Definition
Schedule 14D-9 is the formal “Solicitation/Recommendation Statement” that the target company’s board of directors must file with the SEC within 10 business days of the commencement of a third-party tender offer for the target’s securities.
What it must contain
- The board’s recommendation: accept, reject, express no opinion, or unable to take a position (with reasons)
- Background and reasons for the recommendation
- Any fairness opinion the board obtained
- Conflicts of interest of directors and officers
- Information about any negotiations with the bidder or other parties
Why it matters
The 14D-9 is the target board’s primary chance to communicate with shareholders about the offer. A board recommendation has substantial persuasive weight; bidders structuring a tender offer typically pursue a friendly negotiated outcome to obtain a favorable 14D-9.
Distinction
The bidder’s filing is Schedule TO. The target’s response is Schedule 14D-9.