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The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress, and was published on Apr 29, 2021.
Sponsor Promote and Compensation Act
This bill establishes additional disclosure requirements for a blank check company (e.g., a special purpose acquisition company) during an initial public offering or prior to a merger. A blank check company is a development stage company that issues a penny stock and (1) has no specific business plan or purpose, or (2) has indicated that its business plan is to merge with a company or companies.
Specifically, the bill requires such a company to disclose
the amount of cash per share expected to be held by the blank check company immediately prior to the merger under various redemption scenarios; side payments or agreements to pay sponsors, blank check company investors, or private investors in public equity for their participation in the merger; and fees or other payments to the sponsor, underwriter, and any other party.