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Complying with Corporate Annual Meeting Requirements during the COVID-19 Quarantine

How do you hold a corporate annual meeting when the entire country is in lockdown? On the surface, it might seem like a simple matter of using a favorite video conferencing tool and perhaps checking to see if it’s been hacked. Annual meetings for corporations are more than get-togethers. They are legally mandated proceedings that could put the company at risk if proper rules are not followed.

Before you break out Zoom, Skype or Google Meet, you should be familiar with the state laws, corporate bylaws and SEC regulations that apply to your business. Here are some tips to get you started:

  • The SEC issues up-to-date guidelines on best practices — Corporations that issue stock are required to hold annual meetings in compliance with state law. These meetings have notice, publication, procedural and voting rules. There are numerous regulations stating how a corporation must go about changing the date, time and location of a meeting. In light of the restrictions related to COVID-19, the SEC has issued helpful guidance about how to comply with these regulations.
  • States differ on the validity of virtual meetings — Whether a virtual meeting fulfills your company’s legal obligation depends on its state of incorporation. For example, Delaware allows virtual meetings, with no particularly onerous requirements or regulations. New York accepts hybrid meetings where parties can join in online, but there must be an in-person component.
  • Don’t forget your bylaws — Check your corporate bylaws to determine if a meeting conducted through an online communication tool is allowed, and to see what types of notice might be required.
  • Take security precautions — With millions more people working and attending classes virtually, it is not surprising that many of our online video conferencing providers have struggled. Some have had latency or downtime issues, while others have suffered security breaches. Before you select a vendor for your virtual meeting, you will need to ensure that the platform is secure enough for confidential corporate discussions and appropriate for your particular needs, particularly if a large group of stockholders requires access.

Along with making security and technical arrangements, it’s wise to work with a knowledgeable attorney who can outline the federal, state and internal regulations that must be considered when adjusting the format of a corporate meeting in reaction to the coronavirus pandemic.

Contact an effective business lawyer for a consultation       

Law Offices of Donald W. Hudspeth, P.C. assists businesses with corporate matters and various other types of legal concerns. Please call 866-696-2033 or contact the firm online to make an appointment.

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Donald W. Hudspeth
Principal Attorney

Attorney Donald W. Hudspeth has more than twenty years’ experience practicing corporate and business law. Before attending law school, Mr. Hudspeth held a stock brokers license at the age of 21 and owned his own business at the age of 23. He was a business law professor at Arizona State University, West Campus, and has conducted classes and seminars for a number of higher institutions and organizations. Mr. Hudspeth has published two books on law and is the founder of the radio programs Law on the Edge and Law Talk.

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Mark S. Hamilton

About Attorney Mark S. Hamilton has experience handling all aspects of civil and commercial litigation in federal, state, and tribal courts at the trial and appellate levels. Practice Areas Business litigation Commercial litigation Education University Of Hawaii Wm. S. Richardson School Of Law, Juris Doctor - 2002 University Of Hawaii, Master Of Arts in Asian…

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