26 Capital Acquisition Corp. Announces Hold to Liquidation

Rhea-AI Summary

The Delaware Court of Chancery granted a temporary restraining order against 26 Capital Acquisition Corp, preventing the liquidation and redemption of public shares. The TRO expires on October 11, 2023, and a hearing will determine its renewal. 26 Capital is evaluating its legal options and remains committed to returning funds to stockholders.

MIAMI, Oct. 3, 2023 /PRNewswire/ -- 26 Capital Acquisition Corp. ("26 Capital") (NASDAQ: ADER) today announced that, on September 27, 2023, the Delaware Court of Chancery (the "Delaware Court") granted a motion for temporary restraining order (the "Motion") filed by Schulte Roth & Zabel LLP ("Schulte") enjoining 26 Capital from, among other things, effecting the previously announced (i) liquidation of 26 Capital's trust account (the "Trust Account" and the process, the "Liquidation") and (ii) redemption of all of the public shares held by 26 Capital's public stockholders (the "Redemption"), prior to paying or making provisions for any outstanding obligations owed to its creditors, including Schulte (the "TRO").  Concurrently with filing the Motion, Schulte also filed a complaint against 26 Capital in the Delaware Court related to disputed legal fees.

"We are deeply troubled that Schulte has sought to interfere in the timely and orderly liquidation and distribution of investor capital back to its rightful parties," said Jason Ader, 26 Capital's Chief Executive Officer and Chairman of its board of directors. "In light of the ongoing legal matters, our commitment remains to our stockholders as we strategically allocate our resources."

Unfortunately, as a result of the TRO, 26 Capital instructed Continental Stock Transfer & Trust Company, the trustee of the Trust Account, and Equiniti Trust Co., its transfer agent, to halt, until further notice, the Liquidation and the Redemption. Prior to the TRO, the Liquidation was to be effective as of September 21, 2023, and the Redemption was expected to be completed within ten business days after September 28, 2023.

The TRO expires on October 11, 2023, prior to which the Delaware Court will hold a hearing to determine whether the TRO will be renewed. 26 Capital is evaluating its legal options regarding these proceedings and intends to defend itself vigorously against Schulte's allegations; 26 Capital remains committed to returning the funds held in the Trust Account to its public stockholders as soon as possible.  

Additionally, 26 Capital announced today that, effective September 21, 2023, J. Randall Waterfield resigned from the board of directors of 26 Capital. Mr. Waterfield's resignation was not the result of any dispute or disagreement with 26 Capital or 26 Capital's board of directors on any matter relating to 26 Capital's operations, policies or practices.

About 26 Capital Acquisition Corp.

26 Capital Acquisition Corp. (NASDAQ: ADER) is a Nasdaq-listed blank check company formed for the purpose of creating stockholder value by identifying an acquisition target with significant growth opportunities that the 26 Capital team can enhance by utilizing its experience and track record of creating and unlocking value, with particular focus in gaming, gaming technology, lodging, and entertainment.

Forward-Looking Statements

This press release may include "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements that involve risks and uncertainties. If any of these risks or uncertainties materialize, or if any of 26 Capital's assumptions prove incorrect, 26 Capital's actual results could differ materially from the results expressed or implied by these forward-looking statements. Additional risks and uncertainties include those associated with: litigation relating to the Liquidation and Redemption. All forward-looking statements in this communication are based on information available to 26 Capital as of the date of this communication, and 26 Capital does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.

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SOURCE 26 Capital