SPAC structure today
SPAC technology today Comments
The SPAC structure has
been improved with
issuers addressing key — Investor capital protected
challenges of the legacy Cash in trust — 'I00% in trust at IPO — Lower interest rate environment, but cash in trust
structure including the remains largely unchanged
promote size, shareholder
vote complexities and the
dilutive terms of warrants
— 20% is a strong initial starting point
Sponsor
— 20% common stock — Full promote has been earnedin most successful
promote
back-ends
— Full proxy subject to SEC review
- Much higher certainty of deal close
— When shareholder vote is required, no more
than 50% voting against acquisition - Quicker acquisition timeine
Acquisition — shareholders can vote -yes' and redeem - Shareholders maintain same redemption fights
mechanics shares which typically results in zero 'no'
votes - Higher likelihood ofretaining warrant value
— Redemption thresholds can be set by - Redemption threshold set by specifics of
specific acquisition requirements, i.e. transaction
minimum cash
— Half warrant per unit - Significantly less dilution and overhang
— Strike out of the money - Longer duration provides increased time value to
Warrant terms ($11.50 strike price per whole warrant) warrant holders
— 5 year duration from close of business - Investor trade-offinitial In the money' value to
combination maintain upside
Deutsche Bank 27
Corporate & Investment Banking
CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0062146
CONFIDENTIAL SDNY_GM_00208330
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