|12 Months Ended|
Mar. 31, 2021
|Subsequent Events [Abstract]|
|Subsequent Events||Subsequent Events
April 2021 Credit Facility
Subsequent to year end, on April 29, 2021, the Company entered into an amended and restated Credit Agreement (the “New Credit Agreement”) with Bank of America, N.A., as a lender and administrative agent, and a syndicate of lenders, which provides for a revolving line of credit of $400,000 to be used for working capital, permitted acquisitions, capital expenditures, and other lawful corporate purposes. DT Media and DT USA are additional co-borrowers under the Credit Agreement, and Mobile Posse is a guarantor (together with the Company, DT Media and DT USA, collectively, the “Loan Parties”). This modification replaced the existing BoA Credit Agreement. The New Credit Agreement contains an accordion feature that permits an increase of the revolver by up to $75,000 plus an amount that would enable the Loan Parties to remain in compliance with a consolidated secured net leverage ratio, on such terms as agreed to by the parties.
The revolving line of credit matures on April 29, 2026.
Amounts outstanding under the Credit Agreement accrue interest at an annual rate equal to, at the Company’s election, (i) LIBOR plus between 1.50% and 2.25% based on the Company’s consolidated leverage ratio or (ii) a base rate determined based upon the highest of (a) the federal funds rate plus 0.50%, (b) Bank of America, N.A.’s prime rate or (c) LIBOR plus 1.00%, plus between 0.50% and 1.25% based on the Company’s consolidated leverage ratio. The Credit Agreement contains customary covenants, representations and events of default, and also requires the Company to comply with a maximum consolidated secured net leverage ratio and minimum consolidated interest coverage ratio.
The Loan Parties’ payment and performance obligations under the New Credit Agreement and related loan documents are secured by their grant of a security interest in substantially all of their personal property assets, whether now existing or hereafter acquired, subject to certain exclusions. If the Loan Parties acquire any real property assets with a fair market value in excess of $5,000, they are required to grant a security interest in such real property as well. All such security interests are required to be first priority security interests, subject to certain permitted liens.
Acquisition of AdColony
On April 29, 2021, DT Media completed the acquisition of AdColony Holding AS, a Norway company (“AdColony”), pursuant to a Share Purchase Agreement with AdColony and Otello Corporation ASA, a Norway company and the sole shareholder of AdColony (“Otello”). DT Media acquired all of the outstanding capital stock of AdColony in exchange for an estimated total consideration in the range of $350,000 to $375,000, to be paid as follows: (1) $100,000 in cash paid at closing (which was subject to customary closing purchase price adjustments), (2) $100,000 in cash to be paid six months after closing, and (3) an estimated earn-out in the range of $150,000 to $175,000, to be paid in cash, based on AdColony achieving certain future target net revenues, less associated cost of goods sold, over a twelve-month period ending on December 31, 2021 (the “Earn-Out Period”). Under the terms of the earn-out, DT Media would pay Otello a certain percentage of actual net revenues (less associated cost of goods sold) of AdColony depending on the extent to which AdColony achieves certain target net revenues (less associated cost of goods sold) over the Earn-Out Period. The earn-out payment will be made following the expiration of the Earn-Out Period. The Company paid the closing amount and intends to pay the remainder of the purchase price with a combination of available cash on hand and borrowings under its existing senior credit facility along with future capital financing.
Acquisition of Fyber
On May 25, 2021, the Company and DT Media completed the initial closing of the acquisition of 523,553,108 shares, representing approximately 95.1% of the outstanding voting shares (the “Majority Fyber Shares”) of Fyber N.V., a public limited liability company registered with the Netherlands Chamber of Commerce Business Register (“Fyber”), pursuant to a Sale and Purchase Agreement between Tennor Holding B.V., Advert Finance B.V., and Lars Windhorst (collectively, the “Seller”), the Company, and DT Luxembourg. The Seller transferred and delivered 400,000,000 shares of the Majority Fyber Shares to DT Media on the closing date and will deliver the remaining 123,553,108 shares of the Majority Fyber Shares to DT Media in June 2021. The remaining approximately 4.9% of the shares in Fyber (the “Minority Fyber Shares”) are widely held by other shareholders of Fyber (the “Minority Fyber Shareholders”).
DT Media acquired the Majority Fyber Shares in exchange for an estimated aggregate consideration of up to $600,000, consisting of (i) $150,000 in cash, which was subject to adjustments for certain items including the amount of cash consideration to be paid to the Minority Fyber Shareholders for the Minority Fyber Shares, paid at the closing of the acquisition, (ii) 3,216,935 newly issued shares of common stock of the Company equal in value to $235,000 (based on the volume-weighted average price of the common stock on NASDAQ during the 30-day period prior to the closing date), issued at the closing of the acquisition, (iii) 2,599,653 newly issued shares of common stock of the Company equal in value to $165,000 (based on the volume-weighted average price of the common stock on NASDAQ during the 30-day period prior to the closing date), to be issued in June 2021 after the receipt by the Company of a tax exemption certificate from the Israel Tax Authority, and (iv) contingent upon Fyber’s net revenues being equal or higher than $100,000 for the 12-month earn-out period ending on March 31, 2022, as determined in the manner set forth in the Sale and Purchase Agreement, a certain number of shares of Company common stock, which will be newly-issued to the Seller at the end of the earn-out period, and under certain circumstances, an amount of cash, which value of such shares and cash in aggregate will not exceed $50,000 (subject to set-off against certain potential indemnification claims against the Seller). The Company paid the cash closing amount on the closing date, and intends to pay the remainder of the cash consideration for the acquisition with a combination of available cash on hand, borrowings under the Company’s senior credit facility, and proceeds from future capital financings.
Pursuant to certain German law on public takeovers, following the closing, the Company is obligated to make a public tender offer to the Minority Fyber Shareholders to acquire from them the Minority Fyber Shares. The tender offer will be subject to certain minimum price rules under German law. The timing and the conditions of the tender offer, including the consideration offered to the Minority Fyber Shareholders in connection with the tender offer, will be subsequently determined by the Company pursuant to the applicable Dutch and German takeover laws. The Company anticipates completing the tender offer during the second fiscal quarter 2022.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef