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The SPAC glossary, A to Z

Updated August 14, 2026 · 6 min read · every figure cites its SEC filing

Plain English first: every entry below says what the thing is, then what it means for your money. Terms that deserve a full explanation link to their own article.

A–C

Accretion — the slow growth of the trust from Treasury interest (and any sponsor deposits). It's why redemption payouts run above $10.00: recent real payouts we've recorded range from $10.51 to $12.50 per share.

Announced deal — a SPAC with a signed merger agreement that hasn't closed yet. Not the same as an LOI, and far from a closing.

At-risk capital — the sponsor's real cash investment (private placement units/warrants), lost entirely if the SPAC liquidates. Distinct from the near-free founder shares.

BCA (business combination agreement) — the binding merger contract; the "definitive agreement." Filed as an 8-K exhibit the day the deal is announced.

Blank-check company — the regulatory term for a SPAC: a listed shell with no operations, only cash and a mandate.

Broker action date / broker cutoff — the day your broker needs your redemption instruction — typically one to two business days before the official deadline. The most expensive fine print in SPACs: the full explanation.

Charter deadline — the date, set at IPO (usually 18–24 months out), by which the SPAC must close a deal or liquidate. Movable only by an extension vote.

Class A / Class B shares — Class A: what the public owns, redeemable for trust cash. Class B ("founder shares"): the sponsor's promote — no trust claim, converts to ordinary shares at closing.

Closing — the merger completes; the shell becomes the operating company and the ticker changes. Marked by a "Super 8-K" filing.

D–F

DA (definitive agreement) — see BCA. "Signed DA" is the moment a deal becomes binding — with exits still built in (minimum cash, outside date).

De-SPAC — the day the SPAC becomes the real company; also used for the whole signing-to-closing process, and as a noun for the post-merger company itself.

Dilution — how much of the company new and near-free shares (promote, warrants, PIPE) take from you. The reason a deal announced at $1.2B can really be a $1.79B company: headline vs effective valuation.

Dissolution expenses — a capped amount (commonly up to $100,000) the SPAC may take from trust interest to pay for winding itself up.

DTC (Depository Trust Company) — the clearing plumbing through which brokers deliver shares for redemption. The reason your broker's cutoff precedes the official one.

Earnout — extra shares that management or selling shareholders receive if the post-merger stock hits targets. Contingent dilution: it costs you exactly when things go well.

Effective valuation — what the merged company is really worth on paper when every share is counted at the reference price, versus the press-release headline. Typically 20–50% higher in deals we parse.

Extension (vote / deposit) — more time to find or close a deal, bought from shareholders by vote, usually paid for with sponsor deposits into the trust — with a fresh redemption window attached. Full article.

Floor — the idea that a SPAC share can't fall much below trust value. True only while a redemption right exists. The floor is the right, not the cash.

Floorless / no floor — the cash guarantee is gone: the last redemption window has passed, and price is unprotected no matter what the trust still holds. We've documented a 40.9% "discount" that was unclaimable: the floor disappears.

Founder shares — see Class B and the sponsor promote: ~20% of the company for about $25,000.

G–O

LOI (letter of intent) — a non-binding agreement to negotiate a merger. Announced with fanfare; commits almost nothing.

Liquidation — no deal by the deadline: the trust is returned to public shareholders (recent payouts $10.00–$12.50), warrants and rights expire worthless, the sponsor loses its at-risk capital.

Lock-up — the period (typically ~1 year post-closing, with early release around $12) during which founder shares can't be sold.

Minimum-cash condition — the target's right to walk away if redemptions leave less than a stated amount in trust at closing. The clause that lets 90%+ redemption kill a signed deal.

NAV (net asset value) — trust balance ÷ redeemable shares: the cash each share can claim. Computable from any 10-Q in minutes: how to do it.

Non-redemption agreement — a side deal where a big holder promises not to redeem, usually in exchange for extra founder shares — a private discount you're not getting.

Outside date — the contractual drop-dead date in the merger agreement, after which either side can terminate the deal without penalty.

Overfunded trust — a trust seeded above $10.00 per unit (e.g. $10.05–$10.10), so NAV starts above the IPO price on day one.

P–S

PIPE (private investment in public equity) — institutions buying shares at closing (usually at $10, sometimes discounted) to backfill redemptions and satisfy minimum cash. New shares, more dilution.

Promote — the sponsor's ~20% founder-share fee, contingent only on closing a deal. The gravitational field every SPAC decision bends around: full article.

Pro-forma — "as if the deal had closed": pro-forma shares outstanding and pro-forma equity describe the combined company. The honest valuation lives in the S-4's pro-forma ownership table.

Proxy statement (DEF 14A / DEFM14A) — the document that convenes a shareholder vote. Contains the meeting date, the official redemption deadline and the estimated payout — the three dates that run your position.

Redemption — your right to swap each share for its slice of the trust at set events. The entire safety mechanism, step by step: how redemption works.

Redemption deadline — the last day to exercise that right for a given event — officially two business days before the meeting; practically, your broker's earlier cutoff.

Rights — unit sweeteners that convert automatically into a fraction of a share (commonly 1/10) at closing. No strike, nothing to pay; worthless at liquidation. Units, warrants and rights.

Sponsor — the team (usually an LLC) that forms the SPAC, funds its costs, and owns the promote.

Super 8-K — the oversized 8-K due within four business days of closing, carrying the operating company's full disclosure package.

T–Z

Trust account / trust value — the segregated Treasury-invested account backing every public share; "trust per share" is the cash behind each one. What it is and isn't.

Trust discount — price below trust value: buying the cash for less than the cash — real only while redemption lives: why below trust matters.

Unit — what a SPAC IPO actually sells for $10.00: one share plus fractions of warrants and/or rights, separating into components about 52 days later.

Vote (deal / extension) — the shareholder meetings that punctuate a SPAC's life. Every vote with a charter amendment or merger attached opens a redemption window.

Warrant — an option to buy a share at $11.50 for five years after closing; callable when the stock sustains $18. Worthless at liquidation; the lottery-ticket half of the unit.

Yield to redemption — the annualized return from buying below trust today and redeeming at the next event. The number our yields page ranks — and refuses to print when the floor is gone.

Zombie SPAC — a shell past its useful life: deadline lapsed or serially extended, most of the trust redeemed away, no viable deal. The graveyard is a data set: liquidations list.

Terms we missed? The screener tooltips define every column in place, and each article above goes deeper than any definition can.

Common questions

What is a SPAC in plain English?

A pile of cash with a stock ticker. Investors fund a shell company at $10.00 a share; the cash sits in a protected trust while the managers hunt for a private company to merge with. Shareholders can always take their cash back before a merger — that exit right is the whole safety mechanism.

What do the SEC form numbers in SPAC news mean?

S-1: the IPO registration. 424B4: the final IPO prospectus. 8-K: any material event, from deal signing to redemption results. DEF 14A / DEFM14A: the proxy for a vote, with the redemption deadline inside. S-4: the merger registration with the pro-forma ownership table. 425: deal-related communications. 10-Q/10-K: quarterly and annual reports, where the trust balance lives.

The data behind this article

Keep reading

Educational content, not investment advice. Historical figures are cited to the SEC accession number that states them and were accurate as of the update date above; for current values use the live pages linked in the article.