When the comedian, completing with the most lucid intuition documents that he had. To sum it up, the increase in authorized share capital is not a bearish factor on its own. Statues, like words, should be used in right places. Consequently, while the size of this authorization relative to the current need is indeed an outlier, this facility is unlikely to be fully utilized. Instead of repeatedly going to investors for the issuance of new shares, Churchill Capital IV seems to be catering to all of its foreseeable equity financing needs in one go. With the CCIV/Lucid deal finally becoming official today and trading as a de-SPACd company beginning on Monday the 26th it feels like 'Peak SPAC' is finally, and fully, behind us. Investors should note that authorized share capital is simply an enabling measure and need not be fully utilized.
However, the authorized share capital is nearly 10x this immediate issuance requirement, thereby giving rise to fears of rampant dilution. Assuming no redemptions, 1.595 billion Lucid Group common shares will have to be issued in total upon the close of the merger agreement. Moreover, the PIPE investors, who are bringing in $2.5 billion in crucial liquidity, also need to be issued new shares, to the tune of 166.66 million. As is evident from the snippet above, Churchill Capital IV has to issue new shares to existing Lucid Motors investors. This brings us to the crux of the matter. The special purpose acquisition company (SPAC) saw its stocks soar by over 123 per cent in 2021 so far, and. Under this method of accounting, CCIV has been treated as the acquired company for financial reporting purposes. ('CCIV'), which closed on July 23, 2021, is accounted for as a reverse recapitalization under U.S. Hence, this increase has to be certified by investors if the merger with Lucid Motors is to go ahead. Stocks of blank check company Churchill Capital Corp IV (NYSE: CCIV.U, CCIV.U:US) have been on the rise since reports of its merger talks with California-based electric vehicle (EV) firm Lucid Motors Inc made headlines earlier in January. Lucid reported Q2 revenue of 97.3 million on deliveries of 679 vehicles. So, what does this mean? Well, even if investors were to reject proposal number 3, the increase in CCIV’s authorized share capital is embedded within the Charter Proposal. Interestingly, this same action is also a part of proposal number 3A, with the caveat that proposal number 3 – dubbed the Governance Proposal – is advisory in nature and not mandatory for the consummation of the business combination agreement with Lucid Motors. CCIV Lucid: LUCID MOTORS SNL COMMERCIAL AFTERMATHFollow Me: Instagram: simranpals1ngh TikTok: simranpals1ngh Linkedin. The transaction includes an approximately 2.1 billion cash contribution by CCIV and a 2.5 billion fully committed. Proposal number 2, dubbed the Charter Proposal, calls for an increase in Churchill Capital IV’s authorized number of shares from 501 million to 15.01 billion. CCIV and Lucid are combining at a transaction equity value of 11.75 billion.
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