Business Considerations for Companies Reopening During COVID-19

As the Province of Ontario continues the process of reopening, businesses are beginning to resume operations. Companies

are facing significant uncertainty and should be mindful of new conditions which will require them to adjust operations.

While there are several considerations spanning across sectors, this article focuses on the corporate considerations that

businesses should be aware of as they navigate reopening during COVID-19.

Government orders and new developments

First and foremost, businesses should continue to monitor and be aware of government orders. The provincial government is

continuously releasing new guidance with respect to reopening during COVID-19, and it is essential for businesses to

understand these developments in order to ensure compliance. Businesses should also assess eligibility for federal and/or

provincial relief programs. See here for a description of the federal relief programs available to date. Depending on the

nature of the business, there may also be industry specific guidelines to consider. Multijurisdictional companies have an

added layer of considerations as measures may vary across provinces and countries.

Corporate governance

There are several governance considerations companies should be mindful of as operations resume, some of which include:

implementing alternatives to in-person board meetings
considering amendments to management incentives
restructuring compensation packages for key personnel
managing shareholder dynamics
understanding the most appropriate means of raising capital

Cash flow management

Directors and company management should work together to monitor the business’ financial position, which may be impacted

by third parties. For example, where a supply chain is disrupted or accounts receivable are delayed. Businesses may need

to consider alternatives to maintaining cash flow, including drawing on available credit lines and corporate

restructuring, among other protective measures.

Material contracts

Businesses should undergo careful review of material contracts to evaluate if and how these agreements have been impacted

by COVID-19. Commercial leases, service agreements and insurance policies are some of the contracts which may require

review and renegotiation. For more details, please see our articles on real estate and insurance considerations during

COVID-19.

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