Schedule 13-D

Written By
Paul Tracy
Updated November 11, 2020

What is Schedule 13-D?

A beneficial ownership report, known as SEC Schedule 13-D, is a public notice of anyone who has acquired 5% or more of a voting class of a company's equity securities.

How Does Schedule 13-D Work?

For example, let's say you really like Company XYZ stock. In fact, you like it so much that you start buying shares and buying shares and buying shares. Pretty soon, you own 5% of the company's common stock.

Because Company XYZ is a public company, you must file a Form 13-D with the SEC within 10 days of the transaction that brought your position to the 5% threshold. You must disclose your name, other identifying information and the names of anyone else who has the power to vote the shares or sell the shares.

Why Does Schedule 13-D Matter?

The idea behind a Schedule 13-D is to inform the company and the public that a large shareholder exists and that other people (the shareholder's wife, for example) have the power to vote those shares or sell those shares as he or she sees fit.

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