Stop Wall Street Looting Act

[Congressional Bills 119th Congress] [From the U.S. Government Publishing Office] [H.R. 10595 Introduced in House (IH)]

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119th CONGRESS 2d Session H. R. 10595

To subject certain private funds to joint and several liability with respect to the liabilities of firms acquired and controlled by those funds, and for other purposes.

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IN THE HOUSE OF REPRESENTATIVES

September 24, 2026

Mr. Pocan (for himself, Ms. Jayapal, Mr. Landsman, Mr. Garcia of Illinois, Ms. Norton, Ms. Ocasio-Cortez, Ms. Omar, Mrs. Ramirez, and Ms. Tlaib) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committees on Financial Services, the Judiciary, and Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

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A BILL

To subject certain private funds to joint and several liability with respect to the liabilities of firms acquired and controlled by those funds, 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; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Stop Wall Street Looting Act''. (b) Table of Contents.--The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents. Sec. 2. Findings. Sec. 3. Definitions. TITLE I--CORPORATE RESPONSIBILITY

Sec. 101. Joint and several liability for controlling private funds and holders of active interests in controlling private funds. Sec. 102. Indemnification void as against public policy. TITLE II--ANTI-LOOTING

Sec. 201. Limitations on post-acquisition dividends, distributions, redemptions, buybacks, and outsourcing. Sec. 202. Prevention of fraudulent transfers. Sec. 203. Surtax on certain amounts received by investment firms from controlled target firms. Sec. 204. Limitation on deduction for business interest of certain businesses owned by private funds. Sec. 205. Guardrails around accessing public funds. Sec. 206. Prohibiting payments from Federal health care programs to entities that sell assets to or use assets as collateral for a loan with a real estate investment trust. Sec. 207. Repeal of special rule for taxable REIT subsidiaries with interests in certain health care property. Sec. 208. Elimination of qualified REIT dividends from qualified business income. Sec. 209. Protections for striking workers. TITLE III--PROTECTING WORKERS WHEN COMPANIES GO BANKRUPT

Sec. 301. Increased priority for wages. Sec. 302. Priority for severance pay and contributions to employee welfare benefit plans. Sec. 303. Priority for violations of Federal and State laws. Sec. 304. Limitation on executive compensation enhancements. Sec. 305. Prohibition against special compensation payments. Sec. 306. Executive compensation upon exit from bankruptcy. Sec. 307. Collateral surcharge for employee obligations. Sec. 308. Voidability of preferential compensation transfers. Sec. 309. Protection for employees in a sale of assets. Sec. 310. Protection of gift card purchasers. Sec. 311. Commercial real estate. TITLE IV--CLOSING TAX LOOPHOLES

Sec. 401. Amendment of 1986 Code. Sec. 402. Partnership interests transferred in connection with performance of services. Sec. 403. Special rules for partners providing investment management services to partnerships. TITLE V--INVESTOR PROTECTION AND MARKET TRANSPARENCY

Sec. 501. Disclosure of fees and returns. Sec. 502. Fiduciary obligations. Sec. 503. Disclosures relating to the marketing of private equity funds. Sec. 504. Greater visibility into non-bank direct lending and private credit. TITLE VI--RESTRICTIONS ON SECURITIZING RISKY CORPORATE DEBT

Sec. 601. Risk retention requirements for securitization of corporate debt. TITLE VII--MISCELLANEOUS

Sec. 701. Anti-evasion. Sec. 702. Severability.

SEC. 2. FINDINGS.

Congress finds the following: (1) During the 20-year period preceding the date of enactment of this Act, activity by private equity funds has exploded. (2) Millions of people in communities across the United States rely on companies that are owned by private equity funds, including nearly 12,000,000 individuals who work for companies owned by those funds. For millions of additional individuals, a private investment fund acts as a landlord, a lender, or an owner of a local grocery store, newspaper, or hospital. Many pension funds are also investors in private investment funds. (3) Private investment funds have taken controlling stakes in companies in a wide variety of industries, including the financial services, real estate, media, and healthcare industries, but some of the largest impacts from private investment funds have been in the retail sector. In the 10 years preceding the date of enactment of this Act, cases have been commenced under title 11, United States Code, with respect to dozens of retailers in the United States, including Sears, Toys ``R'' Us, Shopko, Payless ShoeSource, Charlotte Russe, Bon-Ton, Nine West, David's Bridal, Claire's, J. Crew, Neiman Marcus, Guitar Center, Art Van Furniture, and Southeastern Grocers, which was the parent company for BI-LO and Winn-Dixie. (4) Private investment funds have also targeted entities that serve low-income or vulnerable populations, including affordable housing developments, for-profit colleges, payday lenders, medical providers, and nursing homes. (5) While private investment funds often purport to take over struggling companies and make those companies viable, the opposite is often true. Leveraged buyouts impose enormous debt loads on otherwise viable companies and then strip those companies of assets, hobbling the operations of those companies and preventing them from making necessary investments for future growth. If an investment goes well, the fund reaps most of the rewards, but if the investment does not go well, workers and customers of the company, and the community relying on the company, suffer. (6) Regardless of the performance of a private investment fund, the managers of the fund often make profits through fees, dividends, and other financial engineering. Private funds should have a stake in the outcome of their investments, enjoying returns if those investments are successful but absorbing losses if those investments fail. (7) When a case is commenced under title 11, United States Code, with respect to a portfolio company, workers not only lose jobs, but also lose wages and benefits that are owed, severance pay that has been promised, and pensions that have been earned. Workers should not be sent to the back of the line behind other creditors if, through no fault of those workers, an investment fails. (8) The performance of private investment funds is often cloaked in secrecy. Those funds have full control over the information that the funds disclose to investors, which allows the funds to manufacture their own performance metrics and makes it difficult for an investor to compare the returns to other investment options. Funds also increasingly require investors to waive the fiduciary obligations applicable to the funds. Investors should have the information and bargaining power to take control over their own investments. (9) An increasing amount of risky debt is being introduced into the market and the quality of that debt is deteriorating, raising concerns with regulators and lawmakers about systemic risk. The institutions that make and securitize risky loans collect large fees and then pass on risk to unwitting investors. The financial system should not bear all of the risk while lenders and securitizers reap the rewards. (10) The Federal Government should-- (A) protect workers, companies, consumers, and investors in the United States; and (B) put an end to the practice of looting economically viable companies for the enrichment of private investment fund managers.

SEC. 3. DEFINITIONS.

Except as otherwise expressly provided, in this Act: (1) Affiliate.--The term ``affiliate'' means-- (A) a person that directly or indirectly owns, controls, or holds with power to vote, 5 percent or more of the outstanding voting securities of another entity, other than a person that holds such securities-- (i) in a fiduciary or agency capacity without sole discretionary power to vote such securities; or (ii) solely to secure a debt, if such entity has not in fact exercised such power to vote; (B) a corporation, 5 percent or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by another entity (referred to in this subparagraph as a ``covered entity''), or by an entity that directly or indirectly owns, controls, or holds with power to vote, 5 percent or more of the outstanding voting securities of the covered entity, other than an entity that holds such securities-- (i) in a fiduciary or agency capacity without sole discretionary power to vote such securities; or (ii) solely to secure a debt, if such entity has not in fact exercised such power to vote; (C) a person whose business is operated under a lease or operating agreement by another entity, or person substantially all of whose property is operated under an operating agreement with that other entity; or (D) an entity that operates the business or substantially all of the property of another entity under a lease or operating agreement. (2) Capital distribution.--The term ``capital distribution'' means-- (A) a cash or share dividend; (B) a share repurchase; (C) a share redemption; (D) a share buyback; (E) a payment of interest or fee on a share of stock; and (F) any other transaction similar to a transaction described in any of subparagraphs (A) through (E). (3) Change in control.--The term ``change in control'' means a change in a legal right with respect to-- (A) the power to vote more than 5 per centum of any class of voting securities of a corporation that engages in interstate commerce; or (B) any lesser per centum of any class of voting securities of a corporation that engages in interstate commerce that is sufficient to make the acquirer of such an interest a person that has the ability to direct the actions of that corporation. (4) Change in control transaction.--The term ``change in control transaction'' means a transaction, or a set of related transactions, that effectuates a change in control. (5) Commission.--The term ``Commission'' means the Securities and Exchange Commission. (6) Control person.--The term ``control person''-- (A) means-- (i) a person-- (I) that directly or indirectly owns, controls, or holds with power to vote, including through coordination with other persons, 5 percent or more of the outstanding voting interests of a corporation; or (II) that operates the business or substantially all of the property of a corporation under a lease or an operating or management agreement; (ii) a corporation, other than a target firm, that has 5 percent or more of its outstanding voting interests directly or indirectly owned, controlled, or held with power to vote by a person that directly or indirectly owns, controls, or holds with power to vote, including through coordination with other persons, 5 percent or more of the outstanding voting interests of another corporation; or (iii) a person that otherwise has the ability to direct the actions of a corporation; and (B) does not include a person that-- (i)(I) is a limited partner with respect to a controlling private fund that is a partnership; (II) does not participate in the direction of the management or policy of a corporation; and (III) is not an insider with respect to the controlling private fund described in subclause (I); (ii) is a pension fund or employee welfare benefit plan, if neither the fund nor plan (as applicable), nor any beneficiary or affiliate of the benefit or plan, is an insider with respect to a controlling private fund; or (iii) holds the voting interests of a corporation solely-- (I) in a fiduciary or agency capacity without sole discretionary power to vote the securities; or (II) to secure a debt, if the person has not-- (aa) exercised the power to vote; or (bb) exercised any other governance rights with respect to the corporation. (7) Controlling private fund.--The term ``controlling private fund'' means a private fund that, directly or through an affiliate, becomes a control person with respect to a target firm through the change in control transaction with respect to the target firm. (8) Corporation.--The term ``corporation'' means-- (A) a joint-stock company; (B) a company or partnership association organized under a law that makes only the capital subscribed or callable up to a specified amount responsible for the debts of the association, including a limited partnership and a limited liability company; (C) a trust; and (D) an association having a power or privilege that a private corporation, but not an individual or a partnership, possesses. (9) Employee welfare benefit plan.--The term ``employee welfare benefit plan'' has the meaning given the term in section 3 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1002). (10) Holder of an active interest.--The term ``holder of an active interest''-- (A) subject to subparagraph (B)(ii), means-- (i) a person that directly or indirectly has the right to participate in the governance of a controlling private fund, without regard to the form or source of that right; and (ii) any insider with respect to a controlling private fund; and (B) does not include-- (i) a person that-- (I) holds an economic interest solely to secure a debt, if that person does not exercise any voting or other governance right with respect to the interest; (II)(aa) is a limited partner with respect to a controlling private fund that is a partnership; (bb) does not participate in the direction of the management or policy of a corporation; and (cc) is not an insider with respect to the controlling private fund described in item (aa); or (III) is a pension fund or employee welfare benefit plan, if neither the pension fund nor employee welfare benefit plan (as applicable), nor any affiliate or beneficiary of the pension fund or employee welfare benefit plan, is an insider with respect to, or affiliate of, a controlling private fund; or (ii) if the source of the right described in subparagraph (A)(i) is a security-- (I) a person that is engaged in business as an underwriter of securities and that acquires that security through the good faith participation of the person in a firm commitment underwriting registered under the Securities Act of 1933 (15 U.S.C. 77a et seq.), until the date that is 40 days after the date on which that acquisition occurs; or (II) a member of a national securities exchange solely because that member is the record holder of that security and, under the rules of that exchange-- (aa) may direct the vote of that security, without instruction, on--

(AA) other than contested matters; or

(BB) matters that may substantially affect the rights or privileges of the holders of the security to be voted; and

(bb) is otherwise precluded from voting without instruction. (11) Insider.--The term ``insider'' means any-- (A) director of a corporation; (B) officer of a corporation; (C) managing agent of a corporation; (D) control person with respect to a corporation; (E) affiliate of a corporation; (F) general partner of a corporation that is a partnership; (G) consultant or contractor retained by a corporation; (H) affiliate, relative, or agent of a person described in any of subparagraphs (A) through (F); or (I) affiliate, relative, or agent of a person described in subparagraph (H). (12) Investment adviser.--The term ``investment adviser'' has the meaning given the term in section 202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)). (13) Issuer.--The term ``issuer'' has the meaning given the term in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)). (14) National securities exchange.--The term ``national securities exchange'' means an exchange that is registered as a national securities exchange pursuant to section 6 of the Securities Exchange Act of 1934 (15 U.S.C. 78f). (15) Pension fund.--The term ``pension fund'' has the meaning given the term ``pension plan'' in section 3 of the Employee Retirement Security Act of 1974 (29 U.S.C. 1002). (16) Private fund.--The term ``private fund'' means a corporation that-- (A) would be considered an investment company under section 3 of the Investment Company Act of 1940 (15 U.S.C. 80a-3) but for the application of paragraph (1) or (7) of subsection (c) of such section 3; (B) is not a venture capital fund, as defined in section 275.203(l)-1 of title 17, Code of Federal Regulations, as in effect on the date of enactment of this Act; and (C) is not an institution selected under section 107 of the Community Development Banking and Financial Institutions Act of 1994 (12 U.S.C. 4706). (17) Relative.--The term ``relative'' means an individual related by affinity or consanguinity within the third degree as determined by the common law, or individual in a step or adoptive relationship within such third degree. (18) Security.--The term ``security'' has the meaning given the term in section 2(a) of the Securities Act of 1933 (15 U.S.C. 77b(a)). (19) Target firm.--The term ``target firm'' means a corporation that is acquired in a change in control transaction.

TITLE I--CORPORATE RESPONSIBILITY

SEC. 101. JOINT AND SEVERAL LIABILITY FOR CONTROLLING PRIVATE FUNDS AND HOLDERS OF ACTIVE INTERESTS IN CONTROLLING PRIVATE FUNDS.

The Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.) is amended by adding at the end the following:

``SEC. 66. JOINT AND SEVERAL LIABILITY FOR CONTROLLING PRIVATE FUNDS AND HOLDERS OF ACTIVE INTERESTS IN CONTROLLING PRIVATE FUNDS.

``(a) Definitions.--In this section, the terms `affiliate', `control person', `controlling private fund', `holder of an active interest', and `target firm' have the meanings given those terms in section 3 of the Stop Wall Street Looting Act. ``(b) Joint and Several Liability.--Notwithstanding any other provision of law, or the terms of any contract or agreement, a controlling private fund, and any holder of an active interest with respect to a controlling private fund, shall be jointly and severally liable for all liabilities of each target firm for which the controlling private fund is a control person, and for all liabilities of any affiliate of each such target firm, including-- ``(1) any debt incurred by the target firm or an affiliate of the target firm, including as part of the acquisition of the target firm by the controlling private fund; ``(2) any Federal or State civil monetary penalty, or obligation under a settlement or consent order with a Federal or State governmental agency or instrumentality, including a consumer restitution obligation, for which the target firm, or an affiliate of the target firm, is liable; ``(3) any liability resulting from a violation of section 3 of the Worker Adjustment and Retraining Notification Act (29 U.S.C. 2102) by the target firm or an affiliate of the target firm; ``(4) any withdrawal liability determined under part 1 of subtitle E of title IV of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1381 et seq.) that is incurred by the target firm or an affiliate of the target firm; and ``(5) any claim for unfunded benefit liabilities owed to the Pension Benefit Guaranty Corporation under subtitle D of title IV of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1361 et seq.) with respect to the termination of a pension plan sponsored by the target firm or an affiliate of the target firm. ``(c) Rule of Construction.--Nothing in this section may be construed to diminish existing, as of the date of enactment of this section, controlled group liability under the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1001 et seq.).''.

SEC. 102. INDEMNIFICATION VOID AS AGAINST PUBLIC POLICY.

The Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.), as amended by this Act, is amended by adding at the end the following:

``SEC. 67. INDEMNIFICATION VOID AS AGAINST PUBLIC POLICY.

``(a) Definitions.--In this section, the terms `affiliate', `controlling private fund', `holder of an active interest', and `target firm' have the meanings given those terms in section 3 of the Stop Wall Street Looting Act. ``(b) Void as Against Public Policy.--It shall be void as against public policy for a target firm, or an affiliate of a target firm, to indemnify a controlling private fund with respect to-- ``(1) the target firm; ``(2) any affiliate of the target firm; or ``(3) any person that is the holder of an active interest in the controlling private fund with respect to the liabilities of that person under section 66.''.

TITLE II--ANTI-LOOTING

SEC. 201. LIMITATIONS ON POST-ACQUISITION DIVIDENDS, DISTRIBUTIONS, REDEMPTIONS, BUYBACKS, AND OUTSOURCING.

(a) In General.--No target firm may, directly or indirectly, after the closing date of a change in control transaction that results in a private fund becoming a controlling private fund with respect to the target firm-- (1) for a 4-year period, make a capital distribution or similarly reduce the equity capital of the target firm; (2) make a capital distribution greater than 10 percent of the sum of all financial obligations of the target firm for each of the previous 2 years or similarly reduce the equity capital of the target firm; (3) incur an obligation that commits the target firm to making a capital distribution of greater than 10 percent of the new sum of all financial obligations of the firm or a similar reduction of the equity capital of the target firm for each of the following 2 years; or (4) order a plant closing or mass layoff (as defined in section 2(a) of the Worker Adjustment and Retraining Notification Act (29 U.S.C. 2101(a))) and relocate the trade or business conducted by the employees in the United States to one or more facilities outside the United States, in accordance with regulations issued by the Secretary of Labor. (b) Void.--Any transfer made or obligation incurred by a target firm or an affiliate with respect to a target firm in violation of subsection (a) shall be void. (c) Joint and Several Liability for Aiders and Abettors.--Any controlling private fund, any holder of an active interest in a controlling private fund, or any affiliate of a target firm that aids, abets, facilitates, supports, or instructs a target firm's violation of subsection (a) shall be jointly and severally liable under this subsection for any transfer made or obligation incurred, including for reasonable attorney's fees and costs awarded to a plaintiff under subsection (d)(2). (d) Cause of Action.-- (1) In general.--Any employee or creditor, or representative of an employee or creditor, of a target firm that is a debtor under title 11, United States Code, or of an affiliate of a target firm that is such a debtor, may bring an action in an appropriate district court of the United States against the direct or indirect transferee or obligee or beneficiary of the transfer or obligation to void the transfer or obligation and recover any transferred property for the target firm. (2) Award.--In a successful action to recover a transfer, the court shall also award the plaintiff reasonable attorney's fees and costs.

SEC. 202. PREVENTION OF FRAUDULENT TRANSFERS.

(a) Limitation on Safe Harbors.--Section 546(e) of title 11, United States Code, is amended by inserting after ``548(b) of this title,'' the following: ``and except in the case of a transfer made in connection with a change in control transaction, as defined in section 3 of the Stop Wall Street Looting Act, or during the protected period, as defined in section 548(f) of this title,''. (b) Presumption of Insolvency in Transfers Undertaken in Connection With Change in Control Transactions.--Section 548 of title 11, United States Code, is amended by adding at the end the following: ``(f)(1) In this subsection-- ``(A) the terms `change in control transaction', `control person', and `target firm' have the meanings given those terms in section 3 of the Stop Wall Street Looting Act; and ``(B) the term `protected period' means the shorter of-- ``(i) the 15-year period beginning on the date on which a change in control transaction closed; or ``(ii) the period beginning on the date on which a change in control transaction closed and ending on the earliest subsequent date on which a public offering of a controlling share of the common equity securities of the target firm occurs. ``(2) For purposes of this section, if the debtor is a target firm, the debtor is presumed to have made a transfer or incurred an obligation described in subparagraphs (A) and (B) of subsection (a)(1) if-- ``(A) the transfer was made to or obligation was incurred by the debtor or an affiliate in connection with a change in control transaction; or ``(B) during a protected period-- ``(i) the transfer was made by the debtor or an affiliate to a control person, an affiliate, or an insider; or ``(ii) the obligation was incurred by the debtor or an affiliate from a control person, an affiliate, or an insider. ``(3) For the purposes of this section, a court shall, in analyzing related transactions, link together as a single transaction any interrelated yet formally distinct steps in an integrated transaction (commonly known as the `step transaction doctrine').''. (c) Statute of Limitations.-- (1) Title 11.--Section 548 of title 11, United States Code, is amended-- (A) in subsection (a)(1), by striking paragraph ``that was made or incurred on or within 15 years before the date of the filing of the petition'' and inserting ``that was made or incurred during the period described in subsection (g)''; and (B) adding at the end the following: ``(g) The trustee may avoid under subsection (a) a transfer of an interest of the debtor in property or any obligation incurred by the debtor on or within-- ``(1) 15 years before the date of the filing of the petition if the transfer was made or obligation incurred in connection with a change in control transaction, as defined in section 3 of the Stop Wall Street Looting Act; or ``(2) 15 years before the date of the filing of the petition for all other transfers and obligations.''. (2) Title 28.--Section 3306(b) of title 28, United States Code, is amended-- (A) in paragraph (2), by striking ``or'' at the end; (B) in paragraph (3), by striking the period at the end and inserting ``; or''; and (C) by adding at the end the following: ``(4) within 15 years after the transfer was made or the obligation was incurred, if the transfer was made or the obligation was incurred-- ``(A) in connection with a change in control transaction, as defined in section 3 of the Stop Wall Street Looting Act; or ``(B) during a protected period, as defined in section 548(f) of title 11.''. (d) Powers and Duties of Committees.--Section 1103(c) of title 11, United States Code, is amended-- (1) by redesignating paragraphs (3) through (5) as paragraphs (4) through (6), respectively; and (2) by inserting after paragraph (2) the following: ``(3) upon motion, undertake an examination of a director, officer, general partner, or person in control of the debtor regarding potential conflicts of interest;''. (e) Elimination of Sham Independent Directors.--Section 1107 of title 11, United States Code, is amended-- (1) in subsection (a), by striking ``Subject to'' and inserting, ``Except as provided in subsection (c), subject to''; and (2) by adding at the end the following: ``(c) Notwithstanding subsection (a), if a debtor in possession is serving in a case under this title, a committee of creditors appointed under section 1102 of this title shall have the exclusive right of a trustee serving in a case under this chapter to bring or settle on behalf of the estate-- ``(1) an action under section 544, 547, 548, or 553 to avoid a transfer made or obligation incurred by the debtor in connection with a change of control transaction, as defined in section 3 of the Stop Wall Street Looting Act; or ``(2) an action against an insider, a former insider, or an agent or aider and abettor of an insider or former insider.''.

SEC. 203. SURTAX ON CERTAIN AMOUNTS RECEIVED BY INVESTMENT FIRMS FROM CONTROLLED TARGET FIRMS.

(a) Imposition of Tax.--Subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new part:

``PART VIII--SURTAX ON CERTAIN AMOUNTS RECEIVED BY INVESTMENT FIRMS

``Sec. 59B. Surtax on certain amounts received by investment firms from controlled target firms.

``SEC. 59B. SURTAX ON CERTAIN AMOUNTS RECEIVED BY INVESTMENT FIRMS FROM CONTROLLED TARGET FIRMS.

``(a) Imposition of Tax.-- ``(1) In general.--If one or more applicable payments are included in the gross income of a taxpayer for any taxable year, then there is hereby imposed on the taxpayer for the taxable year a tax equal to the applicable percentage of the aggregate amount of such payments. Such tax shall be in addition to any other tax imposed by this subtitle. ``(2) Applicable percentage.--For purposes of this subsection, the term `applicable percentage' means 100 percent, minus the highest rate of tax under section 1 or 11 (whichever is applicable) for the taxable year. ``(b) Applicable Payment.--For purposes of this section-- ``(1) In general.--The term `applicable payment' means any amount paid or incurred by an applicable entity (or any person related within the meaning of section 267(b) or 707(b) to such entity) to any other person which, at the time such amount is paid or incurred, is an applicable controlling entity. An amount shall be treated as an applicable payment without regard to whether it is paid or incurred to the taxpayer including it in gross income and to which subsection (a) applies. ``(2) Exceptions.--Such term shall not include any of the following: ``(A) Interest.--Any amount paid or incurred which is treated as interest for purposes of this chapter. ``(B) Distributions of property with respect to stock.--Any distribution of property (as defined in section 317(a)) to which section 301(a) applies. ``(c) Definitions Relating to Entities.--For purposes of this section-- ``(1) Applicable entity.--The term `applicable entity' means any person-- ``(A) which is engaged in the active conduct of a trade or business, and ``(B) with respect to which any other person conducts activities in connection with an applicable trade or business. ``(2) Applicable controlling entity.--The term `applicable controlling entity' means, with respect to any applicable entity, any person-- ``(A) which is engaged in an applicable trade or business some or all of the activities of which are conducted in connection with the applicable entity, and ``(B) which controls (or is related within the meaning of section 267(b) or 707(b) to a person which controls) the applicable entity. ``(3) Applicable trade or business.--The term `applicable trade or business' means any activity conducted on a regular, continuous, and substantial basis which, regardless of whether the activity is conducted in one or more entities, consists, in whole or in part, of-- ``(A) raising or returning capital, and ``(B) either-- ``(i) investing in or disposing of specified assets (or identifying specified assets for such investing or disposition), or ``(ii) developing specified assets. ``(4) Specified asset.--The term `specified asset' means-- ``(A) securities (as defined in section 475(c)(2) but without regard to the phrase `widely held or publicly traded' in subparagraph (B) thereof and without regard to the last sentence thereof), and ``(B) real estate held for rental or investment. ``(d) Rules and Definitions Relating to Ownership Attribution and Control.--For purposes of this section-- ``(1) Constructive ownership rules used in determining related party.--In determining whether persons are related within the meaning of section 267(b) or 707(b), the constructive ownership rules of section 318 shall apply in lieu of the constructive ownership rules which would otherwise apply, except that in applying such rules the term `stock' shall include capital, profits, or other beneficial interests in persons other than corporations. ``(2) Control.-- ``(A) Corporations.--In the case of a corporation, the term `control' has the meaning given such term by section 304(c) (without regard to paragraph (3)(B) thereof). ``(B) Other entities.--In the case of a person other than a corporation, such term means the ownership, directly or indirectly, of at least 50 percent of the capital, profits, or other beneficial interests in the person. ``(e) Regulations.--The Secretary shall prescribe such regulations or other guidance as may be necessary or appropriate to carry out the provisions of this section, including regulations-- ``(1) providing for such adjustments to the application of this section as are necessary to prevent the avoidance of the purposes of this section, including through the use of unrelated persons, or conduit transactions, and ``(2) modifying the constructive ownership rules under section 318 to the extent necessary to apply such rules to capital, profits, or other beneficial interests as well as stock.''. (b) Disallowance of Credits Against Tax.--Subparagraph (B) of section 26(b)(2) of the Internal Revenue Code of 1986 is amended by inserting ``or section 59B (relating to surtax on certain amounts received by investment firms from controlled target firms)'' after ``anti-abuse tax)''. (c) Conforming Amendments.-- (1) The table of parts for subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding after the item relating to part VII the following new item:

``Part VIII. Surtax on Certain Amounts Received by Investment Firms''.

(2) Section 871(b)(1) of such Code is amended by inserting ``, and as provided in section 59B on applicable payments included in gross income which are effectively connected with the conduct of a trade or business within the United States'' before the period. (3) Section 882(a)(1) of such Code is amended-- (A) by striking ``59A,'' and inserting ``59A''; and (B) by inserting ``, and as provided in section 59B on applicable payments included in gross income which are effectively connected with the conduct of a trade or business within the United States'' before the period. (4) Subparagraph (A) of section 6425(c)(1) of such Code is amended by striking ``plus'' at the end of clause (i), by striking ``plus'' at the end of clause (ii), by striking ``over'' at the end of clause (iii) and inserting ``and'', and by adding at the end the following new clause: ``(iv) the tax imposed by section 59B, over''. (5) Paragraph (1) of section 6654(f) of such Code is amended by striking ``tax'' each place it appears and inserting ``taxes''. (6) Subparagraph (A) of section 6655(g)(1) of such Code is amended by striking ``plus'' at the end of clause (iii), by redesignating clause (iv) as clause (v), and by inserting after clause (iii) the following new clause: ``(iv) the tax imposed by section 59B, and''. (d) Effective Date.--The amendments made by this section shall apply to applicable payments (as defined in section 59B(b) of the Internal Revenue Code of 1986, as added by this section) paid or accrued on or after the date of the enactment of this Act.

SEC. 204. LIMITATION ON DEDUCTION FOR BUSINESS INTEREST OF CERTAIN BUSINESSES OWNED BY PRIVATE FUNDS.

(a) In General.--Section 163(j) of the Internal Revenue Code of 1986 is amended by redesignating paragraph (11) as paragraph (12) and by inserting after paragraph (10) the following new paragraph: ``(11) Modification of limitation for certain businesses owned by private firms.-- ``(A) In general.--In the case of a taxpayer which is an applicable entity controlled by an applicable controlling entity (or any person related within the meaning of section 267(b) or 707(b) to such entity) at any time during the taxable year-- ``(i) if the ratio of debt to equity of the taxpayer as of the close of the taxable year (or on any other day during the taxable year as the Secretary may prescribe in regulations) exceeds 1, then paragraph (1) shall be applied by substituting a percentage that the Secretary determines appropriate (and which shall be not less than 30 percent) for `30 percent', and ``(ii) in the case of the election under paragraph (7)(B) to treat any trade or business of the taxpayer as an electing real property trade or business-- ``(I) the taxpayer may not make any such election during such taxable year, and ``(II) any such election of the taxpayer in effect as of the close of the taxable year preceding such taxable year with respect to a trade or business shall be revoked, effective for such taxable year and all succeeding taxable years. ``(B) Ratio of debt to equity.--For purposes of this paragraph, the term `ratio of debt to equity' means, with respect to any taxpayer, the ratio which the total indebtedness of the taxpayer bears to the sum of the taxpayer's money and all other assets reduced (but not below zero) by such total indebtedness. For purposes of the preceding sentence-- ``(i) the amount taken into account with respect to any asset shall be the adjusted basis thereof for purposes of determining gain, ``(ii) the amount taken into account with respect to any indebtedness with original issue discount shall be its issue price plus the portion of the original issue discount previously accrued as determined under the rules of section 1272 (determined without regard to subsection (a)(7) or (b)(4) thereof), and ``(iii) there shall be such other adjustments as the Secretary may by regulations prescribe. ``(C) Coordination with depreciation rules.--If the alternative depreciation system under section 168(g) applies to property by reason of an election under paragraph (7)(B) which is revoked under subparagraph (A)(ii)(II), then the depreciation deduction under section 167(a) with respect to such property for the taxable year of revocation and all succeeding taxable years shall be determined under section 168 in the same manner as if such revocation were a change in use of the property under section 168(i)(5) and the regulations thereunder. ``(D) Definitions and rules.--For purposes of this paragraph-- ``(i) any term used in this paragraph which is also used in section 59B shall have the same meaning as when used in such section, and ``(ii) the constructive ownership rules of section 318 shall apply in the same manner as such rules apply for purposes of section 59B.''. (b) Effective Dates.-- (1) In general.--The amendments made by this section shall apply to taxable years beginning on or after the date of enactment of this Act. (2) Revocation of elections.--Subparagraphs (A)(ii)(II) and (C) of section 163(j)(11) of the Internal Revenue Code of 1986, as added by this section, shall apply to taxable years beginning on or after the date of enactment of this Act, with respect to elections under section 163(j)(7)(B) of such Code made before, on, or after such date.

SEC. 205. GUARDRAILS AROUND ACCESSING PUBLIC FUNDS.

The Investment Company Act of 1940 (15 U.S.C. 80a-1 et seq.), as amended by this Act, is amended by adding at the end the following:

``SEC. 68. DISCLOSURES.

``Any person described in paragraph (1) or (7) of section 3(c) that receives funds from a Federal or State agency-- ``(1) shall publicly disclose-- ``(A) the total funds received from the agency; ``(B) the workforce demographics of the person; ``(C) the amount of loans, grants, or other benefits provided; ``(D) the use of the proceeds; ``(E) how many jobs were saved or wages preserved; ``(F) any loans forgiven or discharged; ``(G) the beneficial owners of the person; ``(H) the pay ratio between the chief executive officer and the median pay of employees; and ``(2) may not, during the 2-year period beginning on the date on which the person receives the funds-- ``(A) acquire any company; or ``(B) make any distribution to a shareholder of the person.''.

SEC. 206. PROHIBITING PAYMENTS FROM FEDERAL HEALTH CARE PROGRAMS TO ENTITIES THAT SELL ASSETS TO OR USE ASSETS AS COLLATERAL FOR A LOAN WITH A REAL ESTATE INVESTMENT TRUST.

Section 1128(a) of the Social Security Act (42 U.S.C. 1320a-7(a)) is amended by adding at the end the following new paragraph: ``(5) Selling assets to or using assets as collateral for a loan with a real estate investment trust.-- ``(A) In general.--Any individual or entity that, on or after the date of enactment of this paragraph, sells any assets to, or newly pledges any assets as collateral for a loan with, a real estate investment trust (as defined in section 856(a) of the Internal Revenue Code of 1986). ``(B) Clarification.--Subparagraph (A) shall not apply in the case where an individual or entity agreed to pledge an asset as collateral for a loan with a real estate investment trust prior to the date of enactment of this paragraph, including with respect to any future agreement between the individual or entity and the real estate investment trust regarding that same asset.''.

SEC. 207. REPEAL OF SPECIAL RULE FOR TAXABLE REIT SUBSIDIARIES WITH INTERESTS IN CERTAIN HEALTH CARE PROPERTY.

(a) In General.--Section 856(d)(8)(B) of the Internal Revenue Code of 1986 is amended-- (1) by striking ``or a qualified health care property (as defined in subsection (e)(6)(D)(i))'', and (2) by striking ``qualified health care property or''. (b) Conforming Amendments.--Section 856(d)(9) of such Code is amended-- (1) in subparagraph (A)-- (A) by striking ``or a qualified health care property (as defined in subsection (e)(6)(D)(i))'', (B) by striking ``or qualified health care property'', and (C) by striking ``or qualified health care properties'', and (2) in subparagraph (B)-- (A) by striking ``or qualified health care property (as so defined)'', and (B) by striking ``or qualified health care property'' each place it appears in clauses (i), (ii), and (iii)(II). (c) Effective Date.--The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.

SEC. 208. ELIMINATION OF QUALIFIED REIT DIVIDENDS FROM QUALIFIED BUSINESS INCOME.

(a) In General.--Subparagraph (B) of section 199A(b)(1) of the Internal Revenue Code of 1986 is amended by striking ``qualified REIT dividends and''. (b) Conforming Amendments.-- (1) Section 199A(c)(1) of such Code is amended by striking ``qualified REIT dividends or'' in the last sentence. (2) Section 199A(e) of such Code is amended by striking paragraph (3) and by redesignating paragraph (4) as paragraph (3). (c) Effective Date.--The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.

SEC. 209. PROTECTIONS FOR STRIKING WORKERS.

(a) In General.--Section 8 of the National Labor Relations Act (29 U.S.C. 158) is amended-- (1) in subsection (a)-- (A) in paragraph (5), by striking the period and inserting ``;''; and (B) by adding at the end the following: ``(6) to promise, threaten, or take any action-- ``(A) to permanently replace an employee who participates in a strike as defined by section 501(2) of the Labor Management Relations Act, 1947 (29 U.S.C. 142(2)); ``(B) to discriminate against an employee who is working or has unconditionally offered to return to work for the employer because the employee supported or participated in such a strike; or ``(C) to lockout, suspend, or otherwise withhold employment from employees in order to influence the position of such employees or the representative of such employees in collective bargaining prior to a strike; and ``(7) to communicate or misrepresent to an employee under section 2(3) that such employee is excluded from the definition of employee under section 2(3).''; (2) in subsection (b)-- (A) by striking paragraphs (4) and (7); (B) by redesignating paragraphs (5) and (6) as paragraphs (4) and (5), respectively; (C) in paragraph (4), as so redesignated, by striking ``affected;'' and inserting ``affected; and''; and (D) in paragraph (5), as so redesignated, by striking ``; and'' and inserting a period; (3) in subsection (c), by striking the period at the end and inserting the following: ``: Provided, That it shall be an unfair labor practice under subsection (a)(1) for any employer to require or coerce an employee to attend or participate in such employer's campaign activities unrelated to the employee's job duties, including activities that are subject to the requirements under section 203(b) of the Labor-Management Reporting and Disclosure Act of 1959 (29 U.S.C. 433(b)).''; and (4) in subsection (d), in the matter preceding paragraph (1), by inserting ``and to maintain current wages, hours, and terms and conditions of employment pending an agreement'' after ``arising thereunder''. (b) Conforming Amendments.--The National Labor Relations Act is amended-- (1) in section 8(e) (29 U.S.C. 158(e)), by striking ``and section 8(b)(4)(B)''; and (2) in section 10 (29 U.S.C. 160)-- (A) by repealing subsection (k); and (B) in subsection (l)-- (i) by striking ``of paragraph'' and all that follows through ``the preliminary'' and inserting ``of section 8(e), the preliminary''; (ii) by striking the second proviso; and (iii) by striking the final sentence.

TITLE III--PROTECTING WORKERS WHEN COMPANIES GO BANKRUPT

SEC. 301. INCREASED PRIORITY FOR WAGES.

Section 507(a) of title 11, United States Code, is amended-- (1) in paragraph (4)-- (A) by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively; (B) in the matter preceding clause (i), as so redesignated, by inserting ``(A)'' before ``Fourth''; (C) in subparagraph (A), as so designated, in the matter preceding clause (i), as so redesignated-- (i) by striking ``$10,000'' and inserting ``$20,000''; (ii) by striking ``within 180 days''; and (iii) by striking ``or the date of the cessation of the debtor's business, whichever occurs first''; and (D) by adding at the end the following: ``(B) Severance pay described in subparagraph (A)(i) shall be deemed earned in full upon the layoff or termination of employment of the individual to whom the severance pay is owed.''; and (2) in paragraph (5)-- (A) in subparagraph (A)-- (i) by striking ``within 180 days''; and (ii) by striking ``or the date of the cessation of the debtor's business, whichever occurs first''; and (B) by striking subparagraph (B) and inserting the following: ``(B) for each such plan, to the extent of the number of employees covered by each such plan multiplied by $20,000.''.

SEC. 302. PRIORITY FOR SEVERANCE PAY AND CONTRIBUTIONS TO EMPLOYEE WELFARE BENEFIT PLANS.

Section 503(b) of title 11, United States Code, is amended-- (1) in paragraph (8)(B), by striking ``and'' at the end; (2) in paragraph (9), by striking the period and inserting a semicolon; and (3) by adding at the end the following: ``(10) severance pay owed to employees of the debtor (other than to an insider of the debtor or a senior executive officer of the debtor), under a plan, program, or policy generally applicable to employees of the debtor (but not under an individual contract of employment), or owed pursuant to a collective bargaining agreement, for layoff or termination on or after the date of the filing of the petition, which pay shall be deemed earned in full upon such layoff or termination of employment; and ``(11) any contribution due on or after the date of the filing of the petition under an employee welfare benefit plan, as defined in section 3 of the Stop Wall Street Looting Act.''.

SEC. 303. PRIORITY FOR VIOLATIONS OF FEDERAL AND STATE LAWS.

(a) Allowance of Administrative Expenses in Bankruptcy Cases.-- Section 503(b)(1)(A)(ii) of title 11, United States Code, is amended by inserting after ``(ii)'' the following: ``any back pay, civil penalty, or damages for a violation of any Federal or State labor and employment law, including the Worker Adjustment and Retraining Notification Act (29 U.S.C. 2101 et seq.) and any comparable State law, and''. (b) Administration and Enforcement of Worker Adjustment and Retraining Notification Requirements.--Section 5(a)(1) of the Worker Adjustment and Retraining Notification Act (29 U.S.C. 2104(a)(1)) is amended, in the matter following subparagraph (B)-- (1) by inserting ``which for purposes of this sentence shall consist of the days, in the notification period, that are or that follow the date of the prohibited closing or layoff under this Act,'' after ``period of the violation,''; and (2) by inserting ``calendar'' after ``60''.

SEC. 304. LIMITATION ON EXECUTIVE COMPENSATION ENHANCEMENTS.

Section 503(c) of title 11, United States Code, is amended-- (1) in the matter preceding paragraph (1), by inserting ``and subject to section 363(b)(3),'' after ``Notwithstanding subsection (b),''; (2) in paragraph (1), in the matter preceding subparagraph (A)-- (A) by inserting ``, a senior executive officer of the debtor, or any of the 20 next most highly compensated employees of the debtor, department or division managers of the debtor, or consultants providing services to the debtor (regardless of whether the executive officer, employee, manager, or consultant is an insider)'' after ``insider of the debtor''; (B) by inserting ``or for the payment of performance or incentive compensation, a bonus of any kind, or any other financial return designed to replace or enhance incentive, stock, or other compensation in effect before the date of the commencement of the case,'' after ``remain with the debtor's business,''; and (C) by inserting ``clear and convincing'' before ``evidence in the record''; (3) in paragraph (2), in the matter preceding subparagraph (A), by inserting ``, a senior executive officer of the debtor, or any of the 20 next most highly compensated employees of the debtor, department or division managers of the debtor, or consultants providing services to the debtor (regardless of whether the executive officer, employee, manager, or consultant is an insider)'' after ``an insider of the debtor''; and (4) by striking paragraph (3) and inserting the following: ``(3) any other transfer or obligation to or for the benefit of an insider of the debtor, a senior executive officer of the debtor, or any of the 20 next most highly compensated employees of the debtor, department or division managers of the debtor, or consultants providing services to the debtor (regardless of whether the executive officer, employee, manager, or consultant is an insider), absent a finding by the court, based upon clear and convincing evidence in the record, and without deference to a request by the debtor for such payment, that-- ``(A) because of the essential and particularized nature of the services provided by the insider, executive officer, employee, manager, or consultant, the transfer or obligation is essential to-- ``(i) the survival of the business of the debtor; or ``(ii) in a case in which some or all of the assets of the debtor are liquidated, the orderly liquidation of the assets; ``(B) in the case of a transfer or obligation under an incentive program, the transfer or obligation is part of a workforce incentive program generally applicable to the nonmanagement workforce of the debtor; and ``(C) the cost of the transfer or obligation-- ``(i) is reasonable; ``(ii) is not excessive in the context of the financial circumstances of the debtor; and ``(iii) is not disproportionate in light of any economic loss incurred by the nonmanagement workforce of the debtor during the case.''.

SEC. 305. PROHIBITION AGAINST SPECIAL COMPENSATION PAYMENTS.

Section 363 of title 11, United States Code, is amended-- (1) in subsection (b), by adding at the end the following: ``(3) No plan, program, or other transfer or obligation to or for the benefit of an insider of the debtor, a senior executive officer of the debtor, or any of the 20 next most highly compensated employees of the debtor, department or division managers of the debtor, or consultants providing services to the debtor (regardless of whether the executive officer, employee, manager, or consultant is an insider) shall be approved if the debtor has, on or after the date that is 1 year before the date of the filing of the petition-- ``(A) discontinued any plan, program, policy or practice of paying severance pay to the nonmanagement workforce of the debtor; or ``(B) modified any plan, program, policy, or practice described in subparagraph (A) in order to reduce benefits under the plan, program, policy or practice.''; and (2) in subsection (c)(1), by inserting before the period at the end the following: ``, except that, for any transaction that constitutes a transfer or obligation subject to section 503(c), the trustee shall be required to obtain the prior approval of the court after notice and an opportunity for a hearing''.

SEC. 306. EXECUTIVE COMPENSATION UPON EXIT FROM BANKRUPTCY.

Section 1129(a) of title 11, United States Code, is amended-- (1) in paragraph (4), by adding at the end the following: ``Except for compensation subject to review under paragraph (5), any payment or other distribution under the plan to or for the benefit of an insider of the debtor, a senior executive officer of the debtor, or any of the 20 next most highly compensated employees of the debtor, department or division managers of the debtor, or consultants providing services to the debtor (regardless of whether the executive officer, employee, manager, or consultant is an insider), shall not be approved by the court except as part of a program of payments or distributions generally applicable to employees of the debtor, and only to the extent that the court determines that the payment or other distribution is not excessive or disproportionate in comparison to payments or other distributions to the nonmanagement workforce of the debtor.''; and (2) in paragraph (5)-- (A) in subparagraph (A)(ii), by striking ``and'' at the end; (B) in subparagraph (B), by striking the period at the end and inserting ``; and''; and (C) by adding at the end the following: ``(C) the compensation disclosed pursuant to subparagraph (B) has been approved by, or is subject to the approval of, the court as-- ``(i) reasonable in comparison to compensation paid to individuals holding comparable positions at comparable companies in the same industry; and ``(ii) not disproportionate in light of any economic concession made by the nonmanagement workforce of the debtor during the case.''.

SEC. 307. COLLATERAL SURCHARGE FOR EMPLOYEE OBLIGATIONS.

Section 506(c) of title 11, United States Code, is amended-- (1) by inserting ``(1)'' before ``The trustee''; and (2) by adding at the end the following: ``(2) If one or more employees of the debtor have not received wages, accrued vacation, severance, or any other compensation owed under a plan, program, policy, or practice of the debtor, or pursuant to the terms of a collective bargaining agreement, for services rendered on or after the date of the commencement of the case, or the debtor has not made a contribution due under an employee welfare benefit plan, as defined in section 3 of the Stop Wall Street Looting Act, on or after the date of the commencement of the case, such unpaid obligations shall be-- ``(A) deemed-- ``(i) reasonable, necessary costs and expenses of preserving, or disposing of, property securing an allowed secured claim; and ``(ii) benefiting the holder of the allowed secured claim; and ``(B) recovered by the trustee for payment to the employees or the employee welfare benefit plan, as defined in section 3 of the Stop Wall Street Looting Act, as applicable, even if the trustee, or a predecessor or successor in interest, has otherwise waived the provisions of this subsection under an agreement with the holder of the allowed secured claim or a successor or predecessor in interest of the holder of the allowed secured claim.''.

SEC. 308. VOIDABILITY OF PREFERENTIAL COMPENSATION TRANSFERS.

Section 547 of title 11, United States Code, is amended by adding at the end the following: ``(j)(1) The trustee may avoid a transfer to or for the benefit of an insider of the debtor, a senior executive officer of the debtor, or any of the 20 next most highly compensated employees of the debtor, department or division managers of the debtor, or consultants providing services to the debtor (regardless of whether the executive officer, employee, manager, or consultant is an insider), that-- ``(A) is made or incurred under a retention, bonus, or incentive plan devised before the date of the filing of the petition; and ``(B) does not meet the requirements under section 363(b)(3) or 503(c). ``(2) Subsection (c) shall not constitute a defense against the recovery of a transfer under paragraph (1) of this subsection. ``(3)(A) The trustee, or a committee appointed under section 1102, may commence an action to recover a transfer under paragraph (1) of this subsection. ``(B) If neither the trustee nor a committee commences an action to recover a transfer under subparagraph (A) before the date of the commencement of a hearing on the confirmation of a plan, any party in interest may apply to the court for authority to recover the transfer for the benefit of the estate, in which case the costs of recovery shall be borne by the estate.''.

SEC. 309. PROTECTION FOR EMPLOYEES IN A SALE OF ASSETS.

(a) Requirement Relating to Preserving Jobs and Maintaining Terms and Conditions Relating to Employment.--Section 363 of title 11, United States Code, is amended by adding at the end the following: ``(q)(1) In approving a sale or lease of property of the estate under this section, or under a plan under chapter 11, the court shall give substantial weight to the extent to which a prospective purchaser or lessee, respectively, of the property will-- ``(A) preserve the jobs of the workforce of the debtor; and ``(B) maintain the terms and conditions of employment of the workforce of the debtor. ``(2) If there are two or more offers to purchase or lease property of the estate under this section, or under a plan under chapter 11, that qualify under the procedures for the sale or lease, respectively, approved by the court, the court shall approve the offer that best-- ``(A) preserves the jobs of the workforce of the debtor; and ``(B) maintains the terms and conditions of employment of the workforce of the debtor. ``(r)(1) Any party seeking to purchase or lease property of the estate under this section, or under a plan under chapter 11, shall represent to the court the effect of such a transaction with respect to-- ``(A) the preservation of the jobs of the workforce of the debtor; and ``(B) the maintenance of the terms and conditions of employment of the workforce of the debtor. ``(2) The court shall expressly include in an order approving a purchase or lease of property of the estate under this section, or under a plan under chapter 11, any representation made by a purchaser or lessee of the property under paragraph (1). ``(3) With respect to a purchase or lease of property of the estate under this section, or under a plan under chapter 11-- ``(A) the court shall have jurisdiction over the purchaser or lessee of the property in order to enforce the terms of the order approving the purchase or lease; ``(B) the purchaser or lessee shall promptly disclose to the court any material noncompliance with the terms of the order described in su

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