Regulatory Alerts2022-05-13 | 2022-07189Added
Special Purpose Acquisition Companies, Shell Companies, and Projections
The Securities and Exchange Commission proposes new rules to enhance investor protections in initial public offerings by special purpose acquisition companies and subsequent business combination transactions. The proposal mandates specialized disclosure regarding sponsor compensation, conflicts of interest, dilution, and transaction fairness while aligning de-SPAC transactions with traditional IPO requirements. Additionally, the Commission seeks to update guidance on projections, deem shell company business combinations as sales of securities, and establish a safe harbor under the Investment Company Act of 1940.
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