On March 13, 2020, the SEC issued guidance regarding the effect of the coronavirus (COVID-19) on upcoming annual shareholder meetings. The SEC advised that a company that has already mailed and filed its proxy materials can change the date, time, or location (including changing to a “virtual (or “remote-only”) meeting”) of its annual meeting without mailing additional proxy materials so long as that company promptly:
The ability to conduct virtual shareholder meetings is governed by state law and the company’s governing documents. If a company chooses to conduct virtual meetings, the SEC expects the company to promptly disclose all relevant information to its shareholders, including clear directions for how a shareholder will be able to participate in the virtual meeting.
The SEC recommends that companies provide alternative methods for shareholders or their representatives to present their proposals in compliance with Exchange Act Rule 14a-8(h) at the annual meeting. The inability of a shareholder to attend the annual meeting due to the coronavirus crisis will be considered “good cause” under Exchange Act Rule 14a-8(h) and will not serve a basis to exclude a proposal submitted by that shareholder for a meeting within the following two years.
The full text of the SEC Guidance is available here.
Your regular Locke Lord contact and any of the authors would be happy to assist you with these matters.
Visit our COVID-19 Resource Center often for up-to-date information to help you stay informed of the legal issues related to COVID-19.
The post SEC Coronavirus Guidance on Shareholder Annual Meeting Engagement appeared first on Capital Markets.
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