A merger proxy statement is prepared by a public company in connection with an acquisition that shareholders have to vote on. The proxy statement is filed with the Securities and Exchange Commission (SEC) on a Schedule 14A. A preliminary proxy statement, also known as a PREM14A, is typically filed a couple weeks after a public deal announcement. Eventually the company will file a definitive proxy statement, also called a DEFM14A.

Prior to filing the preliminary proxy statement, Rule 14a-12 under the Securities Exchange Act of 1934 allows for soliciting materials to be published or sent to shareholders if certain conditions are met. In particular, the materials must include a “participants in the solicitation” legend. Participants in the solicitation of proxies in connection with the proposed merger typically include the company’s directors, executive officers, and other significant employees. The participants in the solicitation must be explicitly identified and the materials should include a prominent legend that instructs investors to read the company’s proxy statement once available. The “participants in the solicitation” legend is intended to inform investors of the interests of those soliciting the shareholders. This legend is often placed towards the end of the document, since it can be lengthy. It is important to remember that the Rule 14a-12 exemption for soliciting materials can only be relied upon if the company actually intends to file a proxy statement soon afterwards.

Written communications related to solicitation must be promptly filed with the SEC. This usually means that the materials must be filed with the SEC on the same day that the materials are used to solicit investors. The company should evaluate each written communication on a case-by-case basis to determine whether it should be considered soliciting material in connection with the merger transaction.

Additionally, Rule 165 under the Securities Act of 1933 requires all public written communications in connection with a merger transaction to be filed with the SEC. The filing obligation commences with the first public announcement of the merger and extends until closing. This type of filing is referred to as a Rule 425 filing since it must be filed pursuant to Rule 425 of the Securities Act of 1933. The filed materials should include a prominent legend advising investors to fully read the materials for more information. This legend is often titled “Additional Information and Where to Find It.” The legend will also indicate that a free copy of the proxy statement can be obtained from the SEC’s website.

Examples of materials that may be filed under Rule 425 include press releases announcing the merger, Q&As distributed to employees about the merger, prepared scripts used by management to speak at press conferences, and investor presentations about the merger that were shared with financial analysts.

Public companies should keep in mind that disclosures made pursuant to Rule 14a-12 of the Securities Exchange Act of 1934 and Rule 165 of the Securities Act of 1933 can be subject to securities liability. In particular, these disclosures are subject to the liability provisions of Section 14a-9 of the Exchange Act, which prohibits false or misleading statements in proxy statements.