(a) In General- The Emergency
Economic Stabilization Act of 2008 (division A of Public Law
110-343) is amended by adding at the end the following:
`TITLE IV--AUTO INDUSTRY
FINANCING AND RESTRUCTURING
`SEC. 401. PURPOSES.
`The purposes of this
title are--
`(1) to clarify and
confirm the authority and facilities to restore
liquidity and stability to domestic vehicle
manufacturers in the United States; and
`(2) to ensure that
such authority and such facilities are used in a
manner that--
`(A) results in a
viable and competitive domestic automobile
industry that minimizes adverse effects on the
environment;
`(B) enhances the
ability and the capacity of the domestic
automobile industry to pursue the timely and
aggressive production of energy-efficient
advanced technology vehicles;
`(C) preserves and
promotes the jobs of American workers employed
directly by the domestic automobile industry and
in related industries;
`(D) safeguards
the ability of the domestic automobile industry
to provide retirement and health care benefits
for the industry's retirees and their
dependents; and
`(E) stimulates
manufacturing and sales of automobiles produced
by automobile manufacturers in the United
States.
`SEC. 402. PRESIDENTIAL
DESIGNATION.
`(a) Designation- The
President shall designate one or more officers from the
Executive Branch having appropriate expertise in such
areas as economic stabilization, financial aid to
commerce and industry, financial restructuring, energy
efficiency, and environmental protection (who shall
hereinafter in this title be collectively referred to as
the `President's designee') to carry out the purposes of
this title, including the facilitation of restructuring
necessary to achieve the long-term financial viability
of domestic automobile manufacturers, who shall serve at
the pleasure of the President.
`(b) Additional Persons-
The President or the President's designee may also
employ, appoint, or contract with additional persons
having such expertise as the President or the
President's designee believes will assist the Government
in carrying out the purposes of this title.
`(c) Participation by
Other Agency Personnel- Other Federal agencies may
provide, at the request of the President's designee,
staff on detail from such agencies for purposes of
carrying out this title.
`SEC. 403. BRIDGE
FINANCING.
`(a) In General- The
President's designee shall authorize and direct the
disbursement of bridge loans or enter into commitments
for lines of credit to each automobile manufacturer that
submitted a plan to the Congress on December 2, 2008
(hereafter in this title referred to as an `eligible
automobile manufacturer'), and has submitted a request
for such loan or commitment. Nothing in this section
shall preclude the President's designee from authorizing
and directing the disbursement of bridge loans or
entering into commitments for lines of credit to other
entities.
`(b) Amount of Assistance-
The President's designee shall authorize bridge loans or
commitments for lines of credit to each eligible
automobile manufacturer in an amount that is intended to
facilitate the continued operations of the eligible
automobile manufacturer and to prevent the failure of
the eligible automobile manufacturer, consistent with
the plan submitted on December 2, 2008, and subject to
available funds.
`SEC. 404. RESTRUCTURING
PROGRESS ASSESSMENT.
`(a) Establishment of
Measures for Assessing Progress- Not later than February
1, 2009, the President's designee shall determine
appropriate measures for assessing the progress of each
eligible automobile manufacturer toward transforming the
plan submitted by such manufacturer to the Congress on
December 2, 2008, into the restructuring plan to be
submitted under section 405(b).
`(b) Evaluation of
Progress on Basis of Restructuring Progress Assessment
Measures-
`(1) IN GENERAL- The
President's designee shall evaluate the progress of
each eligible automobile manufacturer toward the
development of a restructuring plan, on the basis of
the restructuring progress assessment measures
established under this section for such
manufacturer.
`(2) TIMING- Each
evaluation required under paragraph (1) for any
eligible automobile manufacturer shall be conducted
at the end of the 15-day period beginning on the
date on which the restructuring progress assessment
measures were established by the President's
designee for such eligible automobile manufacturer.
`SEC. 405. SUBMISSION OF
PLANS.
`(A) IN GENERAL-
Beginning on the date of any disbursement under
the facility, the President's designee shall
seek to facilitate agreement on any
restructuring plan to achieve and sustain the
long-term viability, international
competitiveness, and energy efficiency of an
eligible automobile manufacturer, negotiated and
agreed to by representatives of interested
parties (in this title referred to as a
`negotiated plan') with respect to any eligible
automobile manufacturer.
`(B) INTERESTED
PARTIES- For purposes of this section, the term
`interested party' shall be construed broadly so
as to include all persons who have a direct
financial interest in a particular automobile
manufacturer, including--
`(i) employees
and retirees of the eligible automobile
manufacturer;
`(v)
automobile dealers; and
`(2) ACTIONS OF THE
PRESIDENT'S DESIGNEE-
`(A) IN GENERAL-
For the purpose of achieving a negotiated plan,
the President's designee may convene, chair, and
conduct formal and informal meetings,
discussions, and consultations, as appropriate,
with interested parties of an eligible
automobile manufacturer.
`(B)
CLARIFICATION- The Federal Advisory Committee
Act shall not apply with respect to any of the
activities conducted or taken by the President's
designee pursuant to this title.
`(b) Restructuring Plan-
Not later than March 31, 2009, each eligible automobile
manufacturer shall submit to the President's designee a
restructuring plan to achieve and sustain the long-term
viability, international competitiveness, and energy
efficiency of the eligible automobile manufacturer (in
this title referred to as the `restructuring plan') in
accordance with this section. The President's designee
shall approve the restructuring plan if the President's
designee determines that the plan will result in--
`(1) the repayment of
all Government-provided financing, consistent with
the terms specified in section 408, or otherwise
agreed to;
`(A) to comply
with applicable fuel efficiency and emissions
requirements;
`(B) to commence
domestic manufacturing of advanced technology
vehicles, as described in section 136 of the
Energy Independence and Security Act of 2007
(Public Law 110-140; 42 U.S.C. 17013); and
`(C) to produce
new and existing products and capacity;
`(3) the achievement
of a positive net present value, using reasonable
assumptions and taking into account all existing and
projected future costs, including repayment of any
financial assistance provided pursuant to this
title;
`(4) the ability to
rationalize costs, capitalization, and capacity with
respect to the manufacturing workforce, suppliers,
and dealerships of the eligible automobile
manufacturer;
`(5) proposals to
restructure existing debt, including, where
appropriate, the conversion of debt to equity, to
improve the ability of the eligible automobile
manufacturer to raise private capital; and
`(6) a product mix and
cost structure that is competitive in the
marketplace.
`(c) Extension of
Negotiations and Plan Deadline- Notwithstanding the time
limitations in subsection (b), the President's designee,
upon making a determination that the interested parties
are negotiating in good faith, are making significant
progress, and that an additional period of time would
likely facilitate agreement on a negotiated plan, and
upon notification of the Congress, may extend for not
longer than 30 additional days the negotiation period
under subsection (b).
`SEC. 406. FINANCING FOR
RESTRUCTURING.
`Upon approval by the
President's designee of a restructuring plan, the
President's designee may provide financial assistance to
an eligible automobile manufacturer to implement the
restructuring plan.
`SEC. 407. DISAPPROVAL AND
CALL OF LOAN.
`If the President's
designee has not approved the restructuring plan at the
expiration of the period provided in section 405 for
submission and approval of the restructuring plan, the
President's designee shall call the loan or cancel the
commitment within 30 days, unless a restructuring plan
is approved within that period.
`SEC. 408. TERMS AND
CONDITIONS.
`(a) Duration- The
duration of any loan made under this title shall be 7
years, or such period as the President's designee may
determine with respect to such loan.
`(b) No Prepayment
Penalty- A loan made under this title shall be
prepayable without penalty at any time.
`(c) Information Access-
As a condition for the receipt of any financial
assistance made under this title, an eligible automobile
manufacturer shall agree--
`(1) to allow the
President's designee to examine any books, papers,
records, or other data of the eligible automobile
manufacturer, and those of any subsidiary,
affiliate, or entity holding an ownership interest
of 50 percent or more of such automobile
manufacturer, that may be relevant to the financial
assistance, including compliance with the terms of a
loan or any conditions imposed under this title; and
`(2) to provide in a
timely manner any information requested by the
President's designee, including requiring any
officer or employee of the eligible automobile
manufacturer, any subsidiary, affiliate, or entity
referred to in paragraph (1) with respect to such
manufacturer, or any person having possession,
custody, or care of the reports and records required
under paragraph (1), to appear before the
President's designee at a time and place requested
and to provide such books, papers, records, or other
data, as requested, as may be relevant or material.
`(d) Oversight of
Transactions and Financial Condition-
`(1) DUTY TO INFORM-
During the period in which any loan extended under
this title remains outstanding, the eligible
automobile manufacturer which received such loan
shall promptly inform the President's designee of--
`(A) any asset
sale, investment, contract, commitment, or other
transaction proposed to be entered into by such
eligible automobile manufacturer that has a
value in excess of $100,000,000; and
`(B) any other
material change in the financial condition of
such eligible automobile manufacturer.
`(2) AUTHORITY OF THE
PRESIDENT'S DESIGNEE- During the period in which any
loan extended under this title remains outstanding,
the President's designee may--
`(A) review any
asset sale, investment, contract, commitment, or
other transaction described in paragraph (1);
and
`(B) prohibit the
eligible automobile manufacturer which received
the loan from consummating any such proposed
sale, investment, contract, commitment, or other
transaction, if the President's designee
determines that consummation of such transaction
would be inconsistent with or detrimental to the
long-term viability of the eligible automobile
manufacturer.
`(3) PROCEDURES- The
President's designee may establish procedures for
conducting any review under this subsection.
`(e) Consequences for
Failure To Comply- The terms of any financial assistance
made under this title shall provide that if--
`(1) an evaluation by
the President's designee under section 404(b)
demonstrates that the eligible automobile
manufacturer which received the financial assistance
has failed to make adequate progress towards meeting
the restructuring progress assessment measures
established by the President's designee under
section 404(a) with respect to such recipient;
`(2) after March 31,
2009, the eligible automobile manufacturer which
received the financial assistance fails to submit an
acceptable restructuring plan under section 405(b),
or fails to comply with any conditions or
requirement applicable under this title or
applicable fuel efficiency and emissions
requirements; or
`(3) after a
restructuring plan of an eligible automobile
manufacturer has been approved by the President's
designee, the auto manufacturer fails to make
adequate progress in the implementation of the plan,
as determined by the President's designee,
the repayment of any loan
may be accelerated to such earlier date or dates as the
President's designee may determine and any other
financial assistance may be cancelled by the President's
designee.
`SEC. 409. TAXPAYER
PROTECTION.
`(1) IN GENERAL- The
President's designee may not provide any loan under
this title, unless the President's designee, or such
department or agency as is designated for such
purpose by the President, receives from the eligible
automobile manufacturer--
`(A) in the case
of an eligible automobile manufacturer, the
securities of which are traded on a national
securities exchange, a warrant giving the right
to the President's designee to receive nonvoting
common stock or preferred stock in such eligible
automobile manufacturer, or voting stock, with
respect to which the President's designee agrees
not to exercise voting power, whichever the
President's designee determines appropriate; or
`(B) in the case
of an eligible automobile manufacturer other
than one described in subparagraph (A), a
warrant for common or preferred stock, or an
instrument that is the economic equivalent (as
determined by the President's designee) of such
a warrant in the holding company of the eligible
automobile manufacturer, or any company that
controls a majority stake in the eligible
automobile manufacturer, whichever the
President's designee determines appropriate.
`(A) IN GENERAL-
The warrants or instruments described in
paragraph (1) shall have a value equal to 20
percent of the aggregate amount of all loans
provided to the eligible automobile manufacturer
under this title. Such warrants or instruments
shall entitle the Government to purchase--
`(i) nonvoting
common stock, up to a maximum amount of 20
percent of the issued and outstanding common
stock of--
`(I) the
eligible automobile manufacturer; or
`(II) in
the case of an eligible automobile
manufacturer, the securities of which
are not traded on a national securities
exchange, a holding company or company
that controls a majority of the stock
thereof (in this section referred to as
the `warrant common'); and
`(ii)
preferred stock having an aggregate
liquidation preference equal to 20 percent
of such aggregate loan amount, less the
value of common stock available for purchase
under the warrant common (in this section
referred to as the `warrant preferred').
`(B) COMMON STOCK
WARRANT PRICE- The exercise price on a warrant
or instrument described in paragraph (1) shall
be--
`(i) the
15-day trailing average, as of the day
before the date on which any commitment to
provide a loan was entered into, of the
market price of the common stock of the
eligible automobile manufacturer which
received any loan under this title; or
`(ii) in the
case of an eligible automobile manufacturer,
the securities of which are not traded on a
national securities exchange, the economic
equivalent of the market price described in
clause (i), as determined by the President's
designee.
`(C) TERMS OF
PREFERRED STOCK WARRANT-
`(i) IN
GENERAL- The initial exercise price for the
preferred stock warrant shall be $0.01 per
share or such greater amount as the
corporate charter may require as the par
value per share of the warrant preferred.
The Government shall have the right to
immediately exercise the warrants.
`(ii)
REDEMPTION- The warrant preferred may be
redeemed at any time after exercise of the
preferred stock warrant at 100 percent of
its issue price, plus any accrued and unpaid
dividends.
`(iii) OTHER
TERMS AND CONDITIONS- Other terms and
conditions of the warrant preferred shall be
determined by the President's designee to
protect the interests of taxpayers.
`(3) APPLICATION OF
OTHER PROVISIONS OF LAW- Except as otherwise
provided in this section, the requirements for the
purchase of warrants under section 113(d)(2) of the
Emergency Economic Stabilization Act of 2008
(division A of Public Law 110-343) shall apply to
any warrant or instrument described in paragraph
(1), including the antidilution protection
provisions therein.
`(b) Executive
Compensation and Corporate Governance-
`(1) IN GENERAL-
During the period in which any financial assistance
under this title remains outstanding, the eligible
automobile manufacturer which received such
assistance shall be subject to--
`(A) the standards
established by the President's designee under
paragraph (2); and
`(B) the
provisions of section 162(m)(5) of the Internal
Revenue Code of 1986, as applicable.
`(2) STANDARDS
REQUIRED- The President's designee shall require any
eligible automobile manufacturer which received any
financial assistance under this title to meet
appropriate standards for executive compensation and
corporate governance.
`(3) SPECIFIC
REQUIREMENTS- The standards established under
paragraph (2) shall include--
`(A) limits on
compensation that exclude incentives for senior
executive officers of an eligible automobile
manufacturer which received assistance under
this title to take unnecessary and excessive
risks that threaten the value of such
manufacturer during the period that the loan is
outstanding;
`(B) a provision
for the recovery by such automobile manufacturer
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 automobile manufacturer making any
golden parachute payment to a senior executive
officer during the period that the loan is
outstanding;
`(D) a prohibition
on such automobile manufacturer paying or
accruing any bonus or incentive compensation
during the period that the loan is outstanding
to the 25 most highly-compensated employees; and
`(E) a prohibition
on any compensation plan that would encourage
manipulation of such automobile manufacturer's
reported earnings to enhance the compensation of
any of its employees.
`(4) DIVESTITURE-
During the period in which any financial assistance
provided under this title to any eligible automobile
manufacturer is outstanding, the eligible automobile
manufacturer may not own or lease any private
passenger aircraft, or have any interest in such
aircraft, except that such eligible automobile
manufacturer 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 manufacturer immediately before
receiving such assistance, as long as the recipient
demonstrates to the satisfaction of the President's
designee that all reasonable steps are being taken
to sell or divest such aircraft or interest.
`(5) DEFINITIONS- For
purposes of this subsection, the following
definitions shall apply:
`(A) SENIOR
EXECUTIVE OFFICER- The term `senior executive
officer' means an individual who is one of the
top five most highly paid executives of a public
company, whose compensation is required to be
disclosed pursuant to the Securities Exchange
Act of 1934, and any regulations issued
thereunder, and non-public company counterparts.
`(B) GOLDEN
PARACHUTE PAYMENT- The term `golden parachute
payment' means any payment to a senior executive
officer for departure from a company for any
reason, except for payments for services
performed or benefits accrued.
`(c) Prohibition on
Payment of Dividends- Except with respect to obligations
owed pursuant to law to any nonaffiliated party or any
existing contract with any nonaffiliated party in effect
as of December 2, 2008, no dividends or distributions of
any kind, or the economic equivalent thereof (as
determined by the President's designee), may be paid by
any eligible automobile manufacturer which receives
financial assistance under this title, or any holding
company or company that controls a majority stake in the
eligible automobile manufacturer, while such financial
assistance is outstanding.
`(d) Other Interests
Subordinated-
`(1) IN GENERAL- In
the case of an eligible automobile manufacturer
which received a loan under this title, to the
extent permitted by the terms of any existing vested
legal rights and the Constitution, any other
obligation of such eligible automobile manufacturer
shall be subordinate to such loan, and such loan
shall be senior and prior to all obligations,
liabilities, and debts of the eligible automobile
manufacturer, and such eligible automobile
manufacturer shall provide to the Government, all
available security and collateral against which the
loans under this title shall be secured.
`(2) APPLICABILITY IN
CERTAIN CASES- In the case of an eligible automobile
manufacturer referred to in paragraph (1), the
securities of which are not traded on a national
securities exchange, a loan under this title to the
eligible automobile manufacturer shall--
`(A) be treated as
a loan to any holding company of, or company
that controls a majority stake in, the eligible
automobile manufacturer; and
`(B) be senior and
prior to all obligations, liabilities, and debts
of any such holding company or company that
controls a majority stake in the eligible
automobile manufacturer.
`(e) Additional Taxpayer
Protections-
`(1) DISCHARGE- A
discharge under title 11, United States Code, shall
not discharge an eligible automobile manufacturer,
or any successor in interest thereto, from any debt
for financial assistance received pursuant to this
title.
`(2) EXEMPTION- Any
financial assistance provided to an eligible
automobile manufacturer under this title shall be
exempt from the automatic stay established by
section 362 of title 11, United States Code.
`(3) INTERESTED
PARTIES- Notwithstanding any provision of title 11,
United States Code, any interest in property or
equity rights of the United States arising from
financial assistance provided to an eligible
automobile manufacturer under this title shall
remain unaffected by any plan of reorganization,
except as the United States may agree to in writing.
|
|
