Regulatory Alerts2022-03-30
Special Purpose Acquisition Companies, Shell Companies, and Projections
The Securities and Exchange Commission proposes new rules to enhance investor protections in special purpose acquisition company (SPAC) initial public offerings and subsequent business combinations. The regulations mandate specialized disclosures regarding sponsor compensation, conflicts of interest, dilution, and transaction fairness while clarifying underwriter liability and expanding the Private Securities Litigation Reform Act safe harbor. Additionally, the Commission updates projections guidance for SPAC filings and establishes a new Investment Company Act safe harbor to exempt qualifying SPACs from investment company regulation.
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