Bernard E Klein
3000 Stirling Road
Hollywood, FL 33021
October 10, 2003
Jonathan G. Katz, Secretary
U.S. Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549-0609
Re: File No. S7-24-99
SEC Concept Release:
Dear Mr. Katz:
Some level of a short position should trigger disclosure, perhaps a type of Form 13 filing, to be updated until the level of the short position drops below that level. Perhaps, 5% of the float (not the total shares outstanding) or the diluted float (to also include shares issuable from convertible securities and warrants) would make sense. Currently, Registrants do not report the float, except in some cases within the calculation of market value shown on the cover of Form 10-K.
And, for better, easier information, short sellers should be able to get all corporate communications made to long holders. Choices for a broker's client should include:
- Disclose the NOBO (Name of Beneficial Owner), account-wide [the existing default]
- Do not disclose the NOBO, account-wide [an existing choice]
- Do not disclose the NOBO, for an individual security, long or short (to override the account-wide setting)
- OK to disclose the NOBO for an individual security, long or short (to override the account-wide setting)
The choice could be made at the time of placing an order, similar to the manner of selling an identified lot.
There would be a small additional cost to registered companies, and maybe some reluctance, to communicate with short sellers, but the way it is today, a short-seller needs to have a token long position just to be in the information loop.
/s/ Bernard E Klein
Bernard E Klein