What Is Schedule 14C?

Schedule 14C lays out certain disclosure criteria for companies with securities registered with the Securities and Exchange Commission (SEC). Schedule 14C is a proxy statement that an attorney prepares when a public company holds its stockholders’ meeting each year. It is required when the issuer holds special meetings to vote on corporate actions such as name changes and mergers.

Schedule 14C must be completed for SEC-reporting companies whose shareholders approve an action by written consent.

Key Takeaways

  • Schedule 14C sets forth the requirements for SEC-reporting companies whose shareholders approve an action by written consent.
  • The form mandates that the stockholders executing the written consent have enough votes to control the outcome of the matter voted upon.
  • Actions that require Schedule 14A or 14C filings include name changes, stock splits, domicile changes, reverse mergers, corporate reorganizations, and other events that require a shareholder vote.

Understanding Schedule 14C

Companies with SEC-registered securities are required to comply with Section 14 of the Securities Exchange Act of 1934. Section 14 describes proxy rules concerning disclosures required in any materials that solicit shareholder votes at annual meetings. The schedule requires that the stockholders executing the written consent have sufficient votes to control the outcome of the matter voted upon. Shareholder voting takes place either in person or by proxy.

Proxy rules are enforced by the following:

  1. State corporate law
  2. Stock exchange listing requirements
  3. SEC proxy rules
  4. The issuers’ articles and bylaws

Issuers who have a class registered under the Securities Exchange Act of 1934 are subject to the proxy rules. The disclosures on the proxy rules contain the information necessary for shareholders to vote in an informed manner. Voting occurs at either the traditional annual shareholders' meeting or a special shareholders' meeting.

In some cases, shareholder approval is obtained in writing and is not required at a meeting. Then, a company satisfies the disclosure requirements of Section 14 by disclosing the information described in Schedule 14C.

Who Can File a Schedule 14C?

A Schedule 14C attorney typically prepares the proxy statement for the stockholders’ annual when votes on corporate actions occur. Other times, public companies take action with the written consent of the issuer’s shareholders.

How to File a Schedule 14C

The SEC’s proxy rules are found in Section 14 of the Exchange Act. A proxy statement on Schedule 14A or an information statement on Schedule 14C gives shareholders information on corporate changes, actions, and shareholder meetings.

Actions that require Schedule 14A or 14C filings include name changes, reverse mergers, stock splits, domicile changes, corporate reorganizations, and other events that require a vote by the issuer’s shareholders.

Schedule 14C also provides investors with information on actions that have been approved by the issuer’s majority shareholders. Ten days after filing a preliminary information statement on Schedule 14C, if no SEC comments are received, the issuer may file a definitive information statement.

In summary, the issuer of the schedule is requesting that a shareholder consent to an action. The schedule asks for the shareholders' approval, and the issuer must comply with Schedule 14A’s proxy solicitation requirements.