Subject: File No. S7-01-17
From: Keith Paul Bishop
Affiliation: Former California Commissioner of Corporations

June 1, 2017

The term "financial difficulties" should be defined in Rule 15c2-12. Although the term is used in current Rule 15c2-12, I disagree with the proposing release's assertion that "market participants should be familiar with the concept as it relates to the operation of Rule 15c2-12". I am not aware of any case law or SEC guidance interpreting the term. The term itself is extremely vague and open ended. Thus, issuers and their legal counsel can only guess as to what may constitute a "financial difficulty" within the meaning of the rule.

By way of background, I previously served as California's Commissioner of Corporations and in that capacity administered and enforced California's securities laws. I have taught as an adjunct professor at the University of California, Irvine and Chapman School of Law. I have also served as Co-Chairman of the Corporations Committee of the Business Law Section of the California State Bar and Chairman of the Business and Corporate Law Section of the Orange County (California) Bar Association. These comments are submitted in my individual capacity and not on behalf of any other person.