Annual report pursuant to Section 13 and 15(d)

Significant Accounting Policies (Policies)

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Significant Accounting Policies (Policies)
12 Months Ended
Dec. 31, 2012
Accounting Policies [Abstract]  
Basis of Accounting, Policy [Policy Text Block]

 Basis of Presentation

 

The accompanying financial statements of the Company are presented in U.S. dollars in conformity with accounting principles generally accepted in the United States of America and pursuant to the rules and regulations of the Securities and Exchange Commission.

Development Stage Enterprise Policy [Policy Text Block]

Development Stage Company

 

The Company is considered to be in the development stage as defined by FASB ASC 915, “Development Stage Entities,” and is subject to the risks associated with activities of development stage companies. The Company has neither engaged in any operations nor generated any income as of December 31, 2012. All activity through the date the financial statements were issued relates to the Company’s formation and the Public Offering. Following such offering, the Company will not generate any operating revenues until after completion of an initial business combination, at the earliest. The Company will generate non-operating income in the form of interest income on the designated Trust Account after the Public Offering.

Earnings Per Share, Policy [Policy Text Block]

Net Income (Loss) Per Share

 

Basic income (loss) per common share is computed by dividing income applicable to common shareholders by the weighted average number of common shares outstanding during the period in accordance with ASC 260, “Earnings Per Share”. Diluted income (loss) per share reflects the potential dilution that could occur assuming common shares were issued upon the exercise of outstanding in the money warrants and the proceeds thereof were used to purchase common shares at the average market price during the period. The Company uses the treasury stock method to calculate potentially dilutive shares, as if they were converted into common stock at the beginning of the period. At December 31, 2012, the Company had outstanding warrants to purchase 25,992,500 shares of common stock. For all periods presented, the weighted average of these shares was excluded from the calculation of diluted income (loss) per common share because their inclusion would have been anti-dilutive. As a result, dilutive income (loss) per common share is equal to basic income (loss) per common share.

Use of Estimates, Policy [Policy Text Block]

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. Actual results could differ from those estimates.

Concentration Risk, Credit Risk, Policy [Policy Text Block]

Concentration of Credit Risk

 

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which at times, may exceed the Federal depository insurance coverage of $250,000. The Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.

Income Tax, Policy [Policy Text Block]

Income Taxes

 

Deferred income taxes are provided for the differences between the bases of assets and liabilities for financial reporting and income tax purposes. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized.

 

The Company evaluates the uncertainty in tax positions taken or expected to be taken in the course of preparing the Company’s financial statements to determine whether the tax positions are “more likely than not” of being sustained by the applicable tax authority. Tax positions deemed not to meet the “more likely than not” threshold would be recorded as a tax expense in the current period. The Company has no uncertain tax positions at December 31, 2012 or 2011.

 

The Company recognizes interest and penalties related to unrecognized tax benefits in interest expense and other expenses, respectively. No interest expense or penalties have been recognized as of and for the period ended December 31, 2012.

 

The Company files an income tax return in the U.S. federal jurisdiction, and may file income tax returns in various U.S. states and foreign jurisdictions. Generally, the Company is subject to income tax examinations by major taxing authorities since inception.

 

The Company may be subject to potential examination by U.S. federal, U.S. states or foreign jurisdiction authorities in the areas of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with U.S. federal, U.S. state and foreign tax laws. The Company's management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

Deferred Charges, Policy [Policy Text Block]

Deferred Offering Costs

 

Deferred offering costs consist principally of legal, accounting, and underwriting fees incurred through the balance sheet date that are related to the Public Offering and that were charged to stockholders’ equity upon the receipt of the capital at the closing of the Public Offering on May 18, 2011.

Contingent Liabilities [Policy Text Block]

Contingent Liabilities

 

Contingent liabilities include payments to Citibank, N.A. ("Citi") and Bank of America Merrill Lynch ("BAML") in connection with our Business Combination. The Company agreed to pay Citi and BAML $7,000,000 in financial advisory fees only upon successful closing of a business combination.   However, the Company is currently in the process of negotiating these fees downward to comply with minimum cash requirements in the Agreement and Plan of Merger and Reorganization by and among the Company, EAGL Merger Sub Corp., Row 44, Inc. (“Row 44”) and PAR Investment Partners, L.P. (“PAR”), and no fees have been paid as of March 10, 2013.

 

In addition, the Company is currently negotiating the deferred underwriting fees of approximately $6,600,000 due to Citi, Deutsche Bank Securities Inc. and Macquarie Capital (USA) Inc. $400,000 of the deferred underwriting fees have been paid as of March 10, 2013.

 

Under the terms of the Company's agreements with Row 44 and PAR, the Company agreed to pay the transaction expenses of Row 44 and PAR on a success basis only.  The Company believes the amounts actually due under these agreements total approximately $3,000,000, however this amount is in dispute with both advisors, RBC Capital Markets, LLC and Seabury Group LLC, therefore actual amounts to be paid may be more or less than this amount.

Stock Holders Equity Note Redeemable Common Stock Issue Policy [Policy Text Block]

Redeemable Common Stock

 

As discussed in Note 1, all of the 18,992,500 common shares sold as part of a Unit in the Public Offering contained a redemption feature which allowed for the redemption of common shares under the Company's Liquidation or Tender Offer/Stockholder Approval provisions. In accordance with ASC 480, redemption provisions not solely within the control of the Company require the security to be classified outside of permanent equity. Ordinary liquidation events, which involve the redemption and liquidation of all of the entity's equity instruments, are excluded from the provisions of ASC 480. Although the Company did not specify a maximum redemption threshold, its Charter provides that in no event will they redeem its Public Shares in an amount that would cause its net tangible assets (stockholders’ equity) to be less than $5,000,001.

 

The Company recognizes changes in redemption value immediately as they occur and will adjust the carrying value of the security to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable common stock shall be affected by charges against retained earnings.

 

Accordingly, at December 31, 2012 and 2011, 15,269,718 and 16,320,272 respectively, of the 18,992,500 Public Shares were classified outside of permanent equity at its redemption value. The redemption value at December 31, 2012 and 2011 was equal to the pro rata share of the aggregate amount then on deposit in the Trust Account, including interest but less franchise and income taxes payable (approximately $10.00 at December 31, 2012 and 2011).

Fair Value of Financial Instruments, Policy [Policy Text Block]

Fair Value of Financial Instruments

 

Unless otherwise disclosed, the fair value of the Company’s assets and liabilities, which qualify as financial instruments under FASB ASC 820, “Fair Value Measurements and Disclosures”, approximates the carrying amounts represented in the balance sheet.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

 

Management does not believe that any other recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.

Warrant Liability [Policy Text Block]

Warrant Liability

 

The Company accounts for the 25,992,500 warrants issued in connection with the its Initial Public Offering (18,992,500) and Private Placement (7,000,000) in accordance with the guidance contained in ASC 815-40-15-7D whereby under that provision they do not meet the criteria for equity treatment and must be recorded as a liability. Accordingly, the Company classifies the warrant instrument as a liability at its fair value and adjusts the instrument to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statement of operations. The fair value of warrants issued by the Company in connection with the Public Offering and private placements of securities has been estimated using the warrants quoted market price.