True and Concise

The Jan. 18 column by T. Boone Pickens Jr. (“1 Share, 1 Vote--Make It the Rule for All Exchanges”) is true and concise. As a legal counselor and president of my own corporation, I am aware of what can happen to stockholders if the Securities and Exchange Commission decides to allow companies listed on the New York Stock Exchange to have dual classes of common stock.

I favor a one-vote, one-share concept because that was the democratic process adopted by our forefathers when the Constitution was written. We all have voting rights. Many corporations today have dual classes of common stock, one class with voting rights and the other without. As the column stated, this is done to entrench management.

If the SEC permits dual classes of stock for Big Board companies, then we won’t need the SEC as a regulatory body to protect the stockholders because it will have removed the stockholders’ only protection. The SEC was formed to protect the interest of stockholders by giving them the right to remove directors who misuse their positions. I formed my corporation to comply with the SEC regulations, and I want the stockholders to have a voice in the operation of what they have an interest in.

Why do corporations sell stock? Because that’s one way of obtaining financing without the obligation of paying back a loan.

Corporations owe stockholders a chance to participate in the business.

GUS S. MALPEE

Manhattan Beach