[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 851 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 851

     To establish executive compensation and corporate governance 
 requirements for institutions receiving assistance under the Troubled 
                         Assets Relief Program.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 4, 2009

 Ms. Giffords introduced the following bill; which was referred to the 
                    Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
     To establish executive compensation and corporate governance 
 requirements for institutions receiving assistance under the Troubled 
                         Assets Relief Program.

    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 ``Executive Compensation and Corporate 
Governance Act of 2009''.

SEC. 2. EXECUTIVE COMPENSATION AND CORPORATE GOVERNANCE.

    (a) In General.--Section 111 of the Emergency Economic 
Stabilization Act of 2008 (12 U.S.C. 5221) is amended by adding at the 
end the following new subsections:
    ``(e) Across-the-Board Executive Compensation and Corporate 
Governance Requirements.--
            ``(1) Standards required.--Effective as of the date of the 
        enactment of the Executive Compensation and Corporate 
        Governance Act of 2009, and notwithstanding any provision of, 
        and in addition to any requirement of subsection (a), (b), or 
        (c) (other than the definitions in subsection (b)(3)), the 
        Secretary shall require any assisted institution to meet 
        standards for executive compensation and corporate governance 
        while any assistance under this title is outstanding.
            ``(2) Specific requirements.--The standards established 
        under paragraph (1) shall include--
                    ``(A) limits on compensation that exclude 
                incentives for senior executive officers of an assisted 
                institution which received assistance under this title 
                to take unnecessary and excessive risks that threaten 
                the value of such institution during the period that 
                any assistance under this title is outstanding;
                    ``(B) a provision for the recovery by such 
                institution of any bonus or incentive compensation paid 
                to a senior executive officer based on statements of 
                earnings, gains, or other criteria that are later found 
                to be materially inaccurate;
                    ``(C) a prohibition on such institution making any 
                golden parachute payment to a senior executive officer 
                during the period that the assistance under this title 
                is outstanding;
                    ``(D) a prohibition on such institution paying or 
                accruing any bonus or incentive compensation, during 
                the period that the assistance under this title is 
                outstanding, to the twenty-five most highly-compensated 
                employees; and
                    ``(E) a prohibition on any compensation plan that 
                would encourage manipulation of such institution's 
                reported earnings to enhance the compensation of any of 
                its employees.
            ``(3) Divestiture.--During the period in which any 
        assistance under this title to any assisted institution is 
        outstanding, the institution may not own or lease any private 
        passenger aircraft, or have any interest in such aircraft, 
        except that such institution shall not be treated as being in 
        violation of this provision with respect to any aircraft or 
        interest in any aircraft that was owned or held by the 
        institution immediately before receiving such assistance, as 
        long as the recipient demonstrates to the satisfaction of the 
        Secretary that all reasonable steps are being taken to sell or 
        divest such aircraft or interest.
            ``(4) Applicability to prior assistance.--Notwithstanding 
        any limitations included in subsection (a), (b), or (c) with 
        regard to applicability, the Secretary may apply the 
        requirements of and the standards established under this 
        subsection to any assisted institution that received any 
        assistance under this title on or after the date of the 
        enactment of the Executive Compensation and Corporate 
        Governance Act of 2009.
    ``(f) Board Observer.--The Secretary may require the attendance of 
an observer delegated by the Secretary, on behalf of the Secretary, to 
attend the meetings of the board of directors of any assisted 
institution that became an assisted institution on or after October 3, 
2008, and any committees of such board of directors, while any 
assistance under this title is outstanding.''.
    (b) Repeal of De Minimis Exception.--Section 111(c) of the 
Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5221(c)) is 
amended by striking ``and only where such purchases per financial 
institution in the aggregate exceed $300,000,000 (including direct 
purchases),''.
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