SEC Staff Issues, Revises, And Withdraws Compliance And Disclosure Interpretations On A Variety Of Subjects

On January 23, 2026, the SEC staff issued a number of new and revised Compliance and Disclosure Interpretations, and withdrew others, reflecting the adoption of Securities Act Rule 152 (Integration) in November 2020, as well as interpretations related to lock-up agreements, accredited investor verification, financial statements in spin-off transactions, and proxy and tender offer rules.

Securities Act Sections

Integration of Offerings

Questions 134.02, 139.08, and 139.25, which addressed the integration of private and public offerings, were withdrawn as superseded by Securities Act Rule 152, which sets forth an analytical framework for determining whether multiple securities transactions should be considered part of the same offering. The rule provides four non-exclusive safe harbors from integration, as well as a general principle of integration where the safe harbors do not apply.

Question 139.27 was revised to clarify that if a company completes a Section 4(a)(2) private placement, and then files a registration statement for the resale of such securities, but prior to the effectiveness of such registration statement, consummates a second private placement consistent with Rule 152(a)(1), the company may include the securities from the second private placement in a pre-effective amendment to the pending resale registration statement prior to effectiveness.

Lock-Ups

Under revised Question 139.29 and Question 139.30, the staff sets forth specific conditions where it will not object to the execution of agreements to vote in favor of a Rule 145(a) transaction (lock-up agreements) or agreements to tender by accredited investors, qualified institutional buyers and certain target company insiders before the filing of a Form S-4 (or F-4) registration statement in a registered exchange offer. When these conditions are not satisfied, the SEC staff will not object to subsequent registration if the securities will be offered and sold only to persons who did not execute such agreements. Issuers seeking lock-up agreements or agreements to tender from security holders or target company insiders should consider whether such efforts represent the commencement of a tender offer under Section 14(d)(1) of the Exchange Act and Regulation 14D.

Under revised Question 239.13, the staff sets forth specific conditions where it will not object to the execution of lock-up agreements with members of management and principal security holders prior to registration in connection with a Rule 145(a) transaction. When these conditions are not satisfied, the SEC staff will not object to subsequent registration if the securities will be offered and sold only to persons who did not execute such agreements.

Securities Act Rules

Rule 152

Questions 141.06, 152.01, 152.03, 212.06, 256.01, 256.02, and 256.34 were withdrawn as superseded by Rule 152, and Question 152.02 was revised as Question 148.03, which clarifies that an issuer, after an unsuccessful shelf takedown, may rely on Rule 152 to complete the offering privately, provided that it complies with the Rule 152(a) general principle of integration.

Under new Question 148.01, if an issuer engaged in a Rule 506(c) offering soliciting individuals through general solicitations, the issuer can now sell to those individuals through a subsequent Rule 506(b) offering if the issuer established a substantive relationship with the prospective purchasers prior to the commencement of the Rule 506(b) offering. Because the issuer solicited the prospective investors through the general solicitation in the prior Rule 506(c) offering, the issuer cannot  rely on Rule 152(a)(1)(i) with respect to those investors. Whether the issuer has established a substantive relationship depends on the facts and circumstances. The quality of the relationship between an issuer (or its agent) and a prospective investor is the most important factor. An issuer cannot establish such a relationship solely through the passage of time or a particular short-form accreditation questionnaire. Investors with whom the issuer has a pre-existing substantive relationship may include the issuer's existing or prior investors, investors in prior deals of the issuer's management, or friends or family of the issuer's control persons. In the absence of a prior business relationship or a recognized legal duty to offerees, it is likely more difficult for an issuer to establish a pre-existing, substantive relationship, especially when contemplating or engaged in an offering over the internet.

New Question 148.02 clarifies that the existence of an effective registration statement does not “in and of itself” raise integration concerns under Rule 152.

Accredited Investor Verification

Question 255.06 was revised to explain that in determining accredited investor status, an issuer can look through multiple levels of entities to natural persons who are the ultimate owners.

Under new Question 260.39, in a Rule 506(c) offering, an issuer can use different methods to verify the accredited investor status for different investors in the same offering.

Regulation S-K Item 402

Interpretation 217.01 has been revised to provide that historical Item 402 compensation information for a spun-off registrant for periods prior to the spin-off is required only if operated as a separate division or standalone business of the parent and there was continuity of management from before the spin-off. The interpretation notes that “where a spun-off registrant consists of portions of different parts of the parent's business or has new management who will be named executive officers after the spin-off, compensation information for the named executive officers for periods before the spin-off would not be required. In contrast, if the parent spun off a subsidiary that conducted one line of its business, and, before and after the spin-off, the executive officers of the subsidiary: (1) were the same; (2) provided the same type of services to the subsidiary; and (3) provided no services to the parent, historical compensation disclosure likely would be required. When historical compensation is not required, the registrant need only report compensation awarded to, earned by, or paid to the spun-off registrant's named executive officers in connection with and following the spin-off.”

Proxy Rules and Schedules 14A/14C

Notice of Exempt Solicitations

Under revised Question 126.06, the staff will object to a voluntary submission of a Notice of Exempt Solicitation by a soliciting person who does not beneficially own more than $5 million of the class of subject securities.

Under revised Question 126.07, when submitting a Notice of Exempt Solicitation on EDGAR, the written soliciting material may not appear in the notice before the Rule 14a-103 information is presented.

Broker Searches

Under new Question 133.02, recognizing that the broker search process has become more efficient since the current rules were adopted in 1986, the staff will not object if a registrant conducts its “broker search” less than 20 business days before the record date, provided that the registrant reasonably believes that its proxy materials will be timely disseminated to beneficial owners and otherwise complies with Rule 14a-13. This position also applies to registrants subject to the similar “broker search” requirement of Rule 14c-7(a)(3) with respect to information statements.

Under new Question 182.01, the failure to comply with the 20-calendar-day requirement in Rule 14c-2 (requirement to distribute an information statement to security holders at least 20 calendar days prior to the earliest date on which corporate action by written consent may be taken) does not invalidate the corporate action. Where the written consents were solicited by a dissident security holder without the registrant's knowledge, the staff will not object to the registrant's failure to comply with the 20-calendar-day requirement as long as the registrant distributes the information statement as soon as practicable after it becomes aware of the written consents.

Tender Offer Rules and Schedules

Under new Question 166.02, when purchases or arrangements to purchase outside a Tier I cross-border tender offer are made after the public announcement of the offer but before offering documents are disseminated, the Rule 14e-5(b)(10) exception is available for outside purchases. The purpose of the exception is to allow purchases outside of a Tier I tender offer where such outside purchases are permitted by the laws of the subject company's home jurisdiction and the other conditions of the exception are met. The offering documents, when disseminated, should disclose that purchases outside the Tier I offer have already occurred and, if true, may continue during the offer.

Rule 14e-5(b)(12)(i) permits an offeror (and its affiliates) and an affiliate of the offeror's financial advisor to make purchases outside a cross-border tender offer, subject to certain conditions. Rule 14e-5(b)(12)(i)(G)(4) states that the purchases or arrangements to purchase subject securities by the affiliate of the financial advisor outside the tender offer may not be made to facilitate the tender offer. New Question 166.03 clarifies that this condition does not apply to affiliates of the offeror's financial advisor when acting on behalf of the offeror in an agency capacity to effect purchases of subject securities or related securities outside of the tender offer with the purpose of facilitating the tender offer. The Rule 14e-5(b)(12)(G)(4) condition applies only to purchases by affiliates of the financial advisor that are made other than in this agent-of-the-offeror capacity. The purchases would, however, be subject to the other requirements of the rule, including the requirements that the tender offer price be increased to match any consideration paid outside of the tender offer that is greater than the tender offer price.

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