Public companies are navigating choppy waters as a result of COVID-19. In addition to dealing with market volatility, public companies are facing critical business decisions and being asked to manage risks and the interests of their various stakeholders, including shareholders and employees. Providing meaningful disclosure to shareholders in this landscape can be challenging and companies will need time necessary to process the implications that COVID-19 will have on their businesses. In an effort to support public companies during these challenging times while balancing the requirements for meaningful disclosure, securities regulators in Canada and the United States have provided extensions for various filing deadlines and are trying to support social distancing through virtual shareholder meetings. The filing deadline relief from the Canadian Securities Administrators (CSA) applies to financial statements, management discussion and analysis, annual information forms, technical reports and other filings. The following is a summary of the relief and guidance provided by the CSA, the Securities and Exchange Commission (SEC) and OTC Markets (OTC) regarding filing deadline extensions and relief:
|Regulator||Original Filing Deadline||Extended Deadline||Procedure|
|CSA||On or before June 1, 2020||45-Days from original filing deadline||No application needed to get relief.
No Management Cease Trade Order.
|OTC||Between March 1, 2020 and April 30, 2020||Later of 45-Days from original filing deadline and the extended deadline permitted by the company’s foreign primary regulator||Submit a Notification of Late Filing through OTCIQ.com, including a summary of why the relief is needed.
Companies that meet the conditions for filing relief will not be downgraded or identified as delinquent in filings during the relief period
|SEC||Between March 1, 2020 and April 30, 2020||45-Days from original filing deadline||File an 8-K or 6-K by the date the filing was originally due providing the following information:
In addition to providing relief for filing deadlines, regulators have generally been supportive of companies choosing to hold virtual shareholder meetings instead of physical meetings in an effort to maintain social distancing and curb the spread of COVID-19. The CSA has said that it will issue formal guidance on virtual shareholder meetings as soon as possible, but that in the meantime issuers wishing to hold a virtual shareholder meeting should contact their principal regulator. In some instances, issuers may need to obtain court approval to hold a virtual shareholder meeting, including where their articles and by-laws don’t provide for meetings to be held by teleconference or other electronic means. Precedent from the courts is now available, as the British Columbia Supreme Court granted Telus Corporation an order on March 11, 2020 allowing them to hold their annual shareholders meeting virtually. The SEC has also provided a limited exemption from the requirement to furnish shareholders with proxy statements, annual reports and proxy solicitation material if certain conditions set out in the SEC press release linked below are followed.
To discuss the impact of COVID-19 on your public company, please contact any member of our Corporate Finance and Securities Group. For additional information regarding relief for filing deadlines and alternatives for shareholder meetings see the CSA’s press release dated March 18, 2020, the SEC’s press release dated March 4, 2020, and the OTC’s press release dated March 10, 2020.