During an IPO roadshow, a company's CEO presents to institutional investors and mentions that the company expects revenue to grow by 40% next year. This statement is not included in the preliminary prospectus. What is the most significant concern?

Why C — This could constitute gun jumping and create potential liability under Section 12(a)(2)

Making material statements during a roadshow that are not included in the prospectus can create liability under Section 12(a)(2) of the Securities Act, which covers material misstatements or omissions in connection with a public offering. The SEC closely monitors communications during the offering process to ensure investors receive consistent, complete information. While forward-looking statements may be made under certain safe harbors, sharing projections not in the prospectus raises serious gun-jumping concerns.