[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1257 Referred in Senate (RFS)]

  1st Session
                                H. R. 1257


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 23, 2007

     Received; read twice and referred to the Committee on Banking, 
                       Housing, and Urban Affairs

_______________________________________________________________________

                                 AN ACT


 
 To amend the Securities Exchange Act of 1934 to provide shareholders 
            with an advisory vote on executive compensation.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Shareholder Vote on Executive 
Compensation Act''.

SEC. 2. SHAREHOLDER VOTE ON EXECUTIVE COMPENSATION DISCLOSURES.

    (a) Amendment.--Section 14 of the Securities Exchange Act of 1934 
(15 U.S.C. 78n) is amended by adding at the end the following new 
subsection:
    ``(i) Annual Shareholder Approval of Executive Compensation.--
            ``(1) Annual vote.--Any proxy or consent or authorization 
        for an annual meeting of the shareholders (or a special meeting 
        in lieu of the annual meeting) occurring on or after January 1, 
        2009, shall provide for a separate shareholder vote to approve 
        the compensation of executives as disclosed pursuant to the 
        Commission's compensation disclosure rules (which disclosure 
        shall include the compensation discussion and analysis, the 
        compensation tables, and any related material). The shareholder 
        vote shall not be binding on the corporation or the board of 
        directors and shall not be construed as overruling a decision 
        by such board, nor to create or imply any additional fiduciary 
        duty by such board, nor shall such vote be construed to 
        restrict or limit the ability of shareholders to make proposals 
        for inclusion in such proxy materials related to executive 
        compensation.
            ``(2) Shareholder approval of golden parachute 
        compensation.--
                    ``(A) Disclosure.--In any proxy solicitation 
                material for an annual meeting of the shareholders (or 
                a special meeting in lieu of the annual meeting) 
                occurring on or after January 1, 2009, that concerns an 
                acquisition, merger, consolidation, or proposed sale or 
                other disposition of substantially all the assets of an 
                issuer, the person making such solicitation shall 
                disclose in the proxy solicitation material, in a clear 
                and simple form in accordance with regulations of the 
                Commission, any agreements or understandings that such 
                person has with any principal executive officers of 
                such issuer (or of the acquiring issuer, if such issuer 
                is not the acquiring issuer) concerning any type of 
                compensation (whether present, deferred, or contingent) 
                that are based on or otherwise relate to the 
                acquisition, merger, consolidation, sale, or other 
                disposition, and that have not been subject to a 
                shareholder vote under paragraph (1).
                    ``(B) Shareholder approval.--The proxy solicitation 
                material containing the disclosure required by 
                subparagraph (A) shall provide for a separate 
                shareholder vote to approve such agreements or 
                understandings. A vote by the shareholders shall not be 
                binding on the corporation or the board of directors 
                and shall not be construed as overruling a decision by 
                such board, nor to create or imply any additional 
                fiduciary duty by such board, nor shall such vote be 
                construed to restrict or limit the ability of 
                shareholders to make proposals for inclusion in such 
                proxy materials related to executive compensation.''.
    (b) Deadline for Rulemaking.--Not later than 1 year after the date 
of the enactment of this Act, the Securities and Exchange Commission 
shall issue any final rules and regulations required by the amendments 
made by subsection (a).

            Passed the House of Representatives April 20, 2007.

            Attest:

                                            LORRAINE C. MILLER,

                                                                 Clerk.