Page:United States Statutes at Large Volume 123.djvu/537

 123STA T .5 1 7PUBLIC LA W 111 – 5 —FE B. 17 , 2 0 0 9‘ ‘ SEC.1 11. E X EC UTIV EC OMP E N S A TION AN D CO R PORATE G OVERN - ANCE. ‘ ‘ (a)DEFIN I T I O N S.—Forpu rpo se so fthi sse c tio n, the fo l lo w in gd efinitions shall appl y: ‘‘( 1 ) S ENIO R E X E CU TI V E OFFICER.— T he ter m ‘senior e x ecu - ti v e officer ’ means an individual who is 1 of the top 5 most highly paid executives of a pu b lic company, whose compensation is re q uired to be disclosed pursuant to the Securities E xchange A ctof1 934, and any regulations issued thereunder, and non- public company counterparts. ‘‘( 2 ) G O LD EN PA RAC H UTE PA YM ENT.—The term ‘golden para- chute payment’ means any payment to a senior executive officer for departure from a company for any reason, except for pay- ments for services performed or benefits accrued. ‘‘(3) TA RP RECIPIENT.—The term ‘TARP recipient’ means any entity that has received or will receive financial assistance under the financial assistance provided under the TARP. ‘‘(4) C OMMISSION.—The term ‘Commission’ means the Secu- rities and Exchange Commission. ‘‘(5) PERIOD IN W HICH O B LI G ATION IS OUTSTANDING RULE OF CONSTRUCTION.—For purposes of this section, the period in which any obligation arising from financial assistance pro- vided under the TARP remains outstanding does not include any period during which the Federal Government only holds warrants to purchase common stoc k of the TARP recipient. ‘‘(b) EXECUTIVE COMPENSATION AND CORPORATE GOVERN- ANCE.— ‘‘(1) ESTABLISHMENT OF STANDARDS.—During the period in which any obligation arising from financial assistance provided under the TARP remains outstanding, each TARP recipient shall be sub j ect to— ‘‘(A) the standards established by the Secretary under this section; and ‘‘( B ) the provisions of section 1 6 2(m)(5) of the I nternal Revenue Code of 19 8 6, as applicable. ‘‘(2) STANDARDS RE Q UIRED.—The Secretary shall require each TARP recipient to meet appropriate standards for execu- tive compensation and corporate governance. ‘‘(3) SPECIFIC REQUIREMENTS.—The standards established under paragraph (2) shall include the following: ‘‘(A) L imits on compensation that exclude incentives for senior executive officers of the TARP recipient to take unnecessary and excessive risks that threaten the value of such recipient during the period in which any obligation arising from financial assistance provided under the TARP remains outstanding. ‘‘(B) A provision for the recovery by such TARP recipient of any bonus, retention award, or incentive com- pensation paid to a senior executive officer and any of the next 2 0 most highly-compensated employees of the TARP recipient based on statements of earnings, revenues, gains, or other criteria that are later found to be materially inaccurate. ‘‘(C) A prohibition on such TARP recipient making any golden parachute payment to a senior executive officer or any of the next 5 most highly-compensated employees of the TARP recipient during the period in which any