On December 4, 2024, the Canadian Securities Administrators (“CSA”) published a temporary exemption from the requirements to deliver proxy-related materials for annual shareholder meetings (“AGMs”) as a result of the ongoing postal strike in Canada. This relief has been implemented through Coordinated Blanket Order 51-931 Temporary Exemption from Requirements in National Instrument 51-102 Continuous Disclosure Requirements and National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer to Send Certain Proxy-Related Materials During a Postal Strike (the “Blanket Order”). The Blanket Order is effective until January 31, 2025, but does not extend to special meetings.
Blanket Order
Issuers with upcoming shareholder meetings are facing difficulties with delivering proxy-related materials due to the postal strike. Electronic delivery is only available where a shareholder has consented to such method of delivery. The use of couriers results in substantial additional costs, and certain couriers are also unable to process high-volume deliveries and/or deliver to post office boxes.
The Blanket Order provides temporary relief for reporting issuers other than investment funds from the requirements to send proxy-related materials to shareholders, provided that the following conditions are satisfied:
- the postal strike is ongoing;
- each matter to be submitted to the meeting is an “annual matter”, which includes: (i) receiving and considering financial statements; (ii) fixing the number of directors; (iii) electing directors; (iv) appointing auditors; (v) the approval of security-based compensation plans; and (vi) non-binding advisory votes on the issuer’s approach to executive compensation;
- as of the date of the news release referred to below, no matter to be voted upon: (i) requires approval by a special resolution; (ii) requires disinterested shareholder approval, including minority approval under Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions; (iii) is a matter for which a holder of any class of securities has a right of dissent or appraisal; and (iv) has been, to the best of the issuer’s knowledge, contested, or would reasonably be considered to be a contentious matter, by a shareholder;
- the issuer promptly files a copy of the proxy-related materials on SEDAR+;
- the issuer issues and files a news release on SEDAR+ that contains the following information: (i) the date, time and location of the meeting; (ii) a brief description of each matter to be voted upon; (iii) a statement that electronic versions of the proxy-related materials have been filed and are available on SEDAR+ and are posted in a prominent location on the issuer’s website; (iv) a statement that the issuer has satisfied all of the conditions of, and is relying on, the Blanket Order; (v) an explanation of how shareholders may request a copy of the proxy-related materials and their individual control number and how to submit proxies or voting instruction forms (“VIFs”) in a manner that does not require the postal service (including applicable deadlines); and (vi) an email address and telephone number that may be used to request proxy-related materials;
- on the date that the news release is issued, the issuer posts the proxy-related materials and news release on its website. Information on how to access materials and submit proxies or VIFs must also be posted in a prominent location on the issuer’s website; and
- the issuer must comply with its delivery obligations under securities law as soon as practicable, and in any event no later than the third day after the date on which the postal strike ends and regular postal service in Canada resumes, unless: (i) regular postal service does not resume at least seven days before the meeting date; or (ii) in respect of a particular shareholder, the issuer used other means to deliver the proxy-related materials to the holder.
An issuer that does not have a website cannot rely on the Blanket Order. While the Blanket Order provides relief from certain delivery requirements under National Instrument 51-102 Continuous Disclosure Requirements and National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer, it does not provide relief from the delivery requirements under corporate law.
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