From: Chris Spencer [chris@wizzardsoftware.com] Sent: Tuesday, March 11, 2003 8:27 AM To: rule-comments@sec.gov Subject: Comments on DTC withdrawal As CEO of Wizzard Software (OTCBB: WIZD) I would like to comment on the DTC withdrawal issue. I am confident that WIZD has been subject to naked short sellers in the past and could potentially be targeted now. With settlement never forced within a specific time period, we find that market makers can continue to short our stock without the worry of covering their short position in any reasonable time frame. I believe the solution would be for all parties to be required to cover any naked short positions within 72 hours. I also feel that DTC should do a better job tracking the stock in company's float and questioning any position that seems to be naked longer than the allotted time period. Another issue is that you have the owners of the larger brokerage houses overseeing DTC and those are the exact firms profiting from their market makers naked shorting of stocks. There already seems to be rules in place regarding naked short selling. They just need to be enforced. DTC should help enforce seeing that they have a quasi-monopoly on the system. Chris Spencer CEO Wizzard Software Corporation -----Original Message----- From: InvesTrend [mailto:Gayle@InvesTrend.com] Sent: Tuesday, March 11, 2003 12:48 AM To: gayle@investrend.com Subject: SEC to Take Up DTC Dispute With Companies SEC to Take Up DTC Dispute With Companies March 11, 2003. (FinancialWire) The “short seller wars” has reached critical mass, with almost five dozen companies now having announced they are taking legal action or contemplating legal moves to combat what has now been verified by the Securities and Exchange Commission is a worrisome pattern of market manipulation that most believe is exemplified by illegal naked short sales. Financial Times reported Monday that “the US Securities and Exchange Commission is looking closely at a dispute between the US Depository Trust Company (DTC) and a growing band of thinly-traded companies attempting to break out of its system of US share custody.” It said that Life Energy & Technology has announced its intent to exit the DTC system. FT said “the company, which has as its chairman Albert Reynolds, the former prime minister of the Republic of Ireland, claims it was the target of an aggressive short selling campaign.” The Financial Times also said that the SEC enforcement division is hot on the trail of other market manipulators that it intends to bust, similar to the $1 million fine levied last week on Rhino Partners for its illegal hedging often associated with death spiral financing. Rhino’s target was Sedona Corp. (OTCBB: SDNA). Monday, Navigator Ventures (OTCBB: NVGV) CEO Diane Perkins was also quoted as intending to withdraw from the DTC system, and InternetStudios.com, Inc. (OTCBB: ISTO) plans to change the company’s name to IS Media, Inc., the first step in side-stepping a DTC ban on exiting. By changing its name, the company would simply not have to reapply under the new system. FT quoted companies as saying “rogue bands of ‘naked short sellers’ are allowed to borrow shares for short positions through loopholes in the system managed by the DTC, the clearing house that oversees the electronic book entry system, which replaced paper-based clearing and settlement decades ago.” FT said the DTC, “apparently caught off-guard by the requests, ruled that the decision to withdraw from its system was not up to the issuer, but its broker members. In mid-February it sent a notice to the SEC requesting clarification on its rule interpretation.” For most of the companies wanting to exit the DTC, this would present no significant challenge, as many have already received the enthusiastic support of their shareholders in votes to date. Also Monday, the Securities Industry Association sent a letter to the SEC that backs the DTC’s request. A comment period ends around March 20, and anyone may send the SEC an electronic comment at rule-comments@sec.gov . In another story filed yesterday in the Dow Jones (NYSE: DJ) newswires by reporter Carol Remond, she noted that “the SEC may decide to extend that comment period to 90 days. “It's difficult to predict when the SEC will make a decision on the matter since the comment period can be re-triggered by any amendment to the original proposal,” she noted. The complete list of the 64 companies now associated on one side or another of the naked short seller controversy includes A.G. Edwards, Inc. (NYSE: AGE), Federal Agricultural Mortgage Corp. “Farmer Mac” (NYSE: AGM), Allied Capital (NYSE: ALD), American Motorcycle (OTC: AMCYV), American International Industries (OTCBB: AMIN), Ameri-Dream (OTCBB: AMDR), Bluebook International (OTCBB: BBIC), Blue Industries (OTCBB: BLIIV), Bentley Communications (OTCBB: BTLY), Biocurex (OTCBB: BOCX); Critical Home Care (OTCBB: CCLH), Composite Holdings (OTC: COHIA), Edgetech Services (OTCBB: EDGH); Also, Endovasc Ltd. (OTCBB: ENVC), Enviro-Energy Corporation (OTCBB: ENGY), Environmental Products & Technologies (OTC: EPTC), FreeStar Technologies (OTCBB: FSRCE), GeneMax Corp. (OTCBB: GMXX), Global Path (OTCBB: GBPI), Goldman, Sachs & Co. (NYSE: GS), Group Management (OTCBB: GPMT), Hop-On (OTC: HPON), H-Quotient, Inc., (OTCBB: HQNT), International Biochem (OTCBB: IBCL), Intergold Corp. (OTCBB: IGCO), InternetStudios, Inc. (OTCBB: ISTO); Also, ITIS Holdings (OTCBB: ITHH), Jag Media Holdings (OTCBB: JGMHA), Knight Securities, LP (NASDAQ: NITE), Lair Holdings (OTCBB: LAIR), Life Energy & Technology (OTCBB: LETH), MBIA (NYSE: MBI); MetaSource Group, Inc. (OTCBB: MTSR), M. H. Myerson & Co., Inc. (NASDAQ: MHMY), Midastrade.com (OTC: MIDS), Make Your Move (OTCBB: MKMV), MSM Jewelry Corp. (OTC: MSMJ), Nutra Pharmaceutical (OTCBB: NPHC), Nutek (OTCBB: NUTK); Also, Navigator Ventures (OTCBB: NVGC), Pitts & Spitts (OTCBB: PSPP), Sales OnLine Direct (OTCBB: PAID), Pacel Corp. (OTCBB: PCEL), Presidential Air Corp. (OTCBB: PDAR), PayStar Corporation (OTCBB: PYST), Petrogen Corp. (OTCBB: PTGC), PrimeHoldings.com, Inc. (OTC: PRIM), Reed Holdings (OTC: RDHC), Rocky Mountain Energy Corp. (OTCBB: RMEC), Sedona Corp. (OTCBB: SDNA), Sionix Corp. (OTCBB: SINX); Also, Soundcomm Technologies (OTC: STEH), Sports Resorts International (NASDAQ: SPRI), Technology Logistics (OTC: TLOS), Ten Stix, Inc. (OTCBB: TNTI), Tidelands Oil (OTCBB: TIDE), Toronto-Dominion (NYSE: TD), Trezac Corp. (OTCBB: TREZV), US West Homes (OTCBB: USWH), Vega Atlantic (OTCBB: VATL), vFinance, Inc. (OTCBB: VFIN), Vtex Energy (OTCBB: VXEN) and Wizzard Software (OTCBB: WIZD).and WorldTradeShow.com (OTC: WTSW). A FirstAlert special edition on the subject was also published Monday by Investrend Information, and the article may be read in its entirety at http://www.investrendinformation.com The daily electronically distributed FirstAlert Network may be accessed at http://www.investrend.com/contact.asp For a downloadable traffic report toolbar, visit http://download.alexa.com/?amzn_id=investrendcom-20 Clickable links for FinancialWire news are at http://www.financialwire.net For FinancialWire audio news, click on partner ON24 at http://www.on24news.com