DealLawyers.com Blog

This Akin Gump blog describes Nasdaq’s proposal for changes in its listing rules for Special Purpose Acquisition Companies.  Here’s an excerpt highlighting the proposed changes:

Initial Listing Requirements in Connection with Initial Public Offering

Round Lot*
– Existing: 300 round lot holders
– Proposed: 150 round lot holders
* A round lot means 100 shares of a security.

Net Tangible Assets Requirement
– Existing: no net tangible assets requirement
– Proposed: $5 million in net tangible assets

Proposed Continued Listing Requirements and Post-Business Combination Requirements

Continued Listing
– Existing: 300 public holders
– Proposed: No holder requirement

Net Tangible Assets Requirement
– Existing: no net tangible assets requirement
– Proposed: $5 million in net tangible assets

Post-Business Combination Requirement
– Existing: Meet all initial listing requirements following the business combination
– Proposed: Meet all initial listing requirements within 30-day transition period following the business combination

SPACs that are already listed would not be required to satisfy the $5 million net tangible assets requirement, so long as they continued to meet the public holders requirement.  If the rule proposal is approved, Nasdaq will publish a daily list of SPACs that don’t meet the net tangible assets requirement and don’t satisfy any other criteria for exclusion from the penny stock rules.

– John Jenkins