Series 79 practice questionmediumSchedule TO and Schedule 14D-9
The board of directors of a target company has received an unsolicited tender offer. Within how many business days must the target file a Schedule 14D-9 containing its recommendation to shareholders?
- A5 business days
- B30 calendar days
- C20 business days
- D10 business days✓ Correct answer
Explanation
Why D — 10 business days
Under SEC Rule 14d-9, the target company's board must file a Schedule 14D-9 (Solicitation/Recommendation Statement) within 10 business days after the commencement of the tender offer. This filing communicates the board's recommendation to shareholders regarding the offer: accept, reject, express no opinion, or state that it is unable to take a position. The board typically engages a financial advisor to provide a fairness opinion to support its recommendation.
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