google-site-verification=c5jmbe3Z58CqGDU8xGRhtEEbLr7QlySbG_IoVolrBbg
top of page
  • Instagram
  • Facebook
  • Twitter
  • LinkedIn
  • YouTube
  • TikTok
  • Instagram
  • Facebook
  • Twitter
  • LinkedIn
  • YouTube
  • TikTok
  • Instagram
  • Facebook
  • Twitter
  • LinkedIn
  • YouTube
  • TikTok

New Rules By SEC For Investor Protections Relating to Shell Companies, SPACs & Projections

Updated: Feb 1



The new regulations and revisions bring about a range of changes, including more comprehensive disclosures regarding conflicts of interest, compensation for SPAC sponsors, dilution, and other crucial information that investors need to know about SPAC IPOs and de-SPAC transactions




The Securities and Exchange Commission has taken a significant step today by implementing new regulations and changes to improve transparency and safeguard investors in initial public offerings (IPOs) conducted by special purpose acquisition companies (SPACs) and subsequent business combination transactions between SPACs and target companies (de-SPAC transactions).


SPAC IPOs and de-SPAC transactions serve as a gateway for private companies to enter the public markets. Recognizing the intricacies involved in these transactions, the Commission aims to bolster investor protection by ensuring adequate disclosure and responsible utilization of projections in SPAC IPOs and de-SPAC transactions. Additionally, these rules address broader concerns regarding the protection of investors in shell companies and blank check companies, including SPACs.


“Just because a company uses an alternative method to go public does not mean that its investors are any less deserving of time-tested investor protections,” said SEC Chair Gary Gensler. “Today’s adoption will help ensure that the rules for SPACs are substantially aligned with those of traditional IPOs, enhancing investor protection through three areas: disclosure, use of projections, and issuer obligations. Taken together, these steps will help protect investors by addressing information asymmetries, misleading information, and conflicts of interest in SPAC and de-SPAC transactions.”

The new regulations and revisions bring about a range of changes, including more comprehensive disclosures regarding conflicts of interest, compensation for SPAC sponsors, dilution, and other crucial information that investors need to know about SPAC IPOs and de-SPAC transactions. Additionally, these rules mandate that registrants provide investors with additional details about the target company, empowering them to make well-informed voting and investment decisions when it comes to de-SPAC transactions.


These rules aim to align the required disclosures and legal responsibilities in de-SPAC transactions more closely with those in traditional IPOs. For instance, under certain circumstances, the rules necessitate that the target company signs a registration statement filed by a SPAC (or another shell company) in relation to a de-SPAC transaction. This would make the target company a "co-registrant" and hold them accountable for the disclosures made in that registration statement. Furthermore, the rules restrict certain blank check companies, including SPACs, from benefiting from the safe harbor protection of the Private Securities Litigation Reform Act of 1995 for forward-looking statements.

Regarding de-SPAC transactions, there are certain rules in place that pertain to disclosure requirements for projections. These rules mandate the disclosure of all significant bases and assumptions underlying the projections. Additionally, the rules provide updated and expanded guidance on the use of projections in all SEC filings.



THANK YOU FOR YOUR TIME



DISCLAIMER


The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of The Steven Wick Blog. Any content provided by our bloggers or authors are of their opinion and are not intended to malign any religion, ethnic group, club, organization, company, individual or anyone or anything.

If you decide to purchase any item using our authorized referral/affiliate links, be aware, we may receive a portion of the sales as commission, i.e. if you purchase a product/service.


To shop, select or click buttons, links or images, you will be redirected to product pages. Please, carefully research before you purchase. Feel free to share and leave a comment, we would love to hear from you. Your feedback is very important to us.


For more like this, music, literature, news, fashion, savvy political commentary, and fascinating features, sign up for the Steven Wick News Letter.


We here at the Steven Wick Blog are so proud of our work, we’d like to thank you for being a part of our community. However, our mission to share so much from music, literature, lifestyle to fashion is a 24/7 undertaking! We need your help to continue our work. Your financial donation will help us not only keep the lights on, but enable us run many more stories in the future to come. DONATE HERE



Message Of Gratitude


We deeply appreciate your contribution in making our blog the top brand among customers.


Without you as our readers, we wouldn't have achieved this level of success. Your satisfaction is our utmost priority, and we assure you that we will always be a reliable source for your entertainment needs.


Your trust in us is invaluable, and we are grateful for your generous donations as our readers.


A number of you took an extra effort and opted to contribute as monthly donors. By doing so, your generous contribution is multiplied by twelve throughout the year, thereby amplifying the impact you have on our work. Your dedication truly makes a significant change, and we sincerely appreciate your valuable support.


Your support has been instrumental in our brand's success.


Thank you for being with us throughout the past year.

As we continue to grow and enhance our business, we pledge to prioritize your needs and interests.


Best Regards


The Steven Wick Team



0 views0 comments
bottom of page