| Accredited Investors, January 1999 |
January 10, 1999 Ms. Cathy Dixon Chief Counsel Division of Corporation Finance U.S. Securities and Exchange Commission Mail Stop 3-3 450 Fifth Street, N.W. Washington, D.C. 20549 REF: Our telephone conversations on November 3 & 16/ December 8: Accredited Investors Dear Ms. Dixon: With our No-Action request dated July 23, 1997, we state under FACTUAL BACKGROUND, paragraph 2: "The qualified investors [the intended viewing audience] will be typical of the investors who would customarily be invited to attend a live roadshow, such as a registered broker/dealer and investment advisors." While NO one has taken "investors who would customarily be invited to attend the live roadshow" to include average retail investors, as I mentioned in our telephone conversation, there has been some confusion over where we draw the line. Some investment banks customarily invite certain high net worth individuals to attend the live roadshow. Almost all investment banks invite small money managers (hoping that they will someday become a large money manager) to attend. A small money manager may control less money than the high net worth investor. As we discussed on the telephone, what is needed is clear recognizable line that should work within all situations and offer the underwriter, issuer, NetRoadshow and of course the investor a definable standard. Per our request, and with the understanding that the SEC will not recommend enforcement action, we will now set it at the Regulation D standards for 'accredited investor.' The underwriter, in turn, will be responsible for insuring that the viewer meets the 'accredited investor' standard using the same approach as they used today, before providing a password for a roadshow. The particular 'accredited investor' that selects to view the Internet roadshow would, in keeping with the July 23, 1997 No-Action letter, be provided the opportunity to attend a particular 'live' roadshow as determined exclusively by the underwriter(s). In other words, no qualified investor would be disadvantaged; all qualified investors would be treated equally. Everything else about the Internet roadshow process will be consistent with the No- Action request dated July 23, 1997. In all cases a password will be required to view the material, and NetRoadshow provides, as part of our service, a daily list of the clients that viewed the roadshow. As you know, the intent of my request, which may be considered a clarification of the No-Action letter, is to provide some definable boundaries around a system that is already working well. Thank you for not objecting to our request to include the Regulation D 'accredited investor' as part of the Internet roadshow audience. Should you have any questions, or additional thoughts, please do not hesitate to contact me at (404) 873-0200. Sincerely, Brad Hammond President |