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To: Rock_nj who wrote (5804)	4/20/1999 2:11:00 PM
From: Theo	Read Replies (1) \| Respond to of 57584

Where did you hear that shorts must cover when the CUSIP changes? Because when the CUSIP number changes it then becomes necessary for the TA to re-issue certs with the "new" number. In order to facilitate this move, the "old" certs have to be turned in. The TA will only issue "new" certs for "old" certs at the time they are presented. Hence, if somebody has sold shares short, they must come up with shares from somewhere to be corrected. This is why people are led to believe that shorts must cover.(ie., a shareholder having shares in street-name won't be caught holding the bad- the brokerage merely calls the MM who sold them the shares and says "make it good") Problem is, from my understanding, that if a MM is short on the "old" number, he or she will short on the "new" number as they are converted- thus negating the desired affect...covering the short. In a nutshell and overly simplified, but, maybe you get the picture now. Theo;-)