MEMORANDUM

November 12, 2003

TO:	Files
FROM:	Patrick Von Bargen Managing Executive for Policy and Staff
RE:	Security Holder Director Nominations Release Nos. 34-48626; IC 26206 File No. S7-19-03

On November 5, 2003, SEC Chairman Donaldson, Alan Beller (Director of the Division of Corporation Finance) and I met with representatives of the Business Roundtable about the above-referenced rule proposal. The Business Roundtable suggested that the Commission delay acting on the proposal until the effect of recent rule changes can be evaluated and several other concerns are resolved. As examples of their concerns, the Business Roundtable representatives mentioned that:

• The rule could disrupt board operations by including special-interest directors.

• The proposed thresholds for invoking the rule's disclosure requirements are too low and could encompass companies that do not have an ineffective proxy process.

• External sources may inappropriately affect shareholder votes.

• The rule discourages qualified directors from serving.

The Business Roundtable intends to provide details regarding these concerns through the comment letter process.