Registration Statement Contents for Emerging Growth Companies

Floor Speech

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Mr. SHERMAN.

Mr. Speaker, I rise in support of H.R. 2610, sponsored by the gentleman from North Carolina, the chairman of the Financial Services Committee.

Mr. Speaker, both this bill and the last bill we considered are seeking to reduce the obligations of emerging growth companies, or EGCs.

H.R. 2608 would allow an EGC to provide only 2 years of audited financial statements in the case of an acquisition or a follow-on offering. We just passed that bill on this floor by a voice vote. We are now considering H.R. 2610, which takes that concept one step further and allows an EGC to provide only 2 years of audited financial statements in the case of a spinoff.

Logically, if we are going to adopt that bill, we should adopt this bill.

A spinoff transaction is one where one company creates a new independent company by selling new shares of its existing business.

Both H.R. 2608, which we just passed, and this bill, H.R. 2610, reduce the obligations for EGCs by saying that they need to provide not 3 years of audited financial statements but 2 years of audited statements.

We should keep in line what is required for EGCs, whether they are going public, whether they are acquiring, whether they are doing an initial public offering, or, as this bill does, whether they are doing a spinoff.

Mr. Speaker, I urge my colleagues to support this bill, and I reserve the balance of my time.

Mr. Speaker, the House, just a few minutes ago, adopted on a voice vote, H.R. 2608. That bill had passed the committee by a vote of 41-0. This bill is extremely similar, except it passed the committee with a vote of 42-0.

H.R. 2610 will ensure that there is uniformity regarding EGCs' financial disclosure obligations, in this case, in the event that an EGC conducts a spinoff.

Mr. Speaker, I urge my colleagues to support this bill, and I yield back the balance of my time.

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