Signature Devices Inc. (SDVI)

[klhurley]

A short position does not mean you are a holder or entitled to the dividend.

If you research options you will notice that when you purchase options, you are responsible for the dividend.

The company grabs the shareholder list on the dividend date (shorters are not on that list) and pays the dividend.

This list contains actual holders of the stock and the company knows how many shares are outstanding. Look at this way.

Say 900,000 shares are owned by investors and shorties shorted 100,000 shares and the stock is at $1.00. Then company pays a 10% dividend in cash of .10 cents per share. They will be paying out
$90,000.00 to the 900,000 share owners. Since there is another investor that has 100,000 phantom or shorted shares the short must pay the $10,000 dividend to the 100,000 share owner.

Make sense?