Special Opportunities Fund (SPE) announced that the parties to litigation over the dissolution of FAST Acquisition have reached an agreement to prevent the distribution of the SPAC’s net assets to Class B shares until the court rules on whether they must be equitably distributed to all stockholders.
The situation began earlier this month when FAST announced it would liquidate, although its sponsors planned to hold on to a breakup fee of $26 million-plus on a deal that soured last year.
One of the SPAC’s major shareholders, Special Opportunities Fund, cried foul and filed suit, saying FAST Acquisition has an obligation to share all assets equitably with stockholders.
Under the agreement, the SPAC’s Class A shares will be redeemed after Aug. 25, the winding up and dissolution of the company will proceed. However, unless prior notice is given, the SPAC is limited to paying only the following approximate amounts: (a) $4.5 million in taxes; (b) $1 million to reimburse a working capital loan; (c) $3 million in professional fees previously incurred; (d) $1 million for defense costs in connection with the litigation; and (e) expenses incurred to enforce the termination and settlement agreement with Fertitta Entertainment, which terminated a merger agreement with FAST Acquisition last December.
Phillip Goldstein, Chairman of SPE and a managing partner of Bulldog Investors, SPE’s investment adviser, said, “Now that the parties have agreed that no liquidating distributions will be made until the lawsuit concludes, they can turn their attention to the crux of this lawsuit — whether FAST’s Board of Directors has a fiduciary duty in a dissolution to distribute its net assets equitably to all stockholders, not just insiders.”
Morris Kandinov LLP and Bernstein Litowitz Berger & Grossmann LLP are serving as counsel to SPE. The case is Special Opportunities Fund, Inc. v. FAST Acquisition Corp., et al., No. 2022-0702 (Del. Ch.). Read more.
