Financial support for sports organizations during COVID-19

Anne: Okay. Thank you. Hello everyone. My name is Anne Merklinger. I work with Own the Podium. I hope you are all staying safe and well. Welcome to a Gowling WLG webinar on Financial Support For Sport Organizations During COVID-19. I'm pleased to introduce Roberto Aburto. He's a partner in Gowling WLG's Ottawa office, practicing in municipal law and litigation. Roberto's practice includes complex litigation matters and alternative dispute resolution. Roberto also manages numerous client relationships at Gowling WLG, including various sport organizations. Roberto has also sat on numerous of sports organizations and is currently the National Support Commissioner for Life Saving Support in Canada. Roberto is a former captain of Wilfrid Laurier University varsity swim team and also coached swimming at the club in university, both in Canada and the United States. Roberto, thanks very much to you and your team for hosting this webinar and I'll turn it over to you now.

Roberto: Thank you so much for the introduction, Anne, and welcome everybody. I know we've got people from across the country here today and appreciate having you all here. We hope you're all keeping well and stay healthy. I've got my headphones on to make sure that we're avoiding participation from my dog as I'm sure everybody has had enough opportunities to meet people's dogs and cats in the last few weeks. So we'll try and keep things as focused as possible.

As a starting point, I just like to introduce you to our panel. Jahmiah Ferdinand-Hodkin is a litigation partner in Gowling WLG's Ottawa office and she is certified in risk management. She's a member of Gowling WLG's sports law team and represents athletes, organization and corporations in litigation and dispute resolution. She has appeared at all level courts in Ontario as well as tribunal panels and other boards. Jahmiah has never competed on a national level but has played competitive baseball, basketball and volleyball and has competed in cycling, running, cross country skiing and triathlons. She's also coached volleyball, swimming and trained athletes for Iron Man triathlons and other triathlon competitions.

Colin Green is a corporate tax partner in Gowling WLG's Ottawa office. His clients include registered charities, not for profits and for profit entities. He assists clients in pursuing their corporate objectives, both tax driven and otherwise. Arriving at his undergraduate, Colin discovered he was too short at 6'2" to play offside on the Queen's Varsity volleyball team and he stumbled into a love of ultimate frisbee and has competed for Canada at the national level. As an interesting anecdote, Colin met his partner through ultimate frisbee. I met my partner through a life guard competition so, certainly, very, very imbedded sport in each of our households.

This may also be an introduction for many of you to Gowling WLG. Gowling WLG has over 700 professionals across Canada and over 1,500 professionals around the world. We are servicing clients across the nation. Gowling WLG are the legal advisors and first sponsor for the Birmingham 2022 Common Wealth Games. Gowling WLG is counsel for the consortium that is putting in a bid for the City of Hamilton for the 2030 Common Wealth Games. A few housekeeping points, and I know people have submitting points already, which is great. The slide deck will be made available after the webinar and the webinar is being recorded so it will be posted on Gowling WLG's COVID-19 website. So if you Google Gowling WLG and COVID-19 there is a ton of resources in there. We will be joining those resources. And there's a lot of great resources including another webinar in the employment context and we'll talk a little bit. We're going to do our best to get these posted within 48 hours. If you have questions throughout, please submit your questions through the Q&A function. You'll see at the bottom of your screen there's a chat and  Q&A function. We'll see how it goes and we'll do our best to consolidate it for sort of a major question or two that has broad meaning, but otherwise what we're going to do is take the questions and prepare a questions and answers document and send it to everybody who's registered. We'll do our best to answer questions. The more fact specific, the more challenging it may be. And again, as there's over 1,200 people registered for this webinar, we've got people from  varying organizations from single person, small local club to large NSO's and so we're going to try to keep things relevant to everybody, as much as possible, which may mean that's a little bit more general. Our contact information is included at the end of the slide deck and on our website, so again, we're happy to follow up with inquiries there. We're going to cover a lot of ground today. The federal programs reflect our best information at this point in time but it is a moving target, again substantial information released on Wednesday afternoons so, lucky we have Colin Green and the tax group to weave through that list, and it will be great to see what sense we can make of that today and see if we provide some clarity. But it's critical that you're checking the sources and seeking qualified legal advice. There is no one size fits all solution so this is not intended to be legal advice but it should helpfully get you a starting point. And again, we are a webinar from a law firm so, again, we have to have our legal disclaimer up there. It's current as of April 3, 2020, but again please check. We're focusing as much as possible on the Federal level. There are different nuances in different jurisdictions. We'll talk a little bit about some jurisdictions, including Ontario, but we're trying to keep it as broad and high level as possible and focused on the Federal programs. With that said, I'll turn it over to Colin Green.

Colin: Good morning everyone. Sorry, good afternoon. Well, it's good morning to our West Coast affiliates. It's a pleasure to be speaking with you today. As you can see from the slide we have a lot of material to go through. Just as a brief aside, before we start, it's always interesting when you have the collision between sport and professional lives. I appreciate the number of teammates and sporting colleagues at the national level that I've played with that have touched based that are on the ... capacities. As you'll see here on our first slide we have five main areas. And really these are the announcements that we have. This is were those unique times we put aside our critiques of government policies and we focus on the base mechanics. What's being released? What's being offered? What's the shortest quickest way that we can help you, our clients, ... to your pockets to keep as many employees in the chairs as possible, or, to be appropriate, working from home safely and soundly as possible. Because really that's what these programs are designed to do. In many instances these programs are incomplete. It's not a critique of government. That's simply a statement of fact. 48 hours removed from having the front end release of number two on this list, which is one of the most comprehensive and wide ranging and complex pieces and we don't even have the legislation. So I really appreciate that there are going to be questions. We will release information with the updates as we get them. The other thing that is very interesting is that this is one of the first times that we've seen complete crossover where they're applying these programs, not just for profit but to not for profit. And given that these are income tested, this will create a number of really interesting challenges. Let's proceed.

Work sharing program. What this is, is this actually a 3 way agreement. A multi-player agreement, if you will, between employees that work for you the employer and service Canada. In this agreement, the entities agree to assist with layoffs when there's a temporary decrease in  business activity. This is a traditional pool. We've always seen the government do  this, take this and expand it, update it and try and make it more COVID roll ready for the instability of this to come. But was this does is it provides EI benefits to eligible employees, who agree to reduce their normal working hours and share the available work while the employer recovers. Work sharing units are therefore a group of employees, with similar job duties, who agree to reduce the hours and share the work. In terms of what the government has told us for the COVID-19 measures, we know that this is March 15, 2020 through. So we have a full year of access in the program and we've seen an extension to the maximum duration of the program, 76 weeks instead of 38 weeks. We seem to waive mandatory cooling off period. What this means is that this program is one of the first ones that effectively ready on a fairly immediate basis. Now I say fairly immediate basis, because please note that, there is still a 30 day period. And a highlight for you that I've put together a calendar in terms of the various time pieces that the various programs are slated to be available but we'll also make an effort to flag timing as we move forward. What this means is that businesses that have only been in for even 1 year, as opposed to 2, are still eligible. And the thought for this is to use a mechanism to allow the government to assist employees to stay with their organization, to keep control over their organization group. Here when we look at the eligibility requirements, for employers, we see year round in business for 1 year. We see private businesses help publicly, sorry, ... not for profit organizations and we have to have at least 2 employees in a work sharing unit. If we proceed to slide 8, what does not apply? This does not apply to a labour dispute, a seasonal shortage of work or pre-existing or reoccurring production slow down. A decrease in business activity due to recent increase in the sizeable work force. So what the government is telling us with this is, is this is not meant to be used as seasonal component. Now that said, from speaking to government officials we understand that this is going to be unique time in government social assistance program. We understand that, frankly, the benefit of the doubt will be extended to the vast majority of the program applicants that apply, however, if the government subsequently realized that someone was being nefarious in their application approach, they will respond fairly negatively. In terms of their approach.

Let's review the eligibility requirements for employees. Again, this is for year round permanent full staff or part time employees that are needed to carry on the day to day functions, the core staff of the business. These are employees who are eligible to receive EI benefits and they agree to reduce normal working hours by the same percentage and to share available work. And this underscores a point that I think will flow through all aspects of our presentation today. Because these are unique times. Because these things are hitting us so quickly and we're trying to respond effectively on the fly, the law as, up to this point, isn't really built for hairpin turns when it comes to changes to not for profit organizations, or profit organizations, with respect to the inter-relation  between their employees, the staff and the government. Typically these things take time. Planning is required. So the more time and planning that we can buy you, and the more time and planning that you can bring, in terms of planning ahead for these components, the more stabilized your organization will be. Now, obviously we recognize that's a challenge with the fact that the government hasn't released full information yet. But it's still something we want to keep in mind. The second component to this is that employee communications. I think we can see, anecdotally, by looking at the success of various government entities, as they have communicated throughout this health crisis, the government entities that have been transparent, forthcoming with information have received the best ... and we would apply the same principal here. Were you, as an organization, are able to review your available tactical options, to settle on an employee route map, to look at your funding sources and to then communicate, at least some portion of that, with an employee communication program. Typically we've seen that those are the institutions, and those are the areas where there has been far greater upkeep, and there is more of a sense of cohesiveness. Because that is important. As we move down this road we will run into employment walk ons, such as we have put aside for today, such as reasonable notice or severance components, and we can mitigate the application of those to just get to the right solution. Bringing everyone together to create a comprise, where we have good initial and early employee communications. So I would really encourage clients, and we would encourage our clients, to be thinking about their communication plan and their program application review. How does this fit within the scope of your organization? Next slide.

So, who is ineligible? Let's discuss. Seasonal employees and students hired for summer co-ops, casual or on-call employees, employees needed to help generate work or who are essential to the business. Senior management, exec levels, outside sale reps and technical employees engaged in private development. Of interest, also employees that have more than 40%25 of the voting shares. So again, conceptually this isn't meant for your top level senior management team. This is in view for rank and file employees at this ... and this is our first starting program that we're reviewing because it's the one that already exists on the books. So the changes required we're the most limited that the government has to deal with. Let's talk about the application process. Employers must submit applications 10 prior days to their requested start date. They have to submit two documents. The list of the documents there. These can be ready found off of the canada.bc.ca site. We have links throughout the program and slides are available. You'll be able to access them yourselves or a quick Google will ... the same. And you'll see that they even provide contact information. So on our next slide we've provided them, although I will tell you from our efforts, time to contact the relevant government authorities, I respect that they're trying their best, we should anticipate that it will be challenging to get timely response times from our government colleagues as they are effectively suffering through a deluge, in terms of applicants. Slide 13.

So what are the core recommendations that we have here in terms of this? Have a plan. Early communication and we note that work sharing is less aggressive than termination. A lot of employees who have considered this, sorry, employers have considered this, because it lets them mitigate some of the risk that come with employee termination. You don't want to lose some of your best core staff, if necessary. You want to maintain those personal assets so that you can maintain, number one a sense of cohesive togetherness, but also so that you use employees to rebound, insofar as possible and as aptly as possible, coming out of the down turn. So there are definite tactical benefits to maintaining your control of your employee pool and this program can be something that many employers consider in terms of looking at. It's an option. So, again, this is only applicable to employees earning less than $63,500.00, otherwise there will be a clawback to EI. Work sharing does not reduce eligibility for regular EI so while this product and program is ongoing you maintain some EI options. There's a 30 day waiting period for the program to take effect. Again, assuming the application is approved. So our message here, to individuals, organizations, has been to consider your tactical options, to note the calendar dates that apply for you, and then to make sure that you're applying early. In many instances ...,  frankly, a ... between the accountant or CFO, your internal organization, and whoever your particular counsel is, even on a limited basis to make sure, strategically, your pieces are in place and your communication profile is in place.

Okay. As we have a lot of material to consider, let's proceed to number two. This is the 75%25 temporary wage subsidy, or CEWS, for lack of a better word, and we are 48 hours removed from everyone here knowing effectively the same amount of information that our tax team knew about it. We are working off of fresh ground. I'm sure that most people are familiar with the background but April 1, Finance Minister Bill Morneau released the details. This is effectively meant as an increase to the previous 10%25 subsidy program that was put in place. We'll get to the details of that in a second. I think the point here is that this is an example of a Federal government, within effectively a 12 day period, realizing that their previous announcement of 10%25 wage remuneration support wasn't going to cut it, coming back to the drawing board, effectively scrapping the previous program, and then in live time releasing government policy planning points. In effect, this is unprecedented, at least in my life time in terms of these forms of policy announcements, timelines and scope. So when we look at CEWS we see it's a 71 billion dollar subsidy, intended to support workers, to maintain employment relationships and to reduce claims on the employment insurance regime. Again, I think what our government is signaling to us with this, is that they want employees to be protected, insofar as possible, so that organizations can reduce their stress and in so doing, reducing the stress of their employees, maintain near full employment, insofar as possible, and let every individual focus on making sure they're flattening the curve. Slide.

So, CEWS is different, as we've indicated from the previously announced 10%25 wage subsidy. CEWS is a cash subsidy paid by the government to employer a reduction of payroll remittances, sorry, versus a reduction of payroll remittances, which was previously envisaged. One thing I'd like to highlight right off the bat. With CEWS note that once the application period opens, everything is processed as cash in advance. There is that dead period in the middle where organizations are still going to be needing to have a funding strategy in place. To make sure that they are able to account and realize their financial obligations. We will review some of the loan strategies that the government has announced, but even those are reset by timing differences, timing gaps. I would acknowledge, without looking at our question list, that we've had a high volume for profit, not for profit individuals asking us what form of policy programs we are seeing to account for that immediate gap. And to be honest with you, we don't have any silver bullet magic answers. Instead what we're telling people is to review their planning thoroughly, to make sure that they're getting a grasp and full grip on their application programs, to be modeling with their CFO and then seeing what other form of exterior funding organizations they can approach. Some of the applies, financial institutions have been working with multiple clients on this as well, but again there going to get hit by a deluge of applications. So whatever you're going to be doing, we recommend that it be done early. So again, eligible employers can apply for both ..., which is what we're talking about. The 75%25 wage reduction, in addition to the 10%25 subsidy, however, if you receive the one it will reduce the other. So there's no immediate benefit to receiving one versus the other. The key difference that I would want to highlight for you is the 10%25 wage subsidy program, the previous program, was very limited in application. It provided for a maximum of $25,000.00 per employer. By contrast CEWS does not have an employer max. If you've got 500 employees, provided you meet the requirements, this can apply to everybody. So again, these programs are unparalleled in terms of their scope and region application for how quickly they've enrolled it. Next slide.

Eligible employers, and we'll talk about that in a second, are given a temporary wage subsidy of 75%25 of their remuneration paid for a period of 3 months up to a max of $847.00 a week, or 75%25 of the employees pre-crisis remuneration. Now again, this can actually cover more than 100%25 of the eligible remuneration if you already reduced to pre-crisis level amounts, but we'll come back to that. That's just something that we expect the government to release further guidance. The wage subsidy itself is backdated to March 15, 2020. Slide 19.

Note that arms length employees are limited to $847.00 a week, or 75%25 of the pre-crisis weekly remuneration. Let's talk about eligible remuneration. What is included in this concept? This includes salary wages, other remuneration but excludes severance pay, value and stock option benefits, value of non-cash benefits and salaries paid to employee where the employee is eligible under CERB. We'll talk about CERB in a second, in a little while. My apologies. There is a lot of acronyms. That's why I'm trying to provide the outline of the acronym. If you look at the top of this slide, you'll see CEWS again, the temporary wage subsidy. CERB, by contrast is the program that has been put in place that also applies to independent contractors. I want to bold and highlight that because that, in itself, is unique as well. This is one of the first time we've seen policy programming for independent contractors. So again, if an employee is eligible under CERB, there is some crossover but we expect once everything is all said a done, there will be a clawback, dollar for dollar in terms of how this applies. The answer to the anticipated question, we don't have the government policy planning on that yet, just because it hasn't been released. So I do apologize for being an incomplete state but hopefully people will cut us a little slack on that one. Slide 21.

Again, there is no overall cap, at least as currently announced, on the amount of the subsidy that an employer may claim. An employer may claim the subsidy in respect of remuneration paid to new employees as well. So CEWS is remuneration is paid to employees, and it does not extend to independent contractors. Again, there is a separate program for that, less generous in terms of its application, but still definitely something that will certainly be appreciated by many Canadians. So it's important to get a grasp on our separate categories, program, that we had available. Let's talk about the type of eligible employers. Again, this is very broad. CEWS is available to any type of employer in Canada, whether an individual, partnership corporation, not for profit or charity, and it excludes public sector entities, municipalities, crown corps, universities, college, school or ... So if you're an NFP, or registered charity, this is for you, in terms of its application. Let's look at the qualification requirements. Employers must asset to a reduction of gross revenue of 30%25 in March, April and May. Now those are broken out as separate categories and so this is foreseen as being to apply on a month by month basis for the 3 entities. Additional rules will be developed, we've been assured, or the measure of revenue reduction for charities and NFP. We understand the criteria when we adapted to look for all sources of revenue. Here we anticipate, from speaking to groups, that we will see it be a question of reducing, funding or revenue all in. The intent is for it cover NFP's, NFP's and registered charities, are clearly not running for profit business models, but as of yet we don't have the full release of this information. What we are suggesting, though, is that you should proceed, again on a best efforts basis, to be gathering the information in advance to show the drop off from that revenue. You want to be in a position for when this opens, and we'll talk about that in a bit, to have that information in hand, to have reached out to your connecting accountant, or your CFO, and to have gathered that information so you're not caught flat footed when this does go live. So again, employers are to take a best efforts approach to top up employee salary to pre-crisis levels, but again, this appears to be a moving target. It's flexible. And we anticipate that employers will be granted latitude. If you're showing you went to 75%25, but no further, but tried to save every employee that you could, we're hard pressed to anticipate seeing a very critical Federal government approach but we just don't know.

In terms of the application process, again, this is the employers and not the employees that apply for the program. Here we see that there'll be three claiming periods. You'll not I put March 15 in red because that is a backdated application for once it goes live. The associated reference period is there for March 2020, for April 2020 and we presume for May 2020. In each one month window you would show you have corresponding drop in revenue which is necessary to qualify your organization for this Federal subsidy. Further query, without wanting to speculate in matters of health, if this crisis does extend or continue to mature, as we say in the tax world, query whether or not you'll see an extension of these government programs. Right now we just don't know. What we do know is they're modeled and based on some of the Scandinavian approaches, that we've seen, and those ones have been open ended. So there is reason for speculation that they may be open ended in these instances.

Applying for CEWS. The most important piece of advice that we can give clients here is, number one, we presume that all clients are using the My Business Account portal to CRA. They have ready and easy access and there's no issues at that process. If there are, sort them out now, would be our first recommendation. Two, we've been told that the timeline for release is anywhere from 3 to 6 weeks. So from a cash modeling perspective, this means that you could be looking at anywhere from 5 to 7 weeks for the release of this information. This could take us into the first week of May. So for a cash modeling perspective, you as an organization are looking for at least 5 weeks, if not more to prudent and conservative, of cash modeling to make sure you're able to make ends meet. Again, the goal of CEWS is to put employers in a position to maintain full employment, or to re-hire laid off employees, but there is going to be that middle gap while they release the program. Again, the challenge, as you'll see are laid out here with respect to the lag of the payment in wages and receipt of the subsidy, there's a requirement for finance. So with that we can proceed into looking at a few of the other components.

CEWS is obviously going to be included in the employers income but once it's received you will receive a reduction for the amounts paid through employees. I recognize that sound of immediate relevant to RC, sorry, to registered charity or not for profit, but depending upon your filing status, income balances, hitting your sheets, could actually be a significant issue. So just note that there's an obvious deduction for the amount that's flowed through to employees. The next step of the employers is to make your registered for the account and to assemble the records to demonstrate 30%25 reduction of gross revenues and the account of remuneration paid to employees. We don't have information right now in terms of a form of accounting or basics that are going to be applied to this but what we are telling our clients is to make sure you can be comprehensive in showing a drop off. If there's been more than a 30%25 drop off, all the better to make sure that you can document it, clearly and succinctly, to avoid any potential ... issues. Again, with directors being prepared for NFP's, we suggest simply showing a drop in funding right now is a first strike.

There are multiple unknowns of this program in terms of timing, clarity and scope, but what we do know is we're 3 to 5 weeks away from hopefully seeing the program roll out and we anticipate that this may be one of the times that the Federal government is going to, we're cautiously optimistic they'll hit this deadline, just so you have the number, literally millions of Canadians that are going to be needing to advantage, via their employers, for their organizational components. So while we apologize for the lack of clarity we will update as we receive more information. This brings us to our third point.

The Canada Emergency Response Benefit, CERB. So you recall earlier in the acronym soup that we were trying to navigate our way through in talking about CEWS, which we just talked about, we also mentioned CERB. That's this. I would invite listeners, guests, to be thinking about this as effectively the independent contractor program. And that's what CERB is really geared to. So here we've been told that applications open April 6, that applicants reapply every 4 weeks and that the benefits are taxable. Eligible applicants for CERB are Canadian residents, at least 15 years old, they stopped working because of COVID-19, or eligible for employment insurance benefits. And again, here we may see some crossover where CERB is being used as a stop gap, newest employees or former employees, are applying for EI and they had income of at least $5,000.00 in 2019, ... prior to that and they're expected to be without employment, or self-employment income, for at least 14 consecutive days. So again, if we're in a position where we're seeing a stop gap release of employees, and potential reclaiming of employees during a CEWS period, that is something that we see as viable. There are questions in terms of how the clawback amounts, or crediting of these amounts will work. Currently we don't have full release of this information but we are doing our best to get these information release answers from the government through a variety of sources, rest assured.

We've discussed the applicable elements. We've discussed the fact that there's a $5,000.00 income requirement, again, this is from multiple sources. Employment, self-employment, maternity, parental benefits, EI. Big picture, this is a program that also captures the gig economy. It captures your independent contractors, it captures people that were between jobs, so many instances we may see CERB as a frontline response and it is viewed by multiple applicants to get the program assistance that they need. Slide.

So how do we apply online with My CRA account, or the automated phone service? Now, we'll note that we recommended the online account. Again, just in our experience this is by far the better approach, it's the quicker approach. In addition to this, and as extension, we would be suggesting to people to make sure their online account access is currently ready. In many instances there's a delay in terms of getting access to. So you're worried about whether or not you, or your employees, are going to be able to access this, I think part of your communication plan is thinking about how you want to message to employees to making sure that they'll use. Because they will likely need their My Account for any wide number of government programs that are going to be applied for. So you can probably subtly suggest to your employees they have this without telegraphing to them there may some form of reduction, in terms of what's occurring. It's all about the messaging. Next slide.

So here you'll see that we have a, I don't want to say Hunger Games lottery, but effectively a rotating lottery application starting for the year of birth of the application term. We don't have full information from our Federal government in terms of the application term but we anticipate that they'll deal with the deluge of applications by volume in terms of date of birthdays, by month, for the application through, and given it's been pressed enough, we're hopeful that they will process all of the applications within a relatively short period of time.

Okay, this brings us to our fourth component. The Canada Emergency Business Loan Accounts. And again, the philosophy underlining this, I think you will probably all agree with, is the government is releasing social programming designed via CERB, which we just looked at to help independent contractors or others on a short term cash supply, they're looking at employment subsidy via the employer, again they put the employer position of funding through to the employees, through CEWS, that's very helpful as well, but in all instances ... there's this gap. It's a question of what do we with the gap. And here we've taken the first business loan line of credit that we've seen the most of our queries about but there are other programs that are out there. What we see through the business loans account, the Emergency Business Loans account, is this is indicated as  $40,000.00 loan, guaranteed by the government, interest free for the first year. And again, the purpose is to help operating costs during a period where revenues have been temporarily reduced. We anticipate that this may be expanded but certainly we think that the underlying, although not perhaps directly spoken to purpose of this, is to try and help cover off the gap between this and the various other government funding protocols. Now that's an excellent concept in terms of what's there, our concern is in the application and the timing of the application, for the manner in which it will be addressed. And here you'll see that there is a repayment forgiveness component of up to $10,000.00. What we do know is the eligible requirements for NFP's and small businesses, is they must demonstrate between 50,000 and 1 million in payroll for 2019. So if you're above a million dollars in payroll then you would need to look at one of the larger or more expanded financial government loan programs. Here we've seen outreach to BDC and EDC, those are Business Development Bank of Canada or the Exports Development Bank of Canada, but to look  at also through contacting your financial institution. And the reason I say that is because the government here has clearly taken a bit of a separation approach, in terms of saying to contact your appropriate financial institution which well then in turn contact BDC or EDC, where appropriate. What's interesting to this is we're seeing, effectively, an employment partnership between our government and it's goalpost for social programming. So we're seeing the employer, for example, be put in the position of managing the CEWS, the 75%25 wage component, the employer applies, goes to the government, receives the funds, then there disbursed. Or, in this instance, the emergency loan account, again, we're seeing the employer, the NFP, approach it's existing financial institution and then the existing financial institution assisting with the management and the mitigation of that. The challenge, of course, is that I don't think, and this is totally fair to their credit, I don't think the financial institutions, how could they, were fully ready more than a few days ago or a week ago, or really even a heads up that this application process is going to work in this manner. I think we're seeing all of those FI's wrestling. They're doing their absolute best to get ahead of these application requirements, in terms of sorting out funding requirements. So again, what are our recommendations? Not to be beat a dead horse, but if you're the CFO, or if you're in charge of your plan for your organization, what's your line of credit status? What's your communication outreach to your existing financial institution? We would suggest that you be doing outreach to your existing FI, to be mentioning these programs and to indicating your desire to be a part of it. Having the line of credit, frankly from a credit tax earned perspective, it's far better to have it and not need it than the inverse. So we're definitely encouraging our clients to be outreaching to their appropriate financial institution contact. If you don't have an appropriate financial institution contact, again, we would suggest get ahead of this curve insofar as possible, now is the time for that outreach. As challenging as it may be, get that contact, and see what you can work out to make sure your pieces in place. So, again, the timeline is department of finance has advised the program will roll out in 3 weeks after March 27. So we're looking at something towards the mid to late April. Our hope is that individuals, businesses and NFP's, will have this time to contact their FI, to get their applications protocols in place so that everything is set up to roll through. We don't know if this will be feasible. The goal is definitely to have this applied in such a way such that the goal for people to get through their portion of April on a bridge component advance financing, but than a couple of weeks after that to have these funds come through. Again, I'm not saying that to alarm parties. Our thought process here is providing your information so that people can appropriately map out their sources of funding. The timing that goes with those sources of funding, and then to construct their own messaging to employees, in their own strategic tactical approach.

One last component. Again, this is not going to be of immediate import to our NFP guests, however, many NFP's do run sub, or side for profit entities, as funding side components. If you are doing that we would just highlight that there have been significant extensions tacked across the board. We've seen that in terms of the June filing for payment for corporate tax, for business for GST, so just note there's significant latitude has been provided. So in conclusion, completing briefly, here's a calendar snapshot. April 9 for CERB applications opening, payments ... May 1 work sharing applications open. Middle of May, CEWS for government releases and than equally, middle of May the Canada Emergency Business Loans Account. So in conclusion, we're looking at this as seeing that we know that there's this gap in funding. And we know that every organization needs a plan, including employee action plan and communication plan. And ... a multi-layered tax employment advice is critical. We're providing this as a starting point to provide you, our guests, with some of the tools for that and we hope that it admitted interest. Thank you.

Jahmiah:    Alright. Thanks, Colin. So I'm going to address beyond the financial programs that Colin has talked about. The other tools that you might have to address the other financial obligations that you're facing. So whether you're a local or international level, we appreciate that you've planned, likely for some years, for events that were scheduled to take place in 2020. Take the Olympic and Paralympic games as an example. We understand that you've used exceptional resources already, financial and man power. You've sent coaches, trainers and athletes to the selected training sites. You made all of the bookings for all the training facilities, qualification events and the games themselves. And now you're faced with the challenge of how to cancel, or indefinitely postpone, the bookings that you have made. Be it the hotels, the facility rentals, the catering, the food services, equipment rentals, all to ensure that you're not losing tens of thousands of dollars, if not more. So while this is true, to those involved at the international level, I'm sure it's equally true for organizations working locally, Provincially and nationally, in addressing all of the events, facility rentals and registration fees and all those questions that you're likely facing. So our advice to you is very simple, in respect to all of this, and I think it's consistent with the advice that Colin's provided already. And that is act now. And try to come to agreement with your contracting parties. One of the greatest messages that I've heard come through this pandemic is that we're all in this together. Many people are prepared to try and help others work through these times were they can. So act now, speak to stakeholders and see what you can do to try and resolve the financial obligations that so many of your organizations are facing.

So where do we suggest that you start? We suggest you look to the contracts, themselves. There are multiple clauses in the contracts that might assist you with deferring or resolving your payment obligations. The main one that we're going to focus on today is a clause called force majeure. Otherwise known as the act of God clause. Essentially what these do is identify which of the contracting parties owns the problem. So I've put example clause up on the screen for you to see. I don't recommend using this clause in your contracts going forward. You would want to use a clause that's tailored to you and addresses additional issues. However, this sample clause is only to illustrate what I mean by a force majeure clause. Let me try and give you an example of how this would typically be used. If we think of something like rowing, Team Canada sources their boats from Hudson Boat Works. They're getting new boats in preparation for the Olympics. 8 months before the Olympics a tornado hit Hudson's manufacturing plant and the boats are destroyed. Hudson can't fulfill it's obligations to supply boats to Rowing Canada on schedule as a result of this event. If they had used the sample force majeure clause that we have on the screen, it could apply to afford Hudson leeway to provide the boats a few months later so that the whole contract doesn't fall through. If we're talking about an Ontario contract, and the force majeure clause wasn't in the contract and Hudson could not deliver the boats on schedule, Hudson would have no protection in this situation despite it being entirely out of its control. The contract would be frustrated, which is a concept that we'll discuss a little bit later on, and brought to an end. Ultimately, that wouldn't benefit either of the parties in trying to get what they had originally contracted for.

So how can we apply force majeure clauses here? I suggest it could assist you in navigating your obligations to pay for your hotels, pay for your equipment, pay for the food that you've already ordered at the originally scheduled time and either end the obligation entirely, or, defer payment until competition resumes. The first consideration in determining your potential recourse is the jurisdiction. So where are your contracts made? Or what does the contract stipulate as being the governing jurisdiction. The contract may have a clause that states that all dispute will be resolved in Ontario and governed by the laws of  Ontario, meaning that the jurisdiction and governing law is Ontario. Some contracts aren't quite so clear in the way that they describe it. So further analysis is obviously required. This jurisdiction and governing point is exceptionally important. If we take force majeure, as an example, there's a huge difference in the advice that you'll receive if you're contract is governed by Ontario law versus Quebec law. In Quebec the civil code establishes that there's a force majeure clause to be read into the contract. On the other hand if in Ontario there's no force majeure clause in the contract, than you're simply out of luck and you'll have to deal with the effect of not being able to satisfy the contract. Which goes back to the concept that I talked about previously of frustration.

So once you've determined the jurisdiction and the governing law, there are four elements that are going to help you figure out whether force majeure could help you. Does the event qualify as force majeure? Is performance impossible? Could you have foreseen and mitigated the risk? And how do we fix this? 

So when we look at COVID-19, I'll go through these questions with you, generally, but I can't really give you a definite answer as to force majeure will help you relieve your potential contractual obligations without actually reviewing your contracts because every contract is different. And it really does boil down to how your contract was worded and what's the triggering event that brings into play this force majeure requirement. So the first question is does this qualify as a force majeure event? Well, what is the event that we're talking about? It has to be the starting point. In COVID-19, is COVID-19 itself the force majeure? It has been defined by the WHO as a pandemic. So some force majeure clauses include pandemics in the list of triggering events. So that might be the triggering event that you want to use as your reason that this clause has to be triggered. But it's also considered a public health emergency. It's possible that COVID-19 itself is not what actually caused you to be unable to fulfill your contract. If that's the case it may be as a result of a government decision to restrict on non-essential travel or to close down the borders. Some force majeure clauses do actually include government action with restriction and regulation as a triggering event to allow for force majeure clauses to apply. The question you therefore have to ask is whether any scenarios that fit your particular circumstances, identified in your contract, that could allow it to apply which would relieve you from your obligations. The second question is what's the cause? So understanding the cause as to why it becomes impossible for you to fulfill the contract is important because without it being impossible, then force majeure will not apply. It can't be inconvenient or improbable. It actually has to be impossible. Slide 9.

If you did see this coming, so the question now is foreseeability. Did you see this coming and how could you have done anything, or could you have done anything, earlier to have fixed it? At the outset of my presentation I said that our advice was simple and that was to act now. One of the main reasons for this advice is because of this foreseeability requirement. There is a very brief window to exercise a force majeure clause and that window is rapidly closing. The news is constant in terms of the increasingly severe restrictions being imposed across the world everyone is eyes wide open in terms of how this is snowballing. We know that the Olympics and Paralympics are being postponed. How long have we known? Was it foreseeable that we might not have been able to use or hotel reservations and food before the decision was made? Could we have cancelled reservations before the games were actually postponed themselves? If not did we act immediately after the games were postponed to take action? Have we tried to mitigate our losses and respond responsibly? All those questions lead into that idea of foreseeability. Lastly, think about what you want. What is your goal in terms of trying to exercise a force majeure clause. Before you get too creative your contract will likely specific the relief that's available to you. So often times that's a relaxation of the time period obligation. There might also be financial solutions available to you. But these clauses are not applied lightly. It'll be an uphill battle. It will be an uphill battle that you will lose if you sit on it too long. In addition to timing affecting the foreseeable aspect of the provision, some force majeure clauses actually have strict timelines in terms of providing notice of your intention to rely on them. So if you fail to adhere to the notice provisions then you'll unlikely be able to carry out and rely on the clause. So you're best option is to review your contract, find a lawyer in the contract's jurisdiction to come up with a plan as to how you'll negotiate a resolution so that you can avoid a substantial financial loss to your organization, should you have to pay despite not using the services.

If force majeure doesn't work there's also the idea of frustration which we briefly talked about earlier. Frustration is different than a force majeure clause. It doesn't mean that you've written anything into your contract. It's not a nicely wrapped solution towards law in aspect of your contract. It's essentially like a parachute. If you're contract is the burning plane you just have to pull the pin out. When a contract is frustrated the entire contract blows up. In force majeure you continue to work within the contract with the other party. You just excuse the party from fulfilling one aspect of the contract. With an agreed upon resolution. Frustration is different. Frustration, everything is complete, with respect to the contract. So I appreciate that all of these issues that we've been throwing at you may feel like a bit of a firing range. There are so many risks that COVID-19 has raised and many solution options are available to you. To help you organize your path through this crisis I propose that you make use of the basic risk management tool kit to structure yourself and your organization for this week, this month and this quarter. The structure will assist you in evaluating the interplay between all of these issues and prioritizing them based upon urgency and potential impact. So if you've not already done so, please try these steps.

First, identify the risks. All of them. There are many tools to help you identify risks. You can bring in an outside consultant. One of the biggest ways I help clients is by working through identifying what their risks are as opposed to the smaller task of actually determining how to fix them. The reason for this is that identifying risks is the cornerstone to be able to address them. Evidently, if you haven't spotted them you'll be in no position to respond proactively. Sometimes having an outside set of eyes ask questions and evaluate the situation will help you identify risks that you have not even considered. Second, analyze them. What's the likelihood of the risk materializing and what is the consequence? Where you have a high likelihood and significant consequence risk that's obviously an extreme risk that requires aggressive treatment. However, a low likelihood, low consequence risk may simply be something that we can accept and absorb and move forward. Evaluate. Which risks require additional treatment and in what order? Use your analysis to prioritize and organize your path forward. And then treatment. What mechanisms do you want to employ now as we progress through this crisis? Do we want to avoid, accept, transfer or reduce? Something that is too high stakes we may simply avoid the risk. If we can purchase insurance, if we can add a clause in a contract to transfer the risk, then perhaps we move forward with those mitigation steps in order to actually influence the risk. Treatment doesn't have to be static though. So identify, analyze, evaluate and treat in a cyclical fashion as we move through this crisis in order to continue to move forward in an organized way.

How do we suggest is the best approach to succeeding through this crisis? Act now. Discuss with stakeholders, determine their flexibility. If you don't ask them to defer your hotel reservations you'll never know if they'll agree. Start those conversations early. Obtain expert advice. I'm not just saying this self-servicing, obtain a lawyer, legal advice, I'm also suggesting talk to your other trusted advisors. Talk to your accountants. Talk to your brokers. They might be able to assist with you identifying other areas that can assist you through this process. Review the various government funded support programs that Colin talked about previously. And also communicate with your peers and your colleagues. They're living through this to and they can be an invaluable source of support throughout this entire crisis. Thank you so much for taking the time to listen and I'll turn it over to Roberto.

Roberto: Thanks, Jahmiah. Yeah, that communication with others for organizations, I mean certainly in the legal industry we're doing that. I know I was participating in a virtual meeting of law firms, over 10 lawyers in Ottawa, yesterday and it's interesting to sort of hear some of the best practices. It's certainly great advice there. Jahmiah has spoken about force majeure clauses, generally. Just want to talk about other sort of high level things to be evaluating when you're putting together your game plans to identify sources of revenue and minimizing liabilities. You should be reviewing all of your major commercial contracts that may be impacted, for a number of reasons. One, you want to make sure that you're not being surprised by future liabilities. Two, you want to see if you can potentially mitigate future liabilities, and three, there may be opportunities to optimize revenue. A little bit of rejigging of timing and locations of things may still be able to work. Highly contextual. It's going to depend on each circumstance, each specific contract. Might be sponsorship agreements, facility rentals, supplier contracts, solutions like deferrals or renegotiations of agreements, these are things you should be considering to see whether there's an opportunity to mitigate issues. Ensure that you're establishing this game plan. This is where your board members may be super helpful. Putting on my volunteer hat, sitting on a number of boards, I know that sometimes I am able to provide advice, specifically, on some issues that are relevant to the organization, or if not, I can at least point them in the right direction. So leverage the resources in your community and on your boards.  For ..., again, there's complicated international components to some of these contracts so, again, make sure that you're consulting with people in the correct jurisdictions.

Now putting on my real estate and municipal hat, which is my primary area of practice, real property is often, in addition to human resources, one of the largest budget items for an organization. If your organization owns property make sure that you're communicating with your lenders, communicating with your tenants and if you're a tenant, communicate with your landlords. There's been a whole host and variety of outcomes in the market. Lots of media reporting in terms of rent deferrals, rent abatement, business as usual. It's all contextual. You certainly want to make sure that you're considering both the short term and your cash flow, but also the long term. That's where communication is critical and, again, there can be varieties of outcomes in the markets and don't overplay your hand as well. Make sure that you've got a thoughtful strategy. With respect to municipal taxes, sometimes those are the tenant's liability. Sometimes they lay with the landlord. In that context you want to consider those as a possible mechanism. In that context there are a number of Provinces and municipalities that have deferral programs, and may be on the next slide. If your organization owns the property, ensure that you're reviewing your rights there. Again, sometimes it lands with the landlord, sometimes these rights sit with the tenant, and make sure you're evaluating with the potential opportunities are there. Sometimes the classification of a property may be an issue. With the deferral programs, they're different in each municipality or Province. So in Ontario, for example, the education component has been deferred and that's led to sort of an ad hoc approach from different municipalities around the Province. On the high level, again, speak with your legal advisors or your tax consultants to be sure you're taking advantage of rebate programs and all your appeal rights, to the extent that they exist in each jurisdiction.

With respect to employment issues, again, I'm putting on the governance hat here and speaking as someone who sits on a number of boards. I'm not an employment lawyer. But my role is to match folks with the right resources. We have a webinar on managing your work force through crisis. This link will be available when we circulate this slide deck following the presentation and in includes topics such as temporary layoffs, Employment Standards Act, job protected leaves and remote work. Again, contextual analysis required but there's lots of tools there available on our website and, again, as Colin indicated, critical that you've got a plan on that front. Further on the governance side, annual general meetings is a discreet issue that quite a few organizations are running into as a challenge. With the cancellation of large events, many organizations have cancelled their upcoming AGM's, but it's still important that organizations comply with applicable legislation. For Federally incorporation not for profits, which many of these organizations are, they must hold their annual general meetings within 6 months of the end of their financial year end. Often it's December 31^st that's the financial year end so those AGM's need to be held by June 30^th each year. The AGM's must also occur within the 15 months of the previous AGM to comply with the Federal legislation. So for Federal not profits, first, the meeting must be called under the Act, if you're going to do a virtual AGM. Secondly, the bylaws of the not profit corporation must provide for virtual meetings. And third, the median platform used for this virtual meeting must  permit all participants to communicate adequately with each other. So, here in this context, Zoom, it's not two way communication but there is that capability and there are other tools that may be available, so that may be an option. There's also an option to apply to Corporations Canada for an extension to hold an AGM at a later date. Again, ideally, if you can just comply but look at all your options. Different considerations, again, under different legislation. There's been a variety of approaches that different organizations have taken. There's a British Columbia Supreme Court decision that granted an order for Telus to hold a virtual AGM due to COVID-19. It's not a not for profit but it's just demonstrating there's different options out there. Certainly, you'd want to look and see if there is more cost efficient solutions as a starting point. But it's just showing that you need to be creative, potentially, in some contexts. I'm sure the big question is what do you do if your organizations bylaws do not permit virtual meetings. This may be the case, particularly if there are older bylaws or bylaws that will prevail without any legal input. In the short term, you should evaluate deferral as an option and evaluate what is permitted under the bylaws and long term look at revising the bylaws to permit virtual AGM's. Again, the mechanisms very significantly in how you've read your bylaws and whether that may fit into a short term solution. That will certainly depend and it's ... highly contextualized as we've seen with a lot of other of these complicated issues.

There's a lot of uncertainty right now with boards and I know that everybody here is putting out fires right now. I'm not going to get into any detail. I see we're just past 1 o'clock so I don't want to hold people late. But governance, if it's something that's been on your to do list for a long time and you get to a point where employees may be laying idle because operations are just unable to go forward, there may be an opportunity to keep people busy and sort of get some work done on that front. You certainly want to make sure you're respecting your governance mechanisms that are in place. But, again, if there is extra capacity of human resources which may occur sometimes when we're not able to be on the slopes at the end of the seasons, or be on the pool deck, or out rowing, this may be something that's an opportunity. Whenever looking at governance, critical that there's collaboration between all stakeholders, including the board, including staff, coaches. So just make sure that there's a holistic approach there. Again, we could do a whole presentation on this but just for today I just want to put that thought in your head as you're creating your plans around this crisis.

That concludes our presentation. I don't want to be outdone by Colin. I do want to give a shoot out to the swim coaches and all the swimming folk. It was great to see them register. So, shoot out to everybody there and than you everybody for taking the time. As we mentioned we are recording this webinar so it will be available on our website, typically within 48 hours. We will be doing our best to provide a consolidated question and answers. I saw some of them were fairly specific so we'll try and keep it as broad as possible. Lots of context so we're happy to have discussions. Our services can vary from high level strategy to full implementation. And, again, it just depends on each issue. Don't hesitate to contact us. Here's our contact info and on that note, stay healthy everyone.