From: Kraig H. Kayser
Sent: March 13, 2006
Subject: File No. 265-23

I am the President and CEO of a food manufacturing company with a $100MM market capitalization and $850MM in annual revenues. The proposed rules do not take into account companies that may have top line revenues, but operate in very low margin business’. The float in our stock is just two million shares, and we trade at about $20 per share. I recognize that the committee is attempting to capture large companies that have fallen on hard times by putting in a revenue component but it does capture a small number of closely held companies with few shareholders, who nonetheless are subject to the punitive costs of complying with Section 404. I would recommend that the revenue piece be eliminated and but change the language to require companies whose market capitalization has FALLEN below $787MM be required to continue to comply- but companies whose market capitalization is CURRENTLY and has NEVER BEEN $787 million should be exempt from the Section 404 compliance efforts of SARBOX.

404 cost our company over $2MM last year, up from just $150,000 pre SARBOX. We are in the canned food business and our competitors are private or foreign, and not subject to these costs. It is punitive and non-competitive to force closely held micro-cap companies whose revenues are above $250MM to be required to comply. Size is of little consequence to the idea of protecting the shareholders with 404 when vast majority of the shares in our company are owned by the top 25 shareholders. Another alternative would be to look at float as opposed to revenues.


Kraig H. Kayser
President and CEO
Seneca Foods Corporation