To require major corporations receiving Federal aid related to COVID-19 to make annual payments of equity to employees of the corporation while such aid is outstanding, and for other purposes.

I 116TH CONGRESS 2D SESSION H. R. 6851 To require major corporations receiving Federal aid related to COVID–19 to make annual payments of equity to employees of the corporation while such aid is outstanding, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MAY 13, 2020 Ms. OCASIO-CORTEZ introduced the following bill; which was referred to the Committee on Financial Services A BILL To require major corporations receiving Federal aid related to COVID–19 to make annual payments of equity to employees of the corporation while such aid is out- standing, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. EQUITY PAYMENTS TO EMPLOYEES WHILE RE- 3 CEIVING FEDERAL AID. 4 (a) IN GENERAL.—Any major corporation that re- 5 ceives Federal aid related to COVID–19 shall, until the 6 date on which all such Federal aid is repaid to the Federal 7 VerDate Sep 11 2014 04:29 May 30, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H6851.IH H6851 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 6851 IH Government, make an annual grant of equity to the em- 1 ployees of the corporation as provided under this section. 2 (b) PAYMENT AMOUNT.— 3 (1) TOTAL AMOUNT.— 4 (A) IN GENERAL.—The aggregate number 5 of shares of stock granted by a corporation 6 under this section with respect to a year shall, 7 as a percentage of the corporation’s total shares 8 outstanding, be equal to or greater than the 9 prior annual stock grant percentage. 10 (B) PRIOR ANNUAL STOCK GRANT PER- 11 CENTAGE.—In this paragraph, the term ‘‘prior 12 annual stock grant percentage’’ means the aver- 13 age, over the 3 years preceding January 1, 14 2020, of the annual total number of shares of 15 stock in any equity plans of the corporation and 16 shares underlying any stock option plans of the 17 corporation, taken together, as a percent to the 18 corporation’s total shares outstanding. 19 (2) INDIVIDUAL AMOUNTS.—The equity grant 20 for each individual employee shall be at least in pro- 21 portion to a formula taking into account that em- 22 ployee’s salary adjusted for tenure with each year of 23 tenure counting equally, and with a wage limit of 24 $137,700. 25 VerDate Sep 11 2014 04:29 May 30, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H6851.IH H6851 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 6851 IH (c) OTHER REQUIREMENTS AND AUTHORITIES.— 1 (1) FORM OF GRANT.—A grant of equity under 2 this section shall be a grant of whole shares of stock 3 through a restricted stock plan, a leveraged or non- 4 leveraged Employee Stock Ownership Plan, or a 5 stock bonus plan. 6 (2) PROHIBITION ON CONDITIONS.—A grant of 7 equity to an employee under this section may not be 8 conditioned on the purchase of company stock or 9 any employee performance evaluations of any kind. 10 (3) VOTING AND DIVIDEND RIGHTS.—Equity 11 granted under this section shall be equal, in terms 12 of voting rights and dividend rights, to the class of 13 securities of the corporation other than those issued 14 under this section that carry the highest voting 15 rights and dividend rights. 16 (4) RIGHT TO USE FEDERAL AID.—In the case 17 of a leveraged Employee Stock Ownership Plan, the 18 Federal aid related to COVID–19 may be used by 19 the corporation to finance the Employee Stock Own- 20 ership Plan. 21 (d) SENSE OF CONGRESS.—It is the sense of the 22 Congress that annual grants of equity made under this 23 section should not substitute for any wages or benefits of 24 VerDate Sep 11 2014 04:29 May 30, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H6851.IH H6851 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 6851 IH any kind that were part of the total compensation of an 1 employee in the year before such grants are received. 2 (e) RULEMAKING; ENFORCEMENT.—The Securities 3 and Exchange Commission shall issue such rules as may 4 be necessary to carry out this section and may enforce 5 the requirements of this section. 6 (f) DEFINITIONS.—In this Section: 7 (1) EMPLOYEE.—The term ‘‘employee’’— 8 (A) means any full-time or part-time em- 9 ployee in good standing working for the cor- 10 poration on the date of the receipt of Federal 11 aid related to COVID–19; and 12 (B) does not include— 13 (i) any individual who owns more than 14 5 percent of the voting shares of the cor- 15 poration; 16 (ii) a Named Executive Officer; and 17 (iii) any management employee par- 18 ticipating in an equity compensation plan 19 before the corporation received the Federal 20 aid related to COVID–19. 21 (2) FEDERAL AID.—The term ‘‘Federal aid’’ 22 means any emergency lending provided under section 23 13(3) of the Federal Reserve Act or any Federal fi- 24 VerDate Sep 11 2014 04:29 May 30, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H6851.IH H6851 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 6851 IH nancial support in the form of a grant, loan, or loan 1 guarantee. 2 (3) MAJOR CORPORATION.—The term ‘‘major 3 corporation’’ means any issuer— 4 (A) the securities of which are traded on a 5 national securities exchange; 6 (B) the securities of which are required to 7 be registered with the Securities and Exchange 8 Commission under section 12(g) or 15(d) of the 9 Securities Exchange Act of 1934; or 10 (C) that is an accelerated filed, as defined 11 in section 240.12b–2 of title 17, Code of Fed- 12 eral Regulations. 13 (4) MANAGEMENT EMPLOYEE.—The term 14 ‘‘management employee’’ means any employee who 15 supervises another employee. 16 (5) SECURITIES TERMS.—The terms ‘‘issuer’’, 17 ‘‘national securities exchange’’, and ‘‘security’’ have 18 the meaning give those terms, respectively, under 19 section 3 of the Securities Exchange Act of 1934 20 (15 U.S.C. 78c). 21 Æ VerDate Sep 11 2014 04:29 May 30, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6301 E:\BILLS\H6851.IH H6851 kjohnson on DSK79L0C42PROD with BILLS