[Corrected Copy]

 

ASSEMBLY, No. 2883

STATE OF NEW JERSEY

213th LEGISLATURE

 

INTRODUCED JUNE 5, 2008

 


 

Sponsored by:

Assemblyman WAYNE P. DEANGELO

District 14 (Mercer and Middlesex)

Assemblyman UPENDRA J. CHIVUKULA

District 17 (Middlesex and Somerset)

Assemblyman ALBERT COUTINHO

District 29 (Essex and Union)

Assemblyman PATRICK J. DIEGNAN, JR.

District 18 (Middlesex)

Assemblyman JOSEPH VAS

District 19 (Middlesex)

Assemblywoman BONNIE WATSON COLEMAN

District 15 (Mercer)

Assemblywoman PAMELA R. LAMPITT

District 6 (Camden)

 

Co-Sponsored by:

Assemblywoman Rodriguez, Assemblymen Wisniewski, Moriarty, Assemblywoman Pou, Senators Gill and Sarlo

 

 

SYNOPSIS

     Provides that corporate by-laws may allow corporation to eliminate plurality voting for corporate directors.

 

CURRENT VERSION OF TEXT

     As introduced.

  


An Act concerning the election of corporate directors and amending N.J.S.14A:5-24.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    N.J.S.14A:5-24 is amended to read as follows:

     14A:5-24.  Elections of directors;  cumulative voting.

     (1)   Elections of directors need not be by ballot unless a shareholder demands election by ballot at the election and before the voting begins.  If the by-laws require election by ballot at any shareholders' meeting, such requirement is waived unless compliance therewith is requested by a shareholder  entitled to vote at such meeting.

     (2)   At each election of directors every shareholder entitled to vote at such election shall have the right to vote the number of shares owned by him for as many persons as there are directors to be elected and for whose election he has a right to vote, or, if the certificate of incorporation so provides, to cumulate his votes by giving one candidate as many votes as the number of such  directors multiplied by the aggregate number of his votes shall equal, or by  distributing such votes on the same principle among any number of such  candidates.

     (3)   Except as otherwise provided by the certificate of incorporation or by-laws, directors shall be elected by a plurality of the votes cast at an election.

(cf:  P.L.1973, c.366, s.17)

 

     2.    This act shall take effect immediately.

 

 

STATEMENT

 

     This bill allows a corporation to eliminate plurality voting for director elections in the by-laws of the corporation.  Under current law, a corporation can only eliminate plurality voting for director elections if that practice is allowed under its certificate of incorporation.

     The bill allows a corporation to eliminate plurality voting for the board if stated in its by-laws or amended by-laws, and without shareholder approval.  This bill would give New Jersey corporations greater flexibility in adopting majority voting provisions, or other voting schemes, regarding the election of directors.