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Section 132. Rule 14a-12
us SEC - C&DI - Proxy Rules and Schedules
Question 132.01
Question: Under the factual circumstances described in Question 101.02 above, can the target company rely upon Exchange Act Rule 14a-12 to communicate publicly about the proposed business combination transaction even though it does not plan to file its own definitive proxy statement?
Answer: Yes, subject to the conditions described below. Rule 14a-12 permits solicitations before the furnishing of a proxy statement, provided, among other things, that “a definitive proxy statement…is sent or given to security holders solicited in reliance” on the rule. See Rule 14a-12(a)(2). Recognizing the need for the target company to publicly announce the proposed transaction and the fact that the acquiror will send its own definitive proxy statement to its shareholders, the staff will not object if the target company relies on Rule 14a-12 for its public written communications, provided that:
- the target company identifies itself as a participant in the acquiror’s proxy solicitation;
- the target company satisfies the remaining applicable requirements of Rule 14a-12, including the filing of its communications with the Commission; and
- the acquiror complies with the conditions specified in Question 102.04 of the Exchange Act Form 8-K C&DIs.
The target company may have its written communication filed by the acquiror on its behalf and under the acquiror’s Exchange Act file number, provided the communication is clearly identified as that of the target company. [March 22, 2022]
Question 132.02
Question: Is the Rule 14a-12 position described in Question 132.01 above also available for an acquiror that makes public communications regarding a proposed business combination transaction in which it will not file a definitive proxy statement for the transaction but the target company will?
Answer: Yes, as long as the following conditions are satisfied:
- the acquiror identifies itself as a participant in the target company’s proxy solicitation;
- the acquiror complies with all other requirements of Rule 14a-12, including the filing of its communications with the Commission; and
- the target company complies with the conditions specified in Question 102.04 of the Exchange Act Form 8-K C&DIs.
The acquiror may have its written communication filed by the target company on its behalf and under the target company’s Exchange Act file number, provided the communication is clearly identified as that of the acquiror. [March 22, 2022]
Question 132.03
Question: Rule 14a-12 permits solicitations before the furnishing of a proxy statement, provided that, among other things, written soliciting material includes the required participant information or a prominent legend advising shareholders where they can find that information. See Rule 14a-12(a)(1)(i). Can a soliciting party satisfy Rule 14a-12(a)(1)(i) through a legend that only includes a general reference to filings made by the soliciting party or the participants (e.g., a legend that refers shareholders to the prior year annual report on Form 10-K and proxy statement for participant information)?
Answer: No. Rule 14a-12(a)(1)(i) requires a soliciting party to disclose the “identity of the participants in the solicitation…and a description of their direct or indirect interests, by security holdings or otherwise, or a prominent legend in clear, plain language advising security holders where they can obtain that information.” The availability of participant information allows shareholders evaluating soliciting materials to understand the interests of those soliciting the shareholders at the time when the solicitations occur, including before the shareholders receive a proxy statement. When the Commission amended Rule 14a-12 to expand the ability to solicit before furnishing a proxy statement, the Commission cited the legend information as one of the safeguards to protect against misleading solicitations and maintain the integrity of the solicitation process. See Section II.C.1. in Release No. 34-42055 (Oct. 22, 1999). General references in the legend to filings made or to be made by the soliciting party or participants do not sufficiently advise shareholders where they can obtain the required participant information. Instead, the legend should:
- clearly identify the specific filing(s) where participant information appears (including by filing date);
- clearly describe the specific locations of the participant information in such filings, whether by reference to the relevant section headings, captions or otherwise; and
- include active hyperlinks to the referenced filings, when possible.
Soliciting parties also are reminded that participants’ direct and indirect interests in the solicitation are not limited to such participants’ security holdings. [November 17, 2023]
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