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Organization and Plan of Business Operations
6 Months Ended
Jun. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization and Plan of Business Operations

Note 1 — Organization and Plan of Business Operations

 

Allegro Merger Corp. (the "Company") was incorporated in Delaware on August 7, 2017 as a blank check company whose objective is to acquire, through a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination, one or more businesses or entities (a "Business Combination").

 

All activity through June 30, 2020 relates to the Company's formation, the Company's initial public offering of units ("Initial Public Offering") described below and since the Initial Public Offering, the search for a prospective initial Business Combination.

 

The registration statement for the Company's Initial Public Offering was declared effective on July 2, 2018. On July 6, 2018, the Company consummated the Initial Public Offering of 14,950,000 units ("Units" and, with respect to the common stock included in the Units being offered, the "Public Shares"), including 1,950,000 Units issued pursuant to the exercise in full of the underwriters' overallotment option, generating gross proceeds of $149,500,000, which is described in Note 3. Each Unit consisted of one share of the Company's common stock, $0.0001 par value, one redeemable common stock purchase warrant (the "Warrants") and one right (the "Rights"). Each Warrant entitles the holder to purchase one share of common stock at an exercise price of $11.50 per share (see Note 7). Each Right entitles the holder to receive one tenth (1/10) of one share of common stock upon the completion of a Business Combination.

 

Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 372,500 units ("Private Units"), at a price of $10.00 per Private Unit in a private placement to certain of the Initial Stockholders (defined below), Cantor Fitzgerald & Co. and Chardan Capital Markets LLC (collectively, the "Insiders"), generating gross proceeds of $3,725,000, which is described in Note 4.

 

Following the closing of the Initial Public Offering on July 6, 2018, an amount of $149,500,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the Private Units was placed in a trust account ("Trust Account") and was invested in United States government treasury bills, bonds or notes, having a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act.

 

 On July 6, 2018, in connection with the underwriters' election to fully exercise their over-allotment option, the Company consummated the sale of an additional 1,950,000 Units, at $10.00 per unit. Each Unit consisted of one share of the Company's common stock, $0.0001 par value, one redeemable common stock purchase warrant (the "Warrants") and one right (the "Rights"). Each Warrant entitles the holder to purchase one share of common stock at an exercise price of $11.50 per share (see Note 7). Each Right entitles the holder to receive one tenth (1/10) of one share of common stock upon the completion of a Business Combination.

 

Proposed Business Combination

 

On November 8, 2019, the Company entered into an Agreement and Plan of Merger ("Merger Agreement") by and among the Company, Allegro Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company, TGIF Holdings, LLC, a Delaware limited liability company ("Holdings"), TGIF Midco, Inc., a Delaware corporation ("Midco"), and Rohit Manocha, solely in his capacity as the initial representative of the equityholders of Holdings and Midco.

 

On March 31, 2020, the Company and Holdings mutually determined, due to extraordinary market conditions and the failure to meet necessary closing conditions, to terminate the Merger Agreement.

 

As previously disclosed, on March 26, 2020, the Company's shareholders approved an amendment to the Company's amended and restated certificate of incorporation ("Charter") to extend the time by which the Company has to complete an initial business combination from March 31, 2020 to April 30, 2020. However, in light of the termination of the Merger Agreement and due to extraordinary market conditions, the Company determined on March 31, 2020 that it would not so amend its Charter.

 

Going Concern

 

  As of June 30, 2020, the Company had a cash balance of $64,183 and a working capital deficit of $682,167. During the six month periods ended June 30, 2020, the Company has withdrawn $282,032, of interest income to pay its franchise and income taxes and various operating expenses as permitted by the trust agreement. The company has also withdrawn $100,000 to pay dissolution expenses.

 

In addition, in connection with the Company's assessment of going concern considerations in accordance with Financial Accounting Standard Board's Accounting Standards Update ("ASU") 2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern", management has determined that the liquidity, mandatory liquidation and subsequent dissolution raises substantial doubt about the Company's ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company liquidate after June 30, 2020.