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Gordon_Setter - You may have stumbled onto something here.

The SHO rule doesn't alter the basics of short-selling, a time-honored way for traders to make money by borrowing shares from a broker and betting a stock will decline in price. Short-sellers hope to profit by selling borrowed shares and later replacing them with cheaper ones.

But the rule does clamps down on naked shorting, where traders place short bets without actually borrowing shares -- or even determining that any exist to borrow.

By brokers getting permission to borrow shares, that would preclude the shares being "naked". There was a situation on another company where management requested shareholders tp promptly call your brokers and have your stock taken out of street name or put into a cash account. This only means that instead of your shares being registered in your broker's name or being held in a margin account, they would be registered in your name or placed in a cash account. You would still own the stock, and your ability to hold or sell the stock would not change.

Here is the full article:
We Would Like Your Help. However, there is something that you might be able to do to help us, and in the process, help yourself. As you know, like many stocks in the technology industry, MicroStrategy's has been recently trading at a low share price level. Although general market sentiments about technology stocks and our company have undoubtedly played a major role in the recent price of our stock, management believes that the current stock price is also attributable in part to heavy selling pressure from "short selling" in the marketplace. Therefore, let me take a minute to explain "short selling" and what we think you can do to help.

Effect of Short Selling on a Company's Stock Price. In "short selling," traders sell stock they do not own by borrowing shares from a broker that need to be returned at a later date. If the stock price goes down, the short sellers buy stock in the market at a lower price, return the stock to the broker and make a profit. By selling first and buying later, short sellers benefit from stock prices going down instead of up. This makes their interest in our company directly opposite from what most of our stockholders want -- i.e., for the price of our stock to increase. If there is a lot of short selling, supply of our shares may exceed demand for our shares, causing the stock price to go down. In other words, short sellers can make money by selling enough stock short to artificially increase the volume of selling and drive down the market price.

Short Sellers Borrow Stock From Stockholders Like You. Where do the traders get the stock to borrow? Ironically, whether you know it or not, they probably have been borrowing shares from stockholders like you. If your shares are registered in your broker's name instead of yours or are held in a margin account, your broker may have lent your MicroStrategy shares out to these "short sellers." In other words, if your MicroStrategy shares are registered in your broker's name or being held in a margin account, the brokers are free to lend your shares out to short sellers. So, while short sellers are borrowing your stock, they are actually working against your interest in seeing a higher MicroStrategy stock price.

While many companies experience short selling in the marketplace, the amount of short selling compared to the trading volume in our stock has recently been unusually high. Our financial advisors believe this may be adding downward pressure on the price of our stock. Friedman Billings Ramsey, our financial advisor, has commented, "among other factors, a large short position, like that existing today in MicroStrategy stock, can significantly depress the price of a stock. Companies should take action to address the factors that lead to excessive short selling."

How Stockholders Can Help Combat Short Selling. To carry out short sales, traders need to borrow stock from brokers that is registered in "street name" or held in a margin account. However, if enough stock is taken out of street name or margin accounts, short sellers will have difficulty maintaining the current volume of short sales. Therefore, we are asking all of our shareholders to do the following:

Promptly call your brokers and have your MicroStrategy stock taken out of street name or put into a cash account. This only means that instead of your shares being registered in your broker's name or being held in a margin account, they would be registered in your name or placed in a cash account. You would still own the stock, and your ability to hold or sell the stock would not change.

What would change? A short seller would not be able to borrow your stock for short sales without your permission. So long as the stock is registered in the broker's name, the broker is the legal owner of record, and can lend your stock to a short seller without your permission. Similarly, so long as you have your stock in a margin account, it is available for loan by your broker. If you have the stock registered in your own name or placed in a cash account, brokers will not be able to do this.

Would there be any downside for stockholders in having shares registered in their own names or held in cash accounts? From an economic point of view, the answer is no -- nothing will have changed. The only difference would be administrative including some possible paperwork and expenses you may incur in re-registering or moving your shares. When you want to sell, you would have to send your broker instructions to move the stock back into street name or into a margin account, and the broker may ask you to sign some transfer documents. We think this is a small price to pay for relieving the heavy short selling pressure on our stock.

When can shares be taken out of street name or a margin account? You can seek to take shares out of street name or a margin account at any time. However, because of the heavy short selling pressure on our stock, we believe that your immediate help would be desirable. Accordingly, we are asking stockholders to call their brokers to have their shares promptly taken out of street name or a margin account.

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