TABLE OF CONTENTS


I.    INTRODUCTION AND SUMMARY

      A.    Findings and Recommendations of the Committee. . . . . . . . . .  

      B.    The Work of the Committee and Structure of the Report. . . . . . .

II.   RECOMMENDATIONS OF THE ADVISORY COMMITTEE

      A.    Reasons for the Recommendations and Anticipated
Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
      1.    General Statement of Committee's Recommendation to
            Shift
            From a Transactional Registration System to a Company
            Registration System. . . . . . . . . . . . . . . . . . . . . . .  

      2.    Identified Problems of the Current Transactional
            System . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
      
      3.    Company Registration as the Logical Conclusion of
            Evolutionary
            Change in the Regulatory Process . . . . . . . . . . . . . . . .  

      4.    The Benefits of the Company Registration System as
            Compared to the   Current Transactional Regulatory
            System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

      B.    Key Elements of the Recommendations
      
      1.    The Offering Process . . . . . . . . . . . . . . . . . . . . . . .
      
      2.    Prospectus Delivery Requirement. . . . . . . . . . . . . . . . . .
      
      3.    Scope. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      
      4.    Disclosure Enhancements. . . . . . . . . . . . . . . . . . . . . .
      
      5.    Liability. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
      
      6.    Due Diligence. . . . . . . . . . . . . . . . . . . . . . . . . . .

      7.    Disclosure Committee . . . . . . . . . . . . . . . . . . . . . . .

III.  CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

IV.   SEPARATE STATEMENT OF JOHN C. COFFEE, JR., EDWARD F. GREENE,
      AND LAWRENCE W. SONSINI. . . . . . . . . . . . . . . . . . . . . . . . .

           APPENDIX A: THE IMPACT OF THE CURRENT REGULATORY SYSTEM 
                 ON INVESTOR PROTECTION AND CAPITAL FORMATION
                                       

I.    Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  

II.   Direct and Indirect Costs and Uncertainties Resulting
      From the Registration Process for Public Offerings . . . . . . . . . .  

            A.    Costs of Registration - The Offering Process . . . . . . .  
            
            B.    Indirect Costs Associated with the Current Regulatory Scheme

III.  Changes in the Markets and Offering Processes, and the Effect on
            Investor Protection. . . . . . . . . . . . . . . . . . . . . . . .
      
            A.    Attractiveness of Public, Private and Offshore Markets . . .

            B.    Blurring of Distinctions Between Public, Private and
                  Offshore Markets . . . . . . . . . . . . . . . . . . . . . .

            C.    Growth of Secondary Markets and Changes in Offering
                  Techniques . . . . . . . . . . . . . . . . . . . . . . . . .

            D.    Changes in Gatekeeper Role . . . . . . . . . . . . . . . . .

      Addendums to Appendix A

                    APPENDIX B:   ESSENTIAL ELEMENTS OF THE
                          COMPANY REGISTRATION SYSTEM
            
      I.    Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . .  

            A.    Disclosure and Prospectus Delivery Under the Company 
                  Registration System. . . . . . . . . . . . . . . . . . . .  

            B.    Role of the SEC and Other Gatekeepers. . . . . . . . . . . .

      II.   Company Eligibility. . . . . . . . . . . . . . . . . . . . . . . .

      III.  Transactions Covered . . . . . . . . . . . . . . . . . . . . . . .

            A.    Affiliate and Underwriter Resales. . . . . . . . . . . . . .

            B.    Exclusions . . . . . . . . . . . . . . . . . . . . . . . . .

            C.    Offshore Offerings . . . . . . . . . . . . . . . . . . . . .

            D.    Preservation of Transactional Exemptions . . . . . . . . . .

            E.    Limited Placements . . . . . . . . . . . . . . . . . . . . .

      IV.   Disclosure Enhancements Under the Recommended Company
            Registration Model . . . . . . . . . . . . . . . . . . . . . . . .

            A.    Mandatory Disclosure Enhancements. . . . . . . . . . . . . .

            B.    Conclusion . . . . . . . . . . . . . . . . . . . . . . . . .

      V.    Liability and Due Diligence Under Company Registration . . . . . .

            A.    Liability Under Company Registration . . . . . . . . . . . .

            B.    Due Diligence Under Company Registration . . . . . . . . . .

            C.    Conclusion . . . . . . . . . . . . . . . . . . . . . . . . .

      Addendum to Appendix B -- Comparison of Company Registration and Shelf Offering
      System