Also known as: 14A · proxy statement · Form 14A
Written by attorneys · grounded in primary & secondary sources — see below
A detailed disclosure form prescribed by the Securities and Exchange Commission that companies must use when soliciting proxies from shareholders. The form requires specific information about the meeting, director nominees, executive compensation, and other matters to enable informed shareholder voting.
Sentinel Security's bylaws permit qualifying shareholders to place nominees on the proxy card for director elections. Santiago Sanchez, holding the required stake, submits two nominees with all required documentation and representations. The company prepares its proxy materials using Schedule 14A and includes the nominees alongside the board slate. Sanchez later sues when the company attempts to exclude them, claiming the bylaw conditions were met.
Summit Bank seeks shareholder approval for a merger and distributes proxy materials. Sofia Stern receives the Schedule 14A statement but alleges it omitted material facts about the deal's risks. She sues under the proxy rules, claiming the disclosure failed to provide the information needed for an informed vote on the transaction.
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Stonehaven Properties files a Schedule 14A proxy statement ahead of its annual meeting. Sasha Stone, an insider, learns of a major mineral discovery not disclosed in the materials. Stone trades on the information before the meeting, prompting an SEC action alleging misuse of nonpublic facts tied to the proxy solicitation process.
Sapphire Technologies faces a shareholder class action alleging a false proxy statement in a merger vote. Seth Shapiro brings the suit after an earlier SEC enforcement action found the same Schedule 14A materially misleading. The court applies issue preclusion, binding the company to the prior determination on the proxy disclosure.
Simone Sanders submits a shareholder proposal to amend bylaws for proxy access at Stonehaven Properties. The board adopts its own version with stricter thresholds before the record date. Sanders sues, arguing the board bylaw improperly restricts the Schedule 14A inclusion rights the shareholder proposal sought to create.
Sarah Sullivan receives a Schedule 14A proxy statement from Summit Bank recommending a merger. The statement includes board opinions that the deal is fair without disclosing contrary internal projections. Sullivan sues, claiming the opinions were materially misleading and deprived shareholders of accurate information for the vote.
A company must furnish a Schedule 14A proxy statement whenever it solicits proxies for a shareholder meeting at which directors will be elected or other significant matters will be voted on. The statement must accompany or precede the proxy card and contain the information specified in the schedule.
Schedule 14A requires disclosure of the date, time, and place of the meeting, the identity of director nominees and information about them, the identity of persons soliciting proxies, and extensive information on director and executive compensation.
Schedule 14A serves as the federal disclosure vehicle that implements state-law proxy access bylaws by requiring companies to include qualifying shareholder nominees in the proxy materials when the bylaws so provide. The federal form supplies the disclosure framework while the bylaw determines eligibility for inclusion.
A material misstatement or omission in a Schedule 14A proxy statement can give rise to private claims under the proxy rules and may support SEC enforcement. Courts assess materiality by whether there is a substantial likelihood that a reasonable shareholder would consider the information important in deciding how to vote.
…v. United States, 406 U. S., at 153-154. Similarly, we did not require proof that material omissions or misstatements in a proxy statement decisively affected voting, because the proxy solicitation itself, rather than the defect in the solicitation materials, served as an essential link in the transaction. See Mills v.…