0001628280-22-013618 | 10-Q | XBRL Viewer | Hydrofarm Holdings Group INC

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GOODWILL AND INTANGIBLE ASSETS, NET - Future Amortization Expense (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
For the period of April 1, 2022 to December 31, 2022	$ 19,743
Year ending December 31, 2023	25,036
Year ending December 31, 2024	24,876
Year ending December 31, 2025	24,737
Year ending December 31, 2026	20,493
Thereafter	209,325
Total	$ 324,210	$ 193,926

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of presentation	The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These condensed consolidated financial statements have been prepared on the same basis as the Company's annual consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for the fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2022, or for any other interim period or for any other future year. All intercompany balances and transactions have been eliminated in consolidation. The Company reclassified the balance within "Impairment, restructuring and other" on the condensed consolidated statements of operations for the prior period into "Selling, general and administrative expenses" to conform to the current period presentation. The Company reclassified the balance of customer deposits previously reported in "accounts payable" into "deferred revenue" in the condensed consolidated balance sheet as of December 31, 2021 to conform to the current period presentation. The amount totaled $18,273 as of December 31, 2021. The condensed consolidated balance sheet as of December 31, 2021, has been derived from the audited consolidated financial statements of the Company, which is included in the Company's Annual Report on Form 10-K ("2021 Annual Report"). These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the 2021 Annual Report.
Use of estimates	The 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 disclosure of contingent assets and liabilities as of the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Significant estimates include provisions for sales returns, rebates and claims from customers, realization of accounts receivable and inventories, fair value of assets acquired and liabilities assumed for business combinations, valuation of intangible assets and goodwill, estimated useful lives of long lived assets, incremental borrowing rate applied in lease accounting, valuation of stock-based compensation, recognition of deferred income taxes, recognition of liabilities related to commitments and contingencies and valuation allowances. Actual results may differ from these estimates. On an ongoing basis, the Company reviews its estimates to ensure that these estimates appropriately reflect changes in its business or new information available.
Business combinations	Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition date fair values of the assets transferred, liabilities incurred to the former owners of the acquiree, and the equity interests issued in exchange for control of the acquiree. Acquisition related costs are recognized in net income (loss) as incurred. When the consideration transferred in a business combination includes assets or liabilities resulting from a contingent consideration arrangement, the contingent consideration is measured at its acquisition date fair value and included as part of the consideration transferred in a business combination. Contingent consideration is established for business acquisitions where the Company has the obligation to transfer additional assets or equity interests to the former owners if specified future events occur or conditions are met. Contingent consideration is classified as a liability when the obligation requires settlement in cash or other assets and is classified as equity when the obligation requires settlement in the Company's own equity instruments. Changes in the fair value of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with a corresponding adjustment to goodwill. Measurement period adjustments are adjustments that arise from additional information obtained during the measurement period (which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date. All other subsequent changes in the fair value of contingent consideration classified as a liability are included in net income (loss) in the period. Changes in the fair value of contingent consideration classified as equity are not recognized. For a given acquisition, the Company may identify certain pre-acquisition contingencies as of the acquisition date and may extend its review and evaluation of these pre-acquisition contingencies throughout the measurement period to obtain sufficient information to assess these contingencies as part of acquisition accounting, as applicable. Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non‑controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquire (if any) over the net of the acquisition‑date fair value amounts of the identifiable assets acquired, and the liabilities assumed. If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Company reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period, or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that time. Upon conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to net income (loss).
Revenue recognition	The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”) which requires that revenue recognized from contracts with customers be disaggregated into categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. The Company has determined that revenue is generated from one category, which is the distribution and manufacture of controlled environment agriculture equipment and supplies. Revenue is recognized as control of promised goods is transferred to customers which generally occurs upon receipt at customers’ locations determined by the specific terms of the contract. Arrangements generally have a single performance obligation and revenue reported is comprised of fixed consideration and variable consideration which includes applicable volume rebates, cash discounts and sales returns and allowances. Variable consideration is estimated and recorded at the time of sale; these allowances and accruals are not material to the financial statements. The amount billed to customers for shipping and handling costs included in net sales was $3,879 and $1,245 for the three months ended March 31, 2022, and 2021, respectively. Shipping and handling costs that occur before the customer obtains control of the goods are deemed to be fulfillment activities and are accounted for as fulfillment costs included in cost of goods sold. The Company does not receive noncash consideration for the sale of goods. Contract consideration received from a customer prior to revenue recognition is recorded as a contract liability and is recognized as revenue when the Company satisfies the related performance obligation under the terms of the contract. The Company's contract liabilities, which consist primarily of customer deposits are reported within deferred revenue in the condensed consolidated balance sheets, totaled $10,887 and $18,273 as of March 31, 2022, and December 31, 2021, respectively. There are no significant financing components. Excluded from revenue are any taxes assessed by governmental authorities, including value-added and other sales-related taxes that are imposed on and concurrent with revenue-generating activities.
Income taxes—interim tax provision	The Company recorded an income tax benefit of $5,569 for the three months ended March 31, 2022, representing an effective income tax rate of 19.3%. The Company’s effective income tax rate for the three months ended March 31, 2022, differs from the federal statutory rate of 21% primarily as a result of a reduction in the valuation allowance recorded against the Company's net deferred tax assets, due to the acquisition of the IGE Entities (as defined below) which had an income tax rate benefit of 23.4%. In addition, as described in Note 3 - Business Combinations, the Company determined that the preliminary allocation of assets acquired related to indefinite lived trade names have a finite useful life because the expected usefulness of the trade names is limited. As a result of adjusting this provisional amount, the Company recorded a reduction to the valuation allowance, which resulted in an income tax rate benefit of 6.1%. These income tax benefits totaled $8,543, and were partially offset by income taxes from certain foreign jurisdictions where the Company conducts business and state minimum income taxes in the United States.The Company recorded a tax expense of $756 for the three months ended March 31, 2021. The Company’s effective tax rates for the three months ended March 31, 2021, differs from the federal statutory rate of 21% primarily as a result of reducing valuation allowances on the Company's deferred tax assets related to net operating loss carryforwards.
Recent accounting pronouncements	The Company considers the applicability and impact of all Accounting Standards Updates ("ASUs") issued by the FASB. There were no ASUs that were assessed and determined to be applicable or expected to have a material impact on our condensed consolidated financial statements.
Purchase commitments	From time to time in the normal course of business, the Company will enter into agreements with suppliers which provide favorable pricing in return for a commitment to purchase minimum amounts of inventory over a defined time period.
Contingencies	In the normal course of business, certain claims have been brought against the Company and, where applicable, its suppliers. While there is inherent difficulty in predicting the outcome of such matters, management has vigorously contested the validity of these claims. Based on available information, management believes the claims are without merit and does not expect that the outcome, individually or in the aggregate, would have a material adverse effect on the consolidated financial positions, results of operations, cash flows or future earnings.

- Definition

Disclosure of accounting policy for income taxes, which may include its accounting policies for recognizing and measuring deferred tax assets and liabilities and related valuation allowances, recognizing investment tax credits, operating loss carryforwards, tax credit carryforwards, and other carryforwards, methodologies for determining its effective income tax rate and the characterization of interest and penalties in the financial statements.

+ References + Details

- Definition

Disclosure of accounting policy for revenue from contract with customer.

+ References

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+ Details

BUSINESS COMBINATIONS - Components (Details) - USD ($) $ in Thousands	Nov. 01, 2021	Aug. 03, 2021	Jul. 01, 2021	Jun. 01, 2021	May 03, 2021
Heavy 16
Business Acquisition [Line Items]
Cash					$ 60,287
Common stock					16,736
Contingent consideration					344
Forgiveness of assets and liabilities					0
Total purchase price					77,367
Acquisition-related costs					$ 3,104
H&G Entities
Business Acquisition [Line Items]
Cash				$ 133,483
Common stock				0
Contingent consideration				0
Forgiveness of assets and liabilities				0
Total purchase price				133,483
Acquisition-related costs				$ 5,063
Aurora
Business Acquisition [Line Items]
Cash			$ 133,962
Common stock			25,824
Contingent consideration			19,300
Forgiveness of assets and liabilities			(215)
Total purchase price			178,871
Acquisition-related costs			$ 7,345
Greenstar
Business Acquisition [Line Items]
Cash		$ 85,121
Common stock		0
Contingent consideration		0
Forgiveness of assets and liabilities		(1,601)
Total purchase price		83,520
Acquisition-related costs		$ 3,697
Innovative Growers Equipment, Inc.
Business Acquisition [Line Items]
Cash	$ 49,129
Common stock	11,051
Contingent consideration	0
Forgiveness of assets and liabilities	722
Total purchase price	60,902
Acquisition-related costs	$ 2,013

DEBT - Components (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021	Oct. 25, 2021
Debt Instrument [Line Items]
Long-term debt	$ 121,492	$ 121,780
Current portion of long-term debt	2,298	2,263
Long-term debt - net of unamortized discount and deferred financing costs of $5,807 and $6,025 at March 31, 2022, and December 31, 2021, respectively	119,194	119,517
Total debt	121,492	121,780
Unamortized discount and deferred financing costs	5,807	6,025
Term loan
Debt Instrument [Line Items]
Long-term debt	118,880	118,975
Unamortized discount and deferred financing costs	5,807	6,025	$ 6,190
Other
Debt Instrument [Line Items]
Long-term debt	$ 2,612	$ 2,805

- Definition

Amount, after unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but not limited to, notes payable, bonds payable, debentures, mortgage loans and commercial paper. Excludes capital lease obligations.

+ References + Details

DESCRIPTION OF THE BUSINESS (Details) - Common Stock - USD ($) $ / shares in Units, $ in Thousands			12 Months Ended
	May 03, 2021	Dec. 14, 2020	Dec. 31, 2021
IPO
Class of Stock [Line Items]
Shares issued in offering (in shares)		9,966,667
Sale of stock, price per share (in dollars per share)		$ 20.00
Proceeds from issuance on offering		$ 182,271
Issuance of common stock in connection with follow-on public offering, net of offering cost			$ 148
Over-Allotment Option
Class of Stock [Line Items]
Shares issued in offering (in shares)		1,300,000
Follow-On Public Offering
Class of Stock [Line Items]
Shares issued in offering (in shares)	5,526,861
Sale of stock, price per share (in dollars per share)	$ 59.00
Proceeds from issuance on offering	$ 309,782
Follow-On Public Offering, Over-Allotment Option
Class of Stock [Line Items]
Shares issued in offering (in shares)	720,894

GOODWILL AND INTANGIBLE ASSETS, NET - Goodwill (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($)
Goodwill [Roll Forward]
Balance at December 31, 2021	$ 204,868
Balance at March 31, 2022	183,338
IGE Entities
Goodwill [Roll Forward]
Remeasurement adjustments and foreign currency translation adjustments, net	(22,542)
All others
Goodwill [Roll Forward]
Remeasurement adjustments and foreign currency translation adjustments, net	$ 1,012

PROPERTY, PLANT AND EQUIPMENT, NET

3 Months Ended

Mar. 31, 2022

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT, NET

Property, plant and equipment comprised the following:


	March 31, 2022		December 31, 2021
Machinery and equipment	$	26,587	$	25,177
Peat bogs and related development	9,876		8,686
Building and improvements	9,503		9,510
Land	6,116		6,120
Leasehold improvements	3,413		3,207
Computer equipment	3,271		3,197
Furniture and fixtures	2,991		2,867
Gross property, plant and equipment	61,757		58,764
Less: accumulated depreciation	(10,408)		(8,291)
Total property, plant and equipment, net	$	51,349	$	50,473

Depreciation and amortization expense related to property, plant and equipment, net was $2,195 and $385 for the three months ended March 31, 2022, and 2021, respectively.

CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

Capital stock

As of March 31, 2022, the following summarizes shares authorized, issued and outstanding:


Capital stock authorized and outstanding:	Shares authorized	Shares outstanding
Convertible preferred stock	50,000,000	—
Common stock	300,000,000	44,822,866

Common stock

Each holder of common stock is entitled to one vote for each share of common stock. Common stockholders have no pre-emptive rights to acquire additional shares of common stock or other securities. The common stock is not subject to redemption rights and carries no subscription or conversion rights. In the event of liquidation, the stockholders are entitled to share in corporate assets on a pro rata basis after the Company satisfies all liabilities and after provision is made for any class of capital stock having preference over the common stock. Subject to corporate regulations and preferences to preferred stock, if any, dividends are at the discretion of the Company’s board of directors (the ‘‘Board’’).

Warrants

On July 19, 2021, the Company completed the redemption ("Redemption") of certain of its outstanding warrants (the "Investor Warrants") that were issued in connection with a private placement of units (the "private placement"), each consisting of a share of common stock and a warrant to purchase an additional one-half (1/2) shares of common stock, which concluded in the fall of 2018.

The Company was entitled to redeem all of the outstanding Investor Warrants for a redemption price of $0.00033712 per Investor Warrant ("Redemption Price") if (i) there was an effective registration statement covering the resale of the shares of common stock underlying the Investor Warrants, and (ii) the volume-weighted average price of the Company's common stock for the twenty consecutive trading days prior to the date of the notice of redemption is at least $25.28, of which both requirements were met. Investor Warrants were exercisable at a price of $16.86 per share until July 19, 2021 (the "redemption date"). Any Investor Warrants that remained unexercised immediately after the redemption date were void and no longer exercisable, and the holders of those Investor Warrants were entitled to receive the Redemption Price.

Prior to the redemption date 3,367,647 Investor Warrants were exercised, generating total gross proceeds of $56,778. The Company redeemed 1,491 Investor Warrants at the Redemption Price.

In connection with the private placement, the Company agreed to engage the placement agent (the "Placement Agent") as the Company's warrant solicitation agent in the event the Investor Warrants were called for Redemption. The Company agreed to pay a warrant solicitation fee to the Placement Agent equal to five percent of the amount of net cash proceeds solicited by the Placement Agent upon the exercise of certain Investor Warrants following such call for Redemption.

As of March 31, 2022, the following table summarizes the outstanding warrants:


	Number of Warrants	Exercise Price
Placement agent warrants	11,662	$	8.43
Placement agent warrants	6,007	$	16.86
Total	17,669	$	11.30

DEBT

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

DEBT

Debt is comprised of the following:


	March 31, 2022		December 31, 2021
Term loan - net of unamortized discount and deferred financing costs of $5,807 and $6,025 at March 31, 2022, and December 31, 2021, respectively	$	118,880	$	118,975
Other	2,612		2,805
Total debt	$	121,492	$	121,780

Current portion of long-term debt	$	2,298	$	2,263
Long-term debt - net of unamortized discount and deferred financing costs of $5,807 and $6,025 at March 31, 2022, and December 31, 2021, respectively	119,194		119,517
Total debt	$	121,492	$	121,780

Senior Secured Term Loan

On October 25, 2021, the Company and its subsidiaries entered into a Credit and Guaranty Agreement with JPMorgan Chase Bank, N.A., as administrative agent for certain lenders, pursuant to which the Company borrowed a $125,000 senior secured term loan (“Term Loan”). The Term Loan bears interest at LIBOR (with a 1.0% floor) plus 5.50%, or an alternative base rate (with a 2.0% floor), plus 4.50%, and is subject to a call premium of 2% in year one, 1% in year two, and 0% thereafter, and matures on October 25, 2028 ("Maturity Date"). Deferred financing costs and discount totaled $6,190 and are being amortized to interest expense over the term of the loan. For the three months ended March 31, 2022, the effective interest rate was 7.30% and interest expense was $2,031 and amortization of deferred financing costs was $218.

The principal amounts of the Term Loan are required to be repaid in consecutive quarterly installments in amounts equal to 0.25% of the principal amount of the Term Loan, on the last day of each fiscal quarter commencing March 31, 2022, with the balance of the Term Loan payable on the Maturity Date. The Company is also required to make mandatory prepayments upon the occurrence of certain events, including (i) achieving certain excess cash flow criteria, including the achievement and maintenance of a specific leverage ratio, (ii) selling assets that are collateral, or (iii) upon the issuance, offering, or placement of new debt obligations. There were no such mandatory prepayments made since inception of the Term Loan.

The Term Loan requires the Company to maintain certain reporting requirements, affirmative covenants, and negative covenants, and was in compliance with all requirements as of March 31, 2022. The Term Loan is secured by a first lien on the non-working capital assets of the Company and a second lien on the working capital assets of the Company. The Company may request additional term loan commitments subject to certain loan conditions.

Revolving asset-backed credit facilities

Encina Credit Facility

On July 11, 2019, the Company and certain of its direct and indirect subsidiaries (the “Encina Obligors”) entered into the Encina Credit Facility through a certain Loan and Security Agreement whereby the Encina Obligors obtained a revolving asset-based loan commitment in the maximum amount of $45,000 (inclusive of a limit of up to $15,000 of borrowings for the Canadian borrowers and a swingline facility of up to $2,000), subject to applicable borrowing base availability, through Encina Business Credit, LLC. The Encina Credit Facility was due on the earlier of July 11, 2022, or 90 days prior to the scheduled maturity date of the Brightwood Loan Services LLC Term Loan. The Encina Credit Facility was secured by working capital assets and a second lien on non-working capital assets. The Encina Credit Facility was repaid in December 2020 and replaced in March 2021 by the JPMorgan Credit Facility (as defined below). The unamortized deferred financing costs and early termination fees totaling $680 were recognized as a loss on debt extinguishment in the condensed consolidated statements of operations for the three months ended March 31, 2021.

JPMorgan Revolving Credit Facility

On March 29, 2021, Hydrofarm Holdings Group, Inc. and certain of its direct and indirect subsidiaries (the "JPMorgan Obligors") entered into a Senior Secured Revolving Credit Facility (the "JPMorgan Credit Facility") with JPMorgan Chase Bank, N.A., as administrative agent, issuing bank and swingline lender, and the lenders from time to time party thereto. The JPMorgan Credit Facility is due on the earlier of March 29, 2024, or any earlier date on which the revolving commitments are reduced to zero.

The three-year JPMorgan Credit Facility had a borrowing limit of $50,000 with an option to request an increase in the revolving commitment by up to $25,000, drawn in $5,000 increments, for a total not to exceed $75,000, subject to customary condition ("Revolver"). On August 31, 2021, the JPMorgan Obligors entered into an amendment (the "First Amendment") to increase their original borrowing limit to $100,000. In connection with the First Amendment, the Company's recently acquired subsidiaries became party to the JPMorgan Credit Facility as either borrowers or as guarantors. The Revolver maintains an interest rate of LIBOR plus 1.95% and has a 0.0% LIBOR floor. A fee of 0.25% per annum is charged for available but unused borrowings as defined. On October 25, 2021, the Company and its subsidiaries entered into a second amendment (the “Second Amendment”), with JPMorgan Chase Bank, N.A., pursuant to which the parties consented to the Term Loan and the lien priorities described above and made certain conforming changes to the provisions of the Term Loan.

The unamortized debt issuance costs were $908 as of March 31, 2022 and are included in other assets in the condensed consolidated balance sheets. Deferred financing costs are being amortized to interest expense over the term of the Revolver. As of March 31, 2022, the JPMorgan Obligors had approximately $99,674 available to borrow under the JPMorgan Credit Facility.

The JPMorgan Credit Facility is secured by the Company’s assets and the assets of certain of the Company’s subsidiaries. The Company is required to maintain certain reporting requirements, affirmative covenants, negative covenants and financial covenants ("debt covenants"), including, in certain situations pursuant to terms outlined in the agreement, the maintenance of a minimum fixed charge coverage ratio of 1.1x on a rolling twelve-month basis. The JPMorgan Obligors were in compliance with all debt covenants as of March 31, 2022.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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+ Details

FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following table summarizes the estimated fair value of the Company's assets and liabilities for which disclosure of fair value is required:


		March 31, 2022				December 31, 2021
	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Term Loan	Level 2	$	125,000	$	118,750	$	125,000	$	121,250

EARNINGS (LOSS) PER COMMON SHARE (“EPS”) (Tables)

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table presents information necessary to calculate basic and diluted EPS for the three months ended March 31, 2022, and 2021:


	Three months ended March 31,
	2022		2021
Net (loss) income	$	(23,296)	$	4,940
Weighted-average shares of common stock outstanding	44,718,510		33,717,103
Dilutive effect of warrants using the treasury stock method	—		2,840,464
Dilutive effect of restricted stock units using the treasury stock method	—		1,658,866
Dilutive effect of stock options using the treasury stock method	—		780,598
Diluted weighted-average shares of common stock outstanding	44,718,510		38,997,031
Basic EPS	$	(0.52)	$	0.15
Diluted EPS	$	(0.52)	$	0.13

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The computation of the weighted-average shares of common stock outstanding for diluted EPS excludes the following potential common shares as their inclusion would have an anti-dilutive effect:


	Three months ended March 31,
	2022	2021
Shares subject to warrants outstanding	17,669	—
Shares subject to unvested performance based and restricted stock units	1,234,857	—
Shares subject to stock options outstanding	696,071	—

DEBT - Term Loans (Details) - USD ($) $ in Thousands		3 Months Ended
DEBT - Term Loans (Details) - USD ($) $ in Thousands	Oct. 25, 2021	Mar. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Deferred financing costs and discount		$ 5,807	$ 6,025
Senior Secured Term Loan
Debt Instrument [Line Items]
Long-term debt, gross	$ 125
Debt instrument, call premium rate, year one	2.00%
Debt instrument, call premium rate, year two	1.00%
Debt instrument, call premium rate, after year two	0.00%
Deferred financing costs and discount	$ 6,190	$ 5,807	$ 6,025
Debt instrument, interest rate during period		7.30%
Interest expense, debt		$ 2,031
Amortization of deferred financing costs		$ 218
Debt instrument, quarterly payment, principal outstanding, percentage	0.25%
Senior Secured Term Loan \| London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Debt instrument, floor on variable rate	1.00%
Debt instrument, basis spread on variable rate	5.50%
Senior Secured Term Loan \| Alternative Base Rate
Debt Instrument [Line Items]
Debt instrument, floor on variable rate	2.00%
Debt instrument, basis spread on variable rate	4.50%

STOCK-BASED COMPENSATION - Stock Option Activity (Details) - $ / shares	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Number
Outstanding, beginning (in shares)	720,549
Exercised (in shares)	(7,765)
Cancelled (in shares)	(90)
Forfeited (in shares)	(16,623)
Outstanding, ending (in shares)	696,071	720,549
Options exercisable (in shares)	548,551
Vested and expected to vest (in shares)	696,071
Weighted average exercise price
Outstanding, beginning (in dollars per share)	$ 9.57
Exercised (in dollars per share)	9.04
Cancelled (in dollars per share)	11.06
Forfeited (in dollars per share)	11.51
Outstanding, ending (in dollars per share)	9.53	$ 9.57
Options exercisable (in dollars per share)	8.56
Vested and expected to vest (in dollars per share)	9.53
Weighted average grant date fair value
Outstanding, beginning (in dollars per share)	2.21
Exercised (in dollars per share)	2.21
Cancelled (in dollars per share)	9.89
Forfeited (in dollars per share)	6.03
Outstanding, ending (in dollars per share)	2.12	$ 2.21
Options exercisable (in dollars per share)	1.08
Vested and expected to vest (in dollars per share)	$ 2.12
Weighted average remaining contractual term (years)
Outstanding, term	6 years 10 months 2 days	7 years 4 months 13 days
Options exercisable, term	6 years 6 months 10 days
Vested and expected to vest, term	6 years 10 months 2 days

CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (Tables)

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Schedule of Stock by Class

As of March 31, 2022, the following summarizes shares authorized, issued and outstanding:


Capital stock authorized and outstanding:	Shares authorized	Shares outstanding
Convertible preferred stock	50,000,000	—
Common stock	300,000,000	44,822,866

Schedule of Warrants

As of March 31, 2022, the following table summarizes the outstanding warrants:


	Number of Warrants	Exercise Price
Placement agent warrants	11,662	$	8.43
Placement agent warrants	6,007	$	16.86
Total	17,669	$	11.30

- Definition

Tabular disclosure of an entity's stock, including par or stated value per share, number and dollar amount of share subscriptions, shares authorized, shares issued, shares outstanding, number and dollar amount of shares held in an employee trust, dividend per share, total dividends, share conversion features, par value plus additional paid in capital, the value of treasury stock and other information necessary to a fair presentation, and EPS information. Stock by class includes common, convertible, and preferred stocks which are not redeemable or redeemable solely at the option of the issuer. Includes preferred stock with redemption features that are solely within the control of the issuer and mandatorily redeemable stock if redemption is required to occur only upon liquidation or termination of the reporting entity. If more than one issue is outstanding, state the title of each issue and the corresponding dollar amount; dollar amount of any shares subscribed but unissued and the deduction of subscriptions receivable there from; number of shares authorized, issued, and outstanding.

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+ Details

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares	Mar. 31, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	300,000,000	300,000,000
Common stock, shares issued (in shares)	44,822,866	44,618,357
Common stock, shares outstanding (in shares)	44,822,866	44,618,357

STOCK-BASED COMPENSATION - RSU Activity (Details) - RSU	3 Months Ended
STOCK-BASED COMPENSATION - RSU Activity (Details) - RSU	Mar. 31, 2022 $ / shares shares
Number of RSUs
Beginning (in shares) \| shares	1,087,608
Granted (in shares) \| shares	339,076
Vested (in shares) \| shares	(278,002)
Forfeited (in shares) \| shares	(29,938)
Ending (in shares) \| shares	1,118,744
Weighted average grant date fair value
Beginning (in dollars per shares) \| $ / shares	$ 9.71
Granted (in dollars per share) \| $ / shares	15.93
Vested (in dollars per share) \| $ / shares	11.92
Forfeited (in dollars per share) \| $ / shares	52.51
Ending (in dollars shares) \| $ / shares	$ 9.90

EARNINGS (LOSS) PER COMMON SHARE (“EPS”) - Antidilutive (Details) - shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Warrant
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares subject to (in shares)	17,669	0
Performance based and restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares subject to (in shares)	1,234,857	0
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares subject to (in shares)	696,071	0

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive (Loss) Income	Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2020		33,499,953
Beginning balance at Dec. 31, 2020	$ 210,918	$ 3	$ 364,248	$ 599	$ (153,932)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock issued upon exercise of options (in shares)		32,272
Common stock issued upon exercise of options	272		272
Issuance of common stock for vesting of restricted stock units (in shares)		214,324
Shares repurchased for withholding tax on restricted stock units (in shares)		(88,360)
Shares repurchased for withholding tax on restricted stock units	(5,506)		(5,506)
Issuance of common stock under cashless warrant exercise (in shares)		312,175
Stock-based compensation expense	1,001		1,001
Net (loss) income	4,940				4,940
Foreign currency translation gain	223			223
Ending balance (in shares) at Mar. 31, 2021		33,970,364
Ending balance at Mar. 31, 2021	$ 211,848	$ 3	360,015	822	(148,992)
Beginning balance (in shares) at Dec. 31, 2021	44,618,357	44,618,357
Beginning balance at Dec. 31, 2021	$ 635,180	$ 4	777,074	(1,382)	(140,516)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock issued upon exercise of options (in shares)	7,765	7,765
Common stock issued upon exercise of options	$ 70		70
Issuance of common stock for vesting of restricted stock units (in shares)		278,002
Shares repurchased for withholding tax on restricted stock units (in shares)		(81,357)
Shares repurchased for withholding tax on restricted stock units	(1,589)		(1,589)
Issuance of common stock under cashless warrant exercise (in shares)		99
Stock-based compensation expense	2,908		2,908
Net (loss) income	(23,296)				(23,296)
Foreign currency translation gain	$ 2,184			2,184
Ending balance (in shares) at Mar. 31, 2022	44,822,866	44,822,866
Ending balance at Mar. 31, 2022	$ 615,457	$ 4	$ 778,463	$ 802	$ (163,812)

GOODWILL AND INTANGIBLE ASSETS, NET (Tables)

3 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The changes in goodwill are as follows:


	Goodwill
Balance at December 31, 2021	$	204,868
Acquisition - IGE Entities - remeasurement adjustments	(22,542)
Acquisition - all others - remeasurement adjustments and foreign currency translation adjustments, net	1,012
Balance at March 31, 2022	$	183,338

Schedule of Indefinite-Lived Intangible Assets

Intangible assets, net comprised the following:


	March 31, 2022						December 31, 2021
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Finite-lived intangible assets:
Computer software	$	8,929	$	(7,705)	$	1,224	$	8,814	$	(7,208)	$	1,606
Customer relationship	107,800		(19,440)		88,360		101,222		(16,517)		84,705
Technology, formulations and recipes	114,403		(8,026)		106,377		110,561		(3,630)		106,931
Trade names	132,110		(5,060)		127,050		—		—		—
Other	4,878		(3,679)		1,199		2,428		(1,744)		684
Total finite-lived intangible assets, net	368,120		(43,910)		324,210		223,025		(29,099)		193,926
Indefinite-lived intangible asset:
Trade names	2,801		—		2,801		120,773		—		120,773
Other	—		—		—		120		—		120
Total Intangible assets, net	$	370,921	$	(43,910)	$	327,011	$	343,918	$	(29,099)	$	314,819

Schedule of Finite-Lived Intangible Assets

Intangible assets, net comprised the following:


	March 31, 2022						December 31, 2021
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Finite-lived intangible assets:
Computer software	$	8,929	$	(7,705)	$	1,224	$	8,814	$	(7,208)	$	1,606
Customer relationship	107,800		(19,440)		88,360		101,222		(16,517)		84,705
Technology, formulations and recipes	114,403		(8,026)		106,377		110,561		(3,630)		106,931
Trade names	132,110		(5,060)		127,050		—		—		—
Other	4,878		(3,679)		1,199		2,428		(1,744)		684
Total finite-lived intangible assets, net	368,120		(43,910)		324,210		223,025		(29,099)		193,926
Indefinite-lived intangible asset:
Trade names	2,801		—		2,801		120,773		—		120,773
Other	—		—		—		120		—		120
Total Intangible assets, net	$	370,921	$	(43,910)	$	327,011	$	343,918	$	(29,099)	$	314,819

The following are the estimated useful lives for the major classes of finite-lived intangible assets:


Computer software			5 years
Customer relationships			7 to 18 years
Technology, formulations and recipes			8 to 12 years
Trade names			15 to 20 years

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

The estimated aggregate future amortization expense for intangible assets subject to amortization as of March 31, 2022, is summarized below:


	Estimated Future Amortization Expense
For the period of April 1, 2022 to December 31, 2022	$	19,743
Year ending December 31,
2023	25,036
2024	24,876
2025	24,737
2026	20,493
Thereafter	209,325
Total	$	324,210

ACCOUNTS RECEIVABLE, NET AND INVENTORIES (Tables)

3 Months Ended

Mar. 31, 2022

Receivables [Abstract]

Schedule of Accounts Receivable, Net

Accounts receivable, net comprised the following:


	March 31, 2022		December 31, 2021
Trade accounts receivable	$	43,691	$	35,511
Allowance for doubtful accounts	(1,112)		(1,156)
Other receivables	2,740		7,129
Total accounts receivable, net	$	45,319	$	41,484

Schedule of Inventories

Inventories comprised the following:


	March 31, 2022		December 31, 2021
Finished goods	$	145,573	$	145,298
Work-in-process	8,786		5,967
Raw materials	42,135		41,399
Allowance for inventory obsolescence	(6,498)		(3,530)
Total inventories	$	189,996	$	189,134

ACCOUNTS RECEIVABLE, NET AND INVENTORIES

3 Months Ended

Mar. 31, 2022

Receivables [Abstract]

ACCOUNTS RECEIVABLE, NET AND INVENTORIES

ACCOUNTS RECEIVABLE, NET, AND INVENTORIES

Accounts receivable, net comprised the following:


	March 31, 2022		December 31, 2021
Trade accounts receivable	$	43,691	$	35,511
Allowance for doubtful accounts	(1,112)		(1,156)
Other receivables	2,740		7,129
Total accounts receivable, net	$	45,319	$	41,484

Inventories comprised the following:


	March 31, 2022		December 31, 2021
Finished goods	$	145,573	$	145,298
Work-in-process	8,786		5,967
Raw materials	42,135		41,399
Allowance for inventory obsolescence	(6,498)		(3,530)
Total inventories	$	189,996	$	189,134

The allowance for inventory obsolescence increased during the first quarter of 2022 as a result of a reserve for certain durable products.

GOODWILL AND INTANGIBLE ASSETS, NET - Intangible Assets, net (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 368,120	$ 223,025
Accumulated Amortization	(43,910)	(29,099)
Total	324,210	193,926
Indefinite-lived Intangible Assets [Line Items]
Gross Carrying Amount	370,921	343,918
Total	327,011	314,819
Trade names
Indefinite-lived Intangible Assets [Line Items]
Gross Carrying Amount	2,801	120,773
Other intangible assets
Indefinite-lived Intangible Assets [Line Items]
Gross Carrying Amount	0	120
Computer software
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	8,929	8,814
Accumulated Amortization	(7,705)	(7,208)
Total	1,224	1,606
Customer relationship
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	107,800	101,222
Accumulated Amortization	(19,440)	(16,517)
Total	88,360	84,705
Technology, formulations and recipes
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	114,403	110,561
Accumulated Amortization	(8,026)	(3,630)
Total	106,377	106,931
Trade names
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	132,110	0
Accumulated Amortization	(5,060)	0
Total	127,050	0
Other intangible assets
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	4,878	2,428
Accumulated Amortization	(3,679)	(1,744)
Total	$ 1,199	$ 684

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 12,157	$ 26,607
Restricted cash	1,777	1,777
Accounts receivable, net	45,319	41,484
Inventories	189,996	189,134
Notes receivable	475	622
Prepaid expenses and other current assets	11,312	9,760
Total current assets	261,036	269,384
Property, plant and equipment, net	51,349	50,473
Operating lease right-of-use assets	54,566	45,245
Goodwill	183,338	204,868
Intangible assets, net	327,011	314,819
Other assets	4,170	6,453
Total assets	881,470	891,242
Current liabilities:
Accounts payable	36,374	26,685
Accrued expenses and other current liabilities	31,549	33,996
Deferred revenue	10,887	18,273
Current portion of lease liabilities	7,773	7,198
Current portion of long-term debt	2,298	2,263
Total current liabilities	88,881	88,415
Long-term lease liabilities	46,755	38,595
Long-term debt	119,194	119,517
Deferred tax liabilities	6,575	5,631
Other long-term liabilities	4,608	3,904
Total liabilities	266,013	256,062
Commitments and contingencies (Note 13)
Stockholders’ equity
Common stock ($0.0001 par value; 300,000,000 shares authorized; 44,822,866 and 44,618,357 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively)	4	4
Additional paid-in capital	778,463	777,074
Accumulated other comprehensive income (loss)	802	(1,382)
Accumulated deficit	(163,812)	(140,516)
Total stockholders’ equity	615,457	635,180
Total liabilities and stockholders’ equity	$ 881,470	$ 891,242

STOCK-BASED COMPENSATION - Narrative (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) plan shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equity plans maintained \| plan	3
RSU
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Cost not yet recognized, amount	$ 9,010
Cost not yet recognized, period for recognition	1 year 7 months 9 days
Stock-based compensation expense	$ 2,799
PSU
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	1 year
Cost not yet recognized, amount	$ 1,783
Stock-based compensation expense	$ 45
PSU \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cost not yet recognized, period for recognition	1 year
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cost not yet recognized, amount	$ 730
Cost not yet recognized, period for recognition	1 year 11 months 12 days
Stock-based compensation expense	$ 64
2020 Employee, Director, and Consultant Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for grant (in shares) \| shares	1,732,432

DEBT (Tables)

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Schedule of Debt

Debt is comprised of the following:


	March 31, 2022		December 31, 2021
Term loan - net of unamortized discount and deferred financing costs of $5,807 and $6,025 at March 31, 2022, and December 31, 2021, respectively	$	118,880	$	118,975
Other	2,612		2,805
Total debt	$	121,492	$	121,780

Current portion of long-term debt	$	2,298	$	2,263
Long-term debt - net of unamortized discount and deferred financing costs of $5,807 and $6,025 at March 31, 2022, and December 31, 2021, respectively	119,194		119,517
Total debt	$	121,492	$	121,780

OPERATING LEASES - Future Minimum Lease Payment (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Leases [Abstract]
For the period of April 1, 2022 to December 31, 2022	$ 7,003
2023	9,311
2024	9,031
2025	8,338
2026	6,824
2027	6,369
Thereafter	14,208
Total rental payments	61,084
Less portion representing interest	(6,556)
Total lease liabilities	54,528	$ 45,793
Less current portion	(7,773)	(7,198)
Long-term portion	$ 46,755	$ 38,595

COMMITMENTS, CONTINGENCIES, AND RELATED PARTY TRANSACTIONS	3 Months Ended
	Mar. 31, 2022
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES, AND RELATED PARTY TRANSACTIONS	COMMITMENTS, CONTINGENCIES, AND RELATED PARTY TRANSACTIONS Purchase commitments From time to time in the normal course of business, the Company will enter into agreements with suppliers which provide favorable pricing in return for a commitment to purchase minimum amounts of inventory over a defined time period. Contingencies In the normal course of business, certain claims have been brought against the Company and, where applicable, its suppliers. While there is inherent difficulty in predicting the outcome of such matters, management has vigorously contested the validity of these claims. Based on available information, management believes the claims are without merit and does not expect that the outcome, individually or in the aggregate, would have a material adverse effect on the consolidated financial positions, results of operations, cash flows or future earnings. Related party transactions — Hydrofarm Distribution Center The Company leased a distribution center in Petaluma, California from entities in which a related party was a stockholder. For the three months ended March 2021, rent expense for the month-to-month lease totaled $320.

BUSINESS COMBINATIONS

3 Months Ended

Mar. 31, 2022

Business Combination and Asset Acquisition [Abstract]

BUSINESS COMBINATIONS

BUSINESS COMBINATIONSDuring 2021, the Company completed five acquisitions of branded manufacturers of CEA products, resulting in a significant expansion of its portfolio of proprietary branded products and specialized manufacturing capabilities. The Company finalized the determination of its allocation of the purchase price relating to the Heavy 16, H&G Entities, and Aurora acquisitions (all as defined below) as of March 31, 2022. The allocation of purchase price relating to the Greenstar and IGE Entities acquisitions (as defined below) are based upon a preliminary valuation, and the Company’s estimates and assumptions are subject to change within the measurement period as valuations are finalized.

During the three months ended March 31, 2022, the Company evaluated and adjusted the useful lives of certain intangible assets associated with entities that were acquired during 2021. In addition, the Company determined that the preliminary allocation of assets acquired related to indefinite lived trade names have a finite useful life because the expected usefulness of the trade names is limited. As a result of these adjustments to the provisional amounts, the Company recorded $5,894 of additional amortization expense during the three months ended March 31, 2022, that related to amortization expense that would have been recorded in the previous reporting period from the acquisition date through December 31, 2021. The intangible assets were assigned estimated useful lives as follows: (i) customer relationships: 7 to 12 years, (ii) technology, formulations and recipes: 8 to 12 years, and (iii) trade names: 15 to 20 years.

Heavy 16 Acquisition

On May 3, 2021, the Company acquired 100% of the issued and outstanding membership interests of Field 16, LLC ("Heavy 16"), a manufacturer and supplier of branded plant nutritional products. As a result of the acquisition, the Company broadened its proprietary branded offering into the plant nutrients category complementing other product offerings. The acquisition fair value of the consideration transferred for Heavy 16 was $77,367, consisting of $60,287 in cash, $16,736 of the Company's common stock and $344 contingent consideration. The fair value of the common stock issued was determined based on the closing market price of the Company's common stock on the acquisition date.

Pursuant to the purchase agreement, the Company was required to pay up to an additional $2,500 of contingent consideration based on $200 for each $1,000 above a $21,000 threshold for net sales in calendar year 2021. As a result, the Company recorded a liability for contingent consideration at its estimated fair value of $344 as of the acquisition date in the condensed consolidated balance sheets. The contingent consideration was estimated using a Black-Scholes valuation model, which utilized Level 3 inputs as defined in ASC 820 - Fair Value Measurements. The contingent consideration was $200 as of December 31, 2021 and March 31, 2022, and was paid in April 2022. The amount of goodwill is fully deductible for tax purposes.

House & Garden Acquisition

On June 1, 2021, the Company acquired 100% of the issued and outstanding shares of capital stock of House & Garden, Inc. (“HG”), Humboldt Wholesale, Inc. (“HW”), Allied Imports & Logistics, Inc. (“Allied”), South Coast Horticultural Supply, Inc. (“SC” and, together with HG, HW and Allied, the “H&G Entities”), a manufacturer and distributor of plant nutrients and fertilizers to domestic and various international markets. As a result of the acquisition, the Company further broadened its proprietary branded offering into the plant nutrients category complementing other product offerings. The acquisition date fair value of the consideration transferred for the H&G Entities was $133,483 in cash. The amount of goodwill is not deductible for tax purposes. As part of the share acquisition of the H&G Entities, the Company allocated a significant value of the acquisition to identified intangible assets that are not deductible for U.S. tax purposes. Therefore, a deferred tax liability arose providing an additional source of taxable income to support the realization of pre-existing deferred tax assets.

Aurora Acquisition

On July 1, 2021, the Company acquired 100% of the issued and outstanding membership interests of Gotham Properties LLC (“Gotham Properties”), Aurora Innovations LLC (“Aurora Innovations”), Aurora International LLC (“Aurora International” and, together with Gotham Properties and Aurora Innovations, “Aurora”), a manufacturer of plant fertility product lines. As a result of the acquisition, the Company further broadened its proprietary branded offering into the plant nutrients and grow media category complementing other product offerings. The preliminary acquisition fair value of the consideration transferred for Aurora was $178,871, consisting of $133,962 in cash, $25,824 of the Company's common stock, $19,300 contingent consideration and $215 forgiveness of accounts payable. The fair value of the common stock issued was determined based on the closing market price of the Company's common stock on the acquisition date. The forgiveness of accounts payable represents an effective settlement of a preexisting relationship between the parties.

Pursuant to the purchase agreement, the Company was required to pay a maximum contingent consideration equal to $70,997. To the extent 2021 EBITDA of Aurora exceeded $15,556, the excess was multiplied by eleven to determine contingent consideration. As a result, the Company recorded a liability for contingent consideration at its estimated fair value of $19,300 as of the acquisition date in the condensed consolidated balance sheets. The contingent consideration was estimated using the discounted cash flow method, which estimated the incremental EBITDA based on the Company's forecasted 2021 EBITDA of Aurora as of the acquisition date, discounted to a present value as of the acquisition date using a discount rate of 15%. That measure was based on significant inputs that are not observable in the market, which utilized Level 3 inputs as defined in ASC 820 - Fair Value Measurements. The contingent consideration was remeasured to fair value at each reporting date until resolution with changes in fair value recognized within SG&A in the condensed consolidated statements of operations. As of March 31, 2022, the related contingent consideration was $15,274. The contingent consideration is expected to be paid in May 2022. The amount of goodwill is fully deductible for tax purposes.

Greenstar/Grotek Acquisition

On August 3, 2021, the Company acquired 100% of the issued and outstanding shares of Greenstar Plant Products Inc., (“Greenstar”), a manufacturer of horticultural products and solutions for global, domestic and commercial use. As a result of the acquisition, the Company further broadened its proprietary branded offering into the plant nutrients and grow media category complementing other product offerings. The preliminary acquisition fair value of the consideration transferred for Greenstar was $83,520, consisting of $85,121 in cash, less $1,601 forgiveness of accounts payable, net, and obligations due under a distribution agreement. The forgiveness of accounts payable, net, and obligations due under a distribution agreement represent an effective settlement of a preexisting relationship between the parties. The amount of goodwill is not deductible for U.S. tax purposes, but it is partially deductible for Canadian tax purposes.

Innovative Growers Equipment, Inc. Acquisition

On November 1, 2021, the Company acquired 100% of the issued and outstanding shares of Innovative Growers Equipment, Inc., an Illinois corporation (“IGE”), Innovative AG Installation, Inc., an Illinois corporation (“IAG”), Innovative Racking Systems, Inc., an Illinois corporation (“IRS”), and Innovative Shipping Solutions, Inc., an Illinois corporation (“ISS” and, together with IGE, IAG, IRS, and their respective subsidiaries, the “IGE Entities”), a manufacturer of horticulture benches, racking and LED lighting systems which complement the Company’s existing lineup of high performance, proprietary branded products. The preliminary acquisition fair value of the consideration transferred for the IGE Entities was $60,902, consisting of $49,129 in cash, $11,051 of the Company's common stock, and $722 forgiveness of a contract asset. The fair value of the common stock issued was determined based on the closing market price of the Company's common stock on the acquisition date. The forgiveness of contract asset represents an effective settlement of a preexisting relationship between the parties. The amount of goodwill is not deductible for U.S. tax purposes.

The financial results of Heavy 16, the H&G Entities and the IGE Entities are included in the U.S. operating segment since the acquisition date, and the financial results of Greenstar are included in the Canada operating segment since the acquisition date. The financial results of Aurora are included in both the U.S. and Canada operating segments.

The following table sets forth the components and the preliminary allocation of the purchase price for the Company's acquisition of Heavy 16, the H&G Entities, Aurora, Greenstar and the IGE Entities:



	Heavy 16		H&G Entities		Aurora		Greenstar		IGE Entities
Component of Purchase Price:
Cash	$	60,287	$	133,483	$	133,962	$	85,121	$	49,129
Common stock	16,736		—		25,824		—		11,051
Contingent consideration	344		—		19,300		—		—
Forgiveness of assets and liabilities	—		—		(215)		(1,601)		722
Total purchase price	$	77,367	$	133,483	$	178,871	$	83,520	$	60,902

Acquisition-related costs	$	3,104	$	5,063	$	7,345	$	3,697	$	2,013

Allocation of Purchase Price:
Identifiable assets (liabilities)
Accounts receivable	$	510	$	3,308	$	6,967	$	982	$	2,367
Inventories	1,451		6,559		11,031		8,728		30,592
Prepaid expenses and other current assets	34		493		1,086		447		470
Property, plant and equipment	1,078		358		37,991		1,717		4,274
Operating lease right-of-use assets	1,088		1,921		—		2,736		4,447
Other assets	25		213		—		176		—
Accounts payable	(1,055)		(1,320)		(4,360)		(777)		(21,686)
Accrued expenses and other current liabilities	(226)		(445)		(768)		(1,421)		(859)
Current portion of lease liabilities	(274)		(447)		—		(624)		(815)
Current portion of long-term debt	—		—		—		—		(482)
Long-term deferred tax liabilities	—		(25,589)		—		—		(5,531)
Long-term lease liabilities	(868)		(1,501)		—		(1,836)		(3,116)
Long-term debt	—		—		—		—		(1,434)
Other long-term liabilities	—		—		(3,840)		—		—
Net identifiable assets	1,763		(16,450)		48,107		10,128		8,227
Identifiable intangible assets
Other intangible assets	200		200		824		383		2,430
Customer relationships	5,100		12,500		6,400		18,100		6,300
Trademarks and trade names	18,500		31,400		59,100		9,100		14,000
Technology and formulations & recipes	33,600		56,200		18,000		2,800		3,800
Total identifiable intangible assets	57,400		100,300		84,324		30,383		26,530
Goodwill	18,204		49,633		46,440		43,009		26,145
Total purchase price allocation	$	77,367	$	133,483	$	178,871	$	83,520	$	60,902

Supplemental Disclosure of Financial Results

The following represents certain estimated unaudited consolidated net sales and net income amounts for the quarter ended March 31, 2021 as if the five acquisitions had been included in the consolidated results of the Company for the entire period presented below. Management considers these estimates to represent an approximate measure of the performance of the combined Company (in millions):


			Three months ended March 31, 2021
			Estimated ($ in millions)
Net sales			160
Net income			17

BUSINESS COMBINATIONS - Allocation (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021	Nov. 01, 2021	Aug. 03, 2021	Jul. 01, 2021	Jun. 01, 2021	May 03, 2021
Business Acquisition [Line Items]
Goodwill	$ 183,338	$ 204,868
Heavy 16
Business Acquisition [Line Items]
Accounts receivable							$ 510
Inventories							1,451
Prepaid expenses and other current assets							34
Property, plant and equipment							1,078
Operating lease right-of-use assets							1,088
Other assets							25
Accounts payable							(1,055)
Accrued expenses and other current liabilities							(226)
Current portion of lease liabilities							(274)
Current portion of long-term debt							0
Long-term deferred tax liabilities							0
Long-term lease liabilities							(868)
Long-term debt							0
Other long-term liabilities							0
Net identifiable assets							1,763
Total identifiable intangible assets							57,400
Goodwill							18,204
Total purchase price allocation							77,367
Heavy 16 \| Other intangible assets
Business Acquisition [Line Items]
Total identifiable intangible assets							200
Heavy 16 \| Customer relationship
Business Acquisition [Line Items]
Total identifiable intangible assets							5,100
Heavy 16 \| Trademarks and trade names
Business Acquisition [Line Items]
Total identifiable intangible assets							18,500
Heavy 16 \| Technology, formulations and recipes
Business Acquisition [Line Items]
Total identifiable intangible assets							$ 33,600
H&G Entities
Business Acquisition [Line Items]
Accounts receivable						$ 3,308
Inventories						6,559
Prepaid expenses and other current assets						493
Property, plant and equipment						358
Operating lease right-of-use assets						1,921
Other assets						213
Accounts payable						(1,320)
Accrued expenses and other current liabilities						(445)
Current portion of lease liabilities						(447)
Current portion of long-term debt						0
Long-term deferred tax liabilities						(25,589)
Long-term lease liabilities						(1,501)
Long-term debt						0
Other long-term liabilities						0
Net identifiable assets						(16,450)
Total identifiable intangible assets						100,300
Goodwill						49,633
Total purchase price allocation						133,483
H&G Entities \| Other intangible assets
Business Acquisition [Line Items]
Total identifiable intangible assets						200
H&G Entities \| Customer relationship
Business Acquisition [Line Items]
Total identifiable intangible assets						12,500
H&G Entities \| Trademarks and trade names
Business Acquisition [Line Items]
Total identifiable intangible assets						31,400
H&G Entities \| Technology, formulations and recipes
Business Acquisition [Line Items]
Total identifiable intangible assets						$ 56,200
Aurora
Business Acquisition [Line Items]
Accounts receivable					$ 6,967
Inventories					11,031
Prepaid expenses and other current assets					1,086
Property, plant and equipment					37,991
Operating lease right-of-use assets					0
Other assets					0
Accounts payable					(4,360)
Accrued expenses and other current liabilities					(768)
Current portion of lease liabilities					0
Current portion of long-term debt					0
Long-term deferred tax liabilities					0
Long-term lease liabilities					0
Long-term debt					0
Other long-term liabilities					(3,840)
Net identifiable assets					48,107
Total identifiable intangible assets					84,324
Goodwill					46,440
Total purchase price allocation					178,871
Aurora \| Other intangible assets
Business Acquisition [Line Items]
Total identifiable intangible assets					824
Aurora \| Customer relationship
Business Acquisition [Line Items]
Total identifiable intangible assets					6,400
Aurora \| Trademarks and trade names
Business Acquisition [Line Items]
Total identifiable intangible assets					59,100
Aurora \| Technology, formulations and recipes
Business Acquisition [Line Items]
Total identifiable intangible assets					$ 18,000
Greenstar
Business Acquisition [Line Items]
Accounts receivable				$ 982
Inventories				8,728
Prepaid expenses and other current assets				447
Property, plant and equipment				1,717
Operating lease right-of-use assets				2,736
Other assets				176
Accounts payable				(777)
Accrued expenses and other current liabilities				(1,421)
Current portion of lease liabilities				(624)
Current portion of long-term debt				0
Long-term deferred tax liabilities				0
Long-term lease liabilities				(1,836)
Long-term debt				0
Other long-term liabilities				0
Net identifiable assets				10,128
Total identifiable intangible assets				30,383
Goodwill				43,009
Total purchase price allocation				83,520
Greenstar \| Other intangible assets
Business Acquisition [Line Items]
Total identifiable intangible assets				383
Greenstar \| Customer relationship
Business Acquisition [Line Items]
Total identifiable intangible assets				18,100
Greenstar \| Trademarks and trade names
Business Acquisition [Line Items]
Total identifiable intangible assets				9,100
Greenstar \| Technology, formulations and recipes
Business Acquisition [Line Items]
Total identifiable intangible assets				$ 2,800
IGE Entities
Business Acquisition [Line Items]
Accounts receivable			$ 2,367
Inventories			30,592
Prepaid expenses and other current assets			470
Property, plant and equipment			4,274
Operating lease right-of-use assets			4,447
Other assets			0
Accounts payable			(21,686)
Accrued expenses and other current liabilities			(859)
Current portion of lease liabilities			(815)
Current portion of long-term debt			(482)
Long-term deferred tax liabilities			(5,531)
Long-term lease liabilities			(3,116)
Long-term debt			(1,434)
Other long-term liabilities			0
Net identifiable assets			8,227
Total identifiable intangible assets			26,530
Goodwill			26,145
Total purchase price allocation			60,902
IGE Entities \| Other intangible assets
Business Acquisition [Line Items]
Total identifiable intangible assets			2,430
IGE Entities \| Customer relationship
Business Acquisition [Line Items]
Total identifiable intangible assets			6,300
IGE Entities \| Trademarks and trade names
Business Acquisition [Line Items]
Total identifiable intangible assets			14,000
IGE Entities \| Technology, formulations and recipes
Business Acquisition [Line Items]
Total identifiable intangible assets			$ 3,800

EARNINGS (LOSS) PER COMMON SHARE (“EPS”)

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

EARNINGS (LOSS) PER COMMON SHARE (“EPS”)

Basic EPS is computed using net income (loss) divided by the weighted-average number of common shares outstanding during each period, excluding unvested restricted stock units (“RSUs”).

Diluted EPS represents net income (loss) divided by the weighted-average number of common shares outstanding during the period, including common stock equivalents. Common stock equivalents consist of shares subject to warrants and share-based awards with exercise prices less than the average market price of the Company’s common stock for the period, to the extent their inclusion would be dilutive. Regarding RSUs subject to a market condition, before the end of the contingency period, the number of contingently issuable shares (i.e., RSUs) to be included in diluted EPS would be based on the number of common shares issuable under the terms of the arrangement if the end of the reporting period was the end of the contingency period, assuming the result would be dilutive. Those contingently issuable shares would be included in the denominator of diluted EPS as of the beginning of the period, or as of the grant date of the share-based payment, if later.

The following table presents information necessary to calculate basic and diluted EPS for the three months ended March 31, 2022, and 2021:


	Three months ended March 31,
	2022		2021
Net (loss) income	$	(23,296)	$	4,940
Weighted-average shares of common stock outstanding	44,718,510		33,717,103
Dilutive effect of warrants using the treasury stock method	—		2,840,464
Dilutive effect of restricted stock units using the treasury stock method	—		1,658,866
Dilutive effect of stock options using the treasury stock method	—		780,598
Diluted weighted-average shares of common stock outstanding	44,718,510		38,997,031
Basic EPS	$	(0.52)	$	0.15
Diluted EPS	$	(0.52)	$	0.13

The computation of the weighted-average shares of common stock outstanding for diluted EPS excludes the following potential common shares as their inclusion would have an anti-dilutive effect:


	Three months ended March 31,
	2022	2021
Shares subject to warrants outstanding	17,669	—
Shares subject to unvested performance based and restricted stock units	1,234,857	—
Shares subject to stock options outstanding	696,071	—

CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY - Capital Stock (Details) - shares	Mar. 31, 2022	Dec. 31, 2021
Equity [Abstract]
Convertible preferred stock, authorized (in shares)	50,000,000
Convertible preferred stock, outstanding (in shares)	0
Common stock, shares authorized (in shares)	300,000,000	300,000,000
Common stock, shares outstanding (in shares)	44,822,866	44,618,357

EARNINGS (LOSS) PER COMMON SHARE (“EPS”) - Calculation for Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Net (loss) income	$ (23,296)	$ 4,940
Weighted-average shares of common stock outstanding (in shares)	44,718,510	33,717,103
Dilutive effect of warrants using the treasury stock method (in shares)	0	2,840,464
Diluted weighted-average shares of common stock outstanding (in shares)	44,718,510	38,997,031
Basic EPS (in dollars per share)	$ (0.52)	$ 0.15
Diluted EPS (in dollars per share)	$ (0.52)	$ 0.13
Restricted stock units
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Dilutive effect of share-based payments using the treasury stock method (in shares)	0	1,658,866
Stock options
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Dilutive effect of share-based payments using the treasury stock method (in shares)	0	780,598

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables)

3 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Revenue from External Customers by Geographic Areas

Sales to external customers and property, plant and equipment, net in the United States and Canada, determined by the location of the subsidiaries, were as follows:


	Three months ended March 31,
	2022		2021
United States	$	92,858	$	90,672
Canada	21,502		22,264
Intersegment eliminations	(2,983)		(1,547)
Total consolidated net sales	$	111,377	$	111,389




	March 31, 2022		December 31, 2021
United States	$	87,121	$	85,167
Canada	18,794		10,551
Total property, plant and equipment, and operating lease right-of-use assets, net	$	105,915	$	95,718

Long-lived Assets by Geographic Areas

Sales to external customers and property, plant and equipment, net in the United States and Canada, determined by the location of the subsidiaries, were as follows:


	Three months ended March 31,
	2022		2021
United States	$	92,858	$	90,672
Canada	21,502		22,264
Intersegment eliminations	(2,983)		(1,547)
Total consolidated net sales	$	111,377	$	111,389




	March 31, 2022		December 31, 2021
United States	$	87,121	$	85,167
Canada	18,794		10,551
Total property, plant and equipment, and operating lease right-of-use assets, net	$	105,915	$	95,718

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Operating activities
Net (loss) income	$ (23,296)	$ 4,940
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation, depletion and amortization	16,941	1,591
Provision for inventory obsolescence	3,229	16
Stock-based compensation expense	2,908	1,001
Non-cash operating lease expense	2,261	958
Impairment charges	2,756	0
Change in fair value of contingent consideration	(1,560)	0
Deferred income tax benefit	(4,586)	0
Other	258	624
Changes in assets and liabilities:
Accounts receivable	(6,834)	(11,554)
Inventories	(143)	(7,496)
Prepaid expenses and other current assets	(2,315)	(3,970)
Other assets	(90)	(414)
Accounts payable	10,454	14,398
Accrued expenses and other current liabilities	(1,208)	(1,840)
Deferred revenue	(7,159)	(66)
Lease liabilities	(1,750)	(826)
Other long-term liabilities	(21)	0
Net cash used in operating activities	(10,155)	(2,638)
Investing activities
Business combinations, net of cash and cash equivalents	190	0
Purchases of property, plant and equipment	(2,470)	(428)
Other	(105)	(17)
Net cash used in investing activities	(2,385)	(445)
Financing activities
Borrowings under revolving credit facilities	420	52,344
Repayments of revolving credit facilities	(397)	(52,250)
Repayments of long-term debt Term Loan	(313)	0
Payment of withholding tax related to restricted stock units	(1,559)	(11,595)
Other	(104)	(326)
Net cash used in financing activities	(1,953)	(11,827)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	43	(4)
Net decrease in cash, cash equivalents and restricted cash	(14,450)	(14,914)
Cash, cash equivalents and restricted cash at beginning of period	28,384	76,955
Cash, cash equivalents and restricted cash at end of period	$ 13,934	$ 62,041

OPERATING LEASES

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

OPERATING LEASES

OPERATING LEASESThe Company leases its distribution centers and manufacturing facilities from third parties under various non-cancelable lease agreements expiring at various dates through 2032. Certain leases contain escalation provisions and/or renewal options, giving the Company the right to extend the leases by up to 10 years. However, these options are generally not reflected in the calculation of the right-of-use assets and lease liabilities due to uncertainty surrounding the likelihood of renewal. The Company recognizes operating lease costs over the respective lease periods, including short-term and month-to-month leases. During the three months ended March 31, 2022, and 2021, the Company incurred operating lease costs of $2,597 and $1,494, respectively. These costs are included primarily within selling, general and administrative expense in the condensed consolidated statements of operations.

Supplemental balance sheet information related to the Company’s operating leases are as follows:


	March 31, 2022		December 31, 2021
Assets
Operating lease right-of-use assets, net of accumulated amortization	$	54,566	$	45,245
Total leased assets	$	54,566	$	45,245
Liabilities
Current portion of lease liabilities	$	7,773	$	7,198
Long-term lease liabilities	46,755		38,595
Total lease liabilities	$	54,528	$	45,793

As of March 31, 2022, future minimum lease payments under non-cancelable operating leases are as follows:


	Operating
For the period of April 1, 2022 to December 31, 2022	$	7,003
Year ending December 31,
2023	9,311
2024	9,031
2025	8,338
2026	6,824
2027	6,369
Thereafter	14,208
Total rental payments	61,084
Less portion representing interest	(6,556)
Total principal	54,528
Less current portion	(7,773)
Long-term portion	$	46,755

During the three months ended March 31, 2022, the Company executed a lease for approximately 303,000 square feet of warehouse space in Shoemakersville, Pennsylvania, and recorded right-of-use assets for operating leases for $10,463.

During 2021, the Company executed new lease agreements that will commence in 2023. The future minimum lease payments for executed non-cancelable operating leases not yet commenced are as follows:


	Operating
For the period of April 1, 2022, to December 31, 2022	$	—
Year ending December 31,
2023	3,354
2024	3,272
2025	3,610
2026	3,965
2027	4,076
Thereafter	22,633
Total rental payments	$	40,910

ACCOUNTS RECEIVABLE, NET AND INVENTORIES - Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Receivables [Abstract]
Finished goods	$ 145,573	$ 145,298
Work-in-process	8,786	5,967
Raw materials	42,135	41,399
Allowance for inventory obsolescence	(6,498)	(3,530)
Total inventories	$ 189,996	$ 189,134

OPERATING LEASES - Lease Not yet Commenced Maturity (Details) $ in Thousands	Mar. 31, 2022 USD ($)
Leases [Abstract]
For the period of April 1, 2022, to December 31, 2022	$ 0
2023	3,354
2024	3,272
2025	3,610
2026	3,965
2027	4,076
Thereafter	22,633
Total rental payments	$ 40,910

FAIR VALUE MEASUREMENTS (Details) - Level 2 - Term Loan - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Carrying Amount
Liabilities
Debt	$ 125,000	$ 125,000
Estimated Fair Value
Liabilities
Debt	$ 118,750	$ 121,250

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

3 Months Ended

Mar. 31, 2022

Payables and Accruals [Abstract]

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities comprised the following:


	March 31, 2022		December 31, 2021
Accrued compensation and benefits	$	4,283	$	3,713
Freight, custom and duty accrual	2,366		2,094
Goods in transit accrual	2,413		3,473
Income tax accrual	—		729
Contingent consideration	15,474		17,034
Other accrued liabilities	7,013		6,953
Total accrued expenses and other current liabilities	$	31,549	$	33,996

STOCK-BASED COMPENSATION - Unvested Stock Option Activity (Details)	3 Months Ended
	Mar. 31, 2022 $ / shares shares
Number
Balance, outstanding, beginning (in shares) \| shares	202,515
Vested (in shares) \| shares	(38,372)
Forfeited (in shares) \| shares	(16,623)
Balance, outstanding, ending (in shares) \| shares	147,520
Weighted average grant date fair value
Balance, outstanding, beginning (in dollars per share) \| $ / shares	$ 5.04
Vested (in dollars per share) \| $ / shares	1.02
Forfeited (in dollars per share) \| $ / shares	6.03
Balance, outstanding, ending (in dollars per share) \| $ / shares	$ 5.98

GOODWILL AND INTANGIBLE ASSETS, NET

3 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS, NET

Goodwill

The Company's goodwill by reportable segment is $122,977 for the United States and $60,361 for Canada as of March 31, 2022. Goodwill is evaluated for impairment annually in the fourth quarter, or on an interim basis when an event occurs, or circumstances change that indicates the carrying value may not be recoverable. The Company did not identify a triggering event requiring a quantitative test for impairment as of March 31, 2022. The changes in goodwill are as follows:


	Goodwill
Balance at December 31, 2021	$	204,868
Acquisition - IGE Entities - remeasurement adjustments	(22,542)
Acquisition - all others - remeasurement adjustments and foreign currency translation adjustments, net	1,012
Balance at March 31, 2022	$	183,338

Intangible Assets, net

Intangible assets, net comprised the following:


	March 31, 2022						December 31, 2021
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Finite-lived intangible assets:
Computer software	$	8,929	$	(7,705)	$	1,224	$	8,814	$	(7,208)	$	1,606
Customer relationship	107,800		(19,440)		88,360		101,222		(16,517)		84,705
Technology, formulations and recipes	114,403		(8,026)		106,377		110,561		(3,630)		106,931
Trade names	132,110		(5,060)		127,050		—		—		—
Other	4,878		(3,679)		1,199		2,428		(1,744)		684
Total finite-lived intangible assets, net	368,120		(43,910)		324,210		223,025		(29,099)		193,926
Indefinite-lived intangible asset:
Trade names	2,801		—		2,801		120,773		—		120,773
Other	—		—		—		120		—		120
Total Intangible assets, net	$	370,921	$	(43,910)	$	327,011	$	343,918	$	(29,099)	$	314,819

Total amortization expense was $14,746 and $1,206 for the three months ended March 31, 2022 and 2021, respectively. Amortization expense in 2022 includes the impact from intangible assets recorded in connection with five acquisitions completed during the year ended December 31, 2021. The following are the estimated useful lives for the major classes of finite-lived intangible assets:


Computer software			5 years
Customer relationships			7 to 18 years
Technology, formulations and recipes			8 to 12 years
Trade names			15 to 20 years

For intangible assets subject to amortization, the weighted-average amortization period as of March 31, 2022, for computer software, customer relationships, technology and formulations & recipes and trade names was 2 years, 12 years, 11 years, and 19 years, respectively.

The estimated aggregate future amortization expense for intangible assets subject to amortization as of March 31, 2022, is summarized below:


	Estimated Future Amortization Expense
For the period of April 1, 2022 to December 31, 2022	$	19,743
Year ending December 31,
2023	25,036
2024	24,876
2025	24,737
2026	20,493
Thereafter	209,325
Total	$	324,210

ACCOUNTS RECEIVABLE, NET AND INVENTORIES - Accounts Receivable, Net (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Receivables [Abstract]
Trade accounts receivable	$ 43,691	$ 35,511
Allowance for doubtful accounts	(1,112)	(1,156)
Other receivables	2,740	7,129
Total accounts receivable, net	$ 45,319	$ 41,484

GOODWILL AND INTANGIBLE ASSETS, NET - Useful Life Finite-lived Intangible Assets (Details)	3 Months Ended
	Mar. 31, 2022
Computer software
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	5 years
Customer relationship \| Minimum
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	7 years
Customer relationship \| Maximum
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	18 years
Technology, formulations and recipes \| Minimum
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	8 years
Technology, formulations and recipes \| Maximum
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	12 years
Trade names \| Minimum
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	15 years
Trade names \| Maximum
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	20 years

BUSINESS COMBINATIONS (Tables)

3 Months Ended

Mar. 31, 2022

Business Combination and Asset Acquisition [Abstract]

Schedule of Business Acquisitions, by Acquisition

The following table sets forth the components and the preliminary allocation of the purchase price for the Company's acquisition of Heavy 16, the H&G Entities, Aurora, Greenstar and the IGE Entities:



	Heavy 16		H&G Entities		Aurora		Greenstar		IGE Entities
Component of Purchase Price:
Cash	$	60,287	$	133,483	$	133,962	$	85,121	$	49,129
Common stock	16,736		—		25,824		—		11,051
Contingent consideration	344		—		19,300		—		—
Forgiveness of assets and liabilities	—		—		(215)		(1,601)		722
Total purchase price	$	77,367	$	133,483	$	178,871	$	83,520	$	60,902

Acquisition-related costs	$	3,104	$	5,063	$	7,345	$	3,697	$	2,013

Allocation of Purchase Price:
Identifiable assets (liabilities)
Accounts receivable	$	510	$	3,308	$	6,967	$	982	$	2,367
Inventories	1,451		6,559		11,031		8,728		30,592
Prepaid expenses and other current assets	34		493		1,086		447		470
Property, plant and equipment	1,078		358		37,991		1,717		4,274
Operating lease right-of-use assets	1,088		1,921		—		2,736		4,447
Other assets	25		213		—		176		—
Accounts payable	(1,055)		(1,320)		(4,360)		(777)		(21,686)
Accrued expenses and other current liabilities	(226)		(445)		(768)		(1,421)		(859)
Current portion of lease liabilities	(274)		(447)		—		(624)		(815)
Current portion of long-term debt	—		—		—		—		(482)
Long-term deferred tax liabilities	—		(25,589)		—		—		(5,531)
Long-term lease liabilities	(868)		(1,501)		—		(1,836)		(3,116)
Long-term debt	—		—		—		—		(1,434)
Other long-term liabilities	—		—		(3,840)		—		—
Net identifiable assets	1,763		(16,450)		48,107		10,128		8,227
Identifiable intangible assets
Other intangible assets	200		200		824		383		2,430
Customer relationships	5,100		12,500		6,400		18,100		6,300
Trademarks and trade names	18,500		31,400		59,100		9,100		14,000
Technology and formulations & recipes	33,600		56,200		18,000		2,800		3,800
Total identifiable intangible assets	57,400		100,300		84,324		30,383		26,530
Goodwill	18,204		49,633		46,440		43,009		26,145
Total purchase price allocation	$	77,367	$	133,483	$	178,871	$	83,520	$	60,902

Business Acquisition, Pro Forma Information


			Three months ended March 31, 2021
			Estimated ($ in millions)
Net sales			160
Net income			17

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Payables and Accruals [Abstract]
Accrued compensation and benefits	$ 4,283	$ 3,713
Freight, custom and duty accrual	2,366	2,094
Goods in transit accrual	2,413	3,473
Income tax accrual	0	729
Contingent consideration	15,474	17,034
Other accrued liabilities	7,013	6,953
Total accrued expenses and other current liabilities	$ 31,549	$ 33,996

COMMITMENTS, CONTINGENCIES, AND RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Related Party Transaction [Line Items]
Operating lease, expense	$ 2,261	$ 958
Investor \| Petaluma, California
Related Party Transaction [Line Items]
Operating lease, expense		$ 320

STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

Stock-based compensation plan overview

The Company maintains three equity incentive plans: the 2018 Equity Incentive Plan (“2018 Plan”), the 2019 Employee, Director and Consultant Equity Incentive Plan (“2019 Plan”) and the 2020 Employee, Director, and Consultant Equity Incentive Plan (“2020 Plan” and collectively, “Incentive Plans”). The 2020 Plan serves as the successor to the 2019 Plan and 2018 Plan and provides for the issuance of incentive stock options, nonqualified stock options, stock grants and stock-based awards to employees, directors, and consultants of the Company. No further awards will be issued under the 2018 Plan and 2019 Plan. Of the total shares available for grant under the 2020 Plan, 1,732,432 remain available as of March 31, 2022.

RSU Activity

RSUs granted to certain executives, employees and members of the Board generally have a time-based vesting requirement (based on continuous employment). The stock-based compensation expense related to service-based awards is recorded over the requisite service period. During the three months ended March 31, 2022, the Company granted RSU awards that are expected to vest either (i) ratably over a three-year period on each anniversary of the grant date, or (ii) with three vesting tranches, the first of which occurred on the grant date, and the following two tranches on each subsequent anniversary of the grant date. The following table summarizes the activity related to the Company's RSUs for the three months ended March 31, 2022. For purposes of this table, vested RSUs represent the shares for which the service condition had been fulfilled as of March 31, 2022:


	Number of RSUs	Weighted average grant date fair value
Balance, December 31, 2021	1,087,608	$	9.71
Granted	339,076	$	15.93
Vested	(278,002)	$	11.92
Forfeited	(29,938)	$	52.51
Balance, March 31, 2022	1,118,744	$	9.90

As of March 31, 2022, total unamortized stock-based compensation cost related to unvested RSUs was $9,010 and the weighted-average period over which the compensation is expected to be recognized is 1.61 years. For the three months ended March 31, 2022, the Company recognized $2,799 of total stock-based compensation expense for RSUs.

Performance Stock Unit ("PSU") Activity

During the three months ended March 31, 2022, the Company granted PSU awards that are subject to a one-year vesting requirement (based on continuous employment) and contain performance conditions based on certain performance metrics. The following table summarizes the activity related to the Company's PSUs for the three months ended March 31, 2022.


	Number of PSUs	Weighted average grant date fair value
Balance, December 31, 2021	—	$	—
Granted	116,113	$	15.74
Balance, March 31, 2022	116,113	$	15.74

As of March 31, 2022, total unamortized stock-based compensation cost related to unvested PSUs was $1,783 and the weighted-average period over which the compensation is expected to be recognized is less than one year. For the three months ended March 31, 2022, the Company recognized $45 of total stock-based compensation expense for PSUs.

Stock options

The following table summarizes the stock option activity for the three months ended March 31, 2022:


	Number	Weighted average exercise price		Weighted average grant date fair value		Weighted average remaining contractual term (years)
Outstanding as of December 31, 2021	720,549	$	9.57	$	2.21	7.37
Exercised	(7,765)	$	9.04	$	2.21
Cancelled	(90)	$	11.06	$	9.89
Forfeited	(16,623)	$	11.51	$	6.03
Outstanding as of March 31, 2022	696,071	$	9.53	$	2.12	6.84
Options exercisable as of March 31, 2022	548,551	$	8.56	$	1.08	6.53
Vested and expected to vest as of March 31, 2022	696,071	$	9.53	$	2.12	6.84

The following table summarizes the unvested stock option activity for the three months ended March 31, 2022:


	Number	Weighted average grant date fair value
Unvested as of December 31, 2021	202,515	$	5.04
Vested	(38,372)	$	1.02
Forfeited	(16,623)	$	6.03
Unvested as of March 31, 2022	147,520	$	5.98

As of March 31, 2022, total compensation cost related to unvested awards not yet recognized was $730 and the weighted-average period over which the compensation is expected to be recognized is 1.95 years. For the three months ended March 31, 2022, the Company recognized $64 of total stock-based compensation expense for stock options.

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)

3 Months Ended

Mar. 31, 2022

Payables and Accruals [Abstract]

Schedule of Accrued Liabilities and Other Current Liabilities

Accrued expenses and other current liabilities comprised the following:


	March 31, 2022		December 31, 2021
Accrued compensation and benefits	$	4,283	$	3,713
Freight, custom and duty accrual	2,366		2,094
Goods in transit accrual	2,413		3,473
Income tax accrual	—		729
Contingent consideration	15,474		17,034
Other accrued liabilities	7,013		6,953
Total accrued expenses and other current liabilities	$	31,549	$	33,996

BUSINESS COMBINATIONS - Pro Forma (Details) $ in Millions	3 Months Ended
BUSINESS COMBINATIONS - Pro Forma (Details) $ in Millions	Mar. 31, 2021 USD ($)
Business Combination and Asset Acquisition [Abstract]
Net sales	$ 160
Net income	$ 17

OPERATING LEASES - Narrative (Details) ft² in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) ft²	Mar. 31, 2021 USD ($)	Dec. 31, 2021 USD ($)
Leases [Abstract]
Renewal term	10 years
Operating lease, cost	$ 2,597	$ 1,494
Lessee, Lease, Description [Line Items]
Operating lease right-of-use assets	$ 54,566		$ 45,245
Shoemakersville, Pennsylvania
Leases [Abstract]
Rented area (sf) \| ft²	303
Lessee, Lease, Description [Line Items]
Rented area (sf) \| ft²	303
Operating lease right-of-use assets	$ 10,463

CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY - Outstanding Warrants (Details)	Mar. 31, 2022 $ / shares shares
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares) \| shares	17,669
Exercise price (in dollars per share) \| $ / shares	$ 11.30
Investor Warrants, Placement Agents, $8.43
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares) \| shares	11,662
Exercise price (in dollars per share) \| $ / shares	$ 8.43
Investor Warrants, Placement Agents, $16.86
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares) \| shares	6,007
Exercise price (in dollars per share) \| $ / shares	$ 16.86

PROPERTY, PLANT AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Gross property and equipment	$ 61,757		$ 58,764
Less: accumulated depreciation	(10,408)		(8,291)
Total property and equipment, net	51,349		50,473
Depreciation and amortization expense	2,195	$ 385
Machinery and equipment
Property, Plant and Equipment [Line Items]
Gross property and equipment	26,587		25,177
Peat bogs and related development
Property, Plant and Equipment [Line Items]
Gross property and equipment	9,876		8,686
Building and improvements
Property, Plant and Equipment [Line Items]
Gross property and equipment	9,503		9,510
Land
Property, Plant and Equipment [Line Items]
Gross property and equipment	6,116		6,120
Leasehold improvements
Property, Plant and Equipment [Line Items]
Gross property and equipment	3,413		3,207
Computer equipment
Property, Plant and Equipment [Line Items]
Gross property and equipment	3,271		3,197
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Gross property and equipment	$ 2,991		$ 2,867

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These condensed consolidated financial statements have been prepared on the same basis as the Company's annual consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for the fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2022, or for any other interim period or for any other future year. All intercompany balances and transactions have been eliminated in consolidation. The Company reclassified the balance within "Impairment, restructuring and other" on the condensed consolidated statements of operations for the prior period into "Selling, general and administrative expenses" to conform to the current period presentation. The Company reclassified the balance of customer deposits previously reported in "accounts payable" into "deferred revenue" in the condensed consolidated balance sheet as of December 31, 2021 to conform to the current period presentation. The amount totaled $18,273 as of December 31, 2021.

The condensed consolidated balance sheet as of December 31, 2021, has been derived from the audited consolidated financial statements of the Company, which is included in the Company's Annual Report on Form 10-K ("2021 Annual Report"). These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the 2021 Annual Report.

Use of estimates

The 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 disclosure of contingent assets and liabilities as of the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Significant estimates include provisions for sales returns, rebates and claims from customers, realization of accounts receivable and inventories, fair value of assets acquired and liabilities assumed for business combinations, valuation of intangible assets and goodwill, estimated useful lives of long lived assets, incremental borrowing rate applied in lease accounting, valuation of stock-based compensation, recognition of deferred income taxes, recognition of liabilities related to commitments and contingencies and valuation allowances. Actual results may differ from these estimates. On an ongoing basis, the Company reviews its estimates to ensure that these estimates appropriately reflect changes in its business or new information available.

Business combinations

Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition date fair values of the assets transferred, liabilities incurred to the former owners of the acquiree, and the equity interests issued in exchange for control of the acquiree. Acquisition related costs are recognized in net income (loss) as incurred.

When the consideration transferred in a business combination includes assets or liabilities resulting from a contingent consideration arrangement, the contingent consideration is measured at its acquisition date fair value and included as part of the consideration transferred in a business combination. Contingent consideration is established for business acquisitions where the Company has the obligation to transfer additional assets or equity interests to the former owners if specified future events occur or conditions are met. Contingent consideration is classified as a liability when the obligation requires settlement in cash or other assets and is classified as equity when the obligation requires settlement in the Company's own equity instruments. Changes in the fair value of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with a corresponding adjustment to goodwill. Measurement period adjustments are adjustments that arise from additional information obtained during the measurement period (which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date. All other subsequent changes in the fair value of contingent consideration classified as a liability are included in net income (loss) in the period. Changes in the fair value of contingent consideration classified as equity are not recognized.

For a given acquisition, the Company may identify certain pre-acquisition contingencies as of the acquisition date and may extend its review and evaluation of these pre-acquisition contingencies throughout the measurement period to obtain sufficient information to assess these contingencies as part of acquisition accounting, as applicable.

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non‑controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquire (if any) over the net of the acquisition‑date fair value amounts of the identifiable assets acquired, and the liabilities assumed.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Company reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period, or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that time. Upon conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to net income (loss).

Segment and entity-wide information

Segment information

The Company's chief operating decision maker is the chief executive officer ("CEO") who reviews financial information for the purposes of making operating decisions, assessing financial performance, and allocating resources.

The business is organized as two operating segments, the U.S. and Canada, which meet the criteria for aggregation, and the Company has elected to present them as one reportable segment, which is the distribution and manufacture of CEA equipment and supplies. Aggregation is based on similarities which include the nature of its products, production or acquisition of inventory, customer base, fulfillment and distribution and economic characteristics.

Since the Company operates as one reportable segment, all required segment financial information is found in the condensed consolidated financial statements and footnotes with entity-wide disclosures presented below.

Entity-wide information

Sales to external customers and property, plant and equipment, net in the United States and Canada, determined by the location of the subsidiaries, were as follows:


	Three months ended March 31,
	2022		2021
United States	$	92,858	$	90,672
Canada	21,502		22,264
Intersegment eliminations	(2,983)		(1,547)
Total consolidated net sales	$	111,377	$	111,389




	March 31, 2022		December 31, 2021
United States	$	87,121	$	85,167
Canada	18,794		10,551
Total property, plant and equipment, and operating lease right-of-use assets, net	$	105,915	$	95,718

All of the products sold by the Company are similar and classified as CEA equipment and supplies. The Company’s underlying accounting records currently do not support presentation of disaggregated net sales and any attempt to report them would be impracticable.

Note receivable

In 2019, the Company executed a note receivable secured by equipment to a third-party, the terms of which were amended and restated during the first quarter of 2021. The note receivable provided for interest and installment payments to the Company, and full maturity of the note in 2024. During the three months ended March 31, 2022, the third-party defaulted on interest payments, and the Company measured an impairment on the note receivable based on the estimated fair value of the collateral. The Company recorded an impairment loss of $2,636 during the three months ended March 31, 2022, in “Selling, general and administrative expenses” ("SG&A") on the condensed consolidated statements of operations. As of March 31, 2022, the note receivable carrying value was $475.

Revenue recognition

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”) which requires that revenue recognized from contracts with customers be disaggregated into categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected

by economic factors. The Company has determined that revenue is generated from one category, which is the distribution and manufacture of controlled environment agriculture equipment and supplies.

Revenue is recognized as control of promised goods is transferred to customers which generally occurs upon receipt at customers’ locations determined by the specific terms of the contract. Arrangements generally have a single performance obligation and revenue reported is comprised of fixed consideration and variable consideration which includes applicable volume rebates, cash discounts and sales returns and allowances. Variable consideration is estimated and recorded at the time of sale; these allowances and accruals are not material to the financial statements.

The amount billed to customers for shipping and handling costs included in net sales was $3,879 and $1,245 for the three months ended March 31, 2022, and 2021, respectively. Shipping and handling costs that occur before the customer obtains control of the goods are deemed to be fulfillment activities and are accounted for as fulfillment costs included in cost of goods sold. The Company does not receive noncash consideration for the sale of goods. Contract consideration received from a customer prior to revenue recognition is recorded as a contract liability and is recognized as revenue when the Company satisfies the related performance obligation under the terms of the contract. The Company's contract liabilities, which consist primarily of customer deposits are reported within deferred revenue in the condensed consolidated balance sheets, totaled $10,887 and $18,273 as of March 31, 2022, and December 31, 2021, respectively. There are no significant financing components. Excluded from revenue are any taxes assessed by governmental authorities, including value-added and other sales-related taxes that are imposed on and concurrent with revenue-generating activities.

Income taxes—interim tax provision

The Company recorded an income tax benefit of $5,569 for the three months ended March 31, 2022, representing an effective income tax rate of 19.3%. The Company’s effective income tax rate for the three months ended March 31, 2022, differs from the federal statutory rate of 21% primarily as a result of a reduction in the valuation allowance recorded against the Company's net deferred tax assets, due to the acquisition of the IGE Entities (as defined below) which had an income tax rate benefit of 23.4%. In addition, as described in Note 3 - Business Combinations, the Company determined that the preliminary allocation of assets acquired related to indefinite lived trade names have a finite useful life because the expected usefulness of the trade names is limited. As a result of adjusting this provisional amount, the Company recorded a reduction to the valuation allowance, which resulted in an income tax rate benefit of 6.1%. These income tax benefits totaled $8,543, and were partially offset by income taxes from certain foreign jurisdictions where the Company conducts business and state minimum income taxes in the United States.

The Company recorded a tax expense of $756 for the three months ended March 31, 2021. The Company’s effective tax rates for the three months ended March 31, 2021, differs from the federal statutory rate of 21% primarily as a result of reducing valuation allowances on the Company's deferred tax assets related to net operating loss carryforwards.

Recent accounting pronouncements

The Company considers the applicability and impact of all Accounting Standards Updates ("ASUs") issued by the FASB. There were no ASUs that were assessed and determined to be applicable or expected to have a material impact on our condensed consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Income Statement [Abstract]
Net sales	$ 111,377	$ 111,389
Cost of goods sold	94,771	88,166
Gross profit	16,606	23,223
Operating expenses:
Selling, general and administrative	43,003	16,841
(Loss) income from operations	(26,397)	6,382
Interest expense	(2,366)	(90)
Loss on debt extinguishment	0	(680)
Other (expense) income, net	(102)	84
(Loss) income before tax	(28,865)	5,696
Income tax benefit (expense)	5,569	(756)
Net (loss) income	$ (23,296)	$ 4,940
Net (loss) income per share:
Basic (in dollars per share)	$ (0.52)	$ 0.15
Diluted (in dollars per share)	$ (0.52)	$ 0.13
Weighted-average shares of common stock outstanding:
Basic (in shares)	44,718,510	33,717,103
Diluted (in shares)	44,718,510	38,997,031

FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

The following table summarizes the estimated fair value of the Company's assets and liabilities for which disclosure of fair value is required:


		March 31, 2022				December 31, 2021
	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Term Loan	Level 2	$	125,000	$	118,750	$	125,000	$	121,250

The carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued and other current liabilities approximate their fair value due to their short-term maturities. The carrying value of the note receivable (as described in Note 2 - Basis of Presentation and Significant Accounting Policies) and the carrying value of contingent consideration (as described in Note 3 - Business Combinations) are based on level 3 fair value measurements and are reported at estimated fair value. The fair value of the Company's Term Loan was based on bank quotes and the carrying amount reported above excludes unamortized deferred financing costs and discount.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

STOCK-BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement [Abstract]

Share-based Payment Arrangement, Outstanding Award, Activity, Excluding Option

For purposes of this table, vested RSUs represent the shares for which the service condition had been fulfilled as of March 31, 2022:


	Number of RSUs	Weighted average grant date fair value
Balance, December 31, 2021	1,087,608	$	9.71
Granted	339,076	$	15.93
Vested	(278,002)	$	11.92
Forfeited	(29,938)	$	52.51
Balance, March 31, 2022	1,118,744	$	9.90

The following table summarizes the activity related to the Company's PSUs for the three months ended March 31, 2022.


	Number of PSUs	Weighted average grant date fair value
Balance, December 31, 2021	—	$	—
Granted	116,113	$	15.74
Balance, March 31, 2022	116,113	$	15.74

Share-based Payment Arrangement, Option, Activity

The following table summarizes the stock option activity for the three months ended March 31, 2022:


	Number	Weighted average exercise price		Weighted average grant date fair value		Weighted average remaining contractual term (years)
Outstanding as of December 31, 2021	720,549	$	9.57	$	2.21	7.37
Exercised	(7,765)	$	9.04	$	2.21
Cancelled	(90)	$	11.06	$	9.89
Forfeited	(16,623)	$	11.51	$	6.03
Outstanding as of March 31, 2022	696,071	$	9.53	$	2.12	6.84
Options exercisable as of March 31, 2022	548,551	$	8.56	$	1.08	6.53
Vested and expected to vest as of March 31, 2022	696,071	$	9.53	$	2.12	6.84

The following table summarizes the unvested stock option activity for the three months ended March 31, 2022:


	Number	Weighted average grant date fair value
Unvested as of December 31, 2021	202,515	$	5.04
Vested	(38,372)	$	1.02
Forfeited	(16,623)	$	6.03
Unvested as of March 31, 2022	147,520	$	5.98

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Entity-wide Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Segment Reporting Information [Line Items]
Net sales	$ 111,377	$ 111,389
Property, plant and equipment, and operating lease right-of-use assets, net	105,915		$ 95,718
United States
Segment Reporting Information [Line Items]
Property, plant and equipment, and operating lease right-of-use assets, net	87,121		85,167
Canada
Segment Reporting Information [Line Items]
Property, plant and equipment, and operating lease right-of-use assets, net	18,794		$ 10,551
Operating segments \| United States
Segment Reporting Information [Line Items]
Net sales	92,858	90,672
Operating segments \| Canada
Segment Reporting Information [Line Items]
Net sales	21,502	22,264
Intersegment eliminations
Segment Reporting Information [Line Items]
Net sales	$ (2,983)	$ (1,547)

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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+ Details

GOODWILL AND INTANGIBLE ASSETS, NET - Narrative (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2022 USD ($)	Mar. 31, 2021 USD ($)	Dec. 31, 2021 USD ($) acquisition
Goodwill [Line Items]
Goodwill	$ 183,338		$ 204,868
Amortization expense	14,746	$ 1,206
Number of businesses acquired \| acquisition			5
United States
Goodwill [Line Items]
Goodwill	122,977
Canada
Goodwill [Line Items]
Goodwill	$ 60,361
Computer software \| Weighted Average
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, amortization period	2 years
Customer relationship \| Weighted Average
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, amortization period	12 years
Technology, formulations and recipes \| Weighted Average
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, amortization period	11 years
Trade names \| Weighted Average
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, amortization period	19 years

OPERATING LEASES - Balance Sheet (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Leases [Abstract]
Operating lease right-of-use assets, net of accumulated amortization	$ 54,566	$ 45,245
Total leased assets	54,566	45,245
Current portion of lease liabilities	7,773	7,198
Long-term lease liabilities	46,755	38,595
Total lease liabilities	$ 54,528	$ 45,793

STOCK-BASED COMPENSATION - PSU Activity (Details) - PSU	3 Months Ended
STOCK-BASED COMPENSATION - PSU Activity (Details) - PSU	Mar. 31, 2022 $ / shares shares
Number of PSUs
Beginning (in shares) \| shares	0
Granted (in shares) \| shares	116,113
Ending (in shares) \| shares	116,113
Weighted average grant date fair value
Beginning (in dollars per shares) \| $ / shares	$ 0
Granted (in dollars per share) \| $ / shares	15.74
Ending (in dollars shares) \| $ / shares	$ 15.74

BUSINESS COMBINATIONS - Narrative (Details)						3 Months Ended	12 Months Ended
BUSINESS COMBINATIONS - Narrative (Details)	Nov. 01, 2021 USD ($)	Aug. 03, 2021 USD ($)	Jul. 01, 2021 USD ($)	Jun. 01, 2021 USD ($)	May 03, 2021 USD ($)	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($) acquisition
Business Acquisition [Line Items]
Number of businesses acquired \| acquisition							5
Amortization of intangible assets, additional						$ 5,894,000
Field 16, LLC (Heavy 16)
Business Acquisition [Line Items]
Percentage of voting interests acquired					100.00%
Consideration transferred					$ 77,367,000
Cash					60,287,000
Common stock					16,736,000
Contingent consideration					344,000	200,000	$ 200,000
Contingent consideration arrangements, range of outcomes, value, high					2,500,000
Contingent consideration arrangements, range of outcomes, value, incremental amount over threshold					200,000
Contingent consideration arrangements, range of outcomes, value, threshold					1,000,000
Contingent consideration arrangements, range of outcomes, value, sales threshold					21,000,000
Contingent consideration					$ 344,000
H&G Entities
Business Acquisition [Line Items]
Percentage of voting interests acquired				100.00%
Consideration transferred				$ 133,483,000
Cash				133,483,000
Common stock				0
Contingent consideration				$ 0
Aurora
Business Acquisition [Line Items]
Percentage of voting interests acquired			100.00%
Consideration transferred			$ 178,871,000
Cash			133,962,000
Common stock			25,824,000
Contingent consideration						$ 15,274,000
Contingent consideration arrangements, range of outcomes, value, high			70,997,000
Contingent consideration			19,300,000
Forgiveness of accounts payable			215,000
Contingent consideration arrangements, excess EBITDA			$ 15,556,000
Contingent consideration arrangements, multiplier			11
Aurora \| Valuation Technique, Discounted Cash Flow \| Measurement Input, Discount Rate
Business Acquisition [Line Items]
Contingent consideration, liability, measurement input			0.15
Greenstar
Business Acquisition [Line Items]
Percentage of voting interests acquired		100.00%
Consideration transferred		$ 83,520,000
Cash		85,121,000
Common stock		0
Contingent consideration		0
Forgiveness of accounts payable		$ 1,601,000
IGE Entities
Business Acquisition [Line Items]
Percentage of voting interests acquired	100.00%
Consideration transferred	$ 60,902,000
Cash	49,129,000
Common stock	11,051,000
Contingent consideration	0
Forgiveness of contract asset	$ 722,000
Customer relationship \| Minimum
Business Acquisition [Line Items]
Acquired finite-lived intangible assets, weighted average useful life						7 years
Customer relationship \| Maximum
Business Acquisition [Line Items]
Acquired finite-lived intangible assets, weighted average useful life						12 years
Technology, formulations and recipes \| Minimum
Business Acquisition [Line Items]
Acquired finite-lived intangible assets, weighted average useful life						8 years
Technology, formulations and recipes \| Maximum
Business Acquisition [Line Items]
Acquired finite-lived intangible assets, weighted average useful life						12 years
Trade names \| Minimum
Business Acquisition [Line Items]
Acquired finite-lived intangible assets, weighted average useful life						15 years
Trade names \| Maximum
Business Acquisition [Line Items]
Acquired finite-lived intangible assets, weighted average useful life						20 years

DESCRIPTION OF THE BUSINESS	3 Months Ended
DESCRIPTION OF THE BUSINESS	Mar. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF THE BUSINESS	DESCRIPTION OF THE BUSINESS Description of the business Hydrofarm Holdings Group, Inc. and its subsidiaries (collectively, the “Company”) was formed in May 2017 under the laws of the state of Delaware to acquire and continue the business of Hydrofarm, LLC established in 1977. The Company is a leading independent manufacturer and distributor of controlled environment agriculture (“CEA”, principally hydroponics) equipment and supplies, including a broad portfolio of proprietary branded products. Products offered include agricultural lighting devices, indoor climate control equipment, hydroponics and nutrients, and plant additives used to grow, farm and cultivate cannabis, flowers, fruits, plants, vegetables, grains and herbs in controlled environment settings that allow end users to control key farming variables including temperature, humidity, CO2, light intensity and color, nutrient concentration and pH. Initial public offering and follow-on public offering On December 14, 2020, the Company closed its initial public offering (“IPO”) under a registration statement effective December 9, 2020, in which it issued and sold 9,966,667 shares of its common stock, including the full exercise by the underwriters of their option to purchase 1,300,000 additional shares of common stock. The public offering price was $20.00 per share. The Company received net proceeds of $182,271 from the IPO after deducting underwriting discounts and commissions and offering expenses, of which $148 of offering expenses were paid in 2021. On May 3, 2021, the Company closed its follow-on public offering ("follow-on offering") under a registration statement effective April 28, 2021, in which it issued and sold 5,526,861 shares of its common stock, including the full exercise by the underwriters of their option to purchase 720,894 additional shares of common stock. The public offering price was $59.00 per share. The Company received net proceeds of approximately $309,782 from the follow-on offering after deducting underwriting discounts and commissions and offering expenses.

DEBT - Revolving Asset-backed Credit Facilities (Details)				3 Months Ended
	Aug. 31, 2021 USD ($)	Mar. 29, 2021 USD ($)	Jul. 11, 2019 USD ($)	Mar. 31, 2022 USD ($)	Mar. 31, 2021 USD ($)
Debt Instrument [Line Items]
Loss on debt extinguishment				$ 0	$ 680,000
JPMorgan Credit Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 100,000,000	$ 50,000,000
Debt instrument, term		3 years
Line of credit facility, accordion feature, increase limit		$ 25,000,000
Line of credit facility, accordion feature, withdrawal limit increments		5,000,000
Unamortized debt issuance expense				908,000
Line of credit facility, remaining borrowing capacity				$ 99,674,000
Covenant , minimum fixed charge coverage ratio multiplier				1.1
Covenant , minimum fixed charge coverage ratio, term				12 months
JPMorgan Credit Facility \| Revolving Credit Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity		$ 75,000,000
Line of credit facility, unused capacity, commitment fee percentage	0.25%
JPMorgan Credit Facility \| Revolving Credit Facility \| London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	1.95%
Debt instrument, floor on variable rate	0.00%
Revolving Asset-baked Credit Facility \| Encina Obligors
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity			$ 45,000,000
Debt instrument, payment due, period before scheduled maturity date			90 days
Loss on debt extinguishment					$ 680,000
Revolving Asset-baked Credit Facility \| Encina Obligors \| Canada
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity			$ 15,000,000
Bridge Loan \| Encina Obligors
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity			$ 2,000,000

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Statement of Comprehensive Income [Abstract]
Net (loss) income	$ (23,296)	$ 4,940
Other comprehensive (loss) income:
Foreign currency translation gain	2,184	223
Total comprehensive (loss) income	$ (21,112)	$ 5,163

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) segment	Mar. 31, 2021 USD ($)	Dec. 31, 2021 USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Contract liabilities	$ 10,887		$ 18,273
Number of operating segments \| segment	2
Number of reportable segments \| segment	1
Impairment loss	$ 2,636
Notes receivable	475		$ 622
Revenue from External Customer [Line Items]
Net sales	111,377	$ 111,389
Income tax benefit (expense)	$ 5,569	(756)
Effective income tax rate	19.30%
Effective income tax rate reconciliation, change in deferred tax assets valuation allowance, percent	6.10%
Validation allowance	$ 8,543
IGE Entities
Revenue from External Customer [Line Items]
Effective income tax rate	23.40%
Shipping and Handling
Revenue from External Customer [Line Items]
Net sales	$ 3,879	$ 1,245

CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY - Warrant Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands		7 Months Ended
	Jul. 19, 2021	Jul. 18, 2021	Mar. 31, 2022
Class of Warrant or Right [Line Items]
Exercise price (in dollars per share)			$ 11.30
Investor Warrants
Class of Warrant or Right [Line Items]
Redemption price (in dollars per share)	$ 0.00033712
Exercise price (in dollars per share)		$ 16.86
Warrants exercised (in shares)	1,491	3,367,647
Proceeds from warrant exercises		$ 56,778
Warrant solicitation fee expense, percentage of net cash proceeds solicited by placement agents on certain warrants following call for redemption			5.00%
Investor Warrants \| Common Stock
Class of Warrant or Right [Line Items]
Number of securities called by each warrant or right (in shares)	0.5
Number of consecutive trading days prior to notice of redemption	20 days
Investor Warrants \| Common Stock \| Minimum
Class of Warrant or Right [Line Items]
Share price (in dollars per share)	$ 25.28

PROPERTY, PLANT AND EQUIPMENT, NET (Tables)

3 Months Ended

Mar. 31, 2022

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, plant and equipment comprised the following:


	March 31, 2022		December 31, 2021
Machinery and equipment	$	26,587	$	25,177
Peat bogs and related development	9,876		8,686
Building and improvements	9,503		9,510
Land	6,116		6,120
Leasehold improvements	3,413		3,207
Computer equipment	3,271		3,197
Furniture and fixtures	2,991		2,867
Gross property, plant and equipment	61,757		58,764
Less: accumulated depreciation	(10,408)		(8,291)
Total property, plant and equipment, net	$	51,349	$	50,473

OPERATING LEASES (Tables)

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Assets And Liabilities, Lessee

Supplemental balance sheet information related to the Company’s operating leases are as follows:


	March 31, 2022		December 31, 2021
Assets
Operating lease right-of-use assets, net of accumulated amortization	$	54,566	$	45,245
Total leased assets	$	54,566	$	45,245
Liabilities
Current portion of lease liabilities	$	7,773	$	7,198
Long-term lease liabilities	46,755		38,595
Total lease liabilities	$	54,528	$	45,793

Lessee, Operating Lease, Liability, Maturity

As of March 31, 2022, future minimum lease payments under non-cancelable operating leases are as follows:


	Operating
For the period of April 1, 2022 to December 31, 2022	$	7,003
Year ending December 31,
2023	9,311
2024	9,031
2025	8,338
2026	6,824
2027	6,369
Thereafter	14,208
Total rental payments	61,084
Less portion representing interest	(6,556)
Total principal	54,528
Less current portion	(7,773)
Long-term portion	$	46,755

Lessee, Operating Lease, Lease Not yet Commenced, Maturity Schedule

The future minimum lease payments for executed non-cancelable operating leases not yet commenced are as follows:


	Operating
For the period of April 1, 2022, to December 31, 2022	$	—
Year ending December 31,
2023	3,354
2024	3,272
2025	3,610
2026	3,965
2027	4,076
Thereafter	22,633
Total rental payments	$	40,910