On January 19, 2022, the SEC updated its prior guidance on the handling of shareholder proposals at virtual or hybrid shareholder meetings. SEC Rule 14a-8(h) requires proponents or their representatives to show up at meetings to submit their proposals. However, in a nod to the seemingly endless presence of COVID-19, the Division of Corporation Finance has again reminded companies that, “to the extent feasible under state law, [they should] provide shareholder proponents or their representatives with the ability to present their proposals through alternative means, such as by phone.”
The Division has also reminded companies that a proponent’s inability to attend a meeting due to COVID-19 will not enable the company to exclude a proposal from the proponent the following year, noting that “the staff would consider this to be ‘good cause’ under Rule 14a-8(h) should issuers assert Rule 14a-8(h)(3) as a basis to exclude a proposal submitted by the…proponent…”.
In addition, if you are accustomed to routinely providing courtesy paper copies of filings to a reviewer or other SEC staff member, think again. On January 21, 2022, the SEC issued a very brief announcement stating that the Divisions of Corporation Finance and Investment Management “request that paper courtesy copies no longer be sent as a matter of course” and “should only be furnished at the request of the staff.”
Please direct any questions or observations to Gunster securities law and corporate governance practice leader Bob Lamm.
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This publication is for general information only. It is not legal advice, and legal counsel should be contacted before any action is taken that might be influenced by this publication.
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Gunster, Florida’s law firm for business, provides full-service legal counsel to leading organizations and individuals from its 11 offices statewide. Established in 1925, the firm has expanded, diversified and evolved, but always with a singular focus: Florida and its clients’ stake in it. A magnet for business-savvy attorneys who embrace collaboration for the greatest advantage of clients, Gunster’s growth has not been at the expense of personalized service but because of it. The firm serves clients from its offices in Boca Raton, Fort Lauderdale, Jacksonville, Miami, Orlando, Palm Beach, Stuart, Tallahassee, Tampa, Vero Beach, and its headquarters in West Palm Beach. With over 200 attorneys and 200 committed support staff, Gunster is ranked among the National Law Journal’s list of the 500 largest law firms and has been recognized as one of the Top 100 Diverse Law Firms by Law360. More information about its practice areas, offices and insider’s view newsletters is available at www.gunster.com.
