II 

110TH CONGRESS 

2D SESSION S. 3715 

To provide for emergency bridge loan assistance to automobile manufacturers 

and component suppliers. 

IN THE SENATE OF THE UNITED STATES 

NOVEMBER 20, 2008 

Mr. LEVIN (for himself, Mr. BOND, Ms. STABENOW, Mr. VOINOVICH, Mr. 

BROWN, Mr. SPECTER, and Mr. CASEY) introduced the following bill; 

which was read twice and referred to the Committee on Appropriations 

A BILL 

To provide for emergency bridge loan assistance to 

automobile manufacturers and component suppliers. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Auto Industry Emer5 gency Bridge Loan Act’’. 

6 SEC. 2. DEFINITIONS. 

7 In this Act: 

8 (1) AUTOMOBILE MANUFACTURER OR COMPO9 NENT SUPPLIER.—The term ‘‘automobile manufac10 turer or component supplier’’ means an automobile 


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1 manufacturer or component supplier or any suc2 cessor thereto. 

3 (2) GOLDEN PARACHUTE PAYMENT.—The term 

4 ‘‘golden parachute payment’’ means any payment to 

5 a senior executive officer for departure from a com6 pany for any reason. 

7 (3) FINANCIAL VIABILITY.—The term ‘‘finan8 cial viability’’ means, using generally acceptable ac9 counting principles, that there is a reasonable pros10 pect that the applicant will be able to make pay11 ments of principal and interest on the loan as and 

12 when such payments become due under the terms of 

13 the loan documents, and that the applicant has a net 

14 present value that is positive. 

15 (4) SECRETARY.—The term ‘‘Secretary’’ means 

16 the Secretary of Commerce. 

17 (5) SENIOR EXECUTIVE OFFICER.—The term 

18 ‘‘senior executive officer’’ means an individual who is 

19 one of the top five most highly paid executives of a 

20 public company, whose compensation is required to 

21 be disclosed pursuant to the Securities Exchange 

22 Act of 1934, and any regulations issued thereunder, 

23 and nonpublic company counterparts. 


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1 SEC. 3. AUTO INDUSTRY EMERGENCY BRIDGE LOAN PRO2 GRAM. 

3 On or before March 31, 2009, the Secretary shall 

4 make loans from funds provided under this section to 

5 automobile manufacturers or component suppliers that 

6 have— 

7 (1) operations in the United States, the failure 

8 of which would have a systemic adverse effect on the 

9 overall United States economy or a significant loss 

10 of United States jobs, as determined by the Sec11 retary; 

12 (2) operated a manufacturing facility for the 

13 purposes of producing automobiles or automobile 

14 components in the United States throughout the 20- 

15 year period ending on the date of the enactment of 

16 this Act; and 

17 (3) submitted a complete application for a loan 

18 under this section pursuant to section 4(a), which 

19 has been determined eligible under section 4(b). 

20 SEC. 4. PLAN TO ENSURE FINANCIAL VIABILITY OF BOR21 ROWER. 

22 (a) IN GENERAL.—At the time of application for a 

23 loan under this Act, an automobile manufacturer or com24 ponent supplier shall submit to the Secretary a detailed 

25 plan that describes how the requested Government 

26 funds— 


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1 (1) would be utilized to ensure the financial via2 bility of the manufacturer or supplier; 

3 (2) would stimulate automobile production in 

4 the United States; and 

5 (3) would improve the capacity of the manufac6 turer or supplier to pursue the timely and aggressive 

7 production of energy-efficient advanced technology 

8 vehicles. 

9 (b) PLAN CONTENTS.—A plan submitted under this 

10 section shall detail cost control measures and performance 

11 goals and milestones. 

12 SEC. 5. APPLICATIONS, ELIGIBILITY AND DISBURSEMENTS. 

13 (a) APPLICATIONS.—On and after the date that is 3 

14 days after the date of the enactment of this Act, the Sec15 retary shall accept applications for loans under this Act. 

16 (b) DETERMINATION OF ELIGIBILITY.—Not later 

17 than 15 days after the date on which the Secretary re18 ceives a complete application for a loan under subsection 

19 (a), the Secretary shall, after consultation with other Ex20 ecutive Branch officials, determine whether— 

21 (1) the applicant meets the requirements de22 scribed in sections 3 and 4; 

23 (2) the disbursement of funds and the success24 ful implementation of the required plan would en25 sure the financial viability of the applicant; and 


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1 (3) the applicant is therefore eligible to receive 

2 a loan under this Act. 

3 (c) DISBURSEMENT.—The Secretary shall begin dis4 bursement of the proceeds of a loan under this Act to an 

5 eligible applicant not later than 7 days after the date on 

6 which the Secretary receives a disbursal request from the 

7 applicant. 

8 (d) WARRANTS AND DEBT INSTRUMENTS.—The Sec9 retary may not make a loan under this Act unless the Sec10 retary receives from the automobile manufacturer or com11 ponent supplier a warrant or senior debt instrument from 

12 the manufacturer made in accordance with the require13 ments for a warrant or senior debt instrument by a finan14 cial institution under section 113(d) of the Emergency 

15 Economic Stabilization Act of 2008 (division A of Public 

16 Law 110–343). 

17 SEC. 6. REPLENISHMENT OF ADVANCED TECHNOLOGY VE18 HICLE MANUFACTURING INCENTIVE PRO19 GRAM. 

20 (a) EQUITY SALES.— 

21 (1) SALES AUTHORIZED.—The Secretary may 

22 sell, exercise, or surrender any equity instrument re23 ceived under this Act. 

24 (2) TURNAROUND PROFITS TO RESTORE AD25 VANCED VEHICLES MANUFACTURING INCENTIVE


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1 PROGRAM.—Proceeds received from a sale, exercise, 

2 or surrender under paragraph (1) may be credited to 

3 the appropriate Government financing account made 

4 available to fulfill the advanced technology vehicle 

5 manufacturing incentive purpose under section 136 

6 of the Energy Independence and Security Act of 

7 2007 (Public Law 110–140; 42 U.S.C. 17013) until 

8 the amount loaned under this Act has been repaid. 

9 (3) REDUCTION OF PUBLIC DEBT.—Proceeds 

10 received from a sale, exercise, or surrender under 

11 paragraph (1) that takes place after the amount 

12 loaned under this Act has been repaid in accordance 

13 with paragraph (2) may be used to reduce the public 

14 debt. 

15 (b) REPAID LOAN FUNDS.— 

16 (1) IN GENERAL.—Loan amounts repaid under 

17 this Act may be credited to the appropriate Govern18 ment financing account made available to fulfill the 

19 advanced technology vehicle manufacturing incentive 

20 purpose of section 136 of the Energy Independence 

21 and Security Act of 2007 until the amount loaned 

22 under this Act is repaid. 

23 (2) REDUCTION OF PUBLIC DEBT.—Loan 

24 amounts repaid under this Act after the amount 


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1 loaned under this Act has been repaid may be used 

2 to reduce the public debt. 

3 SEC. 7. LIMITS ON EXECUTIVE COMPENSATION. 

4 (a) STANDARDS REQUIRED.—The Secretary shall re5 quire any recipient of a loan under this Act to meet appro6 priate standards for executive compensation and corporate 

7 governance. 

8 (b) SPECIFIC REQUIREMENTS.—The standards es9 tablished under subsection (a) shall include the following: 

10 (1) Limits on compensation that exclude incen11 tives for senior executive officers of a recipient of a 

12 loan under this Act to take unnecessary and exces13 sive risks that threaten the value of such recipient 

14 during the period that the loan is outstanding. 

15 (2) A provision for the recovery by such recipi16 ent of any bonus or incentive compensation paid to 

17 a senior executive officer based on statements of 

18 earnings, gains, or other criteria that are later found 

19 to be materially inaccurate. 

20 (3) A prohibition on such recipient making any 

21 golden parachute payment to a senior executive offi22 cer during the period that the loan under this Act 

23 is outstanding. 

24 (4) A prohibition on such recipient paying or 

25 accruing any bonus or incentive compensation durVerDate Aug 31 2005 01:59 Nov 21, 2008 Jkt 079200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S3715.IS S3715

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1 ing the period that the loan under this Act is out2 standing to any executive whose annual base com3 pensation exceeds $250,000 (which amount shall be 

4 adjusted by the Secretary for inflation). 

5 (5) A prohibition on any compensation plan 

6 that could encourage manipulation of the reported 

7 earnings of the recipient to enhance compensation of 

8 any of its employees. 

9 SEC. 8. PROHIBITION ON THE USE OF LOAN PROCEEDS 

10 FOR LOBBYING ACTIVITIES. 

11 (a) IN GENERAL.—A recipient of a loan under this 

12 Act may not use such funds for any lobbying expenditures 

13 or political contributions. 

14 (b) DEFINITIONS.—In this section: 

15 (1) LOBBYING EXPENDITURES.—The term 

16 ‘‘lobbying expenditures’’ has the meaning given the 

17 term in section 4911(c)(1) of the Internal Revenue 

18 Code of 1986. 

19 (2) POLITICAL CONTRIBUTIONS.—The term 

20 ‘‘political contribution’’ means any contribution on 

21 behalf of a political candidate or to a separate seg22 regated fund described in section 316(b)(2)(C) of 

23 the Federal Election Campaign Act of 1971 (2 

24 U.S.C. 441b(b)(2)(C)). 


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1 SEC. 9. PROHIBITION ON PAYMENT OF DIVIDENDS. 

2 No common stock dividends may be paid by any re3 cipient of a loan under this Act for the duration of the 

4 loan. 

5 SEC. 10. AUTO INDUSTRY EMERGENCY BRIDGE LOAN OVER6 SIGHT BOARD. 

7 (a) ESTABLISHMENT.—There is established the Auto 

8 Industry Emergency Bridge Loan Oversight Board (in 

9 this section referred to as the ‘‘Board’’), which shall be 

10 responsible for reviewing and providing advice concerning 

11 the exercise of authority under this Act, including— 

12 (1) the progress of the applicant in meeting the 

13 performance goals and milestones under its financial 

14 viability plan required under section 4; 

15 (2) recommending changes, as necessary and 

16 appropriate, to the Secretary in meeting the goals 

17 and milestones under the financial viability plan, 

18 and senior management and board of directors to 

19 the automobile manufacturers and component sup20 pliers assisted under this Act; and 

21 (3) reporting any suspected fraud, misrepresen22 tation, or malfeasance to the Inspector General of 

23 the Department of Commerce or the Attorney Gen24 eral of the United States, consistent with section 

25 535(b) of title 28, United States Code. 


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1 (b) MEMBERSHIP.—The Board shall be comprised 

2 of— 

3 (1) the Secretary of Commerce; 

4 (2) the Secretary of Energy; 

5 (3) the Secretary of Transportation; 

6 (4) the Secretary of the Treasury; 

7 (5) the Secretary of Labor; and 

8 (6) the Administrator of the Environmental 

9 Protection Agency. 

10 (c) CHAIRPERSON.—The chairperson of the Board 

11 shall be the Secretary of Commerce. 

12 (d) MEETINGS.—The Board shall meet— 

13 (1) not later than 14 days after the first dis14 bursement of funds provided under this Act; and 

15 (2) not less frequently than monthly thereafter. 

16 (e) REPORTS.—The Board shall report to the appro17 priate committees of Congress, not less frequently than 

18 quarterly, on the matters described under this section. 

19 (f) OVERSIGHT OF TRANSACTIONS AND FINANCIAL

20 CONDITION.— 

21 (1) DUTY TO INFORM.—During the period in 

22 which any loan extended under this Act remains out23 standing, the recipient of such loan shall promptly 

24 inform the Secretary and the Board of— 


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1 (A) any asset sale, investment, or commit2 ment for any asset sale or investment proposed 

3 to be entered into by such recipient that has a 

4 value in excess of $25,000,000; and 

5 (B) any other material change in the fi6 nancial condition of such recipient. 

7 (2) AUTHORITY OF THE SECRETARY.—During 

8 the period in which any loan extended under this Act 

9 remains outstanding, the Secretary, in consultation 

10 with the Board, may— 

11 (A) promptly review any asset sale or in12 vestment described in paragraph (1) or any 

13 commitment for such asset sale or investment; 

14 and 

15 (B) direct the recipient of the loan that it 

16 should not consummate such proposed sale or 

17 investment or commitment for such sale or in18 vestment. 

19 (3) REGULATIONS.—The Board may establish, 

20 by regulation, procedures for conducting any review 

21 under this subsection. 

22 (g) TERMINATION.—The Board, and its authority 

23 under this section, shall terminate not later than 6 months 

24 after the date on which the last loan amounts under this 

25 section are repaid. 


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1 SEC. 11. PRIORITIZATION OF LOAN ALLOCATIONS. 

2 In allocating loan amounts under this Act, the Sec3 retary shall consider the magnitude of the impact of the 

4 manufacturing operations of the applicant in the United 

5 States on the overall economy of the United States and 

6 other segments of the automobile industry, including the 

7 impact on levels of employment, domestic manufacturing 

8 of automobiles and automobile components, and auto9 mobile dealerships. 

10 SEC. 12. RATE OF INTEREST. 

11 The annual rate of interest for a loan under this Act 

12 shall be— 

13 (a) 5 percent during the 5-year period beginning on 

14 the date on which the Secretary disburses the loan; and 

15 (b) 9 percent after the end of the period described 

16 in paragraph (1). 

17 SEC. 13. NO PREPAYMENT PENALTY. 

18 A loan made under this Act shall be prepayable with19 out penalty at any time. 

20 SEC. 14. DISCHARGE. 

21 A discharge under title 11, United States Code, shall 

22 not discharge the borrower from any debt for funds au23 thorized to be disbursed under this Act. 

24 SEC. 15. FEES. 

25 (a) IN GENERAL.—The Secretary may charge and 

26 collect fees for disbursements under this Act in amounts 


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1 that the Secretary determines are sufficient to cover appli2 cable administrative expenses. 

3 (b) AVAILABILITY.—Fees collected under this sec4 tion— 

5 (1) shall be deposited by the Secretary into the 

6 Treasury of the United States; 

7 (2) shall be used by the Secretary to pay ad8 ministrative expenses of making awards and loans 

9 under this Act; and 

10 (3) shall remain available until expended, with11 out further appropriation. 

12 SEC. 16. JUDICIAL REVIEW AND RELATED MATTERS. 

13 (a) STANDARDS.—Actions by the Secretary pursuant 

14 to the authority of this Act shall be subject to chapter 

15 7 of title 5, United States Code, including that such final 

16 actions shall be held unlawful and set aside if found to 

17 be arbitrary, capricious, an abuse of discretion, or not in 

18 accordance with law. 

19 (b) LIMITATIONS ON EQUITABLE RELIEF.— 

20 (1) INJUNCTION.—No injunction or other form 

21 of equitable relief shall be issued against the Sec22 retary for actions pursuant to this Act, other than 

23 to remedy a violation of the Constitution. 

24 (2) TEMPORARY RESTRAINING ORDER.—Any 

25 request for a temporary restraining order against 


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1 the Secretary for actions pursuant to this Act shall 

2 be considered and granted or denied by the court 

3 within 3 days of the date of the request. 

4 (3) PRELIMINARY INJUNCTION.—Any request 

5 for a preliminary injunction against the Secretary 

6 for actions pursuant to this Act shall be considered 

7 and granted or denied by the court on an expedited 

8 basis consistent with the provisions of rule 65(b)(3) 

9 of the Federal Rules of Civil Procedure, or any suc10 cessor to such rule. 

11 (4) PERMANENT INJUNCTION.—Any request for 

12 a permanent injunction against the Secretary for ac13 tions pursuant to this Act shall be considered and 

14 granted or denied by the court on an expedited 

15 basis. Whenever possible, the court shall consolidate 

16 trial on the merits with any hearing on a request for 

17 a preliminary injunction, consistent with the provi18 sions of rule 65(a)(2) of the Federal Rules of Civil 

19 Procedure, or any successor to such rule. 

20 (5) LIMITATION ON ACTIONS BY PARTICIPATING

21 COMPANIES.—No action or claims may be brought 

22 against the Secretary by any person that divests its 

23 assets with respect to its participation in a program 

24 under this Act, except as provided in paragraph (1), 


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1 other than as expressly provided in a written con2 tract with the Secretary. 

3 (6) STAYS.—Any injunction or other form of 

4 equitable relief issued against the Secretary for ac5 tions pursuant to this Act shall be automatically 

6 stayed. The stay shall be lifted, unless the Secretary 

7 seeks a stay from a higher court within 3 calendar 

8 days after the date on which the relief is issued. 

9 (c) SAVINGS CLAUSE.—Any exercise of the authority 

10 of the Secretary pursuant to this section shall not impair 

11 the claims or defenses that would otherwise apply with re12 spect to persons other than the Secretary. 

13 SEC. 17. FUNDING. 

14 (a) IN GENERAL.—The $7,500,000,000 appropriated 

15 for fiscal year 2009 for direct loans under section 129 of 

16 the Consolidated Security, Disaster Assistance, and Con17 tinuing Appropriations Act, 2009 (division A of Public 

18 Law 110–329) is rescinded. 

19 (b) APPROPRIATIONS.—There is appropriated to the 

20 Secretary of Commerce $7,500,000,000 to the ‘‘Depart21 ment of Commerce—Emergency Bridge Loan Program 

22 Account’’ for the cost of direct loans authorized under this 

23 Act, which shall remain available until expended. Commit24 ments for direct loans using such amount shall not exceed 

25 $25,000,000,000 in total loan principal. The cost of such 


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1 direct loans, including the cost of modifying such loans, 

2 shall be calculated in accordance with section 502 of the 

3 Congressional Budget Act of 1974 (2 U.S.C. 661a). 

4 (c) TRANSFERS FOR DIRECT LOANS.—Following the 

5 receipt of a notice from the Secretary of Energy certifying 

6 the approval of a loan under the program authorized 

7 under section 136 of the Energy Independence and Secu8 rity Act of 2007 (Public Law 110–140; 42 U.S.C. 17013), 

9 the Secretary may transfer amounts made available under 

10 this Act to the Secretary of Energy, in an amount suffi11 cient for the cost of the direct loans if such transfer would 

12 not cause the Secretary to exceed the total appropriation 

13 and total commitment level authorized under subsection 

14 (b). Any amounts so transferred shall be available to the 

15 Secretary of Energy without fiscal year limitation and 

16 subject to the terms and conditions described in section 

17 129 of the Consolidated Security, Disaster Assistance, and 

18 Continuing Appropriations Act, 2009. 

19 (d) USE OF REMAINING AMOUNTS.—Amounts appro20 priated under subsection (b) which remain available after 

21 March 31, 2009, shall be transferred to the Secretary of 

22 Energy and shall be used to carry out section 136 of the 

23 Energy Independence and Security Act of 2007, subject 

24 to the terms and conditions described in section 129 of 


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1 the Consolidated Security, Disaster Assistance, and Con2 tinuing Appropriations Act, 2009. 

3 SEC. 18. COORDINATION WITH OTHER LAWS REGARDING 

4 PROMOTION OF ADVANCED TECHNOLOGY VE5 HICLE MANUFACTURING. 

6 Nothing in the Act may be construed as altering, af7 fecting, or superseding the provisions of section 136 of the 

8 Energy Independence and Security Act of 2007, relating 

9 to the technology requirements for energy efficient vehi10 cles. 

Æ 


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