,,ii #aaith ,,congress #b;d ,session ,s4 #dbab ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,march #be1 #bjbf,ms4 ,warren 7for herself and ,mr4 ,hawley7 introduced the following bill2 which was read twice and referred to the ,committee on ,armed ,services ,a ,,bill ,to require contractors of the ,department of ,defense to prioritize meeting warfighter needs over the purchase of their own securities and executive compensation1 and for other purposes4 #a4 ,short title ,this ,act may be cited as ,prioritizing the ,warfighter in ,defense ,contracting ,act of #bjbf4 #b4 ,definitions ,in this ,act3 7#a7 ,appropriate congressional committees ,the term appropriate congressional committees means-- 7,a7 the ,committee on ,armed ,services and the ,committee on ,homeland ,security and ,governmental ,affairs of the ,senate2 and 7,b7 the ,committee on ,armed ,services and the ,committee on ,oversight and ,government ,reform of the ,house of ,representatives4 7#b7 ,covered employee ,the term covered employee means an employee1 executive1 or officer4 7#c7 ,equity security ,the term equity security has the meaning given such term in section #c7;a7 of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #gh;c7a774 7#d7 ,covered compensation ,the term covered compensation-- 7,a7 means-- 7i7 salary2 7ii7 bonuses2 7iii7 any compensation that is granted1 earned1 or vested based wholly or in part upon the attainment of any financial reporting measure or other performance metric2 7iv7 equity-based compensation2 7v7 time- or service-based awards2 7vi7 awards based on nonfinancial metrics2 and 7vii7 any profits realized from the buying or selling of securities2 and 7,b7 does not include-- 7i7 routine employee #dja7k7 plans2 or 7ii7 employee stock ownership plans4 7#e7 ,large contractor ,the term large contractor means a contractor that received more than #bej1jjj1jjj in annual revenue from contracts or licenses from the ,department of ,defense in any of the previous #c years4 7#f7 ,national securities exchange ,the term national securities exchange means an exchange registered as a national securities exchange in accordance with section #f of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #gh;f74 7#g7 ,short-term financial metrics ,the term short-term financial metrics means-- 7,a7 free cash flow2 7,b7 operating cash flow2 and 7,c7 earnings per share driven by stock buy-backs4 #c4 ,limitations on contractors of ,department of ,defense 7a7 ,in general ,the ,secretary of ,defense may not enter into a contract with a large contractor for the procurement of goods or services unless such contractor agrees in writing that-- 7#a7 the entity shall not-- 7,a7 purchase an equity security of such entity1 or any parent entity of such entity1 that is listed on a national securities exchange2 or 7,b7 pay dividends or make any other capital distribution with respect to the equity securities of the entity2 and 7#b7 the covered compensation of a covered employee of such entity shall-- 7,a7 comply with the requirements of section #cgdd of title #aj1 ,united ,states ,code2 7,b7 not be linked to short-term financial metrics2 and 7,c7 not exceed #e1jjj1jjj per calendar year4 7b7 ,compliance plan and procedures 7#a7 ,in general ,any contractor subject to the requirements of subsection 7a7 shall develop and implement a plan to prevent the activities prohibited under that subsection4 7#b7 ,certification ,prior to entering into a contract with the ,department of ,defense1 and annually thereafter for the duration of the contract1 a contractor shall submit to the contracting officer of the ,department a certification that to the best of the knowledge of the contractor1 neither the contractor nor any covered employee of the contractor is engaged in any of the activities prohibited under subsection 7a74 7c7 ,waiver authority 7#a7 ,identification of contractors eligible for waiver ,beginning on the date of the enactment of this ,act1 and on a rolling basis thereafter1 the ,secretary of ,defense-- 7,a7 shall review and determine whether a large contractor meets the contractor metrics described in paragraph 7#d72 and 7,b7 for any large contractor assessed by the ,secretary to meet such metrics1 may grant the contractor a waiver of the requirements of subsection 7a74 7#b7 ,notice ,for any waiver granted under paragraph 7#a71 the ,secretary shall submit to the appropriate congressional committees notification of the waiver that includes justification for the waiver4 7#c7 ,annual review 7,a7 ,in general ,for any contractor granted a waiver under paragraph 7#a71 the ,secretary shall conduct1 not later than #a year after the date on which the contractor was granted a waiver under such paragraph and not less frequently than once a year thereafter1 a review to determine whether the contractor continues to meet the metrics described in paragraph 7#d74 7,b7 ,authority to revoke waiver ,the ,secretary may revoke a waiver issued to any contractor that the ,secretary determines1 during a review conducted pursuant to subparagraph 7,a71 no longer meets the metrics described in paragraph 7#d74 7#d7 ,contractor metrics ,the contractor metrics described in this paragraph are as follows3 7,a7 ,not less than #hj percent of the time during the preceding fiscal year1 the contractor met contract requirements regarding delivery dates with demonstrated1 fieldable capability or associated technical achievement4 7,b7 ,not less than #hj percent of the time during the preceding fiscal year1 the contractor met contract readiness requirements4 7,c7 ,not less than #hj percent of the time during the preceding fiscal year1 the contractor demonstrated technical performance metrics and regular value assessments with the user community4 7,d7 ,not less than #hj percent of the time during the preceding fiscal year1 the contractor responded to requests for certified or uncertified cost or pricing data by the due date stated in the request for submissions4 7#e7 ,rule of construction ,nothing in this subsection may be construed to supersede existing limitations that restrict ,federal funds from being used for contractor employee compensation4 7d7 ,review and enforcement 7#a7 ,establishment of formal review process ,not later than #cj days after the date of the enactment of this ,act1 the ,secretary of ,defense shall establish a formal review mechanism for identifying1 on a continuing basis1 ,defense contractors that are in violation of the requirements of subsection 7a74 7#b7 ,renegotiation of existing contracts 7,a7 ,review and identification ,the ,secretary shall review all contracts in existence on the day before the date of the enactment of this ,act and identify any contract to be modified in the interest of the ,department4 7,b7 ,renegotiation ,for each contract identified by the ,secretary pursuant to subparagraph 7,a71 the ,secretary shall renegotiate such contract in accordance with the requirements of this section4 7#c7 ,evidence and notification of violation 7,a7 ,in general ,if a contracting officer of the ,department finds1 or receives and substantiates1 an allegation described in subparagraph 7,b71 the ,secretary shall-- 7i7 immediately notify the contractor of the violation in writing2 and 7ii7 track and continually update the allegation in the ,contractor ,performance ,assessment ,reporting ,system and the ,system for ,award ,management of the ,general ,services ,administration1 for shared use across contracting officers4 7,b7 ,allegation described ,an allegation described in this subparagraph is any allegation relating to-- 7i7 a contractor of the ,department or any covered employee of such contractor engaging in an activity prohibited under subsection 7a71 if the requirements of such subsection have not been waived under subsection 7c77#a72 or 7ii7 a contractor who received a waiver under subsection 7c77#a7 that is underperforming with respect to prioritization1 investment1 or production such that the contractor no longer meets the contractor metrics described in subsection 7c77#d74 7,c7 ,contents of notice ,the notice issued under subparagraph 7,a77i7 shall include1 depending on the basis of the violation1 a description of-- 7i7 the conduct of the contractor or the covered employee of the contractor that is prohibited under subsection 7a72 or 7ii7 the nature of the underperformance or insufficient prioritization1 investment1 or production speed of the contractor that fails to meet the contractor metrics described in subsection 7c77#d74 7#d7 ,remediation 7,a7 ,in general ,not later than #ae days after the date on which the contractor receives the notice of a violation under paragraph 7#c77;,a77i71 the contractor may submit to the ,secretary a remediation plan1 approved by the board of directors of the contractor1 for review by the ,secretary4 7,b7 ,content of plan ,the remediation plan submitted under subparagraph 7,a7 shall include a description of the manner by which the contractor shall remedy the violation1 including1 if applicable1 a strategy for meeting the contractor metrics described in subsection 7c77#d74 7,c7 ,identification of deficiencies ,if the ,secretary identifies deficiencies in the remediation plan submitted under subparagraph 7,a71 the ,secretary shall engage with the contractor as needed to resolve such deficiencies4 7#e7 ,penalties ,if a contractor engages in an activity prohibited under subsection 7a7 and was not granted a waiver under subsection 7c77#a7 or if the contractor was granted a waiver under subsection 7c77#a7 but no longer meets the contractor metrics described in subsection 7c77#d71 the contracting officer of the ,department may take one or more of the following actions against the contractor3 7,a7 ,suspend payment under one or more contracts1 at the discretion of the ,department4 7,b7 ,revoke the waiver issued under subsection 7c77#a74 7,c7 ,terminate the eligibility of the contractor to receive progress payments under section #chjd of title #aj1 ,united ,states ,code4 7,d7 ,terminate the contract for default or cause in accordance with the termination clause for the contract4 7,e7 ,refer the matter to the ,secretary to claw back all or part of the covered compensation given to a covered employee4 7,f7 ,refer the matter to the relevant suspension and debarment official4 7,g7 ,refer the matter to the ,secretary for other administrative actions4 7,h7 ,refer the matter to the ,attorney ,general for prosecution under any applicable law4 7,i7 ,cease advocacy for the contractor for foreign military sales and direct commercial sales4 7,j7 ,prohibit the ,department from entering into a new contract with the contractor4 7e7 ,reports to ,congress 7#a7 ,annual report 7,a7 ,in general ,not later than one year after the date of the enactment of this ,act1 and annually thereafter1 the ,secretary of ,defense shall submit to the appropriate congressional committees a report that includes1 for the one-year period preceding submission of the report-- 7i7 a list of all contractors subject to the requirements of subsection 7a72 7ii7 for each contractor1 a copy of the certification submitted under subsection 7b77#b72 7iii7 a list of all contractors granted a waiver under subsection 7c77#a7 and the justification for each waiver2 and 7iv7 a list of all entities that have violated the certification submitted under subsection 7b77#b7 or diverged from the practices that justified the granting of a waiver under subsection 7c77#a74 7,b7 ,publication ,not later than #cj days after the date of submission of the report under subparagraph 7,a71 the ,secretary shall make the report publicly available4 7#b7 ,quarterly report ,not later than #ij days after the date of the enactment of this ,act1 and not less frequently than once every #ij days thereafter1 the ,secretary shall submit to the appropriate congressional committees a report that includes1 for the period covered by the report-- 7,a7 a list of all of the contractors that submitted a request for a waiver under subsection 7c77#a72 and 7,b7 the unclassified summaries of the materials submitted by such contractors to the ,department in support of the requests for a waiver4