Measure to Apply During Declared State of Emergency
To minimize business disruptions during a state of emergency declared by the Governor, the Senate advanced legislation on Thursday to provide corporations greater flexibility in how they hold their shareholder meetings. It now heads to the Governor’s desk
While existing law permits shareholders of public and private corporations to participate in annual shareholder meetings remotely, the meetings must occur at a physical location. Under the bill (A-3861), the board of directors of a corporation would be allowed, at their discretion, to adopt guidelines and procedures to hold a meeting in part or solely by remote communication not at any one place or physical location.
Assembly Democrats Rob Karabinchak (D-Middlesex), Gordon Johnson (D-Bergen) and Majority Leader Lou Greenwald (D-Camden, Burlington), sponsors of the bill, issued the following joint statement:
“Allowing shareholders to conduct meetings virtually without having to be together in a physical location is critical in times of public emergency. Whether in support of social distancing efforts today to stem the spread of coronavirus or in the case of future state emergencies, this legislation is crucial to business continuity.
“Remote meetings also create an opportunity for broadened accessibility and participation in shareholder meetings to ensure that everyone can have a voice in the matters vitally important to the future of their company.”
The full Assembly approved the bill 64-0 on Monday March 16, 2020.