Following the increase in the number of special purpose acquisition companies (SPACs) and the related business combinations between SPACs and private target businesses (commonly referred to as “de-SPAC” transactions), an increase in regulatory scrutiny, particularly from the Securities and Exchange Commission, is emerging. As discussed below, in the last week the SEC has issued two statements — one related to the accounting treatment of warrants and one related to liability risk — that have attracted considerable attention from SPACs and other stakeholders.
Continue Reading SEC Statements Regarding SPACs Address Warrants and Projections
SEC Corp Fin Staff Issues Statement on SPAC Transactions
By Brian Hecht, Mark J. Reyes & Mark D. Wood on
Posted in SEC/Corporate
On March 31, the staff of the Division of Corporation Finance (the Staff) of the Securities and Exchange Commission issued a staff statement (the Staff Statement) relating to accounting, financial reporting and governance issues for private companies to consider before engaging in a business combination with a special purpose acquisition company (SPAC).
Continue Reading SEC Corp Fin Staff Issues Statement on SPAC Transactions
Glass Lewis Issues 2021 Proxy Season Updates
By Brian Hecht, Mark J. Reyes & Mark D. Wood on
Posted in SEC/Corporate
On November 23, Glass Lewis issued its Proxy Voting Policy Guidelines for 2021. Glass Lewis, like other proxy advisory firms, reviews proposals to be voted on at public company shareholder meetings and makes voting recommendations to its clients based on its voting policies and standards.
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SEC Division of Corporation Finance Releases Financial Reporting Manual Updates
By Mark D. Wood, Mark J. Reyes & Brian Hecht on
Posted in SEC/Corporate
On November 18, the Division of Corporation Finance (Division) of the Securities and Exchange Commission released updates to the Division’s Financial Reporting Manual. The Financial Reporting Manual is a key source of the Division’s informal accounting guidance and has been updated with changes through October 30.
Continue Reading SEC Division of Corporation Finance Releases Financial Reporting Manual Updates
SEC Issues C&DI on Use of Form S-3 by SPACs
By Brian Hecht, Mark J. Reyes & Mark D. Wood on
Posted in SEC/Corporate
On September 21, the Division of Corporation Finance of the Securities and Exchange Commission issued a new Compliance and Disclosure Interpretation (C&DI) addressing, and limiting, the ability of shell companies, including special purpose acquisition companies (SPACs), to use Form S-3 during the 12 months following a business combination.
Continue Reading SEC Issues C&DI on Use of Form S-3 by SPACs