Subject: File No. S7-25-97, Attention Jonathan Katz

Date:    11/23/97 4:16 PM
     
     
Dear Sirs:
     
I am writing you today to express my concern and register my protest about 
the new rules concerning introduction of shareholder resolutions.  I feel 
that this measure, if adopted, could be extremely harmful to the 
shareholders' movement, which has helped publicize corporate misdeeds.
     
As you are aware, the current rules allow any shareholder holding $1000 
worth of common stock to place a resolution on the company ballot.  If the 
resolution receives 3% or more on the first vote, it is re-introduced the 
next year.  It must then get 6%, then 10%, in each succeeding year, to be 
again re-introduced.  Under the new rules, however, the thresholds grow to 
6,15,30!  Furthermore, if a shareholder wishes to introduce a measure which 
is unsupported by the management, he must, on his own, get 3% of shares on 
his side *simply to put it up before a shareholder vote in the first place!*
 This is, if not impossible, at least dramatically unfeasible.  3% of Intel
Corporation's common stock, for example, is worth more than $4 billion! 
There are few *pension organizations* which own that much stock in a single 
company, let alone individual investors or even investor coalitions.
     
By buying stock in a company, an individual assumes the risks and gains of a 
company.  He therefore has a say, proportional to the risk assumed (1 share 
= 1 vote), as to how the company conducts its business.  This is a basic 
tenent of capitalism.  If the management of the corporation does something 
affecting the shareholder's financial risk negatively or disgracing to the 
company they own, the shareholders have the right to call the management to 
account.  This new rule will hurt that right, by insuring that only 
coalitions of biggest investors are able to exercise that right.
     
Oftentimes, socially concerned investors will introduce measures which help 
draw attention to misdeeds of corporations.  Nike investors may introduce 
measures to prevent the corporation's use of sweatshops and slave labor. 
Intel and Chevron investors may introduce measures so as to force their 
companies to practice safer environmental practices.  By adopting this rule, 
you would be totally eliminating these tactics.
     
You on the SEC were appointed in order to be the guardians and stewards of 
the interests and rights of shareholders.  If you adopt this measure, you 
will be abandoning that stewardship.  I urge you not to forget that as you 
consider this measure, and I hope that you will reach the same conclusion I 
have: that it ought to be rejected.
     
Andrew Carlon
2207 37th Ave SE 
Puyallup, WA  98374-1974
     
     
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| Andrew Carlon                  | Phone: (253) 848-0583       |
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