The recent Covid-19 global pandemic has created a unique situation for provincial and federal corporations. In particular, the implementation of social distancing orders which require individuals to remain 6 feet apart from one another at all times has caused significant problems for corporations conducting their regular course of business. In particular, these social distancing orders were especially tricky to navigate if a corporation’s Annual General Meeting (AGM) fell within the timelines of the social distancing orders.
This paper will discuss the most recent amendments to Federal and Provincial (Ontario) legislation and will aim to provide general guidance for corporations looking to host their AGM during the Covid-19 Pandemic.
What is the AGM?
The AGM is a yearly (or slightly longer) mandatory gathering of a corporation’s interested shareholders and board of directors where directors of the company present the annual report containing information for shareholders about the company’s performance in the last fiscal year (since the last AGM). The company’s performance may also be analysed, future strategy discussed, and shareholders or members are presented with an opportunity to question the board on their performance. It is additionally a time to elect the corporation's directors and address other administrative issues. All other business is generally considered to be special business, which may also be conducted at a special meeting of the shareholders. A special shareholders’ or members’ meeting and the AGM can, and often are combined for ease and time saving purposes.
The directors of a corporation may convene an AGM at any time, however proper notice must be provided. The time and mode of notice changes depending on what Act governs the corporation. The timeline however of hosting AGM’s whether under Ontarian or Federal governance remains exactly the same:
AGMs must be held within 15 months of the previous AGM and no more than six months after the organization's last financial year-end.
Outlined below are the notice periods for most governing Acts under Federal and Ontario legislation.