,,ii #aag? ,,congress #a/ ,session ,s4 #ccia ,,9 ,,! ,,s5ate ,,( ,,! ,,unit$ ,,/ates ,decemb] #ad1 #bjba,mr4 ,k5n$y introduc$ ! foll[+ bill2 :i* 0 read twice & ref]r$ to ! ,committee on ,bank+1 ,h\s+1 & ,urban ,affairs ,a ,,bill ,to am5d ! ,securities ,ex*ange ,act ( #aicd to e/abli% a regi/ration exemption = m]g] & acquisition brok]s1 & = o!r purposes4 #a4 ,%ort title ,?is ,act may be cit$ z ! ,small ,bus9ess ,m]g]s1 ,acquisitions1 ,sales1 & ,brok]age ,simplification ,act ( #bjba4 #b4 ,regi/ration exemption = m]g] & acquisition brok]s 7a7 ,9 g5]al ,section #ae7;b7 ( ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gho7b77 is am5d$ by add+ at ! end ! foll[+3 7#ac7 ,regi/ration exemption = m]g] & acquisition brok]s 7,a7 ,def9itions ,9 ?is p>agraph3 7i7 ,bus9ess comb9ation relat$ %ell company ,! t]m bus9ess comb9ation relat$ %ell company means a %ell company t is =m$ by an entity t is n a %ell company solely = ! purpose (-- 7,i7 *ang+ ! corporate domicile ( t entity solely )9 ! ,unit$ ,/ates2 or 7,,ii7 complet+ a bus9ess comb9ation transaction 7z def9$ 9 section #bcj4afe7;f7 ( title #ag1 ,code ( ,f$]al ,regulations1 or any successor regulation7 among n less ?an #a entity o!r ?an ! company itself1 none ( :i* is a %ell company4 7ii7 ,control 7,i7 ,9 g5]al ,! t]m control means ! p[]1 directly or indirectly1 to direct ! managem5t or policies ( a company1 :e!r ?r\gh own]%ip ( securities1 by contract1 or o!rwise4 7,,ii7 ,presumption ,= ! purposes ( subclause 7,i71 !re %all be a presumption ( control if1 ^u completion ( a transaction1 a buy] or gr\p ( buy]s-- 7aa7 has ! "r to vote #be p]c5t or m ( a class ( vot+ securities or ! p[] to sell or direct ! sale ( #be p]c5t or m ( a class ( vot+ securities2 or 7bb7 9 ! case ( a p>tn]%ip or limit$ liability company1 has ! "r to receive ^u dissolution1 or has contribut$1 #be p]c5t or m ( ! capital4 7iii7 ,eligible privately held company ,! t]m eligible privately held company means a privately held company t meets bo? ( ! foll[+ conditions3 7,i7 ,! company does n h any class ( securities-- 7aa7 regi/]$1 or requir$ to be regi/]$1 ) ! ,commission "u section #ab2 or 7bb7 ) respect to :i* ! company files1 or is requir$ to file1 p]iodic in=mation1 docum5ts1 & reports "u subsection 7d74 7,,ii7 7aa7 ,9 ! fiscal ye> end+ imm$iately be=e ! fiscal ye> 9 :i* ! s]vices ( an ,m,a brok] are initially engag$ ) respect to a securities transaction1 ! company meets ei!r ( ! foll[+ conditions 7det]m9$ 9 accordance ) ! hi/orical f9ancial acc\nt+ records ( ! company73 7,,aa7 ,! e>n+s ( ! company be=e int]e/1 taxes1 depreciation1 & amortization are less ?an #be1jjj1jjj4 7,,bb7 ,! gross rev5ues ( ! company are less ?an #bej1jjj1jjj4 7bb7 ,= purposes ( ?is subclause1 ! ,commission may1 by rule1 modify ! doll> figures 9 subitem 7,,aa7 or 7,,bb7 ( item 7aa7 if ! ,commission det]m9es t su* a modification is necess>y or appropriate 9 ! public int]e/ or = ! protection ( inve/ors4 7iv7 ,m,a brok] ,! t]m ,m,a brok] means a brok]1 & any p]son associat$ ) a brok]1 engag$ 9 ! bus9ess ( effect+ securities transactions solely 9 connection ) ! transf] ( own]%ip ( an eligible privately held company1 reg>dless ( :e!r ! brok] acts on behalf ( a sell] or buy]1 ?r\gh ! pur*ase1 sale1 ex*ange1 issuance1 repur*ase1 or r$emption (1 or a bus9ess comb9ation involv+1 securities or assets ( ! eligible privately held company1 if ! brok] reasonably believes t-- 7,i7 ^u consummation ( ! transaction1 any p]son acquir+ securities or assets ( ! eligible privately held company1 act+ alone or 9 conc]t-- 7aa7 w control ! eligible privately held company or ! bus9ess conduct$ ) ! assets ( ! eligible privately held company2 & 7bb7 directly or indirectly1 w be active 9 ! managem5t ( ! eligible privately held company or ! bus9ess conduct$ ) ! assets ( ! eligible privately held company1 includ+ )\t limitation1 by-- 7,,aa7 elect+ executive (fic]s2 7,,bb7 approv+ ! annual budget2 7,,cc7 s]v+ z an executive or o!r executive manag]2 or 7,,dd7 c>ry+ out su* o!r activities z ! ,commission may1 by rule1 det]m9e to be 9 ! public int]e/2 & 7,,ii7 if any p]son is (f]$ securities 9 ex*ange = securities or assets ( ! eligible privately held company1 t p]son w1 be=e becom+ legally b\nd to consummate ! transaction1 receive or h reasonable access to-- 7aa7 ! mo/ rec5t fiscal ye>-end f9ancial /atem5ts ( ! issu] ( ! securities1 z cu/om>ily prep>$ by ! managem5t ( ! issu] 9 ! normal c\rse ( op]ations2 & 7bb7 if ! f9ancial /atem5ts ( ! issu] are audit$1 review$1 or compil$-- 7,,aa7 any relat$ /atem5t by ! indep5d5t acc\ntant2 7,,bb7 a balance %eet dat$ n m ?an #abj days be=e ! date ( ! (f]2 & 7,,cc7 in=mation p]ta9+ to ! managem5t1 bus9ess1 results ( op]ations = ! p]iod cov]$ by ! =ego+ f9ancial /atem5ts & mat]ial loss cont+5cies ( ! issu]4 7v7 ,%ell company ,! t]m %ell company means a company t1 z ( ! date ( a transaction ) an eligible privately held company-- 7,i7 has no or nom9al op]ations2 & 7,,ii7 has-- 7aa7 no or nom9al assets2 7bb7 assets consi/+ solely ( ca% & ca% equival5ts2 or 7cc7 assets consi/+ ( any am\nt ( ca% & ca% equival5ts & nom9al o!r assets4 7,b7 ,exemption ,except z provid$ 9 subp>agraph 7,c71 an ,m,a brok] %all be exempt f regi/ration "u ?is section4 7,c7 ,exclud$ activities ,an ,m,a brok] is n exempt f regi/ration "u ?is p>agraph if ! ,m,a brok] does any ( ! foll[+3 7i7 ,directly or indirectly1 9 connection ) ! transf] ( own]%ip ( an eligible privately held company1 receives1 holds1 transmits1 or has cu/ody ( ! funds or securities to be ex*ang$ by ! p>ties to ! transaction4 7ii7 ,engages on behalf ( an issu] 9 a public (f]+ ( any class ( securities-- 7,i7 t is regi/]$1 or is requir$ to be regi/]$1 ) ! ,commission "u section #ab2 or 7,,ii7 ) respect to :i* ! issu] files1 or is requir$ to file1 p]iod in=mation1 docum5ts1 & reports "u subsection 7d74 7iii7 ,engages on behalf ( any p>ty 9 a transaction involv+ a %ell company1 o!r ?an a bus9ess comb9ation relat$ %ell company4 7iv7 ,directly1 or indirectly ?r\gh any ( its affiliates1 provides f9anc+ relat+ to ! transf] ( own]%ip ( an eligible privately held company4 7v7 ,assi/s any p>ty to obta9 f9anc+ f an unaffiliat$ ?ird p>ty )\t-- 7,i7 comply+ ) all o!r applicable laws 9 connection ) su* assi/ance1 includ+1 if applicable1 "p #bbj ( title #ab1 ,code ( ,f$]al ,regulations1 or any successor regulations2 & 7,,ii7 disclos+ any comp5sation 9 writ+ to ! p>ty4 7vi7 ,repres5ts bo? ! buy] & ! sell] 9 ! same transaction )\t-- 7,i7 provid+ cle> writt5 disclosure ) respect to ! p>ties ! brok] repres5ts2 & 7,,ii7 obta9+ writt5 cons5t f bo? p>ties to ! jo9t repres5tation4 7vii7 ,facilitates a transaction ) a gr\p ( buy]s =m$ ) ! assi/ance ( ! ,m,a brok] to acquire ! eligible privately held company4 7viii7 ,engages 9 a transaction involv+ ! transf] ( own]%ip ( an eligible privately held company to a passive buy] or gr\p ( passive buy]s4 7ix7 ,b9ds a p>ty to a transf] ( own]%ip ( an eligible privately held company4 7,d7 ,disqualification ,an ,m,a brok] is n exempt f regi/ration "u ?is p>agraph if ! ,m,a brok] 7&1 z applicable1 any (fic]1 director1 memb]1 manag]1 p>tn]1 or employee ( ! ,m,a brok]7-- 7i7 has be5 b>r$ f association ) a brok] or deal] by ! ,commission1 any ,/ate1 or any self-regulatory organization2 or 7ii7 is susp5d$ f association ) a brok] or deal]4 7,e7 ,rule ( con/ruction ,no?+ 9 ?is p>agraph may be con/ru$ to limit any o!r au?ority ( ! ,commission to exempt any p]son1 or any class ( p]sons1 f any provision ( ?is title1 or f any provision ( any rule or regulation !reund]4 7,f7 ,inflation adju/m5t 7i7 ,9 g5]al ,on ! date t is #e ye>s aft] ! date ( enactm5t ( ?is p>agraph1 & e #e ye>s !reaft]1 ea* doll> am\nt 9 subp>agraph 7,a77iii77,,ii77aa7 %all be adju/$ by-- 7,i7 divid+ ! annual value ( ! ,employm5t ,co/ ,index ,= ,wages & ,sal>ies1 ,private ,indu/ry ,work]s 7or any successor index71 z publi%$ by ! ,bureau ( ,labor ,/ati/ics1 = ! cal5d> ye> prec$+ ! cal5d> ye> 9 :i* ! adju/m5t is be+ made by ! annual value ( su* index 7or successor7 = ! cal5d> ye> end+ ,decemb] #ca1 #bjbj2 & 7,,ii7 multiply+ su* doll> am\nt by ! quoti5t obta9$ "u subclause 7,i74 7ii7 ,r\nd+ ,ea* doll> am\nt det]m9$ "u clause 7i7 %all be r\nd$ to ! ne>e/ multiple ( #ajj1jjj4 4 7b7 ,effective date ,! am5dm5ts made by subsection 7a7 %all take effect on ! date t is #ij days aft] ! date ( enactm5t ( ?is ,act4