ALIGN Act

Subjects: Finance and Financial Sector


<html><body><pre>[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 790 Introduced in Senate (IS)]

&lt;DOC&gt;






118th CONGRESS
  1st Session
                                 S. 790

 To align executive compensation with sustainable value creation, and 
                          for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 14, 2023

 Mr. Warner (for himself, Ms. Warren, and Ms. Baldwin) introduced the 
 following bill; which was read twice and referred to the Committee on 
                  Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
 To align executive compensation with sustainable value creation, and 
                          for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Advancing Long-term Incentives for 
Governance Now Act'' or the ``ALIGN Act''.

SEC. 2. RESTRICTIONS ON SALE OF SHARES FOLLOWING STOCK BUYBACKS.

    (a) Definitions.--In this section:
            (1) Covered issuer.--The term ``covered issuer'' means an 
        issuer, a security of which is registered under subsection (b) 
        or (g) of section 12 of the Securities Exchange Act of 1934 (15 
        U.S.C. 78l).
            (2) Covered person.--The term ``covered person'' means an 
        executive officer, as that term is defined in section 240.3b-7 
        of title 17, Code of Federal Regulations, or any successor 
        regulation, with respect to a covered issuer.
            (3) Equity security; issuer; security.--The terms ``equity 
        security'', ``issuer'', and ``security'' have the meanings 
        given the terms in section 3(a) of the Securities Exchange Act 
        of 1934 (15 U.S.C. 78c(a)).
            (4) Share repurchase authorization.--The term ``share 
        repurchase authorization'' means an authorization by the board 
        of directors of a covered issuer to purchase shares of the 
        covered issuer.
            (5) Subject security.--The term ``subject security'' means 
        any equity security of a covered issuer that is awarded to a 
        covered person with respect to that covered issuer as part of 
        the compensation of that covered person.
    (b) Disclosure of Share Repurchase Authorization.--
            (1) In general.--Not later than 180 days after the date of 
        enactment of this Act, the Securities and Exchange Commission 
        shall issue regulations to require covered issuers to publicly 
        disclose a share repurchase authorization not later than 1 
        business day after the authorization has occurred.
            (2) Contents.--In issuing regulations under paragraph (1), 
        the Securities and Exchange Commission shall ensure that each 
        disclosure required under those regulations is--
                    (A) uniform for all covered issuers; and
                    (B) made in a manner that--
                            (i) maintains accuracy; and
                            (ii) reduces the unauthorized disclosure of 
                        information.
    (c) Sale of Subject Securities.--
            (1) Prohibitions.--Except as provided in paragraph (2), no 
        covered person may sell or transfer, or divest an economic 
        interest in, any subject security with respect to the covered 
        person, if--
                    (A) during the preceding 1-year period, the 
                applicable covered issuer was required to make a 
                disclosure pursuant to the regulations issued under 
                subsection (b); or
                    (B) fewer than 3 years have elapsed since the 
                covered person was granted the subject security.
            (2) Exceptions.--The prohibition under paragraph (1) shall 
        not apply with respect to any of the following:
                    (A) Any subject security sold or transferred by a 
                covered person in connection with a change of control 
                with respect to the applicable covered issuer, 
                including an affiliate of that covered issuer.
                    (B) Any subject security sold or transferred by a 
                covered person through--
                            (i) a will; or
                            (ii) the laws of descent or distribution.
                    (C) Any subject security that a covered person owns 
                or beneficially owns, as of the day before the date of 
                enactment of this Act.
                    (D) Any subject security awarded to the applicable 
                covered person that is immediately withheld by the 
                covered issuer and sold solely for the purposes of 
                meeting a tax obligation of the covered person with 
                respect to the receipt of the subject security.
                    (E) Any sale or transfer--
                            (i) which is made on or after the death of 
                        the covered person;
                            (ii) which is made on or after the date on 
                        which the covered person becomes disabled 
                        (within the meaning of section 72(m)(7) of the 
                        Internal Revenue Code of 1986);
                            (iii) which is made pursuant to a domestic 
                        relations order in settlement of marital 
                        property rights;
                            (iv) to the extent the aggregate of such 
                        sales and transfers during any taxable year of 
                        the covered person does not exceed the 
                        qualified higher education expenses (as defined 
                        in section 72(t)(7) of such Code) of the 
                        covered person for such taxable year;
                            (v) to the extent the proceeds of such sale 
                        or transfer are used by the covered person in 
                        the time and manner described in section 
                        72(t)(8) of such Code to pay qualified 
                        acquisition costs described in such section, 
                        subject to the rules of such section including 
                        the limitation of subparagraph (B) thereof; or
                            (vi) to the extent the aggregate of such 
                        sales and transfers during any taxable year of 
                        the covered person does not exceed the amount 
                        allowable as a deduction under section 213 of 
                        such Code to the covered person for amounts 
                        paid during such taxable year for medical care 
                        (determined without regard to whether the 
                        covered person itemizes deductions for such 
                        taxable year).
                                 &lt;all&gt;
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