d) Defending units declare formation changes. Check to see if they complete their formation change before the charge reaches.
e) Defending Unit Response Phase
Infantry units in charge reach of Cavalry will make a morale check to form square or follow orders. If they fail this morale check they will (attempt to) form square. If they make their morale check they will obey orders. In either case there is no effect to their morale level (see page 25). (You are checking to see if they will follow orders or do what they have been drilled to do ie "Form Square if Cavalry in charge range")
Defending Units do their fear-of-impact Morale checks now in the formation they would be in when the charge reaches them. Note if they would be in the middle of a formation change when the charge reached them, they are disordered.
f) If defending units run away, check the next unit in the charge path. If it is in reach of the charging unit, check the unit starting at c) above.