On April 16, 2026, the Securities and Exchange Commission’s Division of Corporation Finance issued an exemptive order reducing the minimum offer period required for certain equity tender offers by half (shortened to 10 business days, rather than the 20-business day period otherwise required), subject to certain conditions depending on the type of issuer and equity tender offer involved.
The order (aimed at addressing market inefficiencies, reflecting technological advancements, and reducing unnecessary exposure to market fluctuations) addresses equity tender offers for two specified categories of issuers (reporting companies and non-reporting companies).
Tender Offers for Equity Securities of Reporting Companies – Conditions for Relief
For tender offers involving equity securities of reporting companies, the exemptive relief applies to the following tender offer categories that otherwise meet their respective conditions specified in the order: (1) certain third-party equity tender offers under Regulation 14D under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and (2) certain issuer equity self-tender offers under Exchange Act Rule 13e-4.
Third-Party Equity Tender Offers Under Regulation 14D
For third-party equity tender offers under Regulation 14D, the following conditions apply:
- Business Combination Agreement: The offer is made pursuant to the terms of a negotiated business combination agreement between the subject company and the offeror.
- All Securities of Class: The offer is made for all outstanding securities of the subject class.
- Schedule 14D-9: The subject company files and disseminates a Schedule 14D-9 no later than 5:30 p.m. Eastern time on the first business day following the date of commencement of the tender offer.
Issuer Equity Self-Tenders Under Rule 13e-4
- Less Than All Securities of Class: For issuer equity self-tender offers under Rule 13e-4, the tender offer must be made for less than all outstanding securities of the subject class.
Additional Conditions for Reporting Company Equity Tender Offers
Third-party equity tender offers under Regulation 14D for reporting companies and issuer equity self-tenders under Rule 13e-4 for reporting companies are both subject to the following additional conditions to qualify for the exemptive relief:
- Cash Only: The consideration offered in the tender offer consists only of cash at a fixed price.
- Not a Going Private: The tender offer is not subject to Exchange Act Rule 13e-3 (“going private” transaction).
- Not Cross-Border Exempt: The tender offer does not rely on the cross-border exemptions set forth in Exchange Act Rules 14d-1(d) or 13e-4(i).
- No Competing Tender Offers at Launch: When the tender offer is publicly announced, the subject securities are not the subject of a previously announced or pending tender offer by another offeror.
- Extension of Offer Period May Be Required: If a competing tender offer for the subject securities is publicly announced following the commencement of the initial tender offer made in reliance on the relief, the initial offer must be extended to at least 20 business days from its commencement date.
- Widely Disseminated Launch Press Release With Hyperlink: The tender offer is announced in a widely disseminated press release by 10:00 a.m., Eastern time on the date the offer commences, including the basic terms (identity of offeror, the class of securities sought, consideration offered, and expiration date) and an active hyperlink to a website where security holders may access the tender offer materials.
- Widely Disseminated Notice of Price and Percentage Changes: Any increase or decrease in the percentage of subject securities sought (other than additional acceptances up to a 2% threshold) or any change in consideration offered must be communicated by press release or other public announcement that is widely disseminated no later than 9:00 a.m. Eastern time on the fifth business day before offer expiration.
- Widely Disseminated Notice of Other Material Changes: Any other material change in the terms of the tender offer is communicated by press release or other public announcement that is widely disseminated no later than 9:00 a.m. Eastern time on the second business day before offer expiration.
Tender Offers for Equity Securities of Non-Reporting Companies – Conditions for Relief
The Division also shortened the time required for a tender offer for equity securities of a non-reporting company[1] by such issuer (or by such issuer’s wholly-owned subsidiary, for equity securities of the issuer) to a minimum of 10 business days if certain conditions are met, including:
- Cash Only: The consideration offered in the tender offer consists only of cash at a fixed price.
- Notice of Price and Percentage Changes: Any increase or decrease in the percentage of securities sought (other than additional acceptances up to a 2% threshold) or any change in consideration offered must be communicated by notice to holders of the subject securities no later than 9:00 a.m. Eastern time on the fifth business day before offer expiration.
- Notice of Other Material Changes: Any other material change in the terms of the tender offer is communicated by notice to holders of the subject securities no later than 9:00 a.m. Eastern time on the second business day before offer expiration.
Additional Information
The exemptive order concludes with a reminder to offerors regarding other federal securities law compliance obligations in connection with tender offers, including anti-fraud and anti-manipulation provisions.
The full exemptive order can be found here.
If you have any questions regarding this client alert, please call or e-mail your SRFC attorney.
DISCLAIMER: This communication, which we believe may be of interest to our clients and friends of the firm, is for general information only. It is not a full analysis of the matters presented and should not be relied upon as legal advice. This may be considered attorney advertising in some jurisdictions.
[1] “Non-reporting company” in this context refers to an issuer that: (i) does not have a class of securities registered under Section 12 of the Exchange Act; and (ii) is not required to file reports pursuant to Section 15(d) of the Exchange Act.