Summary

On June 30, 2026, the SEC’s Division of Corporation Finance (the Division) issued an exemptive order (the Order) permitting qualifying tender and exchange offers for non-convertible debt securities to remain open for a minimum of five business days, rather than the 20 business days ordinarily required. The Order supersedes the Division’s 2015 no-action letter and expands the availability of shortened offer periods for liability management transactions.

The Order follows the SEC’s April 2026 exemptive relief permitting certain equity tender offers to remain open for only 10 business days and reflects ongoing efforts to modernize the tender offer framework. According to the SEC, the Order is intended to reduce market exposure, improve execution certainty, and facilitate efficient debt management transactions while maintaining investor protections.

Scope of Relief

The Order permits issuers to conduct cash tender offers and certain exchange offers for non-convertible debt securities with a minimum offering period of five business days, subject to the following conditions:

  • Eligible Offerors: The issuer, its wholly owned subsidiary, or its wholly owned parent. Third-party tender offers remain subject to the 20-business-day period.
  • Eligible Securities and Consideration: Non-convertible debt securities only. Consideration may consist of cash, Qualified Debt Securities,1 or both.
  • Exchange Offers: Exchange offers using Qualified Debt Securities are limited to Qualified Institutional Buyers, certain accredited institutional investors, and non-U.S. persons in transactions exempt from Securities Act registration. A concurrent cash alternative for non-eligible holders is no longer required.
  • Consent Solicitations: Concurrent consent solicitations are permitted if the indenture amendment requires only simple majority approval. Amendments requiring supermajority or higher consent thresholds remain subject to the 20-business-day framework.
  • Financial Condition Limitations: The abbreviated offering period is unavailable if the issuer is in default, is subject to bankruptcy or insolvency proceedings, or has commenced a pre-packaged bankruptcy solicitation, or if the board has authorized discussions with creditors for a consensual restructuring.
  • Notice and Disclosure: The offer must be announced via widely disseminated press release by 10:00 a.m. Eastern time on the commencement date, including key terms and a hyperlink to tender offer materials. Changes in consideration or the percentage of securities sought (other than acceptance of up to an additional 2%) must be announced by 9:00 a.m. Eastern time on the third business day before expiration. Other material changes must be announced by 9:00 a.m. Eastern time on the second business day before expiration.
  • Withdrawal Rights and Settlement: Withdrawal rights remain consistent with Rule 14e-1. Consideration may not be paid until promptly after offer expiration—early settlement is not permitted.
  • Excluded Transactions: The relief is unavailable for offers commenced within 10 business days after a change-of-control or extraordinary transaction (merger, reorganization, liquidation, or sale of substantially all assets), offers made in anticipation of or in response to competing tender offers, concurrent offers that would subordinate the subject securities, or offers within 10 business days of a material acquisition or disposition requiring pro forma financial statements.

Key Changes From Prior Guidance

Although the Order largely incorporates the 2015 no-action letter framework, it makes several notable changes:

Topic

2015 No-Action Letter

2026 Exemptive Order

Form of Relief

Informal no-action relief (staff would not recommend enforcement action)

Formal exemptive order issued pursuant to delegated SEC authority

Qualified Debt Securities Definition

Must be identical in all material respects to the subject debt securities; must have a longer weighted average life to maturity than the subject securities

Must be substantially similar in all material respects to either the subject securities or the issuer’s most recent pari passu issuance; no weighted average life to maturity requirement

Consideration Pricing Deadline

Exact amount of consideration on Qualified Debt Securities must be fixed no later than 2:00 p.m. Eastern time on the last business day of the offer

No later than the expiration time of the offer

Offer Scope

Must be for any and all of the subject debt securities

Partial (less-than-all) offers permitted; pro rata acceptance required if oversubscribed; proration factor must be announced by 10:00 a.m. Eastern time on the next business day after expiration, or as soon thereafter as practicable

Eligible Exchange Offer Participants

Qualified Institutional Buyers and non-U.S. persons only

Qualified Institutional Buyers, non-U.S. persons, and institutions that are accredited investors under Rule 163B(c)(2)

Cash Alternative for Non-Eligible Holders

Required: Concurrent cash option approximating the value of the Qualified Debt Securities must be offered to non-eligible holders

Eliminated

Consent Solicitation Restriction

Prohibited with respect to any amendment to the governing indenture

Prohibited only if the amendment requires consent of holders of more than a simple majority of the outstanding principal amount of the subject securities

Senior Indebtedness Financing

Prohibited: Offer may not be financed with the proceeds of indebtedness that is structurally or contractually senior to, or has a shorter weighted average life than, the subject debt securities

No restriction on financing sources

Guaranteed Delivery Procedure

Required: Offers must permit tenders through certification of beneficial ownership with delivery by the second business day after expiration

Eliminated

Form 8-K Filing Requirement

Required: Exchange Act reporting companies must file a launch press release and consideration change announcements on Form 8-K

Eliminated

Notice of Changes to Offer

Extension-based: Offer must remain open for at least five business days after announcement of change in consideration, and at least three business days after other material changes

Advance-announcement deadlines (no automatic extension required): Changes in consideration or percentage of securities sought must be announced by 9:00 a.m. Eastern time on the third business day before expiration; other material changes must be announced by 9:00 a.m. Eastern time on the second business day before expiration. Acceptance of up to an additional 2% of the class does not require advance announcement.

2% Additional Securities Carve-Out

Not applicable (any-and-all offers only)

Acceptance of up to an additional 2% of the class does not constitute an increase requiring advance announcement

Extraordinary Transaction Restriction

Subjective standard: Offers may not be made “in anticipation of or in response to, or concurrently with” a change of control or extraordinary transaction

Bright-line standard: Offers may not be commenced within 10 business days after the first public announcement or consummation of such a transaction

Benchmark Rate

Includes London Interbank Offered Rate (LIBOR)

Secured Overnight Financing Rate (SOFR) replaces LIBOR

Concurrent Tender Offer Restriction

Prohibited if the concurrent offer would add obligors, guarantors, or collateral; increase lien priority; or shorten the weighted average life to maturity of such other series

Prohibition retained for adding obligors, guarantors, or collateral, or increasing lien priority; weighted average life to maturity prong removed


Transactions Remaining Subject to 20-Business-Day Period

The following transactions remain subject to the standard 20-business-day minimum offering period and are not eligible for the five-business-day relief:

  • Tender offers for convertible debt securities, equity-linked notes, or contingent convertible securities
  • Consent solicitations requiring more than simple majority approval
  • Third-party (non-issuer) tender offers

Looking Ahead

The Order provides issuers with enhanced flexibility to manage their balance sheets and respond to market conditions. The elimination of the guaranteed delivery requirement, the concurrent cash offer requirement, and financing restrictions should streamline execution and reduce costs. The ability to conduct partial offers and include consent solicitations requiring simple majority approval unlocks new possibilities for strategic liability management.

Issuers, investment banks, and other market participants should evaluate whether future debt tender offers can take advantage of the new five-business-day framework. Although the Order provides greater legal certainty than the prior no-action relief, participants must continue to satisfy its detailed eligibility conditions and remain mindful of anti-fraud and anti-manipulation provisions under Exchange Act Sections 10(b) and 14(e).

For any questions or guidance regarding the Order or its potential impact, please reach out to a member of our Capital Markets & Securities team. We are available to provide practical, tailored advice to help issuers, investment banks, investors, and other market participants navigate the evolving regulatory landscape.

*This client alert was co-authored by Jennifer Leigh, summer associate.

1 “Qualified Debt Securities” are non-convertible debt securities that are substantially similar in all material respects (including but not limited to the issuer(s), guarantor(s), collateral, lien priority, covenants, and other terms) to either (1) the debt securities that are the subject of the tender offer or (2) the most recent issuance of debt securities that are pari passu to the subject debt securities, except in either case for the maturity date, interest payment and record dates, redemption provisions, and interest rate; provided that Qualified Debt Securities must have all interest payable only in cash.