This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

32471 

Vol. 74, No. 129 

Wednesday, July 8, 2009 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2009–0622; Directorate 

Identifier 2009–CE–034–AD] 

RIN 2120–AA64 

Airworthiness Directives; Pilatus 

Aircraft Ltd. Models PC–6, PC–6–H1, 

PC–6–H2, PC–6/350, PC–6/350–H1, PC– 

6/350–H2, PC–6/A, PC–6/A–H1, PC–6/ 

A–H2, PC–6/B–H2, PC–6/B1–H2, PC–6/ 

B2–H2, PC–6/B2–H4, PC–6/C–H2, and 

PC–6/C1–H2 Airplanes 

AGENCY: Federal Aviation 

Administration (FAA), Department of 

Transportation (DOT). 

ACTION: Notice of proposed rulemaking 

(NPRM). 

SUMMARY: We propose to adopt a new 

airworthiness directive (AD) for the 

products listed above that would 

supersede an existing AD. This 

proposed AD results from mandatory 

continuing airworthiness information 

(MCAI) originated by an aviation 

authority of another country to identify 

and correct an unsafe condition on an 

aviation product. The MCAI describes 

the unsafe condition as: 

Findings of corrosion, wear and cracks in 

the upper wing strut fittings on some PC–6 

aircraft have been reported in the past. It is 

possible that the spherical bearing of the 

wing strut fittings installed in the underwing 

can be loose in the fitting or cannot rotate 

because of corrosion. In this condition, the 

joint cannot function as designed and fatigue 

cracks may then develop. Undetected cracks, 

wear and/or corrosion in this area could 

cause failure of the upper attachment fitting, 

leading to failure of the wing structure and 

subsequent loss of control of the aircraft. 

The proposed AD would require 

actions that are intended to address the 

unsafe condition described in the MCAI. 

DATES: We must receive comments on 

this proposed AD by August 7, 2009. 

ADDRESSES: You may send comments by 

any of the following methods: 

• Federal eRulemaking Portal: Go to 

http://www.regulations.gov. Follow the 

instructions for submitting comments. 

• Fax: (202) 493–2251. 

• Mail: U.S. Department of 

Transportation, Docket Operations, M– 

30, West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue, SE., 

Washington, DC 20590. 

• Hand Delivery: U.S. Department of 

Transportation, Docket Operations, M– 

30, West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue, SE., 

Washington, DC 20590, between 9 a.m. 

and 5 p.m., Monday through Friday, 

except Federal holidays. 

Examining the AD Docket 

You may examine the AD docket on 

the Internet at http:// 

www.regulations.gov; or in person at the 

Docket Management Facility between 9 

a.m. and 5 p.m., Monday through 

Friday, except Federal holidays. The AD 

docket contains this proposed AD, the 

regulatory evaluation, any comments 

received, and other information. The 

street address for the Docket Office 

(telephone (800) 647–5527) is in the 

ADDRESSES section. Comments will be 

available in the AD docket shortly after 

receipt. 

FOR FURTHER INFORMATION CONTACT: 

Doug Rudolph, Aerospace Engineer, 

FAA, Small Airplane Directorate, 901 

Locust, Room 301, Kansas City, 

Missouri 64106; telephone: (816) 329– 

4059; fax: (816) 329–4090. 

SUPPLEMENTARY INFORMATION: 

Comments Invited 

We invite you to send any written 

relevant data, views, or arguments about 

this proposed AD. Send your comments 

to an address listed under the 

ADDRESSES section. Include ‘‘Docket No. 

FAA–2009–0622; Directorate Identifier 

2009–CE–034–AD’’ at the beginning of 

your comments. We specifically invite 

comments on the overall regulatory, 

economic, environmental, and energy 

aspects of this proposed AD. We will 

consider all comments received by the 

closing date and may amend this 

proposed AD because of those 

comments. 

We will post all comments we 

receive, without change, to http:// 

regulations.gov, including any personal 

information you provide. We will also 

post a report summarizing each 

substantive verbal contact we receive 

about this proposed AD. 

Discussion 

On September 13, 2007, we issued AD 

2007–19–14, Amendment 39–15205 (72 

FR 53920; September 21, 2007), which 

superseded AD 2007–15–09, 

Amendment 39–15138 (72 FR 41436; 

July 30, 2007), issued on July 19, 2007. 

AD 2007–15–09 superseded AD 2007– 

03–08, Amendment 39–14919 (72 FR 

4635; February 1, 2007), issued January 

24, 2007. Those ADs required actions 

intended to address an unsafe condition 

on the products listed above. 

Since we issued AD 2007–19–14, 

Pilatus has developed new wing strut 

fittings that require repetitive visual and 

eddy current inspections. In addition, 

fatigue test results show the eddy 

current repetitive inspection interval for 

the old wing strut fittings can be 

extended to 1,100 hours time-in-service 

(TIS) or 12 calendar months, whichever 

occurs first. 

The European Aviation Safety Agency 

(EASA), which is the Technical Agent 

for the Member States of the European 

Community, has issued AD No.: 2007– 

0241R3, dated May 6, 2009 (referred to 

after this as ‘‘the MCAI’’), to correct an 

unsafe condition for the specified 

products. The MCAI states: 

Findings of corrosion, wear and cracks in 

the upper wing strut fittings on some PC–6 

aircraft have been reported in the past. It is 

possible that the spherical bearing of the 

wing strut fittings installed in the underwing 

can be loose in the fitting or cannot rotate 

because of corrosion. In this condition, the 

joint cannot function as designed and fatigue 

cracks may then develop. Undetected cracks, 

wear and/or corrosion in this area could 

cause failure of the upper attachment fitting, 

leading to failure of the wing structure and 

subsequent loss of control of the aircraft. 

To address this problem, FOCA published 

AD TM–L Nr. 80.627–6/Index 72–2 and HB– 

2006–400 and EASA published AD 2007– 

0114 to require specific inspections and to 

obtain a fleet status. Since the issuance of AD 

2007–0114, the reported data proved that it 

was necessary to establish and require 

repetitive inspections. 

EASA published Emergency AD 2007– 

0241–E to extend the applicability and to 

require repetitive eddy current and visual 

inspections of the upper wing strut fitting for 

evidence of cracks, wear and/or corrosion 

and examination of the spherical bearing and 

replacement of cracked fittings. Collected 

data received in response to Emergency AD 

2007–0241–E resulted in the issuance of 

EASA AD 2007–0241R1 that permitted 

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32472 Federal Register / Vol. 74, No. 129 / Wednesday, July 8, 2009 / Proposed Rules 

extending the intervals for the repetitive 

eddy current and visual inspections from 100 

Flight Hours (FH) to 300 FH and from 150 

Flight Cycles (FC) to 450 FC, respectively. In 

addition, oversize bolts were introduced by 

Pilatus PC–6 Service Bulletin (SB) 57–005 R1 

and the fitting replacement procedure was 

adjusted accordingly. 

Based on fatigue test results, EASA AD 

2007–0241R2 was issued to extend the 

repetitive inspection interval to 1 100 FH or 

12 calendar months, whichever occurs first, 

and to delete the related flight cycle intervals 

and the requirement for the ‘‘Mild Corrosion 

Severity Zone’’. In addition, some editorial 

changes have been made for reasons of 

standardization and readability. 

Revision 3 of this AD refers to the latest 

revision of the PC–6 Aircraft Maintenance 

Manual (AMM) Chapter 5 limitations which 

includes the same repetitive inspection 

intervals and procedures already mandated 

in the revision 2 of AD 2007–0241. Besides 

the inspections, the latest revision of the PC– 

6 AMM contains the replacement procedures 

for the fittings. 

Additionally, it is possible to replace the 

wing strut fitting with a new designed wing 

strut fitting. With this optional part 

replacement, in the repetitive inspection 

procedure the 1 100 FH interval is deleted so 

that only calendar defined intervals of 

inspections remain applicable. 

You may obtain further information 

by examining the MCAI in the AD 

docket. 

Relevant Service Information 

Pilatus Aircraft Ltd. has issued Pilatus 

Aircraft Ltd. Pilatus PC–6 Service 

Bulletin No. 57–005, REV No. 2, dated 

May 19, 2008; and Chapter 57–00–02 of 

Pilatus Aircraft Ltd. Pilatus PC–6 

Aircraft Maintenance, dated November 

30, 2008 (referenced as revision 9 in 

EASA AD No.: 2007–0241R3). The 

actions described in this service 

information are intended to correct the 

unsafe condition identified in the 

MCAI. 

FAA’s Determination and Requirements 

of the Proposed AD 

This product has been approved by 

the aviation authority of another 

country, and is approved for operation 

in the United States. Pursuant to our 

bilateral agreement with this State of 

Design Authority, they have notified us 

of the unsafe condition described in the 

MCAI and service information 

referenced above. We are proposing this 

AD because we evaluated all 

information and determined the unsafe 

condition exists and is likely to exist or 

develop on other products of the same 

type design. 

Differences Between This Proposed AD 

and the MCAI or Service Information 

We have reviewed the MCAI and 

related service information and, in 

general, agree with their substance. But 

we might have found it necessary to use 

different words from those in the MCAI 

to ensure the AD is clear for U.S. 

operators and is enforceable. In making 

these changes, we do not intend to differ 

substantively from the information 

provided in the MCAI and related 

service information. 

We might also have proposed 

different actions in this AD from those 

in the MCAI in order to follow FAA 

policies. Any such differences are 

highlighted in a Note within the 

proposed AD. 

Costs of Compliance 

We estimate that this proposed AD 

will affect 50 products of U.S. registry. 

We also estimate that it would take 

about 7 work-hours per product to 

comply with the basic requirements of 

this proposed AD. The average labor 

rate is $80 per work-hour. 

Based on these figures, we estimate 

the cost of the proposed AD on U.S. 

operators to be $28,000, or $560 per 

product. 

In addition, we estimate that any 

necessary follow-on actions would take 

about 30 work-hours and require parts 

costing $5,000, for a cost of $7,400 per 

product. We have no way of 

determining the number of products 

that may need these actions. 

Authority for This Rulemaking 

Title 49 of the United States Code 

specifies the FAA’s authority to issue 

rules on aviation safety. Subtitle I, 

section 106, describes the authority of 

the FAA Administrator. ‘‘Subtitle VII: 

Aviation Programs,’’ describes in more 

detail the scope of the Agency’s 

authority. 

We are issuing this rulemaking under 

the authority described in ‘‘Subtitle VII, 

Part A, Subpart III, Section 44701: 

General requirements.’’ Under that 

section, Congress charges the FAA with 

promoting safe flight of civil aircraft in 

air commerce by prescribing regulations 

for practices, methods, and procedures 

the Administrator finds necessary for 

safety in air commerce. This regulation 

is within the scope of that authority 

because it addresses an unsafe condition 

that is likely to exist or develop on 

products identified in this rulemaking 

action. 

Regulatory Findings 

We determined that this proposed AD 

would not have federalism implications 

under Executive Order 13132. This 

proposed AD would not have a 

substantial direct effect on the States, on 

the relationship between the national 

Government and the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government. 

For the reasons discussed above, I 

certify this proposed regulation: 

1. Is not a ‘‘significant regulatory 

action’’ under Executive Order 12866; 

2. Is not a ‘‘significant rule’’ under the 

DOT Regulatory Policies and Procedures 

(44 FR 11034, February 26, 1979); and 

3. Will not have a significant 

economic impact, positive or negative, 

on a substantial number of small entities 

under the criteria of the Regulatory 

Flexibility Act. 

We prepared a regulatory evaluation 

of the estimated costs to comply with 

this proposed AD and placed it in the 

AD docket. 

List of Subjects in 14 CFR Part 39 

Air transportation, Aircraft, Aviation 

safety, Incorporation by reference, 

Safety. 

The Proposed Amendment 

Accordingly, under the authority 

delegated to me by the Administrator, 

the FAA proposes to amend 14 CFR part 

39 as follows: 

PART 39—AIRWORTHINESS 

DIRECTIVES 

1. The authority citation for part 39 

continues to read as follows: 

Authority: 49 U.S.C. 106(g), 40113, 44701. 

§ 39.13 [Amended] 

2. The FAA amends § 39.13 by 

removing Amendment 39–15205 (72 FR 

53920; September 21, 2007), and adding 

the following new AD: 

Pilatus Aircraft Ltd.: Docket No. FAA–2009– 

0622; Directorate Identifier 2009–CE– 

034–AD. 

Comments Due Date 

(a) We must receive comments by August 

7, 2009. 

Affected ADs 

(b) This AD supersedes AD 2007–19–14, 

Amendment 39–15205 (72 FR 53920; 

September 21, 2007). 

Applicability 

(c) This AD applies to Models PC–6, PC– 

6–H1, PC–6–H2, PC–6/350, PC–6/350–H1, 

PC–6/350–H2, PC–6/A, PC–6/A–H1, PC–6/ 

A–H2, PC–6/B–H2, PC–6/B1–H2, PC–6/B2– 

H2, PC–6/B2–H4, PC–6/C–H2, and PC–6/C1– 

H2 airplanes, manufacturer serial numbers 

(MSN) 101 through 999 and MSN 2001 

through 2092, certificated in any category. 

Note 1: These airplanes are also identified 

as Fairchild Republic Company PC–6 

airplanes, Fairchild Industries PC–6 

airplanes, Fairchild Heli Porter PC–6 

airplanes, or Fairchild-Hiller Corporation 

PC–6 airplanes. 

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Federal Register / Vol. 74, No. 129 / Wednesday, July 8, 2009 / Proposed Rules 32473 

Subject 

(d) Air Transport Association of America 

(ATA) Code 57: Wings. 

Reason 

(e) The mandatory continuing 

airworthiness information (MCAI) states: 

Findings of corrosion, wear and cracks in 

the upper wing strut fittings on some PC–6 

aircraft have been reported in the past. It is 

possible that the spherical bearing of the 

wing strut fittings installed in the underwing 

can be loose in the fitting or cannot rotate 

because of corrosion. In this condition, the 

joint cannot function as designed and fatigue 

cracks may then develop. Undetected cracks, 

wear and/or corrosion in this area could 

cause failure of the upper attachment fitting, 

leading to failure of the wing structure and 

subsequent loss of control of the aircraft. 

To address this problem, FOCA published 

AD TM–L Nr. 80.627–6/Index 72–2 and HB– 

2006–400 and EASA published AD 2007– 

0114 to require specific inspections and to 

obtain a fleet status. Since the issuance of AD 

2007–0114, the reported data proved that it 

was necessary to establish and require 

repetitive inspections. 

EASA published Emergency AD 2007– 

0241–E to extend the applicability and to 

require repetitive eddy current and visual 

inspections of the upper wing strut fitting for 

evidence of cracks, wear and/or corrosion 

and examination of the spherical bearing and 

replacement of cracked fittings. Collected 

data received in response to Emergency AD 

2007–0241–E resulted in the issuance of 

EASA AD 2007–0241R1 that permitted 

extending the intervals for the repetitive 

eddy current and visual inspections from 100 

Flight Hours (FH) to 300 FH and from 150 

Flight Cycles (FC) to 450 FC, respectively. In 

addition, oversize bolts were introduced by 

Pilatus PC–6 Service Bulletin (SB) 57–005 R1 

and the fitting replacement procedure was 

adjusted accordingly. 

Based on fatigue test results, EASA AD 

2007–0241R2 was issued to extend the 

repetitive inspection interval to 1 100 FH or 

12 calendar months, whichever occurs first, 

and to delete the related flight cycle intervals 

and the requirement for the ‘‘Mild Corrosion 

Severity Zone’’. In addition, some editorial 

changes have been made for reasons of 

standardization and readability. 

Revision 3 of this AD refers to the latest 

revision of the PC–6 Aircraft Maintenance 

Manual (AMM) Chapter 5 limitations which 

includes the same repetitive inspection 

intervals and procedures already mandated 

in the revision 2 of AD 2007–0241. Besides 

the inspections, the latest revision of the PC– 

6 AMM contains the replacement procedures 

for the fittings. 

Additionally, it is possible to replace the 

wing strut fitting with a new designed wing 

strut fitting. With this optional part 

replacement, in the repetitive inspection 

procedure the 1 100 FH interval is deleted so 

that only calendar defined intervals of 

inspections remain applicable. 

Actions and Compliance 

(f) Unless already done, do the following 

actions: 

(1) For airplanes that have not had both 

wing strut fittings replaced within the last 

100 hours time-in-service (TIS) before 

September 26, 2007 (the effective date of AD 

2007–19–14) or have not been inspected 

using an eddy current inspection method 

following Pilatus Aircraft Ltd. Pilatus PC–6 

Service Bulletin No. 57–004, dated April 16, 

2007, within the last 100 hours TIS before 

September 26, 2007 (the effective date of AD 

2007–19–14): Before further flight after 

September 26, 2007 (the effective date of AD 

2007–19–14), visually inspect the upper wing 

strut fittings and examine the spherical 

bearings following the Pilatus Aircraft Ltd. 

Pilatus PC–6 Service Bulletin No. 57–005, 

REV No. 2, dated May 19, 2008. 

(2) For all airplanes: Within 25 hours TIS 

after September 26, 2007 (the effective date 

of AD 2007–19–14), or within 30 days after 

September 26, 2007 (the effective date of AD 

2007–19–14), whichever occurs first, visually 

and using eddy current methods, inspect the 

upper wing strut fittings and examine the 

spherical bearings following Pilatus Aircraft 

Ltd. Pilatus PC–6 Service Bulletin No. 57– 

005, REV No. 2, dated May 19, 2008. 

(3) After doing the inspection specified in 

paragraph (f)(2) of this AD or replacing the 

upper wing strut fitting, repetitively do the 

following inspections: 

(i) For all airplanes: At intervals not to 

exceed every 3 calendar months visually 

inspect the upper wing strut fittings and 

examine the spherical bearings following 

Chapter 57–00–02 of Pilatus Aircraft Ltd. 

Pilatus PC–6 Aircraft Maintenance Manual, 

dated November 30, 2008 (referenced as 

revision 9 in EASA AD No.: 2007–0241R3). 

For airplanes equipped with wing strut 

fitting part number (P/N) 6102.0041.00, P/N 

111.35.06.055, P/N 111.35.06.056, P/N 

111.35.06.184, P/N 111.35.06.185, or P/N 

111.35.06.186, you may also do these 

inspections following Pilatus Aircraft Ltd. 

Pilatus PC–6 Service Bulletin No. 57–005, 

REV No. 2, dated May 19, 2008. 

(ii) For airplanes equipped with wing strut 

fitting P/N 6102.0041.00, P/N 111.35.06.055, 

P/N 111.35.06.056, P/N 111.35.06.184, P/N 

111.35.06.185, or P/N 111.35.06.186: At 

intervals not to exceed every 1,100 hours TIS 

or 12 calendar months, whichever occurs 

first, visually and using eddy current 

methods, inspect the upper wing strut fittings 

and examine the spherical bearings following 

Pilatus Aircraft Ltd. Pilatus PC–6 Service 

Bulletin No. 57–005, REV No. 2, dated May 

19, 2008, or Chapter 57–00–02 of Pilatus 

Aircraft Ltd. Pilatus PC–6 Aircraft 

Maintenance Manual, dated November 30, 

2008 (referenced as revision 9 in EASA AD 

No.: 2007–0241R3). 

(iii) For airplanes equipped with wing strut 

fitting P/N 111.35.06.193, P/N 111.35.06.194, 

or P/N 111.35.06.195: At intervals not to 

exceed every 12 calendar months, visually 

and using eddy current methods, inspect the 

upper wing strut fittings and examine the 

spherical bearings following Chapter 57–00– 

02 of Pilatus Aircraft Ltd. Pilatus PC–6 

Aircraft Maintenance Manual, dated 

November 30, 2008 (referenced as revision 9 

in EASA AD No.: 2007–0241R3). 

(4) You may also take ‘‘unless already 

done’’ credit for any inspection specified in 

paragraph (f)(1), (f)(2), or (f)(3) of this AD if 

done before the effective date of this AD 

following Pilatus Aircraft Ltd. Pilatus PC–6 

Service Bulletin No. 57–005, dated August 

30, 2007; or Pilatus Aircraft Ltd. Pilatus PC– 

6 Service Bulletin No. 57–005, REV No. 1, 

dated November 19, 2007. 

(5) For all airplanes: If during any 

inspection required by paragraph (f)(1), (f)(2), 

or (f)(3) of this AD you find the following 

conditions, before further flight, replace the 

specified part following Chapter 57–00–02 of 

Pilatus Aircraft Ltd. Pilatus PC–6 Aircraft 

Maintenance Manual, dated November 30, 

2008 (referenced as revision 9 in EASA AD 

No.: 2007–0241R3): 

(i) Cracks in the upper wing strut fitting; 

or 

(ii) The spherical bearing is not in 

conformity. 

(6) For all airplanes: Replacement of one or 

both upper wing strut fitting(s) does not 

terminate the repetitive inspection specified 

in paragraph (f)(3) of this AD. 

FAA AD Differences 

Note: This AD differs from the MCAI and/ 

or service information as follows: No 

differences. 

Other FAA AD Provisions 

(g) The following provisions also apply to 

this AD: 

(1) Alternative Methods of Compliance 

(AMOCs): 

(i) The Manager, Standards Office, FAA, 

has the authority to approve AMOCs for this 

AD, if requested using the procedures found 

in 14 CFR 39.19. Send information to ATTN: 

Doug Rudolph, Aerospace Engineer, FAA, 

Small Airplane Directorate, 901 Locust, 

Room 301, Kansas City, Missouri 64106; 

telephone: (816) 329–4059; fax: (816) 329– 

4090. Before using any approved AMOC on 

any airplane to which the AMOC applies, 

notify your appropriate principal inspector 

(PI) in the FAA Flight Standards District 

Office (FSDO), or lacking a PI, your local 

FSDO. 

(ii) AMOCs approved for AD 2007–19–14 

are not approved for this AD. 

(2) Airworthy Product: For any requirement 

in this AD to obtain corrective actions from 

a manufacturer or other source, use these 

actions if they are FAA-approved. Corrective 

actions are considered FAA-approved if they 

are approved by the State of Design Authority 

(or their delegated agent). You are required 

to assure the product is airworthy before it 

is returned to service. 

(3) Reporting Requirements: For any 

reporting requirement in this AD, under the 

provisions of the Paperwork Reduction Act 

(44 U.S.C. 3501 et. seq.), the Office of 

Management and Budget (OMB) has 

approved the information collection 

requirements and has assigned OMB Control 

Number 2120–0056. 

Related Information 

(h) Refer to MCAI European Aviation 

Safety Agency (EASA) AD No.: 2007–0241R3, 

dated May 6, 2009; Pilatus Aircraft Ltd. 

Pilatus PC–6 Service Bulletin No. 57–005, 

REV No. 2, dated May 19, 2008; Pilatus 

Aircraft Ltd. Pilatus PC–6 Service Bulletin 

No. 57–005, REV No. 1, dated November 19, 

2007; Pilatus Aircraft Ltd. Pilatus PC–6 

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32474 Federal Register / Vol. 74, No. 129 / Wednesday, July 8, 2009 / Proposed Rules 

1 17 CFR 240.14a–101. 

2 15 U.S.C. 78a et seq. 

3Pub. L. 111–5, Title II, 110 Stat. (2009). 

4 12 U.S.C. 5221. 

5Section 111(e) of the EESA, as amended, 

states— 

(1) ANNUAL SHAREHOLDER APPROVAL OF 

EXECUTIVE COMPENSATION—Any proxy or 

consent or authorization for an annual or other 

meeting of the shareholders of any TARP recipient 

during the period in which any obligation arising 

from financial assistance provided under the TARP 

remains outstanding shall permit a separate 

shareholder vote to approve the compensation of 

executives, as disclosed pursuant to the 

compensation disclosure rules of the Commission 

(which disclosure shall include the compensation 

discussion and analysis, the compensation tables, 

and any related material). 

(2) NONBINDING VOTE—A shareholder vote 

described in paragraph (1) shall not be binding on 

the board of directors of a TARP recipient, and may 

not be construed as overruling a decision by such 

board, nor to create or imply any additional 

fiduciary duty by such board, nor shall such vote 

be construed to restrict or limit the ability of 

shareholders to make proposals for inclusion in 

proxy materials related to executive compensation. 

(3) DEADLINE FOR RULEMAKING—Not later 

than 1 year after the date of enactment of the 

American Recovery and Reinvestment Act of 2009, 

the Commission shall issue any final rules and 

regulations required by this subsection. 

6We do not believe this provision changes the 

Commission’s rules for a smaller reporting company 

that is a TARP recipient under the EESA with 

respect to the compensation discussion and 

analysis (‘‘CD&A’’) disclosure. Our compensation 

disclosure rules, as set forth in Item 402 of 

Regulation S–K [17 CFR 229.402], permit smaller 

reporting companies to provide scaled disclosure 

that does not include CD&A. 

7Section 111 of the EESA defines this period to 

not include any period during which the Federal 

Government ‘‘only holds warrants to purchase 

common stock of the TARP recipient.’’ See 12 

U.S.C. 5221(a)(5). 

8Section 111(e)(2) of the EESA [12 U.S.C. 

5221(e)(2)]. 

9Rule 14a–8 under the Exchange Act will 

continue to apply to shareholder proposals that 

relate to executive compensation. Rule 14a–8 

provides shareholders with an opportunity to place 

a proposal in a company’s proxy materials for a vote 

at an annual or special meeting of shareholders. 

Under this rule, a company generally is required to 

include the proposal unless the shareholder has not 

complied with the rule’s procedural requirements 

or the proposal falls within one of the rule’s 13 

substantive bases for exclusion. To date, the staff of 

Service Bulletin No. 57–005, dated August 

30, 2007; Pilatus Aircraft Ltd. Pilatus PC–6 

Service Bulletin No. 57–004, dated April 16, 

2007; and Chapter 57–00–02 of Pilatus 

Aircraft Ltd. Pilatus PC–6 Aircraft 

Maintenance Manual, dated November 30, 

2008 (referenced as revision 9 in EASA AD 

No.: 2007–0241R3), for related information. 

Issued in Kansas City, Missouri, on July 1, 

2009. 

Scott A. Horn, 

Acting Manager, Small Airplane Directorate, 

Aircraft Certification Service. 

[FR Doc. E9–16142 Filed 7–7–09; 8:45 am] 

BILLING CODE 4910–13–P 

SECURITIES AND EXCHANGE 

COMMISSION 

17 CFR PART 240 

[Release No. 34–60218; File No. S7–12–09] 

RIN 3235–AK31 

Shareholder Approval of Executive 

Compensation of TARP Recipients 

AGENCY: Securities and Exchange 

Commission. 

ACTION: Proposed rule. 

SUMMARY: We are proposing 

amendments to the proxy rules under 

the Securities Exchange Act of 1934 to 

set forth certain requirements for U.S. 

registrants subject to Section 111(e) of 

the Emergency Economic Stabilization 

Act of 2008. Section 111(e) of the 

Emergency Economic Stabilization Act 

of 2008 requires companies that have 

received financial assistance under the 

Troubled Asset Relief Program 

(‘‘TARP’’) to permit a separate 

shareholder advisory vote to approve 

the compensation of executives, as 

disclosed pursuant to the compensation 

disclosure rules of the Commission, 

during the period in which any 

obligation arising from financial 

assistance provided under the TARP 

remains outstanding. The proposed 

amendments are intended to help 

implement this requirement by 

specifying and clarifying it in the 

context of the federal proxy rules. 

DATES: Comments should be received on 

or before September 8, 2009. 

ADDRESSES: Comments may be 

submitted by any of the following 

methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/proposed.shtml); 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number S7–12–09 on the subject line; 

or 

• Use the Federal Rulemaking Portal 

(http://www.regulations.gov). Follow the 

instructions for submitting comments. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number S7–12–09. This file number 

should be included on the subject line 

if e-mail is used. To help us process and 

review your comments more efficiently, 

please use only one method. The 

Commission will post all comments on 

the Commission’s Internet Web site 

(http://www.sec.gov/rules/ 

proposed.shtml). Comments are also 

available for public inspection and 

copying in the Commission’s Public 

Reference Room, 100 F Street, NE, 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. All comments received 

will be posted without change; we do 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. 

FOR FURTHER INFORMATION CONTACT: John 

Harrington, Attorney-Adviser, or N. 

Sean Harrison, Special Counsel, 

Division of Corporation Finance, at 

(202) 551–3430, or Division of 

Corporation Finance, at (202) 551–3430, 

U.S. Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–3628. 

SUPPLEMENTARY INFORMATION: We are 

proposing a new Rule 14a–20 and 

amendments to Schedule 14A1 under 

the Securities Exchange Act of 1934 

(‘‘Exchange Act’’).2

I. Background 

The American Recovery and 

Reinvestment Act of 2009 (‘‘ARRA’’) 

was enacted on February 17, 2009.3

Section 7001 of the ARRA amended the 

executive compensation and corporate 

governance provisions of Section 111 of 

the Emergency Economic Stabilization 

Act of 2008 (‘‘EESA’’).4 Section 111(e) of 

the EESA,5 as amended, requires any 

entity that has received or will receive 

financial assistance under the Troubled 

Asset Relief Program (‘‘TARP’’) to 

‘‘permit a separate shareholder vote to 

approve the compensation of 

executives, as disclosed pursuant to the 

compensation disclosure rules of the 

Commission (which disclosure shall 

include the compensation discussion 

and analysis, the compensation tables, 

and any related material).’’ 6 Companies 

that have received financial assistance 

under the TARP are required to provide 

this separate shareholder vote during 

the period in which any obligation 

arising from financial assistance 

provided under the TARP remains 

outstanding.7 The shareholder vote 

required by Section 111(e) of the EESA 

is not binding on the board of directors 

of a TARP recipient, and such vote will 

not be construed as overruling a board 

decision or as creating or implying any 

additional fiduciary duty by the board.8

The vote also will not be construed to 

restrict or limit the ability of 

shareholders to make proposals for 

inclusion in proxy materials related to 

executive compensation.9

mstockstill on DSKH9S0YB1PROD with PROPOSALS