USA LAW AND PRACTICE Contributed by: George Casey, Heiko Schiwek, Elena Rubinov, Pierre-Emmanuel Perais, Clara Pang and Gregory Gewirtz, Linklaters LLP
Tender Offers and Exchange Offers The SEC rules relating to tender offers require that the acquiror file a Schedule TO (including an offer to purchase and related documents, such as a letter of transmittal). Because a tender offer is an offer made directly to the stockholders, no board of directors’ approval from the target is technically required, although most friendly tender offers are made pursuant to a board- approved merger agreement. In any event, the board of directors of the target will be required under other SEC rules to state its position with respect to the tender offer. The staff of the SEC will review and comment on any materials relating to the tender offer. The acqui- ror must address the staff’s comments to the satisfaction of the SEC (which typically involves filing amendments to the tender offer materials during the time the tender offer is open). If the SEC comment process leads to material amend- ments to the tender offer materials, the acquiror may be required to extend the offer period and/ or disseminate new documents to the target’s stockholders. 6.14 Timing of the Takeover Offer See 6.13 Securities Regulator’s or Stock Exchange Process .
for public companies, and is mostly focused on adequacy of disclosure relating to the proposed transaction, and, if applicable, the tender offer process or proxy solicitations. Federal securi- ties laws are administered and enforced by the SEC; alleged violations of state corporate law are typically challenged by private plaintiffs in state courts (private plaintiffs also often chal- lenge violations of federal securities laws in federal courts). State securities (aka “blue sky”) laws may also be applicable depending on the relevant state. If a US publicly traded entity is involved in the transaction, stock exchange rules may also be applicable. The state law of the target company’s jurisdiction of incorporation will also govern many aspects of an acquisition. State law may impose sub- stantive requirements of fairness on the transac- tion, and may provide the target company with anti-takeover defences, such as the ability to implement shareholder rights plans (also known as “poison pills”). US federal antitrust laws are enforced by the Antitrust Division of the Department of Justice (DOJ) and by the Federal Trade Commission (FTC). 7.3 Restrictions on Foreign Investments There are several sectors (eg, airlines and broad- cast communications) in which the US govern- ment restricts foreign ownership or attaches spe- cial regulatory requirements for foreign owners. Waivers or licences allowing foreign owners to exceed standard limits are sometimes available. There are also situations in which foreign own- ership is not limited but is subject to regulatory requirements. The US government also has four separate national security-based processes for regulating foreign investment. See 7.4 National Security Review/Export Control .
7. Overview of Regulatory Requirements 7.1 Regulations Applicable to a Technology Company
Generally, no specific regulations apply to start- ing up a new technology company in the USA. 7.2 Primary Securities Market Regulators US federal law relating to acquisitions is gener- ally part of US securities laws and regulations
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