TRENTON – The Senate Commerce Committee advanced several bills, including prescription eyedrop coverage and shareholder meetings.
S2326/A3123: This legislation, passed unanimously, revises the law concerning shareholder derivative proceedings. The bill repeals the law concerning actions brought in the right of a corporation by a shareholder, and supplements the “New Jersey Business Corporation Act” with a new set of regulations concerning derivative proceedings.
Under the bill, the regulations governing derivative proceedings and shareholder class actions are applicable only if the certificate of incorporation makes it applicable.
The bill raises the value of plaintiffs’ shareholdings required to avoid the need to post security for a fee award, which had not been increased since 1968, to $250,000.
The bill also adds the judicially developed concept that the shareholder plaintiffs must continue to hold the shares throughout the derivative proceeding.
S2327/A3050: This legislation, passed unanimously, provides for remote participation in a meeting of shareholders – including voting – to the extent that the corporation’s board of directors authorizes it.
S2328/A3049: This legislation, passed unanimously, allows business combinations between domestic corporations and interested stockholders.
The bill amends the definition of “resident domestic corporation” to provide that it does not include an issuer of voting stock which is organized under the laws of this state but neither maintains its principal executive offices in this state nor has significant business operations located in this state if that corporation’s board of director adopts an amendment to its bylaws electing not to be a resident domestic corporation within 90 days from the effective date of this bill.
The bill also allows a resident domestic corporation to engage in a business combination with an interested stockholder if the transaction which caused the person to become an interested stockholder was approved by the corporation’s board of directors prior to the stock acquisition date. (Generally, an “interested stockholder” is an owner of 10 percent or more of the outstanding voting stock of the corporation.)
S2336/S2166/A3080: This bill requires health insurers that provide coverage for prescription eye drops to provide health benefits coverage for expenses incurred for a refill of prescription eye drops.
It passed unanimously.