidated balance sheets as of April 30, 2021. The finance lease is included in the caption “Property and equipment, net” and “Lease Liabilities” on the Company’s consolidated balance sheets as of April 30, 2021. The weighted-average remaining lease term of the Company’s operating leases is 6.7 years and the remaining lease term of its finance lease is 0.7 years as of April 30, 2021 (Successor). Lease costs for minimum lease payments is recognized on a straight-line basis over the lease term. The lease costs were $1.4 million and related cash payments were $1.6 million for the three months ended April 30, 2021 (Successor). The lease costs were $1.6 million and related cash payments were $1.5 million for the three months ended April 30, 2020 (Predecessor). Lease costs are included within content and software development, selling and marketing, and general and administrative lines on the consolidated statements of operations, and the operating leases related cash payments were included in the operating cash flows and the finance lease related cash payments were included in the financing cash flows on the consolidated statements of cash flows. Short-term lease costs and variable lease costs are not material. The table below reconciles the undiscounted future minimum lease payments under non-cancellable leases with terms of more than one year to the total lease liabilities recognized on the consolidated balance sheets as of April 30, 2021 (Successor): Fiscal Year Ended January 31, 2021 (in thousands): Operating Leases Finance Leases 2022 (excluding 3 months ended April 30, 2021) $ 3,898 $ 1,209 2023 4,065 — 2024 3,499 — 2025 2,684 — 2026 1,245 Thereafter 6,245 — Total future minimum lease payments 21,636 1,209 Less effects of discounting (5,692) (93) Total lease liabilities $ 15,944 $ 1,116 Reported as of April 30, 2021 Lease liabilities $ 3,574 $ 1,116 Long-term lease liabilities 12,370 — Total lease liabilities $ 15,944 $ 1,116 Litigation From time to time, the Company is a party to or may be threatened with litigation in the ordinary course of its business. The Company regularly analyzes current information, including, as applicable, the Company’s defense and insurance coverage and, as necessary, provides accruals for probable and estimable liabilities for the eventual disposition of these matters. The Company is presently not a party to any material legal proceedings. | (13) Leases The Company has entered into a number of facility leases to support its research and development activities, sales operations and other corporate and administrative functions in North America, Europe, and Asia, which qualify as operating leases under U.S. GAAP. The Company also has entered into an equipment lease agreement for its hosting services and storage, which qualifies as finance lease under U.S. GAAP. The Company’s leases have remaining terms of nine months to thirteen years. Some of the Company’s leases include options to extend or terminate the lease prior to the end of the agreed upon lease term. For purposes of calculating lease liabilities, lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. During the fourth quarter of fiscal year 2021, the Company determined it would exercise the option to terminate its Paris facility lease on October 31, 2021 which is three years prior to the end of the original lease term. Per the lease agreement, the Company has the right to terminate lease without the landlord’s consent, and the Company only needs to issue a six-month notice to the landlord. As a result, the Company remeasured the lease liability using the revised lease term, and reduced Paris facility related right-of-use (ROU) asset and lease liability by $1.1 million as of January 31, 2021. Operating lease and finance lease ROU assets and liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the lease commencement date. As the Company’s operating leases generally do not provide an implicit rate, the Company uses an estimated incremental borrowing rate in determining the present value of future payments. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular location and currency environment. The Company used an implicit rate provided in the equipment lease agreement for its finance lease in determining the present value of future payments. In connection with the Company’s emergence from bankruptcy and in accordance with ASC 852, the Company applied the provisions of fresh start reporting to its Consolidated Financial Statements on the Effective Date. The operating leases are included in the caption “Right of use assets”, “Lease Liabilities”, and “Long-term lease liabilities” on the Company’s consolidated balance sheets as of January 31, 2021. The finance lease is included in the caption “Property and equipment, net” and “Lease Liabilities” on the Company’s consolidated balance sheets as of January 31, 2021. For the fiscal years ending January 31, 2020 and 2019, the Company accounted for leases in accordance with ASC 840. Under ASC 840, the Company recognized the total related rent expense on a straight-line basis over its expected lease term for operating leases that contained predetermined fixed escalations of the minimum rent, with a deferred asset or liability reported on the balance sheet for the difference between expense and cash paid. Total rent expense for the fiscal year ending January 31, 2020 and 2019 was $5.7 million and $5.4 million, respectively. The weighted-average remaining lease term of the Company’s operating leases is 6.8 years and the remaining lease term of its finance lease is 0.9 years as of January 31, 2021 (Successor). Lease costs for minimum lease payments is recognized on a straight-line basis over the lease term. The lease costs were $3.9 million and related cash payments were $3.6 million for the period from February 1, 2020 through August 27, 2020 (Predecessor). The lease costs were $2.7 million and related cash payments were $2.7 million for the period from August 28, 2020 through January 31, 2021 (Successor). Lease costs are included within content and software development, selling and marketing, and general and administrative lines on the consolidated statements of operations, and the operating leases related cash payments were included in the operating cash flows and the finance lease related cash payments were included in the financing cash flows on the consolidated statements of cash flows. Short-term lease costs and variable lease costs are not material. The table below reconciles the undiscounted future minimum lease payments under non-cancellable leases with terms of more than one year to the total lease liabilities recognized on the consolidated balance sheets as of January 31, 2021 (Successor): Operating Finance As of January 31, 2021 (in thousands): Leases Leases 2022 $ 5,203 $ 1,112 2023 4,070 — 2024 3,514 — 2025 2,697 — Thereafter 7,509 — Total future minimum lease payments 22,993 1,112 Less effects of discounting (6,120) (90) Total lease liabilities $ 16,873 $ 1,022 Reported as of January 31, 2021 Lease liabilities $ 3,718 $ 1,022 Lease liabilities non-current 13,155 — Total lease liabilities $ 16,873 $ 1,022 Litigation From time to time, the Company is a party to or may be threatened with litigation in the ordinary course of its business. The Company regularly analyzes current information, including, as applicable, the Company’s defense and insurance coverage and, as necessary, provides accruals for probable and estimable liabilities for the eventual disposition of these matters. The Company is presently not a party to any material legal proceedings. Guarantees The Company’s software license arrangements and hosting services are typically warranted to perform in a manner consistent with general industry standards that are reasonably applicable and substantially in accordance with the Company’s product documentation under normal use and circumstances. The Company’s arrangements also include certain provisions for indemnifying customers against liabilities if its products or services infringe a third party’s intellectual property rights. The Company has entered into service level agreements with some of its hosted application customers warranting certain levels of uptime reliability and such agreements permit those customers to receive credits against monthly hosting fees or terminate their agreements in the event that the Company fails to meet those levels for an agreed upon period of time. To date, the Company has not incurred any material costs as a result of such indemnifications or commitments and has not accrued any liabilities related to such obligations in the accompanying consolidated financial statements. |
Long-Term Debt_2
Long-Term Debt | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Long-Term Debt | (10) Long-Term Debt Exit Credit Facility (Successor) Upon emergence from Chapter 11, the Company entered into the Exit Credit Facility of $520 million consisting of (i) a $110 million super senior term loan facility, the First Out Term Loan, and (ii) a $410 million first lien, second-out term loan facility, the Second Out Term Loan. The Exit Credit Facility bears interest at a rate equal to LIBOR plus 7.50% per annum, with a LIBOR floor of 1.00%. The First Out Term loan is due in December 2024 and the Second Out Term Loan is due April 2025. The Exit Credit Facility contains customary provisions and reporting requirements, including prepayment penalties and a maximum leverage covenant that will be first measured January 31, 2022 and each quarter thereafter. Quarterly principal repayments of $1.3 million begin for the quarter ended April 30, 2021 and increase to $2.6 million for the quarter ended April 30, 2022 until maturity. The Company considered the fair value of its external borrowings and believes their carrying values approximate fair value based on the recent fair value assessment done for fresh-start accounting. Minimum principal payments under the exit facility are as follows: Fiscal year ended January 31: 2022 (remaining 9 months) $ 3,900 2023 10,400 2024 10,400 2025 112,700 2026 381,300 Total payments 518,700 Less: Current portion (6,500) Less: Unamortized Fresh-Start Reporting Fair Value Adjustment (4,273) Long-term portion $ 507,927 | (14) Exit Credit Facility (Successor) Upon emergence from Chapter 11, the Company entered into the Exit Credit Facility of $520 million consisting of (i) a $110 million super senior term loan facility, the First Out Term Loan, and (ii) a $410 million first lien, second-out term loan facility, the Second Out Term Loan. The Exit Credit Facility bears interest at a rate equal to LIBOR plus 7.50% per annum, with a LIBOR floor of 1.00%. The First Out Term loan is due in December 2024 and the Second Out Term Loan is due April 2025. The Exit Credit Facility contains customary provisions and reporting requirements, including prepayment penalties and a maximum leverage covenant that will be first measured January 31, 2022 and each quarter thereafter. Quarterly principal repayments of $1.3 million begin for the quarter ended April 30, 2021 and increase to $2.6 million for the quarter ended April 30, 2022 until maturity. The Company ceased to accrue interest expense on long-term debt reclassified as Liabilities subject to compromise as of the Petition Date, resulting in approximately $100.4 million in contractual interest not being accrued for the period from June 14, 2020 to August 27, 2020 (Predecessor). The Company considered the fair value of its external borrowings and believes their carrying values approximate fair value based on the recent fair value assessment done for fresh-start accounting. Minimum principal payments under the exit facility are as follows: Fiscal year ended January 31: 2022 $ 5,200 2023 10,400 2024 10,400 2025 112,700 2026 381,300 Total payments 520,000 Less: Current portion (5,200) Less: Unamortized Fresh-Start Reporting Fair Value Adjustment (4,564) Long-term portion $ 510,236 Senior Credit Facilities (Predecessor) On April 28, 2014, Evergreen Skills Lux S.a.r.l., an affiliated entity, (“Holdings”) and the Company entered into a Senior Credit Facility among Holdings, Skillsoft Corporation, Barclays Bank Plc., Deutsche Bank Securities, Morgan Stanley Senior Funding Inc. the lenders party thereto, and the other agents named therein (the “Senior Credit Facility”). Skillsoft Corporation and Holdings were jointly and severally liable for all borrowings under the Senior Credit Facility. The Senior Credit Facility consisted of a $2,035.0 million term loan facility which consisted of a First Lien ($1,365.0 million) and a Second Lien ($670 million), and a $80.0 million revolving credit facility. The Company initially borrowed $664.1 million of the amounts drawn on the First Lien and $302.4 million of the amounts drawn on the Second Lien. The remainder of amounts the First and Second Liens were drawn by Holdings. As of January 31, 2020, the following amounts were outstanding under the Senior Credit Facilities (in thousands): Payable in Fiscal Year First Lien Second Lien Revolving Credit Total Fiscal 2021 $ 627,536 $ 302,336 60,000 $ 989,872 Total $ 627,536 $ 302,336 60,000 $ 989,872 Outstanding borrowings under the Senior Credit Facility by Holdings at January 31, 2020 totaled approximately $1,030 million, consisting of $662,390 in First Lien amounts due and $367,614 in Second Lien amounts due. The Company was jointly and severally liable for those borrowings. Certain loans due from Pointwell to Holdings at January 31, 2020, (described below) represented the basis of the agreements between Holdings and Pointwell as to the additional amounts Pointwell expected to pay on behalf of Holdings under the Senior Credit Facility. All of the loans and accrued interests under the Senior Credit Facility were discharged upon the emergence from Chapter 11 on August 27, 2020. Loan amounts due to parent entity As noted, Holdings had approximately $1,030 million of debt obligations to third parties that were collateralized by substantially all of the assets of Pointwell and for which its subsidiary, Skillsoft Corporation, was jointly and severally liable. At the time the Skillsoft and SumTotal business were acquired by Pointwell, Holdings issued notes to Pointwell corresponding to Holdings’ borrowings under the Senior Credit Facility as well as other acquisition related debt. Additional loans of $50,000 and $54,000 were executed in the fiscal years ended January 31, 2019 and 2018 in satisfaction of paid in kind interest on certain of the loan amounts due to Holdings. A summary of net loans due to Holdings as of January 31, 2020 was as follows: Weighted Average Maturity Instrument Balance Interest Rate Interest Type Issuance Date Date Series 1 $ 933,615 13.0 % Variable, Compounding Apr 25, 2014 Jan 31, 2045 Series 2 598,787 8.0 % Variable, Simple Apr 25, 2014 Apr 28, 2021 Series 3 327,537 11.5 % Variable, Simple Apr 25, 2014 Apr 28, 2021 Series 4 60,000 13.0 % Variable, Compounding Sep 25, 2014 Sep 30, 2044 Series 5(a) 71,538 8.0 % Variable, Simple Sep 25, 2014 Sep 30, 2044 Series 5(b) 28,461 11.5 % Variable, Simple Sep 25, 2014 Sep 30, 2044 Intra-group Loan Agreement 65,000 12.0 % Variable, Compounding Dec 3, 2015 Nov 3, 2044 Funding Bond # 1 54,000 13.0 % Variable, Simple Jan 31, 2018 Apr 28, 2021 Funding Bond # 2 50,000 13.0 % Variable, Simple Jan 29, 2019 Apr 28, 2021 Total $ 2,188,938 Interest payable on the loans above was payable in kind at the election of Pointwell. Accrued and unpaid interest on the Series Loan Notes was $1,067 million as of January 31, 2020. The loan maturities accelerated in the event of actions such as the Chapter 11 reorganization, accordingly all loan balances and accrued interest were presented as current liabilities in the accompanying balance sheet as of January 31, 2020. Additional loans of $160,000 were executed in the period from February 1 2020 through August 27, 2020 (Predecessor) in satisfaction of paid in kind interest on certain of the loan amounts due to Holdings. Pointwell was separated from Evergreen Skills Lux S.à.r.l. effective August 27, 2020 as a result of the reorganization. In connection with the separation, all amounts due to Holdings were cancelled with no cash consideration transferred by either party. Accounts Receivable Facility (Predecessor and Successor) On December 20, 2018, the Company entered into a $75.0 million receivables credit agreement, with a termination date of the earliest of 5 years from closing or 45 days before the revolving credit facility maturity or 180 days before the maturity of any term indebtedness greater than $75 million. There are four classes of available receivables for sale with advance rates between 50.0% and 85.0%. The lenders require the Company to deposit receipts from sold receivables to a restricted concentration account. Receivables that have been sold to the lenders must be transferred to the restricted concentration account within two business days of being collected by the Company. The Company accounts for these transactions as borrowings, as the assets being transferred contain the rights to future revenues. Under these agreements, the Company receives the net present value of the accounts receivable balances being transferred. The interest rate on borrowings outstanding under these agreements was 4.899% at January 31, 2021. Borrowings and repayments under these agreements are presented as cash flows from financing activities in the accompanying consolidated statements of cash flows. On September 19, 2019, the Company amended the receivables credit agreement to include Class “B” lending. This increased the facility borrowing capacity up to $90.0 million. In conjunction with this, it increased the advance rate to 95% across the four classes of available receivables. All other terms and conditions remained materially the same. On August 27, 2020, the Company amended its accounts receivable facility. In connection with the amendment, additional capacity under the previous accounts receivable facility which had been extended by the private equity sponsor of the Company’s prior owner was eliminated, reducing the maximum capacity of the facility from $90 million to $75 million. The maturity date for the remaining $75 million facility was extended to the earlier of (i) December 2024 or (ii) 90 days prior to the maturity of any corporate debt. The Company submits a monthly reconciliation on each month’s settlement date detailing what was collected from the prior months borrowing base and what receivables are being sold during the new borrowing base period to replenish them. If additional receivables are sold to replenish receipts, the funds from the concentration account will be returned to the Company from the restricted concentration account by the administration agent. The reserve balances were $1.7 million at January 31, 2021 and are classified as restricted cash on the balance sheet. |
Long-Term Liabilities_2
Long-Term Liabilities | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Long-Term Liabilities | (11) Long-Term Liabilities Other long-term liabilities in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Uncertain tax positions; including interest and penalties – long-term $ 4,374 $ 5,794 Warrants 800 900 Other 216 204 Total other long-term liabilities $ 5,390 $ 6,898 In connection with the Company’s emergence from Chapter 11, lenders holding second lien debt prior to the Petition Date also received warrants to purchase common shares of the Company, on or before August 27, 2025, which included (i) tranche A warrants to purchase 235,294 ordinary shares at a price of $262.34 per share and (ii) tranche B warrants to purchase 470,588 ordinary shares at a price of $274.84. The warrants are classified as a liability under GAAP and are remeasured at each balance sheet date, with changes in fair value being recorded in other income and expense. The Company recognized $0.1 million in other income related to the warrants for the three months ended April 30, 2021 (Successor). | (15) Other long-term liabilities in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Uncertain tax positions; including interest and penalties – long-term $ 5,794 $ 6,025 Warrants 900 — Other 204 1,547 Total other long-term liabilities $ 6,898 $ 7,572 In connection with the Company’s emergence from Chapter 11, lenders holding second lien debt prior to the Petition Date also received warrants to purchase common shares of the Company, on or before August 27, 2025, which included (i) tranche A warrants to purchase 235,294 ordinary shares at a price of $262.34 per share and (ii) tranche B warrants to purchase 470,588 ordinary shares at a price of $274.84. The warrants are classified as a liability under GAAP and are remeasured at each balance sheet date, with changes in fair value being recorded in other income and expense. The Company recognized $2,900 in other income related to the warrants for the period from August 28, 2020 through January 31, 2021 (Successor). |
Employee Benefit Plan_2
Employee Benefit Plan | 5 Months Ended |
Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |
Employee Benefit Plan | (12) The Company has a 401(k) plan covering all US-based employees of the Company who have met certain eligibility requirements. Under the terms of the 401(k) plan, the employees may elect to make tax- deferred contributions to the 401(k) plan. In addition, the Company may make discretionary contributions to the 401(k) plan. Under this plan, contributions of approximately $1.5 million, $2.0 million, $3.5 million and $3.5 million were made for the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), the fiscal year ended January 31, 2020 and the fiscal year ended January 31, 2019, respectively. In addition, the Company has various retirement and post-employment plans covering certain international employees. Certain of the plans allow the Company to match employee contributions up to a specified percentage as defined by the plans. Under these plans, contributions of approximately $0.6 million, $0.7 million, $1.1 million, and $1.6 million were made for the period from August 28, 2020 through January 31, 2021 (Successor), the period from February 1, 2020 through August 27, 2020 (Predecessor), the fiscal year ended January 31, 2020 and the fiscal year ended January 31, 2019, respectively. |
Shareholders' Equity_2
Shareholders' Equity | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Shareholders' Equity | NOTE 7. STOCKHOLDERS’ EQUITY Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At March 31, 2021 and December 31, 2020, there were no shares of preferred stock issued or outstanding. Class A Common Stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At March 31, 2021, there were 11,090,292 shares of Class A common stock issued and outstanding, excluding 57,909,708 shares of Class A common stock subject to possible redemption. At December 31, 2020, there were 15,287,498 shares of Class A common stock issued and outstanding, excluding 53,712,502 shares of Class A common stock subject to possible redemption. Class B Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At March 31, 2021 and December 31, 2020, there were 17,250,000 shares of Class B common stock issued and outstanding. Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business Combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, any private placement-equivalent warrants issued, or to be issued, to any seller in a Business Combination. | NOTE 8. STOCKHOLDERS’ EQUITY Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At December 31, 2020 and 2019, there were no shares of preferred stock issued or outstanding. Common Stock Class A Common Stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At December 31, 2020 and 2019, there were 15,287,498 and 7,974,075 shares of Class A common stock issued or outstanding, excluding 53,712,502 and 61,025,925 shares of Class A common stock subject to possible redemption, respectively. Class B Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At December 31, 2020 and 2019, there were 17,250,000 shares of Class B common stock issued and outstanding. Holders of Class B common stock will have the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders except as required by law. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (net of the number of shares of Class A common stock redeemed in connection with a Business Combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination, any private placement-equivalent warrants issued, or to be issued, to any seller in a Business Combination. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Shareholders' Equity | (12) Shareholders’ Equity Software Luxembourg Holding S.A. (Successor) Reorganization On August 27, 2020 the Company completed a reorganization. As a result of the reorganization, ownership of the Company was transferred to the Company’s lenders and no consideration or right to future consideration was provided to the former equity holders of Pointwell. In addition, the shared-based compensation plans, described below were cancelled with no consideration provided. In Settlement of the company’s Predecessor first and second lien debt obligations, the holders of the Predecessors first lien received a total of 3,840,000 of Class A common shares. The Predecessor’s second lien holders received a total of 160,000 of Class B common shares and a total of 705,882 warrants to purchase additional common shares (see Note 2 for additional discussion on warrants). Share Capital As of January 31, 2021 the Company’s authorized share capital consisted of 1,000,000,000 common shares with a par value $0.01 each. This consists of 800,000,000 Class A shares and 200,000,000 Class B shares. As of January 31, 2021, 4,000,000 common shares were issued and outstanding. This consists of 3,840,000 Class A shares and 160,000 Class B shares. Any amendment to the share capital of the Company shall be voted upon by the extraordinary general meeting of shareholders upon approval by a majority of the shareholders representing three quarters of the share capital at least. The Company has no authorized share capital which would enable its board of managers to increase the share capital. Each share of the Company is entitled to one vote at ordinary and extraordinary general meetings. The amendments to the articles of association of the Company require the approval of a majority of shareholders representing three quarters of the share capital at least. In case the Company shall have only one single shareholder, the sole shareholder exercises all the powers granted to the general meeting of shareholders. Any legally available amounts to be distributed by the Company in or in respect of any financial period (the Company’s financial year starts on the first of February and ends on the thirty-first of January) may be distributed amongst the holders of shares in proportion to the number of shares held by them. Any decision to distribute legally available amounts shall be adopted either by the board of managers or the general meeting of shareholders of the Company, as the case may be. | (16) Software Luxembourg Holding S.A. (Successor) Reorganization As discussed in Note 3, on August 27, 2020 the Company completed a reorganization. As a result of the reorganization, ownership of the Company was transferred to the Company’s lenders and no consideration or right to future consideration was provided to the former equity holders of Pointwell. In addition, the share-based compensation plans, described below were cancelled with no consideration provided. In Settlement of the company’s Predecessor first and second lien debt obligations, the holders of the Predecessors first lien received a total of 3,840,000 of Class A common shares. The Predecessor’s second lien holders received a total of 160,000 of Class B common shares and a total of 705,882 warrants to purchase additional common shares (see Note 2 for additional discussion on warrants). Share Capital As of January 31, 2021 the Company’s authorized share capital consisted of 1,000,000,000 common shares with a par value $0.01 each. This consists of 800,000,000 Class A Shares and 200,000,000 Class B Shares. As of January 31, 2021, 4,000,000 common shares were issued and outstanding. This consists of 3,840,000 Class A Shares and 160,000 Class B Shares. Any amendment to the share capital of the Company shall be voted upon by the extraordinary general meeting of shareholders upon approval by a majority of the shareholders representing three quarters of the share capital at least. The Company has no authorized share capital which would enable its board of managers to increase the share capital. Each share of the Company is entitled to one vote at ordinary and extraordinary general meetings. The amendments to the articles of association of the Company require the approval of a majority of shareholders representing three quarters of the share capital at least. In case the Company shall have only one single shareholder, the sole shareholder exercises all the powers granted to the general meeting of shareholders. Any legally available amounts to be distributed by the Company in or in respect of any financial period (the Company’s financial year starts on the first of February and ends on the thirty-first of January) may be distributed amongst the holders of shares in proportion to the number of shares held by them. Any decision to distribute legally available amounts shall be adopted either by the board of managers or the general meeting of shareholders of the Company, as the case may be. Pointwell Limited (Predecessor) Share-Based Compensation “B” Ordinary Shares Prior to the reorganization, the Company allowed certain executives to purchase “B” Ordinary shares of the Company’s indirect parent, Evergreen Skills Top Holding Lux S.a.r.l, (“Evergreen”) for $0.01 per share. These shares carried certain transfer restrictions and repurchase rights, which allowed Evergreen, in certain circumstances where the holder’s employment was terminated, to repurchase the shares from the employees at the lower of cost or fair market value. These restrictions lapsed over defined vesting periods over which the executives had to remain employed by the Company. Due to these repurchase features, these share purchases were treated as restricted stock for accounting purposes. The compensation expense associated with these awards was recognized in the Company’s financial statements as a capital contribution over the requisite service period. In conjunction with these purchases, the Company paid the related tax liabilities resulting from the purchases on behalf of certain of the executives in return for recourse notes. The notes were issued by executives purchasing shares for the amounts paid on their behalf to cover tax obligations arising from the purchase of these shares. These notes were due nine years from the date of issuance, but were repayable immediately upon transfer of the shares and bear an interest rate deemed to be a market rate. The notes were collateralized by the underlying shares as well as the assets of the executives. If the borrower disposed of the shares and recognized a capital loss tax benefit on those shares, a portion of the loan would be forgiven if the capital loss benefit recognized was less than the unpaid principal and accrued interest. The amount that would have been forgiven was equal the amount of unpaid principal and interest that was in excess of the capital loss recognized plus an amount equal to the income tax owed by the borrower on the amount of forgiveness granted. During the fiscal year ended January 31, 2020, the Company assessed the likelihood of recovery of the loans based on the value of the underlying stock. Based on that assessment, the Company placed a full impairment reserve against the balance of $5.4 million with the expense recorded within general and administrative expense for the year ended January 31, 2020 in the accompanying statement of operations. Notional Units In fiscal 2015, the Company’s parent company implemented a Notional Equity Plan (“the 2015 Plan”). The 2015 Plan allowed the Company to issue notional units to Skillsoft employees. The notional unit entitled the holder to the right to participate in dividends (if declared) or other distributions of cash paid to holders of ordinary shares (which would occur on the liquidation, IPO or sale of the Company). The notional unit did not convey any rights of ownership of the Company or its parent company and was fully vested at the date of grant. As the notional units were based in part by the price of the Company’s ordinary shares and payments on these awards were linked to the value of the Company’s ordinary shares, these units were subject to accounting as share-based payments. The Company evaluated the performance conditions inherent in the awards and determined that the achievement of those conditions was not probable during the period from February 1, 2020 through August 27, 2020 (Predecessor) and as of January 31, 2020 and 2019. As such no compensation expense had been recognized for those awards. These awards were cancelled as part of the bankruptcy proceedings. The following table summarized the share award activity for the fiscal year ended January 31, 2020: Units Outstanding at January 31, 2019 356,771 Issued — Forfeited (104,007) Outstanding at January 31, 2020 252,764 Cancelled (252,764) Outstanding at August 27, 2020 (Predecessor) — |
Revenue_2
Revenue | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Revenue | (13) Revenue Disaggregated Revenue and Geography Information The following is a summary of revenues by type for the three months ended April 30, 2021 (Successor) and three months ended April 30, 2020 (Predecessor), (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 SaaS and subscription services $ 78,575 $ 101,089 Software maintenance 4,064 5,260 Professional services 8,191 10,946 Perpetual software licenses 871 1,031 Hardware and other — 3 Total net revenues(1) $ 91,701 $ 118,329 The following table sets forth our revenues by geographic region for the three months ended April 30, 2021 (Successor) and three months ended April 30, 2020 (Predecessor), (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Revenues: United States $ 70,170 $ 93,533 Other Americas 4,461 4,931 Europe, Middle East and Africa 12,113 13,787 Asia-Pacific 4,957 6,078 Total net revenues (1) $ 91,701 $ 118,329 Other than the United States, no single country accounted for more than 10% of revenue for all periods presented. Deferred Revenue Deferred revenue activity for the three months ended April 30, 2021 was as follows (in thousands): Deferred revenue at January 31, 2021 (Successor) $ 260,584 Billings deferred 67,034 Recognition of prior deferred revenue (91,701) Deferred revenue at April 30, 2021 (Successor) $ 235,917 Deferred revenue performance obligations relate predominately to time-based SaaS and subscription services that are billed in advance of services being rendered. Deferred Contract Acquisition Costs Deferred contract acquisition cost activity for the three months ended April 30, 2021 was as follows (in thousands): Deferred contract acquisition costs at January 31, 2021 (Successor) $ 7,584 Contract acquisition costs 5,491 Recognition of contract acquisition costs (3,323) Deferred contract acquisition costs at April 30, 2021 (Successor) $ 9,752 | (17) Revenue Components and Performance Obligations Subscription services The Company offers (i) subscriptions for its content offerings, which includes hosted tools that allow users to access and consume its content offerings and (ii) hosted versions of its SumTotal offerings. The Company’s subscription contracts include standard terms and conditions and typically have terms between one and three years. Annual contracts are usually non-cancellable and non-refundable whereas multi-year contracts sometimes allow customers to cancel early at certain anniversary dates. Billing is usually in advance of services being provided, with payments typically due 30 to 60 days from service commencement. The Company’s subscription arrangements usually do not provide customers with the right to take possession of the software and, as a result, are accounted for over time as service arrangements. Access to the platform represents a series of distinct services as the Company continually provides access to, and fulfill its obligation to, the end customer over the subscription term. The series of distinct services represents a single performance obligation that is satisfied over time. Accordingly, the fixed consideration related to subscription revenue is generally recognized on a straight-line basis over the contract term, beginning on the date that the service is made available to the customer. Professional services The Company provides a variety of professional services that generally consist of implementation, integration, consulting and custom content creation services. Most of the Company’s professional service engagements are short in duration, performed on a fixed fee basis with a standard contract with governing terms and conditions. Billing is usually in advance of services being provided, with payments typically due 30 to 60 days from service commencement, however, some customers will negotiate a final milestone billing upon completion of the project. Each service deliverable generally represents a distinct performance obligation and revenue is recognized over time, typically in proportion of the total hours incurred as a percentage of total estimated hours required to complete the project. Perpetual software licenses, hardware and other While less common and decreasing in favor of SaaS offerings, the Company also offers perpetual licenses for some of its SumTotal product offerings. The Company also, from time to time, resells off the shelf hardware that works in conjunction with certain of its SumTotal solutions. The Company sells these products to customers under a contract and payment terms are generally 30 to 60 days from delivery. Each individual product sold to a customer represents a distinct performance obligation and revenue is recognized at the point in time when control of the product transfers, which is typically when the product is shipped to the customer or, in the case of certain software licenses, when the software license term commences and is accessible by the customer. Software maintenance For customers that previously purchased a perpetual software license for one of the Company’s SumTotal products, the Company offers software maintenance. Software maintenance contracts are provided under the Company’s standard terms and conditions and typically have terms of one year of more. Billing is usually in advance of services being rendered, with payments typically due 30 to 60 days from service commencement. Software maintenance contracts include stand-ready performance obligations to provide software updates, bug fixes and call support. Software maintenance contract performance obligations are satisfied over time and revenue is recognized ratably over the term of the support contract. Disaggregated Revenue and Geography Information The following is a summary of revenues by type for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019 (Predecessor) (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 SaaS and subscription services $ 93,205 $ 234,766 $ 439,791 $ 462,240 Software maintenance 4,770 12,079 23,982 30,161 Professional services 9,546 24,499 45,661 38,043 Perpetual software licenses 1,241 2,486 1,885 3,340 Hardware and other 6 21 2,702 357 Total net revenues (1) $ 108,768 $ 273,851 $ 514,021 $ 534,141 The following table sets forth our revenues by geographic region for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019 (Predecessor) (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Revenues: United States $ 84,248 $ 217,783 $ 405,065 $ 421,746 Other Americas 4,724 8,899 21,925 22,807 Europe, Middle East and Africa 13,934 32,788 61,321 66,244 Asia-Pacific 5,862 14,381 25,710 23,344 Total net revenues (1) $ 108,768 $ 273,851 $ 514,021 $ 534,141 (1) As a result of the Company’s adoption of ASC 606 effective February 1, 2019 using the modified retrospective method, prior period amounts have not been adjusted to conform with ASC 606 and therefore may not be comparable. Other than the United States, no single country accounted for more than 10% of revenue for all periods presented. Deferred Revenue Deferred revenue activity for the period February 1, 2020 through August 27, 2020 (Predecessor) and the period August 28, 2020 through January 31, 2021 (Successor) was as follows (in thousands): Deferred revenue at February 1, 2020 (includes current and non-current components) $ 311,170 Billings deferred 163,333 Recognition of prior deferred revenue (273,851) Deferred revenue at August 27, 2020 200,652 Fresh start reporting fair value adjustment (116,252) Deferred revenue at August 28, 2020 (Successor) 84,400 Billings deferred 284,952 Recognition of prior deferred revenue (108,768) Deferred revenue at January 31, 2021 (Successor) $ 260,584 Deferred revenue performance obligations relate predominately to time-based SaaS and subscription services that are billed in advance of services being rendered. Deferred Contract Acquisition Costs Deferred contract acquisition cost activity for the period February 1, 2020 through August 27, 2020 (Predecessor) and the periods August 28, 2020 through January 31, 2021 (Successor) was as follows (in thousands): Deferred contract acquisition costs at February 1, 2020 $ 22,887 Contract acquisition costs 11,965 Recognition of contract acquisition costs (14,060) Deferred contract acquisition costs at August 27, 2020 (Predecessor) $ 20,792 Fresh start reporting fair value adjustment (20,792) Deferred contract acquisition costs at August 28, 2020 (Successor) — Contract acquisition costs 19,973 Recognition of contract acquisition costs (12,389) Deferred contract acquisition costs at January 31, 2021 (Successor) $ 7,584 |
Fair Value Measurements_2_3_4
Fair Value Measurements | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Fair Value Measurements | 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: Level 2: Level 3: The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020 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 $ 697,018,229 $ 696,957,196 Liabilities: Warrant liability-Public Warrants 1 33,810,000 45,310,000 Warrant liability-Private Placement Warrants 3 26,702,000 32,548,000 Prosus Agreement liability 3 24,532,413 50,481,190 Conversion option liability 3 1,632,013 1,604,359 The derivative instruments were accounted for as liabilities in accordance with ASC 815-40 and are measured at fair value at inception and on a recurring basis, with changes in fair value recorded in the consolidated statement of operations. At issuance, the Warrant Liability for Public Warrants and Private Placement Warrants were valued as of June 26, 2019 using a Monte Carlo simulation and Black Scholes model, respectively, which are considered to be a Level 3 fair value measurements. Subsequent to the Public Warrants detachment from the Units, the Public Warrants are valued based on quoted market price, under ticker CCX WS, which is a Level 1 fair value. The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the Warrants is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination was 80% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. As of issuance and March 31, 2021, the estimated fair value of Warrant Liability — Private Placement Warrants were determined using a Black-Scholes valuation and based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.68 $ 10.00 Volatility 16.5 % 25 % Probability of completing a Business Combination 80.0 % 90 % Term 5.33 5.08 Risk-free rate 1.86 % 0.94 % Dividend yield 0.0 % 0.0 % At inception, the Prosus Agreement Liability consisted of two components: a commitment for the First Step Investment and an option for the Second Step Investment. Subsequent to Prosus exercising its Second Step Investment option, the Prosus Agreement Liability represented a commitment. The commitment and option were valued using forward contract valuation methodology and a Black Scholes model, respectively. Both valuation methodologies were considered to be Level 3 fair value measurements. As of inception and March 31, 2021, the estimated fair value of Prosus Agreement Liability was determined based on the following significant inputs: At As of March 31, inception 2021 Exercise price $ 400.0 M $ 500.0 M Underlying value $ 436.8 M $ 524.5 M Volatility 40.0 % N/A Term 0.55 0.08 Risk-free rate 0.12 % 0.08 % Dividend yield 0.00 % N/A The Conversion option liability was valued using a Black Scholes model, which was considered to be a Level 3 fair value measurement. At inception and March 31, 2021, the estimated fair value of Conversion option liability was determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 1.00 $ 1.00 Underlying warrant value $ 1.92 * $ 2.09 * Volatility 125.0 % 115.0 % Number of Class A Shares 1.5 M% 1.5 M% Term 0.28 0.08 Risk-free rate 0.09 % 0.01 % Dividend yield 0.0 % 0.0 % * The underlying warrant value equals the calculated fair value of the private placement warrants as of each date presented and determined based on the following significant inputs: At As of March 31, issuance 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 9.97 $ 10.00 Volatility 30.0 % 25 % Probability of completing a Business Combination 85.0 % 90 % Term 5.28 5.08 Risk-free rate 0.41 % 0.94 % Dividend yield 0.0 % 0.0 % The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrants Warrants Warrant Liabilities January 1, 2021 $ 32,548,000 $ 45,310,000 $ 77,858,000 Change in valuation inputs or other assumptions (5,846,000) (11,500,000) (17,346,000) Fair value as of March 31, 2021 26,702,000 33,810,000 60,512,000 There were no transfers in or out of Level 3 from other levels in the fair value hierarchy. | NOTE 11. 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 and liabilities that are measured at fair value on a recurring basis at December 31, 2020 and 2019, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value: December 31, December 31, Description Level 2020 2019 Assets: Cash and marketable securities held in Trust Account 1 $ 696,957,196 $ 695,295,418 Liabilities: Warrant Liabilities – Public Warrants 1 45,310,000 32,660,000 Warrant Liabilities – Private Placement Warrants 3 32,548,000 23,700,000 Prosus subscription agreement liability 3 50,481,190 — Conversion option liability 3 1,604,359 — The Derivative Instruments were accounted for as liabilities in accordance with ASC 815-40 and are measured at fair value at inception and on a recurring basis, with changes in fair value recorded in the statement of operations. The Warrants were valued as of July 1, 2019 using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement. The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the Warrants is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination was 80% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable 'blank-check' companies without an identified target. The subsequent measurements of the Public Warrants after the detachment of the Public Warrants from the Units is classified as Level 1 due to the use of an observable market quote in an active market under the ticker CVII.WS. The following table presents the changes in the fair value of warrant liabilities: Private Placement Public Warrant Liabilities Fair value as of April 11, 2019 (inception) $ — $ — $ — Initial measurement on July 1, 2019 15,800,000 22,310,000 38,110,000 Change in valuation inputs or other assumptions 7,900,000 10,350,000 18,250,000 Fair value as of December 31, 2019 23,700,000 32,660,000 56,360,000 Change in valuation inputs and other assumptions 8,848,000 12,650,000 21,498,000 Fair value as of December 31, 2020 $ 32,548,000 $ 45,310,000 $ 77,858,000 | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Fair Value Measurements | (14) Fair Value Measurements FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) establishes a fair value hierarchy that prioritizes the inputs used to measure fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs. Observable inputs are inputs that reflect the assumptions 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 about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The three levels of the fair value hierarchy established by ASC 820 in order of priority are as follows: · Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. · Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. · Level 3: Unobservable inputs that reflect the Company’s assumptions about the assumptions that market participants would use in pricing the asset or liability. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available. The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of April 30, 2021 and are categorized using the fair value hierarchy (in thousands): Total (Level 3) Warrants to purchase Company common stock $ 800 $ 800 Total assets recorded at fair value $ 800 800 The following table is a reconciliation of Level 3 instruments for which significant unobservable inputs were used to determine fair value: Successor Three months ended April 30, 2021 Balance as of January 31, 2021 $ 900 Impact of warrant modification, recorded in shareholders’ equity — Unrealized gains recognized as other income (100) Balance as of April 30, 2021 $ 800 At each relevant measurement date, the warrants were valued using a probability-based approach that considered management’s estimate of the probability of (i) a Favored Sale, (ii) a sale of the company that did not qualify as a Favored Sale and (iii) warrants being held to maturity, with the last two scenarios utilizing a Black-Scholes model to estimate fair value. The Black-Scholes model relies on a number of key assumptions to calculate estimated fair value. The assumed dividend yield of zero is based on the fact that the Company has never paid cash dividends and has no present expectation to pay cash dividends. Management utilized an equity value of $667 million as an input in all Black-Scholes calculations, consistent with the fresh-start reporting valuation after adjusting for warrants. The volatility input utilized in the non-Favored Sale scenario was 35.0%, consistent with the contractually stated rate, and 31.6% for the held to maturity scenario. The assumed risk-free interest rate is the U.S. Treasury security rate with a term equal to the expected life of the warrant. The assumed expected life is based on the maximum contractual term of the warrants as a make-whole provision compensates holders in the event the awards are settled prior to their exercise or expiration. The Company currently invests excess cash balances primarily in cash deposits held at major banks. The carrying amounts of cash deposits, trade receivables, trade payables and accrued liabilities, as reported on the consolidated balance sheet as of April 30, 2021, approximate their fair value because of the short maturity of those instruments. The Company considered the fair value of its external borrowings and believes their carrying values approximate fair value based on the recent fair value assessment done for fresh-start accounting. When calculating goodwill impairments for the three months ended April 30, 2020 (Predecessor), the Company estimated the fair value of its reporting units using income and market multiple approaches. An income approach, which is generally a discounted cash flow methodology that includes assumptions for, among other things, forecasted revenues, gross profit margins, operating profit margins, working capital cash flow, growth rates, income tax rates, expected tax benefits and long-term discount rates, all of which require significant judgments by management. The market approach considered comparable market data based on multiples of revenue and EBITDA. Management also considered the overall value of the Company implied by the trading prices of debt securities, after adjusting for a control premium, given that the enterprise value of the Company was substantially lower than the carrying value of long-term debt. All of these techniques utilized would be considered Level 3 inputs. | (19) FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) establishes a fair value hierarchy that prioritizes the inputs used to measure fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs. Observable inputs are inputs that reflect the assumptions 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 about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The three levels of the fair value hierarchy established by ASC 820 in order of priority are as follows: · Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. · Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. · Level 3: Unobservable inputs that reflect the Company’s assumptions about the assumptions that market participants would use in pricing the asset or liability. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available. The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of January 31, 2021 and are categorized using the fair value hierarchy (in thousands): Total (Level 3) Warrants to purchase Company common stock $ 900 $ 900 Total assets recorded at fair value $ 900 900 The following table is a reconciliation of Level 3 instruments for which significant unobservable inputs were used to determine fair value: Successor August 28, 2020 through January 31, 2021 Balance as of August 28, 2020 $ 11,200 Impact of warrant modification, recorded in shareholders’ equity (7,400) Unrealized gains recognized as other income (2,900) Balance as of January 31, 2021 $ 900 At each relevant measurement date, the warrants were valued using a probability-based approach that considered management’s estimate of the probability of (i) a Favored Sale, (ii) a sale of the company that did not qualify as a Favored Sale and (iii) warrants being held to maturity, with the last two scenarios utilizing a Black-Scholes model to estimate fair value. The Black-Scholes model relies on a number of key assumptions to calculate estimated fair value. The assumed dividend yield of zero is based on the fact that the Company has never paid cash dividends and has no present expectation to pay cash dividends. Management utilized an equity value of $667 million as an input in all Black-Scholes calculations, consistent with the fresh-start reporting valuation after adjusting for warrants. The volatility input utilized in the non-Favored Sale scenario was 35.0%, consistent with the contractually stated rate, and 31.6% for the held to maturity scenario. The assumed risk-free interest rate is the U.S. Treasury security rate with a term equal to the expected life of the warrant. The assumed expected life is based on the maximum contractual term of the warrants as a make-whole provision compensates holders in the event the awards are settled prior to their exercise or expiration. The Company currently invests excess cash balances primarily in cash deposits held at major banks. The carrying amounts of cash deposits, trade receivables, trade payables and accrued liabilities, as reported on the consolidated balance sheet as of January 31, 2021, approximate their fair value because of the short maturity of those instruments. The Company considered the fair value of its external borrowings and believes their carrying values approximate fair value based on the recent fair value assessment done for fresh-start accounting. When calculating goodwill impairments for the year ended January 31, 2020 and the period from February 1, 2020 through August 27, 2020 (Predecessor), the Company estimated the fair value of its reporting units using income and market multiple approaches. An income approach, which is generally a discounted cash flow methodology that includes assumptions for, among other things, forecasted revenues, gross profit margins, operating profit margins, working capital cash flow, growth rates, income tax rates, expected tax benefits and long-term discount rates, all of which require significant judgments by management. The market approach considered comparable market data based on multiples of revenue and EBITDA. Management also considered the overall value of the Company implied by the trading prices of debt securities, after adjusting for a control premium, given that the enterprise value of the Company was substantially lower than the carrying value of long-term debt. All of these techniques utilized would be considered Level 3 inputs. |
Segment Information_2
Segment Information | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Segment Information | (15) Segment Information ASC 280, Segment Reporting , establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision makers (CODMs) are its Executive Chairman and Chief Administrative Officer. The Company’s CODMs evaluate results using the operating segment structure is the primary basis for which the allocation of resources and financial results are assessed. The Company has organized its business into two segments: Skillsoft and SumTotal. Both of the Company’s businesses market and sell their offerings globally to businesses of many sizes, government agencies, educational institutions and resellers with a worldwide sales force positioned to offer the combinations that best meet customer needs. The CODMs primarily use revenues and operating income as measures used to evaluate financial results and allocation of resources. The Company allocates certain operating expenses to the reportable segments, including general and administrative costs based on the usage and relative contribution provided to the segments. There are no net revenue transactions between the Company’s reportable segments. The Skillsoft business engages in the sale, marketing and delivery of its content learning solutions, in areas such as Leadership and Business, Technology and Developer and Compliance. In addition, Skillsoft offers Percipio, an intelligent online learning experience platform that delivers an immersive learning experience. It leverages its highly engaging content, curated into nearly 700 learning paths (channels) that are continuously updated to ensure customers always have access to the latest information. The SumTotal business provides a unified, comprehensive and configurable solution that allows organizations to attract, develop and retain the best talent. SumTotal’s solution impacts a company’s workforce throughout the entire employee lifecycle and helps companies succeed in an evolving business climate. SumTotal’s primary solutions are Talent Acquisition, Learning Management, Talent Management and Workforce Management. The following table presents summary results for each of the businesses for the three months ended April 30, 2021 and the three months ended April 30, 2020 (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Skillsoft Revenues $ 67,057 $ 84,318 Operating expenses 93,127 287,917 Operating (loss) income (26,070) (203,599) SumTotal Revenues 24,644 34,011 Operating expenses 26,277 168,157 Operating income (loss) (1,633) (134,146) Consolidated Revenues 91,701 118,329 Operating expenses 119,404 456,074 Operating income (loss) (27,703) (337,745) Total non-operating (expense) income (352) 910 Interest expense, net (11,439) (105,959) Reorganization items, net — — (Provision) benefit for income taxes 2,089 8,891 Net (loss) income $ (37,405) $ (433,903) The Company’s segment assets primarily consist of cash and cash equivalents, accounts receivable, prepaid expenses, deferred taxes, property and equipment, goodwill and intangible assets. The following table sets forth the Company’s segment assets as of April 30, 2021 and January 31, 2021 (in thousands): April 30, 2021 January 31, 2021 Skillsoft $ 1,313,124 $ 1,398,379 SumTotal 144,982 147,358 Corporate — — Consolidated $ 1,458,106 $ 1,545,737 The following table sets forth the Company’s long-lived tangible assets by geographic region for the years ended April 30, 2021 and January 31, 2021 (in thousands): April 30, 2021 January 31, 2021 United States $ 9,019 $ 10,613 Ireland 499 609 Rest of world 2,280 2,558 Total $ 11,798 $ 13,780 | (20) ASC 280, Segment Reporting , establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision- making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision makers (CODMs) are its Executive Chairman and Chief Administrative Officer. The Company’s CODMs evaluate results using the operating segment structure is the primary basis for which the allocation of resources and financial results are assessed. The Company has organized its business into two segments: Skillsoft and SumTotal. Both of the Company’s businesses market and sell their offerings globally to businesses of many sizes, government agencies, educational institutions and resellers with a worldwide sales force positioned to offer the combinations that best meet customer needs. The CODMs primarily use revenues and operating income as measures used to evaluate financial results and allocation of resources. The Company allocates certain operating expenses to the reportable segments, including general and administrative costs based on the usage and relative contribution provided to the segments. There are no net revenue transactions between the Company’s reportable segments. The Skillsoft business engages in the sale, marketing and delivery of its content learning solutions, in areas such as Leadership and Business, Technology and Developer and Compliance. In addition, Skillsoft offers Percipio, an intelligent online learning experience platform that delivers an immersive learning experience. It leverages its highly engaging content, curated into nearly 700 learning paths (channels) that are continuously updated to ensure customers always have access to the latest information. The SumTotal business provides a unified, comprehensive and configurable solution that allows organizations to attract, develop and retain the best talent. SumTotal’s solution impacts a company’s workforce throughout the entire employee lifecycle and helps companies succeed in an evolving business climate. SumTotal’s primary solutions are Talent Acquisition, Learning Management, Talent Management and Workforce Management. The following table presents summary results for each of the businesses for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year ended Year ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Skillsoft Revenues $ 72,425 $ 196,238 $ 362,503 $ 378,316 Operating expenses 158,671 398,178 637,658 364,581 Operating (loss) income (86,246) (201,940) (275,155) 13,735 SumTotal Revenues 36,343 77,613 151,518 155,825 Operating expenses 49,269 205,483 279,579 162,906 Operating income (loss) (12,926) (127,870) (128,061) (7,081) Consolidated Revenues 108,768 273,851 514,021 534,141 Operating expenses 207,940 603,661 917,237 527,487 Operating income (loss) (99,172) (329,810) (403,216) 6,654 Total non-operating (expense) income 3,452 1,268 (5,120) (5,624) Interest expense, net (19,936) (168,236) (429,657) (395,842) Reorganization items, net — 3,329,245 — — (Provision) benefit for income taxes 21,934 (68,455) (11,212) (5,027) Net (loss) income $ (93,722) $ 2,764,012 $ (849,205) $ (399,839) The Company’s segment assets primarily consist of cash and cash equivalents, accounts receivable, prepaid expenses, deferred taxes, property and equipment, goodwill and intangible assets. The following table sets forth the Company’s segment assets as of January 31, 2021 and January 31, 2020 (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Skillsoft $ 1,398,379 $ 1,655,474 SumTotal 147,358 330,785 Corporate — 6 Consolidated $ 1,545,737 $ 1,986,265 The following table sets forth the Company’s long-lived tangible assets by geographic region for the years ended January 31, 2021 and January 31, 2020 (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 United States $ 10,613 $ 13,469 Ireland 609 897 Rest of world 2,558 3,536 Total $ 13,780 $ 17,902 |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Net Loss Per Share | (16) Net Loss Per Share Basic earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period, plus the dilutive effect of outstanding restricted stock-based awards, stock options, and shares issuable under the employee stock purchase plan using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share (in thousands, except number of shares and per share data): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Net loss $ (37,405) $ (433,903) Weighted average common shares outstanding: Ordinary – Basic and Diluted (Predecessor) * 100 Class A and B – Basic and Diluted (Successor) 4,000 * Net loss per share Loss per share: Ordinary – Basic and Diluted (Predecessor) * $ (4,334.70) Class A and B – Basic and Diluted (Successor) $ (9.35) * * Potential common shares related to participating rights in Notional Units in Evergreen have been excluded as the income generated for three months ended April 30, 2020 (Predecessor) is attributable to gains recognized upon emergence of bankruptcy, which the Notional Units did not participate in as they were cancelled at that time. Warrants to purchase 705,882 common shares have been excluded from the successor period since, for periods of losses, the impact would be anti-dilutive and, for periods of income, no shares would be added to diluted earnings per share under the treasury stock method as the strike price of these awards are above the fair market value of underlying shares for all periods presented. | (21) Basic earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding during the period, plus the dilutive effect of outstanding restricted stock-based awards, stock options, and shares issuable under the employee stock purchase plan using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share (in thousands, except number of shares and per share data): Successor Predecessor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2020 2020 2020 2019 Net (loss) income $ (93,722) $ 2,764,012 $ (849,205) $ (399,839) Weighted average common share outstanding: Ordinary – Basic and Diluted (Predecessor * 100 100 100 Class A – Basic and Diluted 3,840 * * * Class B – Basic and Diluted 160 * * * Net loss per share class (Successor only) Net loss for Class A $ (89,973) * * * Loss on modifications of terms of participation rights held by other shareholders and warrants (5,900) * * * Net loss attributable to Class A $ (95,873) * * * Net loss for Class B $ (3,749) * * * Gain on modifications of terms of participation rights held by other shareholders and warrants 5,900 * * * Net income attributable to Class B $ 2,151 * * * (Losses) income per share: Ordinary – Basic and Diluted (Predecessor) * $ 27,612.51 $ (8,483.57) $ (3,994.40) Class A – Basic and Diluted (Successor) $ (24.97) * * * Class B – Basic and Diluted (Successor) $ 13.44 * * * * Potential common shares related to participating rights in Notional Units in Evergreen have been excluded as the income generated for period from February 1, 2020 through August 27, 2020 (Predecessor) is attributable to gains recognized upon emergence of bankruptcy, which the Notional Units did not participate in as they were cancelled at that time. Potential common shares related to participating rights in Notional Units in Evergreen for the predecessor fiscal years ended January 31, 2020 and 2019 as excluded from earnings per share as they are contingently issuable and the impact would be anti-dilutive. Warrants to purchase 705,882 common shares have been excluded from the successor period since, for periods of losses, the impact would be anti-dilutive and, for periods of income, no shares would be added to diluted earnings per share under the treasury stock method as the strike price of these awards are above the fair market value of underlying shares for all periods presented. |
Related Party Transactions_2_3
Related Party Transactions | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Related Party Transactions | NOTE 5. RELATED PARTY TRANSACTIONS Founder Shares In May 2019, the Sponsor purchased 8,625,000 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On June 7, 2019, the Company effected a stock dividend at one-third of one share of Class B common stock for each outstanding share of Class B common stock, resulting in an aggregate of 11,500,000 Founder Shares outstanding. On June 26, 2019, the Company effected a further stock dividend of one-half of a share of Class B common stock for each outstanding share of Class B common stock, resulting in the Sponsor holding an aggregate of 17,250,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the stock dividend. The Founder Shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 7. The Founder Shares included an aggregate of up to 2,250,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, 2,250,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) the date on which the Company completes a liquidation, merger, stock exchange, reorganization or similar transaction after a Business Combination that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A common stock equals or exceeds $12.00 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 at least 150 days after a Business Combination, the Founder Shares will be released form the lock-up. Administrative Support Agreement The Company entered into an agreement, commencing on June 26, 2019 through the earlier of the Company’s consummation of a Business Combination and its liquidation, pursuant to which the Company will pay an affiliate of the Sponsor a total of up to $20,000 per month for office space, administrative and support services. For the three months ended March 31, 2021 and 2020, the Company incurred and paid $60,000 in fees for these services. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor or the Company’s directors and officers 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. 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 either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On November 2, 2020, the Company entered into a convertible promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Promissory Note”). The Convertible Promissory Note is non-interest bearing and payable on the earlier of the date on which the Company consummates a Business Combination or the date that the winding up of the Company is effective. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Promissory Note; however, no proceeds from the Trust Account may be used for such repayment. Up to $1,500,000 of the Convertible Promissory Note may be converted into warrants at a price of $1.00 per warrant at the option of the Sponsor. The warrants would be identical to the Private Placement Warrants. As of March31, 2021 and December 31, 2020, the outstanding balance under the Convertible Promissory Note amounted to an aggregate of $1,500,000. The Company assessed the provisions of the Convertible Promissory Note under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on conversion option liability. The conversion option was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 9). The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the conversion option is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of November 2, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of conversion option: Fair value as of January 1, 2021 $ 1,604,359 Change in valuation inputs and other assumptions 27,624 Fair value as of March 31, 2021 $ 1,632,013 Advisory Fee The Company may engage M. Klein and Company, LLC, an affiliate of the Sponsor, or another affiliate of the Sponsor, as its lead financial advisor in connection with a Business Combination and may pay such affiliate a customary financial advisory fee in an amount that constitutes a market standard financial advisory fee for comparable transactions. | NOTE 6. RELATED PARTY TRANSACTIONS Founder Shares In May 2019, the Sponsor purchased 8,625,000 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On June 7, 2019, the Company effected a stock dividend at one-third of one share of Class B common stock for each outstanding share of Class B common stock, resulting in an aggregate of 11,500,000 Founder Shares outstanding. On June 26, 2019, the Company effected a further stock dividend of one-half of a share of Class B common stock for each outstanding share of Class B common stock, resulting in the Sponsor holding an aggregate of 17,250,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the stock dividend. The Founder Shares will automatically convert into shares of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described in Note 8. The Founder Shares included an aggregate of up to 2,250,000 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Sponsor would own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, 2,250,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) the date on which the Company completes a liquidation, merger, stock exchange, reorganization or similar transaction after a Business Combination that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, if the closing price of the Class A common stock equals or exceeds $12.00 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 at least 150 days after a Business Combination, the Founder Shares will be released from the lock-up. Promissory Note — Related Party On April 29, 2019, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Promissory Note”). The Promissory Note was non-interest bearing and payable on the earlier of December 31, 2019 or the completion of the Initial Public Offering. The Promissory Note was drawn in the amount of $200,000 and was repaid in full upon the consummation of the Initial Public Offering on July 1, 2019. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or the Company’s officers and directors 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. 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 either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants at a price of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. On November 2, 2020, the Company entered into a convertible promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $1,500,000 (the “Convertible Promissory Note”). The Convertible Promissory Note is non-interest bearing and payable on the earlier of the date on which the Company consummates a Business Combination or the date that the winding up of the Company is effective. If the Company does not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Promissory Note; however, no proceeds from the Trust Account may be used for such repayment. Up to $1,500,000 of the Convertible Promissory Note may be converted into warrants at a price of $1.00 per warrant at the option of the Sponsor. The warrants would be identical to the Private Placement Warrants. As of December 31, 2020, the outstanding balance under the Convertible Promissory Note amounted to an aggregate of $1,500,000. The Company assessed the provisions of the Convertible Promissory Note under ASC 815-15. The derivative component of the obligation is initially valued and classified as a derivative liability with an offset to loss on conversion option liability. The conversion option was valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement (see Note 11). The Monte Carlo simulation's primary unobservable input utilized in determining the fair value of the conversion option is the probability of consummation of the Business Combination. The probability assigned to the consummation of the Business Combination as of November 2, 2020 and December 31, 2020 was 85% which was estimated based on the observed success rates of business combinations for special purpose acquisition companies. The following table presents the change in the fair value of conversion option: Fair value as of January 1, 2020 $ — Initial measurement on November 2, 2020 1,493,877 Change in valuation inputs and other assumptions 110,482 Fair value as of December 31, 2020 $ 1,604,359 Administrative Support Agreement The Company entered into an agreement whereby, commencing on June 26, 2019 through the earlier of the Company’s consummation of a Business Combination and its liquidation, the Company will pay an affiliate of the Sponsor a total of $20,000 per month for office space, administrative and support services. For the year ended December 31, 2020 and for the period from April 11, 2019 through December 31, 2019, the Company incurred and paid $240,000 and $123,333 of such fees, respectively. Advisory Fee The Company may engage M. Klein and Company, LLC, an affiliate of the Sponsor, or another affiliate of the Sponsor, as its lead financial advisor in connection with a Business Combination and may pay such affiliate a customary financial advisory fee in an amount that constitutes a market standard financial advisory fee for comparable transactions. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Related Party Transactions | (17) Related Party Transactions Successor Related Party Transactions Upon our emergence from Chapter 11 on August 27, 2020, our exit facility consisting of $110 million of First Out Term Loans and $410 million of Second Out Term Loans were financed in whole by our Class A shareholders. Class A shareholders have the ability to trade their debt positions independently from their equity positions, however, as of April 30, 2021, the substantial majority of First Out and Second Out term loans continue to be held by Class A shareholders. | (22) The Company paid the tax obligations for certain current and former executives that purchased “B” ordinary shares in the parent company in return for $5.4 million of recourse notes, which were reserved for in the year ended January 31, 2020. The Company reserved the balance due as a result of certain forgiveness provisions in the event the value of the shares declined. As of January 31, 2020, $9.9 million of outstanding borrowing capacity under the Company’s accounts receivable facility were loaned by the private equity sponsor of Evergreen Skills Lux S.A.R.L., who was a related party. As of January 31, 2020 and 2019, the Company had loans of $2,189 million in outstanding borrowings from Holdings. As of January 31, 2020 and 2019, the Company had accrued interest of $1,067 million and $787 million, respectively, related to these borrowings. Successor Related Party Transactions Upon our emergence from Chapter 11 on August 27, 2020, our exit facility consisting of $110 million of First Out Term Loans and $410 million of Second Out Term Loans were financed in whole by our Class A shareholders. Class A shareholders have the ability to trade their debt positions independently from their equity positions, however, as of January 31, 2021, the substantial majority of First Out and Second Out term loans continue to be held by Class A shareholders. |
Subsequent Events_2_3_4
Subsequent Events | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Subsequent Events | NOTE 10. 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, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements, except as set forth below. On May 3, 2021, the Company was informed by Prosus that Prosus received notice from CFIUS that it has concluded all action under Section 721 of the Defense Production Act of 1950 and determined that there are no unresolved national security concerns with respect to the Prosus PIPE Investment. | NOTE 12. 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 and in Note 2, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. On January 22, 2021, the Company entered into an amendment (the “Merger Agreement Amendment”), to which amends and restates in its entirety the definition of “Applicable Majority” in the Skillsoft Merger Agreement. The definition of “Applicable Majority” is used in the Skillsoft Merger Agreement. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Subsequent Events | (18) Subsequent Events The Company has evaluated subsequent events through June 11, 2021 the date the financial statements were issued. Churchill Merger On October 12, 2020, the Company and Churchill Capital Corp II, a Delaware corporation (“Churchill”), entered into an Agreement and Plan of Merger (the “Skillsoft Merger Agreement”) by and between Churchill and the Company. Pursuant to the terms of the Skillsoft Merger Agreement, a business combination between Churchill and Skillsoft will be effected through the merger of the Company with and into Churchill, with Churchill surviving as the surviving company (the “Skillsoft Merger”). At the effective time of the Skillsoft Merger (the “Effective Time”), (a) each Class A share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class A Shares”), outstanding immediately prior to the Effective Time, will be automatically canceled and Churchill will issue as consideration therefor (i) such number of shares of Churchill’s Class A common stock, par value $0.0001 per share (the “Churchill Class A Common Stock”) as would be transferred pursuant to the Class A First Lien Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (ii) Churchill’s Class C common stock, par value $0.0001 per share (the “Churchill Class C Common Stock”), as would be transferred pursuant to the Class C Exchange Ratio (as defined in the Skillsoft Merger Agreement), and (b) each Class B share of Skillsoft, with nominal value of $0.01 per share (“Skillsoft Class B Shares”), will be automatically canceled and Churchill will issue as consideration therefor such number of shares of Churchill Class A common stock equal to the Per Class B Share Merger Consideration (as defined in the Skillsoft Merger Agreement). Pursuant to the terms of the Skillsoft Merger Agreement, Churchill is required to use commercially reasonable efforts to cause the Churchill Class A Common Stock to be issued in connection with the transactions contemplated by the Skillsoft Merger Agreement (the “Skillsoft Transactions”) to be listed on the New York Stock Exchange (“NYSE”) prior to the closing of the Skillsoft Merger (the “Skillsoft Closing”). Immediately following the Effective Time, Churchill will redeem all of the shares of Class C Common Stock issued to the holders of Skillsoft Class A Shares for an aggregate redemption price of (i) $505,000,000 in cash and (ii) indebtedness under the Existing Second Out Credit Agreement (as defined in the Skillsoft Merger Agreement), as amended by the Existing Second Out Credit Agreement Amendment (as defined in the Skillsoft Merger Agreement), in the aggregate principal amount equal to the sum of $20,000,000 to be issued by the Surviving Corporation (as defined in the Skillsoft Merger Agreement) or one of its subsidiaries, in each case, pro rata among the holders of Churchill Class C Common Stock issued in connection with the Skillsoft Merger. The transaction closed effective June 11, 2021. | (23) The Company has evaluated subsequent events through April 9, 2021 the date the financial statements were issued. |
Organization and Description _4
Organization and Description of Business (Policies) | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Use of Estimates | Use of Estimates The preparation of the condensed 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 the 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. | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. On June 17, 2020, the Company’s Canadian subsidiary, Skillsoft Canada Ltd., voluntarily commenced parallel recognition proceedings under the Companies’ Creditors Arrangement Act (“CCAA”) with the Court of Queen’s Bench of New Brunswick in Canada seeking recognition and enforcement of the Debtors’ Chapter 11 Cases, including the DIP Facility. This action resulted in the deconsolidation of Skillsoft Canada Ltd. under ASC 810, Consolidation and the Company recognizing its retained noncontrolling interest in the Canadian subsidiary at its fair value of approximately $4.8 million. On August 17, 2020, the Canadian Court entered an order recognizing and enforcing the Chapter 11 Cases and Plan in Canada upon the Effective Date. The Company reconsolidated Skillsoft Canada Ltd and de-recognized the non-controlling interest. The Company applied the guidance in ASC 805, Business Combinations for recognizing a new accounting basis for the Canadian subsidiary. | ||
Use of Estimates | Use of Estimates Our preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from our estimates. | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires 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 revenue and expenses during the reporting period. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Significant estimates and assumptions by management affect the Company’s accounting for the impairment of goodwill and its assessment of other intangible assets for potential impairment, determination of estimated period of economic benefit for deferred commissions and income taxes and related valuation allowances. Significant estimates and assumptions were also made by management in determining the fair value of asset and liabilities as required under the application of fresh-start reporting and in the valuation of warrants. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ from management’s estimates if past experience or other assumptions do not turn out to be substantially accurate. |
Intangible Assets (Tables)_2
Intangible Assets (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Schedule of intangible assets | Intangible assets consisted of the following (in thousands): April 30, 2021 January 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Developed software/ courseware $ 267,014 $ 39,459 $ 227,555 $ 265,758 $ 24,669 $ 241,089 Customer contracts/ relationships 279,500 9,114 270,386 279,500 3,627 275,873 Trademarks and trade names 6,300 676 5,624 6,300 455 5,845 Publishing rights 35,200 4,693 30,507 35,200 2,933 32,267 Backlog 90,200 20,842 69,358 90,200 8,141 82,059 Skillsoft trademark 91,500 — 91,500 91,500 — 91,500 Total $ 769,714 $ 74,784 $ 694,930 $ 768,458 $ 39,825 $ 728,633 | Intangible assets consisted of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Developed software/ courseware $ 265,758 $ 24,669 $ 241,089 $ 157,168 $ 129,663 $ 27,505 Customer contracts/ relationships 279,500 3,627 275,873 670,800 466,972 203,828 Trademarks and trade names 6,300 455 5,845 45,300 27,648 17,652 Publishing rights 35,200 2,933 32,267 — — — Backlog 90,200 8,141 82,059 — — — Skillsoft trademark 91,500 — 91,500 186,000 — 186,000 Total $ 768,458 $ 39,825 $ 728,633 $ 1,059,268 $ 624,283 $ 434,985 |
Schedule of amortization expense related to the existing finite-lived intangible assets | Amortization expense related to the existing finite-lived intangible assets is expected to be as follows (in thousands): Fiscal Year Amortization Expense 2022 (Remaining 9 months) $ 104,693 2023 120,579 2024 106,172 2025 94,070 2026 64,496 Thereafter 113,420 Total $ 603,430 | Amortization expense related to the existing finite-lived intangible assets is expected to be as follows (in thousands): Amortization Fiscal Year Expense 2022 $ 139,408 2023 120,339 2024 105,910 2025 93,842 2026 64,269 Thereafter 113,365 Total $ 637,133 |
Schedule of goodwill | Description Skillsoft SumTotal Consolidated Goodwill, net January 31, 2021 (Predecessor) $ 491,654 $ 3,350 $ 495,004 Foreign currency translation adjustment (62) — (62) Goodwill, net April 30, 2021 (Predecessor) $ 491,592 $ 3,350 $ 494,942 | Description Skillsoft SumTotal Consolidated Goodwill, January 31, 2018 $ — $ — $ 1,693,906 Re-allocation of goodwill upon change in reporting units 1,433,662 260,244 — Foreign currency translation adjustment 385 22 407 Goodwill, January 31, 2019 1,434,047 260,266 1,694,313 Foreign currency translation adjustment 113 (6) 107 Impairment of goodwill (321,340) (119,258) (440,598) Goodwill, net January 31, 2020 (Predecessor) 1,112,820 141,002 1,253,822 Foreign currency translation adjustment (158) (4) (162) Impairment of goodwill (107,934) (69,952) (177,886) Canada deconsolidation (5,100) (5,100) Goodwill, net August 27, 2020 (Predecessor) $ 999,628 $ 71,046 $ 1,070,674 Impact of Fresh-Start Reporting (507,843) (67,696) (575,539) Goodwill, net August 28, 2020 (Successor) $ 491,785 $ 3,350 $ 495,135 Foreign currency translation adjustment (131) (131) Goodwill, net January 31, 2021 (Successor) $ 491,654 $ 3,350 $ 495,004 |
Prepaid Expenses and Other Cu_5
Prepaid Expenses and Other Current Assets (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of prepaid expenses and other current assets | Prepaid expense and other current assets in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Deferred commission costs – current $ 4,019 $ 3,147 Refundable income tax 9,618 8,969 Prepaid software maintenance costs 8,370 8,587 Prepaid royalties 2,876 2,958 Other 6,942 6,665 Total prepaid expenses and other current assets $ 31,825 $ 30,326 | Prepaid expense and other current assets in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Deferred commission costs – current $ 3,147 $ 11,195 Refundable income tax 8,969 6,726 Prepaid software maintenance costs 8,587 6,569 Prepaid royalties 2,958 2,294 Employee bonus advance — 1,867 Other 6,665 7,771 Total prepaid expenses and other current assets $ 30,326 $ 36,422 |
Other Assets (Tables)_2
Other Assets (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of other assets | Other assets in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Deferred commission costs – non-current $ 5,733 $ 4,437 Other 3,772 4,199 Total other assets $ 9,505 $ 8,636 | Other assets in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Deferred commission costs – non-current $ 4,437 $ 11,692 Non-current refundable income tax — 1,979 Other 4,199 2,635 Total other assets $ 8,636 $ 16,306 |
Accrued Expenses (Tables)_2
Accrued Expenses (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of accrued expenses | Accrued expenses in the accompanying consolidated balance sheets consisted of the following (in thousands): April 30, 2021 January 31, 2021 Professional fees $ 6,018 $ 8,832 Accrued sales tax/VAT 2,144 5,379 Accrued royalties 1,961 2,152 Accrued tax 4,727 2,634 Accrued interest 368 491 Other accrued liabilities 3,067 3,637 Total accrued expenses $ 18,285 $ 23,125 | Accrued expenses in the accompanying consolidated balance sheets consisted of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Professional fees $ 8,832 $ 12,947 Accrued sales tax/VAT 5,379 5,824 Accrued royalties 2,152 1,869 Accrued tax 2,634 1,288 Accrued interest 491 274 Other accrued liabilities 3,637 7,065 Total accrued expenses $ 23,125 $ 29,267 |
Restructuring (Tables)_2
Restructuring (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of Activity in the Company's restructuring accrual | Activity in the Company’s restructuring accrual was as follows (in thousands): Employee Severance Contractual and Related Costs Obligations Total Restructuring accrual as of January 31, 2021 $ 5,000 $ 171 $ 5,171 Restructuring charges incurred 311 226 537 Payments made (2,049) (298) (2,347) Foreign currency translation adjustment — — — Restructuring accrual as of April 30, 2021 $ 3,262 $ 99 $ 3,361 | Activity in the Company’s restructuring accrual was as follows (in thousands): Employee Severance Contractual and Related Costs Obligations Total Restructuring accrual as of January 31, 2018 $ 1,504 $ 25 $ 1,529 Restructuring charges incurred 1,971 102 2,073 Payments made (1,720) (100) (1,820) Foreign currency translation adjustment (42) — (42) Restructuring accrual as of January 31, 2019 $ 1,713 $ 27 $ 1,740 Restructuring charges incurred 1,610 290 1,900 Payments made (2,588) (41) (2,629) Foreign currency translation adjustment 26 — 26 Restructuring accrual as of January 31, 2020 (Predecessor) $ 761 $ 276 $ 1,037 Restructuring charges incurred 1,032 147 1,179 Payments made (559) (154) (713) Foreign currency translation adjustment — — — Restructuring accrual as of August 27, 2020 (Predecessor) $ 1,234 $ 269 $ 1,503 Restructuring charges incurred 4,218 123 4,341 Payments made (452) (221) (673) Foreign currency translation adjustment — — — Restructuring accrual as of January 31, 2021 (Successor) $ 5,000 171 5,171 |
Leases, Commitment and Contin_6
Leases, Commitment and Contingencies (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of undiscounted future minimum lease payments under non-cancellable leases | The table below reconciles the undiscounted future minimum lease payments under non-cancellable leases with terms of more than one year to the total lease liabilities recognized on the consolidated balance sheets as of April 30, 2021 (Successor): Fiscal Year Ended January 31, 2021 (in thousands): Operating Leases Finance Leases 2022 (excluding 3 months ended April 30, 2021) $ 3,898 $ 1,209 2023 4,065 — 2024 3,499 — 2025 2,684 — 2026 1,245 Thereafter 6,245 — Total future minimum lease payments 21,636 1,209 Less effects of discounting (5,692) (93) Total lease liabilities $ 15,944 $ 1,116 Reported as of April 30, 2021 Lease liabilities $ 3,574 $ 1,116 Long-term lease liabilities 12,370 — Total lease liabilities $ 15,944 $ 1,116 | Operating Finance As of January 31, 2021 (in thousands): Leases Leases 2022 $ 5,203 $ 1,112 2023 4,070 — 2024 3,514 — 2025 2,697 — Thereafter 7,509 — Total future minimum lease payments 22,993 1,112 Less effects of discounting (6,120) (90) Total lease liabilities $ 16,873 $ 1,022 Reported as of January 31, 2021 Lease liabilities $ 3,718 $ 1,022 Lease liabilities non-current 13,155 — Total lease liabilities $ 16,873 $ 1,022 |
Long-Term Debt (Tables)_2
Long-Term Debt (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Schedule of maturities of long term debt | Fiscal year ended January 31: 2022 (remaining 9 months) $ 3,900 2023 10,400 2024 10,400 2025 112,700 2026 381,300 Total payments 518,700 Less: Current portion (6,500) Less: Unamortized Fresh-Start Reporting Fair Value Adjustment (4,273) Long-term portion $ 507,927 | Fiscal year ended January 31: 2022 $ 5,200 2023 10,400 2024 10,400 2025 112,700 2026 381,300 Total payments 520,000 Less: Current portion (5,200) Less: Unamortized Fresh-Start Reporting Fair Value Adjustment (4,564) Long-term portion $ 510,236 |
Schedule of amounts outstanding under Senior Credit Facilities | Payable in Fiscal Year First Lien Second Lien Revolving Credit Total Fiscal 2021 $ 627,536 $ 302,336 60,000 $ 989,872 Total $ 627,536 $ 302,336 60,000 $ 989,872 | |
Scheuled of summary of net loans | Weighted Average Maturity Instrument Balance Interest Rate Interest Type Issuance Date Date Series 1 $ 933,615 13.0 % Variable, Compounding Apr 25, 2014 Jan 31, 2045 Series 2 598,787 8.0 % Variable, Simple Apr 25, 2014 Apr 28, 2021 Series 3 327,537 11.5 % Variable, Simple Apr 25, 2014 Apr 28, 2021 Series 4 60,000 13.0 % Variable, Compounding Sep 25, 2014 Sep 30, 2044 Series 5(a) 71,538 8.0 % Variable, Simple Sep 25, 2014 Sep 30, 2044 Series 5(b) 28,461 11.5 % Variable, Simple Sep 25, 2014 Sep 30, 2044 Intra-group Loan Agreement 65,000 12.0 % Variable, Compounding Dec 3, 2015 Nov 3, 2044 Funding Bond # 1 54,000 13.0 % Variable, Simple Jan 31, 2018 Apr 28, 2021 Funding Bond # 2 50,000 13.0 % Variable, Simple Jan 29, 2019 Apr 28, 2021 Total $ 2,188,938 |
Long-Term Liabilities (Tables_2
Long-Term Liabilities (Tables) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Schedule of other noncurrent liabilities | Other long-term liabilities in the accompanying consolidated balance sheets consist of the following (in thousands): April 30, 2021 January 31, 2021 Uncertain tax positions; including interest and penalties – long-term $ 4,374 $ 5,794 Warrants 800 900 Other 216 204 Total other long-term liabilities $ 5,390 $ 6,898 | Other long-term liabilities in the accompanying consolidated balance sheets consist of the following (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Uncertain tax positions; including interest and penalties – long-term $ 5,794 $ 6,025 Warrants 900 — Other 204 1,547 Total other long-term liabilities $ 6,898 $ 7,572 |
Revenue (Tables)_2
Revenue (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Schedule of disaggregated revenue | The following is a summary of revenues by type for the three months ended April 30, 2021 (Successor) and three months ended April 30, 2020 (Predecessor), (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 SaaS and subscription services $ 78,575 $ 101,089 Software maintenance 4,064 5,260 Professional services 8,191 10,946 Perpetual software licenses 871 1,031 Hardware and other — 3 Total net revenues(1) $ 91,701 $ 118,329 The following table sets forth our revenues by geographic region for the three months ended April 30, 2021 (Successor) and three months ended April 30, 2020 (Predecessor), (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Revenues: United States $ 70,170 $ 93,533 Other Americas 4,461 4,931 Europe, Middle East and Africa 12,113 13,787 Asia-Pacific 4,957 6,078 Total net revenues (1) $ 91,701 $ 118,329 | The following is a summary of revenues by type for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019 (Predecessor) (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 SaaS and subscription services $ 93,205 $ 234,766 $ 439,791 $ 462,240 Software maintenance 4,770 12,079 23,982 30,161 Professional services 9,546 24,499 45,661 38,043 Perpetual software licenses 1,241 2,486 1,885 3,340 Hardware and other 6 21 2,702 357 Total net revenues (1) $ 108,768 $ 273,851 $ 514,021 $ 534,141 The following table sets forth our revenues by geographic region for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor), and the fiscal years ended January 31, 2020 and 2019 (Predecessor) (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Revenues: United States $ 84,248 $ 217,783 $ 405,065 $ 421,746 Other Americas 4,724 8,899 21,925 22,807 Europe, Middle East and Africa 13,934 32,788 61,321 66,244 Asia-Pacific 5,862 14,381 25,710 23,344 Total net revenues (1) $ 108,768 $ 273,851 $ 514,021 $ 534,141 (1) As a result of the Company’s adoption of ASC 606 effective February 1, 2019 using the modified retrospective method, prior period amounts have not been adjusted to conform with ASC 606 and therefore may not be comparable. |
Schedule of deferred revenue | Deferred revenue activity for the three months ended April 30, 2021 was as follows (in thousands): Deferred revenue at January 31, 2021 (Successor) $ 260,584 Billings deferred 67,034 Recognition of prior deferred revenue (91,701) Deferred revenue at April 30, 2021 (Successor) $ 235,917 | Deferred revenue activity for the period February 1, 2020 through August 27, 2020 (Predecessor) and the period August 28, 2020 through January 31, 2021 (Successor) was as follows (in thousands): Deferred revenue at February 1, 2020 (includes current and non-current components) $ 311,170 Billings deferred 163,333 Recognition of prior deferred revenue (273,851) Deferred revenue at August 27, 2020 200,652 Fresh start reporting fair value adjustment (116,252) Deferred revenue at August 28, 2020 (Successor) 84,400 Billings deferred 284,952 Recognition of prior deferred revenue (108,768) Deferred revenue at January 31, 2021 (Successor) $ 260,584 |
Schedule of deferred contract acquisition costs | Deferred contract acquisition cost activity for the three months ended April 30, 2021 was as follows (in thousands): Deferred contract acquisition costs at January 31, 2021 (Successor) $ 7,584 Contract acquisition costs 5,491 Recognition of contract acquisition costs (3,323) Deferred contract acquisition costs at April 30, 2021 (Successor) $ 9,752 | Deferred contract acquisition cost activity for the period February 1, 2020 through August 27, 2020 (Predecessor) and the periods August 28, 2020 through January 31, 2021 (Successor) was as follows (in thousands): Deferred contract acquisition costs at February 1, 2020 $ 22,887 Contract acquisition costs 11,965 Recognition of contract acquisition costs (14,060) Deferred contract acquisition costs at August 27, 2020 (Predecessor) $ 20,792 Fresh start reporting fair value adjustment (20,792) Deferred contract acquisition costs at August 28, 2020 (Successor) — Contract acquisition costs 19,973 Recognition of contract acquisition costs (12,389) Deferred contract acquisition costs at January 31, 2021 (Successor) $ 7,584 |
Fair Value Measurements (Tabl_4
Fair Value Measurements (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Schedule of company's assets and liabilities that are measured at fair value on a recurring basis | The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of April 30, 2021 and are categorized using the fair value hierarchy (in thousands): Total (Level 3) Warrants to purchase Company common stock $ 800 $ 800 Total assets recorded at fair value $ 800 800 | The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of January 31, 2021 and are categorized using the fair value hierarchy (in thousands): Total (Level 3) Warrants to purchase Company common stock $ 900 $ 900 Total assets recorded at fair value $ 900 900 |
Schedule of reconciliation of Level 3 instruments | The following table is a reconciliation of Level 3 instruments for which significant unobservable inputs were used to determine fair value: Successor Three months ended April 30, 2021 Balance as of January 31, 2021 $ 900 Impact of warrant modification, recorded in shareholders’ equity — Unrealized gains recognized as other income (100) Balance as of April 30, 2021 $ 800 | Successor August 28, 2020 through January 31, 2021 Balance as of August 28, 2020 $ 11,200 Impact of warrant modification, recorded in shareholders’ equity (7,400) Unrealized gains recognized as other income (2,900) Balance as of January 31, 2021 $ 900 |
Segment Information (Tables)_2
Segment Information (Tables) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Summary company's segment results and segment assets | The following table presents summary results for each of the businesses for the three months ended April 30, 2021 and the three months ended April 30, 2020 (in thousands): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Skillsoft Revenues $ 67,057 $ 84,318 Operating expenses 93,127 287,917 Operating (loss) income (26,070) (203,599) SumTotal Revenues 24,644 34,011 Operating expenses 26,277 168,157 Operating income (loss) (1,633) (134,146) Consolidated Revenues 91,701 118,329 Operating expenses 119,404 456,074 Operating income (loss) (27,703) (337,745) Total non-operating (expense) income (352) 910 Interest expense, net (11,439) (105,959) Reorganization items, net — — (Provision) benefit for income taxes 2,089 8,891 Net (loss) income $ (37,405) $ (433,903) The Company’s segment assets primarily consist of cash and cash equivalents, accounts receivable, prepaid expenses, deferred taxes, property and equipment, goodwill and intangible assets. The following table sets forth the Company’s segment assets as of April 30, 2021 and January 31, 2021 (in thousands): April 30, 2021 January 31, 2021 Skillsoft $ 1,313,124 $ 1,398,379 SumTotal 144,982 147,358 Corporate — — Consolidated $ 1,458,106 $ 1,545,737 | The following table presents summary results for each of the businesses for the period August 28, 2020 through January 31, 2021 (Successor), February 1, 2020 through August 27, 2020 (Predecessor) and the fiscal years ended January 31, 2020 and 2019 (in thousands): Successor Predecessor August 28, 2020 February 1, 2020 Year ended Year ended through January 31, through August 27, January 31, January 31, 2021 2020 2020 2019 Skillsoft Revenues $ 72,425 $ 196,238 $ 362,503 $ 378,316 Operating expenses 158,671 398,178 637,658 364,581 Operating (loss) income (86,246) (201,940) (275,155) 13,735 SumTotal Revenues 36,343 77,613 151,518 155,825 Operating expenses 49,269 205,483 279,579 162,906 Operating income (loss) (12,926) (127,870) (128,061) (7,081) Consolidated Revenues 108,768 273,851 514,021 534,141 Operating expenses 207,940 603,661 917,237 527,487 Operating income (loss) (99,172) (329,810) (403,216) 6,654 Total non-operating (expense) income 3,452 1,268 (5,120) (5,624) Interest expense, net (19,936) (168,236) (429,657) (395,842) Reorganization items, net — 3,329,245 — — (Provision) benefit for income taxes 21,934 (68,455) (11,212) (5,027) Net (loss) income $ (93,722) $ 2,764,012 $ (849,205) $ (399,839) The Company’s segment assets primarily consist of cash and cash equivalents, accounts receivable, prepaid expenses, deferred taxes, property and equipment, goodwill and intangible assets. The following table sets forth the Company’s segment assets as of January 31, 2021 and January 31, 2020 (in thousands): Successor Predecessor January 31, 2021 January 31, 2020 Skillsoft $ 1,398,379 $ 1,655,474 SumTotal 147,358 330,785 Corporate — 6 Consolidated $ 1,545,737 $ 1,986,265 |
Schedule company's long-lived tangible assets by geographic region | The following table sets forth the Company’s long-lived tangible assets by geographic region for the years ended April 30, 2021 and January 31, 2021 (in thousands): April 30, 2021 January 31, 2021 United States $ 9,019 $ 10,613 Ireland 499 609 Rest of world 2,280 2,558 Total $ 11,798 $ 13,780 | Successor Predecessor January 31, 2021 January 31, 2020 United States $ 10,613 $ 13,469 Ireland 609 897 Rest of world 2,558 3,536 Total $ 13,780 $ 17,902 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | |
Schedule of basic and diluted loss per share | The following table reflects the calculation of basic and diluted net income (loss) per share (in dollars, except per share amounts): Three Months Ended Three Months Ended March 31, March 31, 2021 2020 Class A common stock subject to possible redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 50,107 $ 1,956,529 Unrealized gain (loss) on investments held in Trust Account 1,118 (18,188) Less: Company's portion available to be withdrawn to pay taxes (43,998) (395,474) Less: Company's portion available to be withdrawn for working capital purposes (7,227) (217,385) Net income allocable to Class A common stock subject to possible redemption $ — $ 1,325,482 Denominator: Weighted Average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 53,712,502 61,025,925 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.00 $ 0.02 Non-Redeemable Common Stock Numerator: Net Income (Loss) minus Net Earnings Net income (loss) $ 41,740,801 $ (8,823,514) Less: Income allocable to Class A common stock subject to possible redemption — (1,325,482) Non-Redeemable Net Income (Loss) $ 41,740,801 $ (10,148,996) Denominator: Weighted Average Non-redeemable Common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 32,537,498 25,224,075 Basic and diluted net income (loss) per share, Non-redeemable Common stock $ 1.28 $ (0.40) | The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts): For the Period from April 11, 2019 (Inception) Year Ended Through December 31, December 31, 2020 2019 Class A Common Stock Subject to Possible Redemption Numerator: Earnings allocable to Class A common stock subject to possible redemption Interest income $ 1,959,040 $ 6,410,370 Unrealized gain on investments held in Trust Account 993 44,401 Less: Company’s portion available to be withdrawn to pay taxes (534,953) (1,344,722) Less: Company’s portion available to be withdrawn for working capital purposes (194,600) (241,375) Net income allocable to Class A common stock subject to possible redemption $ 1,230,480 $ 4,868,674 Denominator: Weighted average Class A common stock subject to possible redemption Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption 58,723,869 61,961,631 Basic and diluted net income per share, Class A common stock subject to possible redemption $ 0.02 $ 0.08 Non-Redeemable Common Stock Numerator: Net loss minus net earnings Net loss $ (72,459,185) $ (14,682,592) Less: Income attributable to Class A common stock subject to possible redemption (1,230,480) (4,868,674) Non-redeemable net loss $ (73,689,665) $ (19,551,226) Denominator: Weighted Average Non-redeemable common stock Basic and diluted weighted average shares outstanding, Non-redeemable Common stock 27,526,131 21,438,529 Basic and diluted net loss per common share, Non-redeemable common stock $ (2.68) $ (0.91) | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||
Schedule of basic and diluted loss per share | The following table sets forth the computation of basic and diluted earnings per share (in thousands, except number of shares and per share data): Successor Predecessor Three months ended Three months ended April 30, 2021 April 30, 2020 Net loss $ (37,405) $ (433,903) Weighted average common shares outstanding: Ordinary – Basic and Diluted (Predecessor) * 100 Class A and B – Basic and Diluted (Successor) 4,000 * Net loss per share Loss per share: Ordinary – Basic and Diluted (Predecessor) * $ (4,334.70) Class A and B – Basic and Diluted (Successor) $ (9.35) * | The following table sets forth the computation of basic and diluted earnings per share (in thousands, except number of shares and per share data): Successor Predecessor Predecessor August 28, 2020 February 1, 2020 Year Ended Year Ended through January 31, through August 27, January 31, January 31, 2020 2020 2020 2019 Net (loss) income $ (93,722) $ 2,764,012 $ (849,205) $ (399,839) Weighted average common share outstanding: Ordinary – Basic and Diluted (Predecessor * 100 100 100 Class A – Basic and Diluted 3,840 * * * Class B – Basic and Diluted 160 * * * Net loss per share class (Successor only) Net loss for Class A $ (89,973) * * * Loss on modifications of terms of participation rights held by other shareholders and warrants (5,900) * * * Net loss attributable to Class A $ (95,873) * * * Net loss for Class B $ (3,749) * * * Gain on modifications of terms of participation rights held by other shareholders and warrants 5,900 * * * Net income attributable to Class B $ 2,151 * * * (Losses) income per share: Ordinary – Basic and Diluted (Predecessor) * $ 27,612.51 $ (8,483.57) $ (3,994.40) Class A – Basic and Diluted (Successor) $ (24.97) * * * Class B – Basic and Diluted (Successor) $ 13.44 * * * |
Intangible Assets - Intangibl_2
Intangible Assets - Intangible assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 |
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Accumulated Amortization, Finite-lived | $ 74,784 | $ 39,825 | $ 624,283 |
Net Carrying Amount, Finite-lived | 603,430 | 637,133 | |
Gross Carrying Amount, Intangible assets | 769,714 | 768,458 | 1,059,268 |
Net Carrying Amount, Intangible assets | 694,930 | 728,633 | 434,985 |
Skillsoft trademark | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Carrying Amount, Indefinite-lived | 91,500 | 186,000 | |
Gross Carrying Amount, Intangible assets | 91,500 | 91,500 | |
Net Carrying Amount, Intangible assets | 91,500 | 91,500 | |
Developed software/ courseware | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 267,014 | 265,758 | 157,168 |
Accumulated Amortization, Finite-lived | 39,459 | 24,669 | 129,663 |
Net Carrying Amount, Finite-lived | 227,555 | 241,089 | 27,505 |
Customer contracts/ relationships | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 279,500 | 279,500 | 670,800 |
Accumulated Amortization, Finite-lived | 9,114 | 3,627 | 466,972 |
Net Carrying Amount, Finite-lived | 270,386 | 275,873 | 203,828 |
Trademarks and trade names | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 6,300 | 6,300 | 45,300 |
Accumulated Amortization, Finite-lived | 676 | 455 | 27,648 |
Net Carrying Amount, Finite-lived | 5,624 | 5,845 | $ 17,652 |
Publishing rights | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 35,200 | 35,200 | |
Accumulated Amortization, Finite-lived | 4,693 | 2,933 | |
Net Carrying Amount, Finite-lived | 30,507 | 32,267 | |
Backlog | |||
Finite Lived And Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross Carrying Amount, Finite-lived | 90,200 | 90,200 | |
Accumulated Amortization, Finite-lived | 20,842 | 8,141 | |
Net Carrying Amount, Finite-lived | $ 69,358 | $ 82,059 |
Intangible Assets - Amortizat_2
Intangible Assets - Amortization expense (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | |
Amortization expense related to the existing finite-lived intangible assets | |||
2022 (Remaining 9 months) | $ 104,693 | $ 139,408 | |
2023 | 120,579 | 120,339 | |
2024 | 106,172 | 105,910 | |
2025 | 94,070 | 93,842 | |
2026 | 64,496 | 64,269 | |
Thereafter | 113,420 | 113,365 | |
Total | 603,430 | $ 637,133 | |
Amortization expense related to intangible assets | $ 35,200 | $ 17,400 |
Intangible Assets (Details)_2
Intangible Assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Goodwill [Line Items] | |||||
Impairment charges of indefinite-lived intangible assets | $ 332,376 | $ 332,376 | $ 440,598 | $ 16,094 | |
Goodwill impairment | 177,886 | 440,598 | |||
Goodwill and intangible asset impairment charges | 332,376 | 332,376 | 440,598 | 16,094 | |
Books24x7 tradename | |||||
Goodwill [Line Items] | |||||
Impairment charges of definite lived intangible assets | 15,500 | ||||
Vodeclic tradename | |||||
Goodwill [Line Items] | |||||
Impairment charges of definite lived intangible assets | $ 600 | ||||
Skillsoft reporting unit | |||||
Goodwill [Line Items] | |||||
Impairment charges of indefinite-lived intangible assets | 92,200 | 92,200 | |||
Goodwill impairment | $ 107,900 | 107,900 | 107,934 | 321,340 | |
Goodwill and intangible asset impairment charges | 92,200 | ||||
SumTotal reporting unit | |||||
Goodwill [Line Items] | |||||
Impairment charges of definite lived intangible assets | 62,300 | 62,300 | |||
Goodwill impairment | $ 70,000 | 70,000 | $ 69,952 | $ 119,258 | |
Goodwill and intangible asset impairment charges | $ 62,300 |
Intangible Assets - rollforwa_2
Intangible Assets - rollforward of goodwill - (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Goodwill [Line Items] | |||||
Goodwill, Beginning balance | $ 495,004,000 | $ 495,135,000 | $ 1,253,822,000 | $ 1,694,313,000 | $ 1,693,906,000 |
Re-allocation of goodwill upon change in reporting units | 0 | ||||
Impact of Fresh-Start Reporting | 575,539,000 | ||||
Foreign currency translation adjustment | (62,000) | (131,000) | (162,000) | 107,000 | 407,000 |
Canada deconsolidation | 5,100,000 | ||||
Goodwill, Ending balance | 494,942,000 | 495,004,000 | 1,070,674,000 | 1,253,822,000 | 1,694,313,000 |
Skillsoft reporting unit | |||||
Goodwill [Line Items] | |||||
Goodwill, Beginning balance | 491,654,000 | 491,785,000 | 1,112,820,000 | 1,434,047,000 | 0 |
Re-allocation of goodwill upon change in reporting units | 1,433,662,000 | ||||
Impact of Fresh-Start Reporting | 507,843,000 | ||||
Foreign currency translation adjustment | (62,000) | (131,000) | (158,000) | 113,000 | 385,000 |
Canada deconsolidation | 5,100,000 | ||||
Goodwill, Ending balance | 491,592,000 | 491,654,000 | 999,628,000 | 1,112,820,000 | 1,434,047,000 |
Accumulated impairment losses | 0 | 0 | 321,340 | 0 | |
SumTotal reporting unit | |||||
Goodwill [Line Items] | |||||
Goodwill, Beginning balance | 3,350,000 | 3,350,000 | 141,002,000 | 260,266,000 | 0 |
Re-allocation of goodwill upon change in reporting units | 260,244,000 | ||||
Impact of Fresh-Start Reporting | 67,696,000 | ||||
Foreign currency translation adjustment | 0 | (4,000) | (6,000) | 22,000 | |
Canada deconsolidation | 0 | ||||
Goodwill, Ending balance | $ 3,350,000 | 3,350,000 | $ 71,046,000 | 141,002,000 | 260,266,000 |
Accumulated impairment losses | $ 0 | $ 119,258 | $ 0 |
Taxes (Details)_2
Taxes (Details) - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Aug. 31, 2020 | Aug. 27, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 |
Income Tax Examination [Line Items] | |||||||||||||
Benefit from income taxes | $ 2,422 | $ 404,809 | $ 1,247,517 | $ 486,761 | $ 1,247,517 | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||||||
Income Tax Examination [Line Items] | |||||||||||||
Benefit from income taxes | $ 11,212,000 | $ 2,089,000 | $ 8,891,000 | $ (21,934,000) | $ 68,455,000 | $ 68,455,000 | $ 11,212,000 | $ 5,027,000 | |||||
Pretax losses | $ 39,500,000 | $ 442,800,000 |
Prepaid Expenses and Other Cu_6
Prepaid Expenses and Other Current Assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 | Feb. 01, 2019 | Jan. 31, 2019 |
Deferred commission costs - current | $ 4,019 | $ 3,147 | $ 11,195 | ||
Refundable income tax | 9,618 | 8,969 | 6,726 | ||
Prepaid software maintenance costs | 8,370 | 8,587 | 6,569 | ||
Prepaid royalties | 2,876 | 2,958 | 2,294 | ||
Employee bonus advance | 1,867 | ||||
Other | 6,942 | 6,665 | 7,771 | ||
Total prepaid expenses and other current assets | $ 31,825 | $ 30,326 | $ 36,422 | $ 36,933 | $ 52,456 |
Other Assets (Details)_2
Other Assets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 | Feb. 01, 2019 | Jan. 31, 2019 |
Deferred commission costs - non-current | $ 5,733 | $ 4,437 | $ 11,692 | ||
Non-current refundable income tax | 1,979 | ||||
Other | 3,772 | 4,199 | 2,635 | ||
Total other assets | $ 9,505 | $ 8,636 | $ 16,306 | $ 16,168 | $ 6,037 |
Accrued Expenses (Details)_2
Accrued Expenses (Details) - USD ($) | Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Jan. 31, 2020 |
Income taxes payable | $ 98,700 | $ 95,302 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||
Professional fees | $ 6,018,000 | $ 8,832,000 | $ 12,947,000 | ||
Accrued sales tax/VAT | 2,144,000 | 5,379,000 | 5,824,000 | ||
Accrued royalties | 1,961,000 | 2,152,000 | 1,869,000 | ||
Income taxes payable | 4,727,000 | 2,634,000 | 1,288,000 | ||
Accrued interest | 368,000 | 491,000 | 274,000 | ||
Other accrued liabilities | 3,067,000 | 3,637,000 | 7,065,000 | ||
Total accrued expenses | $ 18,285,000 | $ 23,125,000 | $ 29,267,000 |
Restructuring (Details)_2
Restructuring (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
Restructuring Reserve [Roll Forward] | ||||||
Restructuring accrual as of January 31, 2021 | $ 5,171 | $ 1,037 | $ 1,503 | $ 1,037 | $ 1,740 | $ 1,529 |
Restructuring charges incurred | 537 | 370 | 4,341 | 1,179 | 1,900 | 2,073 |
Payments made | (2,347) | (673) | (713) | (2,629) | (1,820) | |
Foreign currency translation adjustment | 26 | (42) | ||||
Restructuring accrual as of April 30, 2021 | 3,361 | 5,171 | 1,503 | 1,037 | 1,740 | |
Employee Severance and Related Costs | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Restructuring accrual as of January 31, 2021 | 5,000 | 761 | 1,234 | 761 | 1,713 | 1,504 |
Restructuring charges incurred | 311 | 4,218 | 1,032 | 1,610 | 1,971 | |
Payments made | (2,049) | (452) | (559) | (2,588) | (1,720) | |
Foreign currency translation adjustment | 26 | (42) | ||||
Restructuring accrual as of April 30, 2021 | 3,262 | 5,000 | 1,234 | 761 | 1,713 | |
Contractual Obligations | ||||||
Restructuring Reserve [Roll Forward] | ||||||
Restructuring accrual as of January 31, 2021 | 171 | $ 276 | 269 | 276 | 27 | 25 |
Restructuring charges incurred | 226 | 123 | 147 | 290 | 102 | |
Payments made | (298) | (221) | (154) | (41) | (100) | |
Restructuring accrual as of April 30, 2021 | $ 99 | $ 171 | $ 269 | $ 276 | $ 27 |
Restructuring - Restructuring_2
Restructuring - Restructuring charges (Details) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges incurred | $ 537 | $ 370 | $ 4,341 | $ 1,179 | $ 1,900 | $ 2,073 |
Leases, Commitment and Contin_7
Leases, Commitment and Contingencies (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) | Apr. 30, 2021 | Jan. 31, 2021 |
Operating Leases | ||
2022 (excluding 3 months ended April 30, 2021) | $ 3,898,000 | |
2023 | 4,065,000 | $ 5,203,000 |
2024 | 3,499,000 | 4,070,000 |
2025 | 2,684,000 | 3,514,000 |
2026 | 1,245,000 | 2,697,000 |
Thereafter | 6,245,000 | |
Total future minimum lease payments | 21,636,000 | 22,993,000 |
Less effects of discounting | (5,692,000) | (6,120,000) |
Total lease liabilities | 15,944,000 | 16,873,000 |
Reported as of April 30, 2021 | ||
Lease liabilities | 3,574,000 | 3,718,000 |
Long term lease liabilities | 12,370,000 | 13,155,000 |
Total lease liabilities | 15,944,000 | 16,873,000 |
Finance Leases | ||
2022 (excluding 3 months ended April 30, 2021) | 1,209,000 | |
2023 | 1,112,000 | |
Total future minimum lease payments | 1,209,000 | 1,112,000 |
Less effects of discounting | (93,000) | (90,000) |
Total lease liabilities | 1,116,000 | 1,022,000 |
Reported as of April 30, 2021 | ||
Lease liabilities | 1,116,000 | 1,022,000 |
Total lease liabilities | $ 1,116,000 | $ 1,022,000 |
Leases, Commitment and Contin_8
Leases, Commitment and Contingencies - Additional Information (Details) - USD ($) | 3 Months Ended | 5 Months Ended | 7 Months Ended | 16 Months Ended | |
Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Apr. 30, 2021 | |
Lessee, Lease, Description [Line Items] | |||||
Option to extend lease | True | ||||
Option to terminate lease | True | ||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||
Lessee, Lease, Description [Line Items] | |||||
Option to extend lease | True | ||||
Option to terminate lease | True | ||||
Remaining lease term at the time of exercise of option to terminate paris facility lease | 3 years | ||||
Term of notice to landlord to exercise the lease termination option | 6 months | ||||
Maximum purchase price (in percentage) | 12.00% | ||||
Finance lease, right of use assets | $ 400,000 | $ 1,100,000 | $ 400,000 | ||
Finance Lease liability | $ 1,116,000 | $ 1,022,000 | $ 1,116,000 | ||
Weighted-average remaining lease term of operating leases | 6 years 8 months 12 days | 6 years 9 months 18 days | 6 years 8 months 12 days | ||
Remaining lease term of finance lease | 8 months 12 days | 10 months 24 days | 8 months 12 days | ||
Lease costs | $ 1,400,000 | $ 1,600,000 | $ 2,700,000 | $ 3,900,000 | |
Payment of lease cost related amounts | $ 1,600,000 | $ 1,500,000 | $ 2,700,000 | $ 3,600,000 | |
Maximum [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||
Lessee, Lease, Description [Line Items] | |||||
Company's leases, remaining lease term | 13 years | 13 months | |||
Minimum [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||
Lessee, Lease, Description [Line Items] | |||||
Company's leases, remaining lease term | 6 months | 9 months |
Long-Term Debt -Minimum princ_2
Long-Term Debt -Minimum principal payments (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 |
Short-term Debt [Line Items] | ||
2022 (remaining 9 months) | $ 3,900 | $ 5,200 |
2023 | 10,400 | 10,400 |
2024 | 10,400 | 10,400 |
2025 | 112,700 | 112,700 |
2026 | 381,300 | 381,300 |
Total payments | 518,700 | 520,000 |
Less: Current portion | (6,500) | |
Less: Unamortized Fresh-Start Reporting Fair Value Adjustment | (4,273) | $ (4,564) |
Long-term portion | $ 507,927 |
Long-Term Debt - Accounts recei
Long-Term Debt - Accounts receivable Facility (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Aug. 27, 2020 | Dec. 20, 2018 | Apr. 30, 2022 | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 | Sep. 19, 2019 | Jan. 31, 2019 | Jan. 31, 2018 |
Debt Instrument [Line Items] | |||||||||
Exit Credit Facility | $ 520,000 | $ 520,000 | |||||||
LIBOR Floor Rate | 1.00% | 1.00% | |||||||
Instrument amount | $ 2,600 | $ 1,300 | |||||||
Contractual interest | $ 100,400 | ||||||||
Senior credit facility | $ 2,035,000 | ||||||||
Outstanding borrowings | $ 1,030,000 | $ 90,000 | |||||||
Additionla loans | $ 160 | $ 50,000 | $ 54,000 | ||||||
Debt instrument accrued and unpaid interest | 1,067,000 | ||||||||
Long term accounts and loan receivable | $ 75,000 | ||||||||
Amount indebtedness | $ 75,000 | ||||||||
Advance Rate | 95.00% | ||||||||
interest rate | 4.899% | ||||||||
Maturity period for remaning amount of credit facility | 90 days | ||||||||
Reserve balances | $ 1,700 | ||||||||
Scenario 1 | |||||||||
Debt Instrument [Line Items] | |||||||||
Termination period | 5 years | ||||||||
Scenario 2 | |||||||||
Debt Instrument [Line Items] | |||||||||
Termination period | 45 days | ||||||||
Scenario 3 | |||||||||
Debt Instrument [Line Items] | |||||||||
Termination period | 180 days | ||||||||
Maximum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Outstanding borrowings | $ 90,000 | ||||||||
Advance Rate | 85.00% | ||||||||
Minimum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Outstanding borrowings | $ 75,000 | ||||||||
Advance Rate | 50.00% | ||||||||
Third party | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument collateral amount | $ 1,030,000 | ||||||||
LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate (as a percent) | 7.50% | 7.50% | |||||||
First out term loan facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Exit Credit Facility | $ 110,000 | $ 110,000 | |||||||
Second-out term loan facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Exit Credit Facility | $ 410,000 | 410,000 | |||||||
First Lien | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior credit facility | 1,365,000 | ||||||||
Initially borrowings | 664,100 | ||||||||
Outstanding borrowings | 662,390 | ||||||||
Second Lien | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior credit facility | 670,000 | ||||||||
Initially borrowings | 302,400 | ||||||||
Outstanding borrowings | $ 367,614 | ||||||||
Revolving Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior credit facility | $ 80,000 |
Long-Term Liabilities - Conso_2
Long-Term Liabilities - Consolidated balance sheets (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 |
Uncertain tax positions; including interest and penalties - long-term | $ 4,374 | $ 5,794 | $ 6,025 |
Warrant Liabilities | 800 | 900 | |
Other | 216 | 204 | |
Total other long-term liabilities | $ 5,390 | $ 6,898 | $ 7,572 |
Long-Term Liabilities - Warrant
Long-Term Liabilities - Warrant (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 5 Months Ended | |
Apr. 30, 2021 | Jan. 31, 2021 | Jul. 01, 2019 | |
Warrant purchase price | $ 11.50 | ||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||
Number of ordinary shares issued | 705,882 | 705,882 | |
Warrants Other Income | $ 100 | $ 2,900 | |
Tranche A warrants | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||
Number of ordinary shares issued | 235,294 | 235,294 | |
Warrant purchase price | $ 262.34 | $ 262.34 | |
Tranche B warrants | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||
Number of ordinary shares issued | 470,588 | 470,588 | |
Warrant purchase price | $ 274.84 | $ 274.84 |
Shareholders' Equity (Details_2
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions | Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Oct. 12, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jun. 26, 2019 | Jun. 07, 2019 |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 4,000,000 | 100,100 | |||||||
Number of warrants to purchase additional common shares | 705,882 | 705,882 | |||||||
Common shares authorized | 1,000,000,000 | 1,000,000 | |||||||
Common stock par value | $ 0.01 | $ 1.38 | |||||||
Common stock shares outstanding | 4,000,000 | 100,100 | |||||||
Class A Common Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 11,090,292 | 15,287,498 | 7,974,075 | ||||||
Common shares authorized | 200,000,000 | 200,000,000 | 200,000,000 | ||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Common stock shares outstanding | 11,090,292 | 3,840,000 | 15,287,498 | 7,974,075 | |||||
Class A Common Stock [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 3,840,000 | 3,840,000 | |||||||
Common shares authorized | 800,000,000 | ||||||||
Common stock shares outstanding | 3,840,000 | ||||||||
Class B Common Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 17,250,000 | 17,250,000 | 17,250,000 | ||||||
Common shares authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Common stock shares outstanding | 17,250,000 | 160,000 | 17,250,000 | 17,250,000 | 17,250,000 | 11,500,000 | |||
Class B Common Stock [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock issued | 160,000 | 160,000 | |||||||
Common shares authorized | 200,000,000 | ||||||||
Common stock shares outstanding | 160,000 | ||||||||
Current and former executives | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
"Purchase of ordinary shares reserved in | $ 5.4 | ||||||||
Evergreen | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock par value | $ 0.01 |
Revenue - Disaggregated reven_2
Revenue - Disaggregated revenue and geography information (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Jan. 31, 2020 | Apr. 30, 2021 | Apr. 30, 2020 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Jan. 31, 2019 |
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | $ 514,021 | $ 91,701 | $ 118,329 | $ 108,768 | $ 273,851 | $ 514,021 | $ 534,141 |
SaaS and subscription services | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 78,575 | 101,089 | 93,205 | 234,766 | 439,791 | 462,240 | |
Software maintenance | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 4,064 | 5,260 | 4,770 | 12,079 | 23,982 | 30,161 | |
Professional services | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 8,191 | 10,946 | 9,546 | 24,499 | 45,661 | 38,043 | |
Perpetual software licenses | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 871 | 1,031 | 1,241 | 2,486 | 1,885 | 3,340 | |
Hardware and other | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 3 | 6 | 21 | 2,702 | 357 | ||
United States | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 70,170 | 93,533 | 84,248 | 217,783 | 405,065 | 421,746 | |
Other Americas | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 4,461 | 4,931 | 4,724 | 8,899 | 21,925 | 22,807 | |
Europe, Middle East and Africa | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | 12,113 | 13,787 | 13,934 | 32,788 | 61,321 | 66,244 | |
Asia-Pacific | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Total net revenues | $ 4,957 | $ 6,078 | $ 5,862 | $ 14,381 | $ 25,710 | $ 23,344 |
Revenue - Deferred revenue (D_2
Revenue - Deferred revenue (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | Aug. 27, 2020 | |
Movement in Deferred Revenue [Roll Forward] | |||
Deferred revenue, Beginning balance | $ 260,584 | $ 84,400 | $ 311,170 |
Billings deferred | 67,034 | 284,952 | 163,333 |
Recognition of prior deferred revenue | (91,701) | (108,768) | (273,851) |
Deferred revenue, Ending balance | $ 235,917 | $ 260,584 | $ 200,652 |
Revenue - Deferred contract a_2
Revenue - Deferred contract acquisition cost (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 7 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | Aug. 27, 2020 | |
Movement Analysis of Deferred Policy Acquisition Costs [Roll Forward] | |||
Deferred contract acquisition costs at beginning balance | $ 7,584 | $ 20,792 | $ 22,887 |
Contract acquisition costs | 5,491 | 19,973 | 11,965 |
Recognition of contract acquisition costs | (3,323) | ||
Deferred contract acquisition costs at ending balance | $ 9,752 | $ 7,584 | $ 20,792 |
Fair Value Measurements - Ass_2
Fair Value Measurements - Assets and liabilities that are measured at fair value on a recurring basis (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | $ 800 | $ 900 |
Recurring member | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | 800 | 900 |
Total assets recorded at fair value | 800 | 900 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | 800 | 900 |
Total assets recorded at fair value | $ 800 | $ 900 |
Fair Value Measurements - Rec_2
Fair Value Measurements - Reconciliation of Level 3 instruments (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | 3 Months Ended | 5 Months Ended | 12 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value as of beginning period | $ 900 | $ 11,200 | |
Impact of warrant modification, recorded in shareholders' equity | (7,400) | ||
Unrealized gains recognized as other income | (100) | (2,900) | |
Fair value as of Ending period | $ 800 | $ 900 | $ 900 |
Fair Value, Recurring Basis, Unobservable Input Reconciliation, Liability, Gain (Loss), Statement of Income [Extensible List] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Fair Value Measurements - Add_2
Fair Value Measurements - Additional information (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) $ in Millions | Apr. 30, 2021USD ($) | Jan. 31, 2021USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity value used as an input in Black-Scholes calculations | $ 667 | $ 667 |
Dividend yield | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input | 0 | 0 |
Volatility | Non-Favored Sale scenario | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input | 35 | 35 |
Volatility | Held-to-maturity scenario | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input | 31.6 | 31.6 |
Segment Information - Segment_2
Segment Information - Segment results (Details) - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | Aug. 27, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 |
Segment Reporting Information [Line Items] | ||||||||||||||||
Formation and operating costs | $ 1,584,933 | $ 301,863 | $ 744,859 | $ 2,906,903 | ||||||||||||
Operating income (loss) | (1,584,933) | (301,863) | (744,859) | (906,903) | ||||||||||||
Total non-operating (expense) income | 43,328,156 | (8,116,842) | (12,690,216) | (71,065,521) | ||||||||||||
Benefit from income taxes | 2,422 | 404,809 | 1,247,517 | 486,761 | $ 1,247,517 | |||||||||||
Net income | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||
Revenues | $ 91,701,000 | $ 118,329,000 | $ 108,768,000 | $ 273,851,000 | $ 514,021,000 | $ 534,141,000 | ||||||||||
Formation and operating costs | 119,404,000 | 456,074,000 | 207,940,000 | 603,661,000 | $ 603,661,000 | 917,237,000 | 527,487,000 | |||||||||
Operating income (loss) | $ (403,216,000) | (27,703,000) | (337,745,000) | (99,172,000) | (329,810,000) | (329,810,000) | (403,216,000) | 6,654,000 | ||||||||
Total non-operating (expense) income | (352,000) | 910,000 | 3,452,000 | 1,268,000 | (5,120,000) | (5,624,000) | ||||||||||
Interest expense, net | (11,439,000) | (105,959,000) | (19,936,000) | (168,236,000) | (429,657,000) | (395,842,000) | ||||||||||
Reorganization items, net | 3,329,245,000 | (3,329,245,000) | ||||||||||||||
Benefit from income taxes | 11,212,000 | 2,089,000 | 8,891,000 | (21,934,000) | 68,455,000 | 68,455,000 | 11,212,000 | 5,027,000 | ||||||||
Net income | $ (849,205,000) | (37,405,000) | (433,903,000) | (93,722,000) | 2,764,012,000 | $ 2,764,012,000 | (849,205,000) | (399,839,000) | ||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Skillsoft | ||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||
Revenues | 67,057,000 | 84,318,000 | 72,425,000 | 196,238,000 | 362,503,000 | 378,316,000 | ||||||||||
Formation and operating costs | 93,127,000 | 287,917,000 | 158,671,000 | 398,178,000 | 637,658,000 | 364,581,000 | ||||||||||
Operating income (loss) | (26,070,000) | (203,599,000) | (86,246,000) | (201,940,000) | (275,155,000) | 13,735,000 | ||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | SumTotal | ||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||
Revenues | 24,644,000 | 34,011,000 | 36,343,000 | 77,613,000 | 151,518,000 | 155,825,000 | ||||||||||
Formation and operating costs | 26,277,000 | 168,157,000 | 49,269,000 | 205,483,000 | 279,579,000 | 162,906,000 | ||||||||||
Operating income (loss) | $ (1,633,000) | $ (134,146,000) | $ (12,926,000) | $ (127,870,000) | $ (128,061,000) | $ (7,081,000) |
Segment Information - Segment_3
Segment Information - Segment assets (Details) - USD ($) | Apr. 30, 2021 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Feb. 01, 2019 | Jan. 31, 2019 |
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | $ 699,511,963 | $ 700,925,360 | $ 697,836,358 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | $ 1,458,106,000 | $ 1,545,737,000 | $ 1,986,265,000 | $ 2,539,783,000 | $ 2,545,175,000 | |||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Skillsoft | ||||||||
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | 1,313,124,000 | 1,398,379,000 | 1,655,474,000 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | SumTotal | ||||||||
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | $ 144,982,000 | $ 147,358,000 | 330,785,000 | |||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | Corporate | ||||||||
Segment Reporting Information [Line Items] | ||||||||
TOTAL ASSETS | $ 6,000 |
Segment Information - Long-li_2
Segment Information - Long-lived tangible assets by geographic region (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Thousands | Apr. 30, 2021 | Jan. 31, 2021 | Jan. 31, 2020 |
Segment Reporting Information [Line Items] | |||
Total | $ 11,798 | $ 13,780 | $ 17,902 |
United States | |||
Segment Reporting Information [Line Items] | |||
Total | 9,019 | 10,613 | 13,469 |
Ireland | |||
Segment Reporting Information [Line Items] | |||
Total | 499 | 609 | 897 |
Rest of world | |||
Segment Reporting Information [Line Items] | |||
Total | $ 2,280 | $ 2,558 | $ 3,536 |
Segment Information - Additiona
Segment Information - Additional Information (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | 3 Months Ended |
Apr. 30, 2021segmentitem | |
Segment Reporting Information [Line Items] | |
Number of operating segments | segment | 2 |
Number of learning paths (channels) in skillsoft | item | 700 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) | Jan. 31, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2020 | Aug. 27, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Jan. 31, 2019 |
Net income (loss) | $ 41,740,801 | $ (8,823,514) | $ (53,585,867) | $ (16,497,280) | $ (25,340,816) | $ (14,682,592) | $ (72,459,185) | $ (14,682,592) | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 32,537,498 | 25,224,075 | 21,438,529 | 27,526,131 | ||||||||||||
Loss per share: | ||||||||||||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ 1.28 | $ (0.41) | $ (0.91) | $ (2.68) | ||||||||||||
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||||||||
Net income (loss) | $ (849,205,000) | $ (37,405,000) | $ (433,903,000) | $ (93,722,000) | $ 2,764,012,000 | $ 2,764,012,000 | $ (849,205,000) | $ (399,839,000) | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 100 | 100 | 100 | 100 | ||||||||||||
Loss on modifications of terms of participation rights held by other shareholders and warrants | (5,900,000) | |||||||||||||||
Gain on modifications of terms of participation rights held by other shareholders and warrants | $ 5,900,000 | |||||||||||||||
Loss per share: | ||||||||||||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ (4,334.70) | $ 27,612.51 | $ (8,483.57) | $ (3,994.40) | ||||||||||||
Class A And Class B | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | 4,000 | |||||||||||||||
Loss per share: | ||||||||||||||||
Basic and diluted net loss per share, Non-redeemable common stock | $ (9.35) |
Net Loss Per Share - Additional
Net Loss Per Share - Additional Information (Details) - shares | 3 Months Ended | 5 Months Ended |
Apr. 30, 2021 | Jan. 31, 2021 | |
Warrant [Member] | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities | 705,882 | 705,882 |
Related Party Transactions (D_3
Related Party Transactions (Details) - SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) - USD ($) $ in Millions | Apr. 30, 2021 | Jan. 31, 2021 | Aug. 27, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Dec. 02, 2019 | Mar. 31, 2019 | Mar. 02, 2019 | Jan. 31, 2019 | Dec. 31, 2018 | Dec. 02, 2018 | Mar. 31, 2018 | Mar. 02, 2018 |
Related Party Transaction [Line Items] | |||||||||||||
Outstanding borrowings | $ 2,035 | ||||||||||||
Holdings | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Outstanding borrowings | $ 2,189 | $ 2,189 | $ 2,189 | $ 2,189 | $ 2,189 | $ 2,189 | $ 2,189 | $ 2,189 | $ 2,189 | $ 2,189 | |||
First Out Term Loans | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Outstanding borrowings | $ 110 | $ 110 | |||||||||||
Second Out Term Loan Facility | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Outstanding borrowings | $ 410 | $ 410 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Oct. 12, 2020 | Mar. 31, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 |
SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Subsequent Event [Line Items] | ||||||
Common stock par value | $ 0.01 | $ 1.38 | ||||
Agreement and Plan of Merger | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Subsequent Event [Line Items] | ||||||
Nominal value per share | $ 0.01 | |||||
Common stock par value | $ 0.0001 | |||||
Aggregate principal amount | $ 20,000,000 | |||||
Agreement and Plan of Merger | Existing Second Out Credit Agreement | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Subsequent Event [Line Items] | ||||||
Aggregate redemption price, cash | $ 505,000,000 | |||||
Class A Common Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Class A Common Stock [Member] | Agreement and Plan of Merger | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Subsequent Event [Line Items] | ||||||
Nominal value per share | 0.01 | |||||
Common stock par value | 0.0001 | |||||
Class B Common Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Common stock par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Class B Common Stock [Member] | Agreement and Plan of Merger | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Subsequent Event [Line Items] | ||||||
Nominal value per share | 0.01 | |||||
Class C Common Stock [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Common stock par value | 0.0001 | |||||
Class C Common Stock [Member] | Agreement and Plan of Merger | SOFTWARE LUXEMBOURG HOLDING S.A. (SUCCESSOR) AND POINTWELL LIMITED (PREDECESSOR) | ||||||
Subsequent Event [Line Items] | ||||||
Common stock par value | $ 0.0001 |