On January 27, 2025, the staff of the Division of Corporation Finance of the Securities and Exchange Commission (the “Staff”) released two updated and three new Compliance & Disclosure Interpretations (“C&DIs”) relating to the use of PX14A6G filings pursuant to Exchange Act Rule 14a-6(g). A summary of the C&DIs is below with the full text of the recently revised C&DIs, including links to markups showing the revisions from the SEC, attached.
Overview of SEC Form PX14A6G. Pursuant to Exchange Act Rule 14a-6(g), SEC Form PX14A6G is a notice of exempt solicitation filed with the SEC. The form acts as a cover page for copies of soliciting materials (e.g., letters sent to shareholders) used by a shareholder who wants to communicate or recommend a particular issue to other shareholders (for example, electing board members), owns more than $5 million of a company’s securities and who is not seeking to act as a proxy (or furnishing or requesting a form of revocation, abstention, consent or authorization).
The updates clarify certain use and criteria of PX14A6G filings, including:
- Voluntary Submission. A voluntary submission of a PX14A6G filing by a soliciting person who does not beneficially own more than $5 million of the class of subject securities (i.e., does not meet the requirements of Rule 14a-6(g)(1)) is permissible with appropriate disclosure. The Staff notes that the cover page must clearly state that “the soliciting person does not beneficially own more than $5 million of the class of subject securities; and the notice is therefore being provided on a voluntary basis.” (Q&A 126.06)
- Cover Page. Whether filing voluntarily or to satisfy the requirements of Rule 14a-6(g)(1), written soliciting material must be submitted “under cover” of the Notice of Exempt Solicitation. In particular, the C&DIs state that “all of the information required under Rule 14a-103 must be presented in the submission before any written soliciting materials.” (Q&A 126.07)
- Previously Disseminated Written Soliciting Material. The Staff reminds filers that the filing of a Notice of Exempt Solicitation is intended to only notify the public of the written soliciting material that the person has previously sent or given to security holders through other means. The Staff further notes that the filing itself is not meant to be the means through which a person provides written soliciting material to security holders. (Q&A 126.08)
- Must Constitute a “Solicitation”. Only written communications that constitute a “solicitation” under the Rule 14a-2(b)(1) exemption should be submitted under the cover of a Notice of Exempt Solicitation as Rule 14a-6(g) only applies to solicitations made pursuant to the Rule 14a-2(b)(1) exemption. Under Rule 14a-1(l)(1)(iii)(A), a “solicitation” for purposes of Regulation 14A is any proxy voting advice that recommends how a security holder should vote on a specific matter. The Staff provides, as an example, that generally a written communication on matters that are not the subject of a solicitation by the registrant or a third party for an upcoming shareholder meeting would not be viewed as a solicitation and thus should not be submitted under the cover of a Notice of Exempt Solicitation. (Q&A 126.09)
- Rule 14a-9 Liability. Any written soliciting material attached to a Notice of Exempt Solicitation is subject to liability under Rule 14a-9, which prohibits materially false or misleading statements in soliciting materials. The Staff further reminds filers that Rule 14a-2(b) does not provide an exemption from Rule 14a-9. The notes to Rule 14a-9 provide the following examples of what, in certain circumstances, may be deemed misleading:
- Predictions as to specific future market values.
- Material which directly or indirectly impugns character, integrity or personal reputation, or directly or indirectly makes charges concerning improper, illegal or immoral conduct or associations, without factual foundation.
- Failure to so identify a proxy statement, form of proxy and other soliciting material as to clearly distinguish it from the soliciting material of any other person or persons soliciting for the same meeting or subject matter.
- Claims made prior to a meeting regarding the results of a solicitation. (Q&A 126.10)
This publication is for general information purposes only. It is not intended to provide, nor is it to be used as, a substitute for legal advice. In some jurisdictions it may be considered attorney advertising.