Aldel Financial II has arranged up to $1 million in interest-free working-capital financing from its sponsor, while facing a move off Nasdaq after failing to meet a listing requirement. Its ordinary shares, units and warrants are set to stop trading on Nasdaq on November 6 and may instead be quoted in the over-the-counter market from that date.
Key details
- Sponsor financing: Aldel can draw up to $1 million from Aldel Investors II LLC. The sponsor must fund each request within five business days.
- Use of proceeds: The money is for working capital, including payments to extend the term of the company’s trust agreement.
- Repayment: The loan is unsecured, carries no interest and is due after Aldel completes its initial business combination. It may be repaid early. Failure to repay at maturity would be a default and could allow the lender to demand immediate payment.
- Nasdaq delisting: Nasdaq plans to suspend trading in Aldel’s ordinary shares, warrants and units when the market opens on November 6, followed by their removal from the exchange. The decision follows a September notice that Aldel did not meet a continued-listing requirement; the company did not submit a compliance plan by Nasdaq’s deadline.
- OTC trading: From November 6, the securities may be quoted and traded over the counter. Their assigned symbols are ALDF for ordinary shares, ALDFU for units and ALDFW for warrants.
Plain-English implications
The financing gives Aldel access to as much as $1 million, but the full amount is not necessarily drawn or already in hand. Any amount borrowed will become a repayment obligation due when the company completes a business combination. The Nasdaq action changes where Aldel’s securities may trade; the company said they may be quoted over the counter starting the same day Nasdaq trading is suspended.