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Proxy Statements

 
If and only if you are a 1934 Act Reporting Company [by filing a Form 8-A or Form 10], you must file with the SEC a proxy statement on all matters requiring shareholder vote. They typical matters which require shareholder vote are:
 
  • Amendment to Articles Incorporation to change your company’s name.
  • Amendment to Articles Incorporation to increase authorized shares or authorize a new class of shares such as Preferred Stock not previously authorized.
  • Election of Directors
  • Adoption of Stock Option Plans requiring shareholder approval
  • Reverse Stock Splits
  • Business Combinations such as mergers or share exchanges
 
A preliminary proxy statement must be filed 10 days before mailing and may not be mailed until the SEC advises they have no comments. The shareholder vote may not be held until 20 days after mailing.
 
There are two kinds of proxy filings:
 
  • Information Statement on Schedule 14C
  • Proxy Solicitation on Schedule 14A
 
Information Statement on Schedule 14C
 
If the officers and directors of your company own more than 50% of your voting stock, so you are assured the matter will pass, you do not solicit votes, or proxies. You simply give the minority shareholders information about what is being voted on. Thus, this is called an “Information Statement.”
 
Be careful here. You might think that if your officers and directors don’t own over 50% of your voting stock but one of your good friends who is not an officer or director owns enough stock to get you over 50%, you can file an Information Statement rather than a Proxy Solicitation. NO. You cannot use non-insiders to get you over 50%. In this case, you are stuck doing a Proxy Solicitation.
 
Proxy Solicitation on Schedule 14A
 
This is the format you use when the officers and directors of your company do not own more than 50% of your voting stock and you must solicit votes, or proxies, to pass a particular matter that requires shareholder vote.
 
Information in Schedule 14
 
In addition to some of the information required in your Form 10-K, Schedule 14 Statements require you to describe, among other disclosure requirements, the transaction for which shareholder vote is necessary and describe the Board of Directors recommendation and the basis for the recommendation.
 
 
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This site provided by Williams Securities Law Firm, Michael T. Williams, Esq., Tampa, FL