SEC Issues Guidance Allowing Public Companies to Reschedule or Hold Virtual Annual Meetings
The Securities and Exchange Commission has been proactive in addressing the unique issues that publicly-traded companies face during the COVID-19 coronavirus crisis, including requirements relating to annual meetings of shareholders. Although many states permit telephonic or other means of virtual shareholders meetings, most companies continue to hold an in-person annual meeting. Now however, even in states where non-essential gatherings have not been banned, many companies are rethinking this approach.
Companies that have already mailed their proxy materials must now decide whether to reschedule the annual meeting or shift to a virtual meeting. Under existing SEC rules either approach could require a costly mailing to the company’s shareholders, but the SEC has issued staff guidance permitting companies to make these changes by issuing a press release without the cost of an additional mailing, assuming certain notice and filing requirements are met.