SPAC Share Class
A share in a blank-check company, backed by a trust and redeemable for cash before a combination closes.
A special purpose acquisition company sells public shares — conventionally Class A — whose proceeds sit in a trust. Until a business combination closes, the public holder has a right to redeem the share for its pro-rata trust amount. Sponsors hold a separate founder class, conventionally Class B, purchased at nominal cost and convertible into Class A. The two classes are the same company and radically different instruments.
In detail
A SPAC is a shell with cash and a deadline. It raises money in an IPO, places substantially all of it in a trust invested in short-term government instruments, and has a stated window — typically 18 to 24 months, extendable under charter terms — to complete a business combination. If it fails, the trust is returned to public holders and the shell liquidates.
The public Class A share comes to exist in the IPO, registered on an S-1, usually sold as part of a unit. Its defining feature is the redemption right: in connection with the vote on a business combination, or on an extension of the deadline, or on liquidation, the public holder may tender the share and receive its pro-rata share of trust, including accrued interest, whether or not the holder votes for the deal. That right is what makes a pre-deal SPAC share economically a short-dated claim on cash rather than an equity investment in a business. It also means the share count that survives a deal is not knowable in advance: redemption rates have ranged from negligible to nearly total, which is why merger agreements often carry minimum-cash conditions that heavy redemptions can break.
The founder Class B share comes to exist before the IPO, purchased by the sponsor for a nominal amount, sized conventionally at 20% of the post-IPO public share count, subject to forfeiture if the over-allotment is not exercised. It carries the right to elect directors before a combination, converts into Class A at or around the closing on a ratio set in the charter, is customarily locked up for a period after closing, and has no redemption right and no claim on trust. The sponsor also buys private placement warrants or units to fund the trust overfunding and the working capital — the at-risk capital that is lost if no deal closes.
Lifecycle events: IPO on S-1 and 8-K with the trust agreement and charter; announcement of a combination in an 8-K and a merger agreement; the S-4 or proxy statement with the deal terms, the redemption mechanics, and the pro forma ownership; extension votes, each with its own redemption window, in DEF 14A and 8-K; the closing 8-K — conventionally called a Super 8-K — which contains the surviving company's full Form 10 information, actual redemption figures, and the final share count; or a liquidation announced in an 8-K, with trust distribution and Form 25.
Before assuming anything, identify which class the ticker is; read the current trust value per share and the deadline; check whether an extension is pending and what its terms cost the trust; and treat the pre-deal share and the post-close share as two different securities that happen to share a lineage — the closing is a birth, not a continuation of a shell.
These values are read from the filing linked above. They describe the instrument, not its merits. Nothing here is investment advice.