On April 7, 2020, the SEC modified its March 13th guidance described here, addressing the effect of the coronavirus (COVID-19) on annual shareholder meetings.
The modified guidance notes that issuers encountering delays in printing and mailing a full set of their physical proxy materials may choose to furnish their proxy materials instead through the “notice-only” delivery option permitted by Exchange Act Rule 14a-16. Some issuers may not be able to meet every requirement under Rule 14a-16, such as providing 40 days’ notice of the electronic availability of proxy materials. The SEC encourages affected issuers to use all reasonable efforts to make sure that shareholders receive information in a timely manner to make informed investment decisions. Where delays are unavoidable, issuers may rely on Rule 14a-16 without meeting all notice and timing aspects of the rule so long as they provide shareholders enough time to review the proxy materials and exercise their voting rights prior to the annual meeting. Issuers would need to announce a change in delivery method in the same manner in which they would announce a change in meeting time, date or location. This includes (1) issuing a press release announcing the change, (2) filing the announcement as definitive additional soliciting materials on EDGAR; and (3) taking reasonable steps to inform intermediaries of the changes.
The modified guidance also (a) clarifies that its guidance to issuers who wish to change the time, date or location of a meeting after mailing and filing definitive proxy materials applies to special meetings as well as annual meetings, and (b) provides guidance to investment companies on changes to their shareholder meetings.
The full text of the modified guidance is available here.
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