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8000 - Miscellaneous Statutes and Regulations


§ 240.14e--1  Unlawful tender offer practices.

As a means reasonably designed to prevent fraudulent, deceptive or manipulative acts or practices within the meaning of section 14(e) of the Act, no person who makes a tender offer shall:

(a)  Hold such tender offer open for less than twenty business days from the date such tender offer is first published or sent to security holders; provided, however, that if the tender offer involves a roll-up transaction as defined in Item 901(c) of Regulation S--K (17 CFR 229.901(c)) and the securities being offered are registered (or authorized to be registered) on Form S--4 (17 CFR 229.25) or Form F--4 (17 CFR 229.34), the offer shall not be open for less than sixty calendar days from the date the tender offer is first published or sent to security holders;

(b)  Increase or decrease the percentage of the class of securities being sought or the consideration offered or the dealer's soliciting fee to be given in a tender offer unless suchtender offer remains open for at least ten business days from the date that notice of such increase or decrease is first published or sent or given to security holders. Provided, however, That, for purposes of this paragraph, the acceptance for payment of an additional amount of securities not to exceed two percent of the class of securities that is the subject of the tender offer shall not be deemed to be an increase. For purposes of this paragraph, the percentage of a class of securities shall be calculated in accordance with section 14(d)(3) of the Act.

(c)  Fail to pay the consideration offered or return the securities deposited by or on behalf of security holders promptly after the termination or withdrawal of a tender offer;

(d)  Extend the length of a tender offer without issuing a notice of such extension by press release or other public announcement, which notice shall include disclosure of the approximate number of securities deposited to date and shall be issued no later than the earlier of: (i) 9:00 a.m. Eastern time, on the next business day after the scheduled expiration date of the offer or (ii), if the class of securities which is the subject of the tender

offer is registered on one or more national securities exchanges, the first opening of any one of such exchanges on the next business day after the scheduled expiration date of the offer.

(e)  The periods of time required by paragraphs (a) and (b) of this section shall be tolled for any period during which the bidder has failed to file in electronic format, absent a hardship exemption (§§ 232.201 and 232.202 of this chapter), the Schedule 14D--1 Tender Offer Statement (§ 240.14d--100 of this chapter), any tender offer material specified in paragraph (a) of Item 11 of that Schedule, and any amendments thereto. If such documents were filed in paper pursuant to a hardship exemption (see § 232.201 and § 232.202(d) of this chapter), the minimum offering periods shall be tolled for any period during which a required confirming electronic copy of such Schedule and tender offer material is delinquent.

[Codified to 17 C.F.R. § 240.14e--1]

[Section 240.14e--1 added at 44 Fed. Reg. 70348, December 6, 1979; amended at 51 Fed. Reg. 3035, January 23, 1986, effective March 1, 1986; 51 Fed. Reg. 25883, July 17, 1986, effective August 18, 1986, except that a tender offer commenced after August 18, 1986 in competition with an offer that commenced prior to that date would be permitted to rely on the rules in effect prior to such date; 51 Fed. Reg. 32630, September 15, 1986; 56 Fed. Reg. 57255, November 8, 1991, effective October 30, 1991; 58 Fed. Reg. 14685 March 18, 1993, effective April 26, 1993; 59 Fed. Reg. 67765, December 30, 1994, effective January 30, 1995; 62 Fed. Reg. 36459, July 8, 1997]

§ 240.14e--2  Position of subject company with respect to a tender offer.

(a)  Position of subject company. As a means reasonably designed to prevent fraudulent, deceptive or manipulative acts or practices within the meaning of section 14(e) of the Act, the subject company, no later than 10 business days from the date the tender offer is first published or sent or given, shall publish, send or give to security holders a statement disclosing that the subject company:

(1)  Recommends acceptance or rejection of the bidder's tender offer;

(2)  Expresses no opinion and is remaining neutral toward the bidder's tender offer; or

(3)  Is unable to take a position with respect to the bidder's tender offer. Such statement shall also include the reason(s) for the position (including the inability to take a position) disclosed therein.

(b)  Material change.  If any material change occurs in the disclosure required by paragraph (a) of this section, the subject company shall promptly publish or send or give a statement disclosing such material change to security holders.

(c)  Any issuer, a class of the securities of which is the subject of a tender offer filed with the Commission on Schedule 14D-1F and conducted in reliance upon and in conformity with Rule 14d-1(b) under the Act, and any director or officer of such issuer where so required by the laws, regulations and policies of Canada and/or any of its provinces or territories, in lieu of the statements called for by paragraph (a) of this section and rule 14d-9 under the Act, shall file with the Commission on Schedule 14D-9F the entire disclosure document(s) required to be furnished to holders of securities of the subject issuer by the laws, regulations and policies of Canada and/or any of its provinces or territories governing the conduct of the tender offer, and shall disseminate such document(s) in the United States in accordance with such laws, regulations and policies.

(d)  Exemption for cross-border tender offers. The subject company shall be exempt from this section with respect to a tender offer conducted under Sec. 240.14d-1(c).

[Codified to 17 C.F.R. § 240.14e--2]

[Section 240.14e--2 added at 44 Fed. Reg. 70348, December 6, 1979; amended at 56 Fed. Reg. 30075, July 1, 1991; 64 Fed. Reg. 61406, November 10, 1999]

§ 240.14e--3  Transactions is securities on the basis of material, nonpublic information in the context of tender offers.

(a)  If any person has taken a substantial step or steps to commence, or has commenced, a tender offer (the "offering person"), it shall constitute a fraudulent, deceptive or manipulative act or practice within the meaning of section 14(e) of the act for any other person who is in possession of material information relating to such tender offer which information he knows or has reason to know is nonpublic and which he knows or has reason to know has been acquired directly or indirectly from (1) the offering person, (2) the issuer of the securities sought or to be sought by such tender offer, or (3) any officer, director, partner or employee or any other person acting on behalf of the offering person or such issuer, to purchase or sell or cause to be purchased or sold any of such securities or any securities convertible into or exchangeable for any such securities or any option or right to obtain or to dispose of any of the foregoing securities, unless within a reasonable time prior to any purchase or sale such information and its source are publicly disclosed by press release or otherwise.

(b)  A person other than a natural person shall not violate paragraph (a) of this section if such person shows that:

(1)  The individual(s) making the investment decision on behalf of such person to purchase or sell any security described in paragraph (a) of this section or to cause any such security to be purchased or sold by or on behalf of others did not know the material, nonpublic information; and

(2)  Such person had implemented one or a combination of policies and procedures, reasonable under the circumstances, taking into consideration the nature of the person's business, to ensure that individual(s) making investment decision(s) would not violate paragraph (a) of this section, which policies and procedures may include, but are not limited to, (i) those which restrict any purchase, sale and causing any purchase and sale of any such security or (ii) those which prevent such individual(s) from knowing such information.

(c)  Notwithstanding anything in paragraph (a) of this section to contrary, the following transactions shall not be violations of paragraph (a) of this section:

(1)  Purchase(s) of any security described in paragraph (a) of this section by a broker or by another agent on behalf of an offering person; or

(2)  Sale(s) by any person of any security described in paragraph (a) of this section to the offering person.

(d)(1)  As a means reasonably designed to prevent fraudulent, deceptive or manipulative acts or practices within the meaning of section 14(e) of the act, it shall be unlawful for any person described in paragraph (d)(2) of this section to communicate material, nonpublic information relating to a tender offer to any other person under circumstances in which it is reasonably foreseeable that such communication is likely to result in a violation of this section except that this paragraph shall not apply to a communication made in good faith,

(i)  To the officers, directors, partners or employees of the offering person, to its advisors or to other persons, involved in the planning, financing, preparation or execution of such tender offer;

(ii)  To the issuer whose securities are sought or to be sought by such tender offer, to its officers, directors, partners, employees or advisors or to other persons, involved in the planning, financing, preparation or execution of the activities of the issuer with respect to such tender offer; or

(iii)  To any person pursuant to a requirement of any statute or rule or regulation promulgated thereunder.

(2)  The persons referred to in paragraph (d)(1) of this section are:

(i)  The offering person or its officers, directors, partners, employees or advisors;

(ii)  The issuer of the securities sought or to be sought by such tender offer or its officers, directors, partners, employees or advisors;

(iii)  Anyone acting on behalf of the persons in paragraph (d)(2)(i) of this section or the issuer or persons in paragraph (d)(2)(ii) of this section; and

(iv)  Any person in possession of material information relating to a tender offer which information he knows or has reason to know is nonpublic and which he knows or has reason to know has been acquired directly or indirectly from any of the above.

[Codified to 17 C.F.R. § 240.14e--3]

[Section 240.14e--3 added at 45 Fed. Reg. 60418, September 12, 1980, effective October 14, 1980]


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Last updated September 16, 2013 regs@fdic.gov