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SCO Possibly Delisted from NASDAQ 366

Posted by Zonk
from the my-karma-ran-over-your-dogma dept.
canfirman writes "Reuters is reporting that SCO could be delisted from the NASDAQ because "it has not filed its annual 10-K report with the SEC". The company claims it's because "it is examining matters related to stock issued as part of its compensation plans". SCO Stock is sitting at $4.30 at opening today. It'll be interesing to see where it goes from here."
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SCO Possibly Delisted from NASDAQ

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  • by jayed_99 (267003) on Thursday February 17, 2005 @11:28AM (#11700555)
    It got slashdotted real quick.
  • Another link.. (Score:5, Informative)

    by slashkitty (21637) on Thursday February 17, 2005 @11:32AM (#11700632) Homepage
  • SCOX - SCOXE (Score:5, Informative)

    by ballpoint (192660) on Thursday February 17, 2005 @11:34AM (#11700649)
  • Re:requirements? (Score:3, Informative)

    by oliana (181649) on Thursday February 17, 2005 @11:39AM (#11700747) Homepage
    Being publicly traded and being available on a regulated stock exchange (NASDAQ, NYSE) are two different things. People who own the stock if it gets de-listed will have to find buyers in a different market.

    There are several non-regulated stock markets out there. http://www.otcbb.com/ [otcbb.com]Is one.

  • by draos (672972) on Thursday February 17, 2005 @11:40AM (#11700753)
    If the nasdaq adds an 'e' to the symbol then SCO will have 30 days to file the 10-k before they are delisted. Also the nasdaq routinely allows companies to extend the 30 day deadline if the company can make a case for why they are late in filing....so while they are likely to get an e I find it unlikely they will allow themselves to be delisted.
  • Re:requirements? (Score:1, Informative)

    by Anonymous Coward on Thursday February 17, 2005 @11:44AM (#11700830)
    Since SCO has stocks issued to the public, aren't they required to fill out the proper paperwork?

    they only have to do paperwork for new issues of stock such as those for employee compensation

    How does one who own SCO stock supposed to sell his stock?

    just like any other stock, once it goes through the investment bank as a new issue or IPO, the corporation really has no involvement with the trading of the stock in the secondary market. if it is delisted, the stock will simply have a tiny secondary market that will be difficult to find.

    Can they do this w/o getting sued by their share holders?

    why would shareholders sue their own business?
  • by Anonymous Coward on Thursday February 17, 2005 @11:47AM (#11700884)
    It's Darl not Darryl. How come no one can get that right?
  • by DrXym (126579) on Thursday February 17, 2005 @11:49AM (#11700904)
    According to the news release, they'll be delisted on February 25 - i.e. one full week from now unless they appeal.
  • Real Time Quote (Score:4, Informative)

    by MrByte420 (554317) * on Thursday February 17, 2005 @11:57AM (#11701042) Journal
    bid: 3.88 ask: 3.91 They're not doing so hot today...
  • by satsuke (263225) on Thursday February 17, 2005 @11:59AM (#11701087)
    http://www.nasdaq.com/about/nasdaq_listing_req_fee s.pdf [nasdaq.com] Listing requirements $10mil in outstanding equity 750,000 outstanding shares $1.00 minimum share price 400 shareholders as well as other requirements for filing such as the form they missed .. triggering the reason for this artical
  • Re:SELL SHORT? (Score:5, Informative)

    by bigtallmofo (695287) on Thursday February 17, 2005 @11:59AM (#11701090)
    Couple points:

    1. Many brokers don't let you short a stock that is below $5.
    2. Delisting a stock decreases liquidity which can make it very difficult to cover your short if the stock rises precipitously.

    Unlike buying a stock which has a limited downside potential (the stock goes to $0 in which case you lose your entire investment), shorting a stock has a theoretically infinite downside potential. If you short a stock at $4.30 and it goes up to $1,000,000 per share, you've lost almost a million dollars for each share you shorted. Of course, that's not realistic, but the point is that shorting a stock is not to be taken lightly.
  • by Animats (122034) on Thursday February 17, 2005 @12:00PM (#11701095) Homepage
    SCO can't file their 10-K because "it is examining matters related to stock issued as part of its compensation plans"? That's one of the lamer excuses sent to the SEC in a while.

    The "10-K" is the backup data behind a company's annual report. It's the single most important disclosure of a company's financial status. The SEC allows 3 months after the close of the fiscal year for a 10-K filing. SCO's year closed at the end of October, and their 10-K was due at the end of January. Late filing of a 10-K or 10-Q (the quarterly report) is considered a major red flag for a stock. When I was following dying dot-coms [downside.com], a late 10-K or 10-Q was a strong indicator of trouble. Nobody files late because they have unexpectedly good numbers.

    SCO filed an NT-12K form [sec.gov] with the SEC, asking for a 15-day extension. "The Company currently anticipates that the Form 10-K will be filed by no later than the fifteenth calendar day following the date on which the Form 10-K was due." They missed that date, too.

    There has to be something really embarassing in the compensation plan. Really embarassing, if they're willing to risk delisting from the NASDAQ.

    Delisting kicks a stock down to the pink sheets [pinksheets.com]. That's where the penny stocks favored by spammers and scammers live.

  • Re:SCOX - SCOXE (Score:5, Informative)

    by Jerky McNaughty (1391) on Thursday February 17, 2005 @12:01PM (#11701120)
    E means they are deliquent in SEC filings; usually it's related to earnings (as it is in SCO's case). Other letters used commonly are Q (bankruptcy filings; bad) or Y (trading as depository receipts (ADRs); not bad, for example, ERICY).
  • Re:Pitty (Score:3, Informative)

    by soloport (312487) on Thursday February 17, 2005 @12:08PM (#11701219) Homepage
    Oh, boy... In the time it took me to post the parent, the price has slipped a few times. Wow.

    One must wonder: Who's doing the buying?!
  • Re:SELL SHORT? (Score:2, Informative)

    by Anonymous Coward on Thursday February 17, 2005 @12:19PM (#11701401)
    Selling short requires two things:

    (1) Selling shares that you don't have (you borrow them, and pay some kind of interest on the loan usually 25-300bp over prime or so), this opens your position.

    (2) To close this position, you need to buy back the shares (to give back to the person you bought them from). If the stock is thinly traded (e.g. a delisted SCO would trade on OTC-Pink Sheets), it might be difficult to buy them back.
  • Re:requirements? (Score:5, Informative)

    by Anonymous Coward on Thursday February 17, 2005 @12:21PM (#11701440)
    why would shareholders sue their own business?

    Because the company was mismanaged. Because the executives were negligent in performing their duties.

    Shareholder lawsuits happen all the time. You don't follow business news, do you?

  • Re:If they go down. (Score:3, Informative)

    by iabervon (1971) on Thursday February 17, 2005 @12:30PM (#11701581) Homepage Journal
    There is no Linux IP issue. SCO dropped those claims. SCO's current claims are breach of contract against IBM and copyright infringement in AIX from IBM continuing their AIX work after SCO said they couldn't. Chances are that nobody actually wants SCO's assets, since they're probably mostly liabilities at this point, and there's nothing really unique and useful. So it wouldn't, at that point, matter if there was SCO IP in Linux, so long as nobody wanted to acquire it and try to argue it.
  • Re:requirements? (Score:5, Informative)

    by BreadMan (178060) on Thursday February 17, 2005 @12:30PM (#11701594)
    Companies that don't do the minimal filings can get trade on the pink sheets [invest-faq.com] market, but that's not very liquid.

    IIRC, I don't think a copy can list on the bulletin board unless they do the necessary filings under the 1934 securities act, like the 10-K and other annual reports. Maybe I'm confusing the bulletin board with something else.

    Getting a delisting notice is not good, but not the end of the world. Having that "E" on the end of your symbol until you get your paper work in will get you dropped out of a lot of mutual funds who won't hold stocks that don't conform to the market's rules. If you want to make a bet on SCOX, you can try going short if you think they won't make the reporting deadline. Peeking at the short ratio, looks like a lot of people are thinking the same.
  • Re:SELL SHORT? (Score:3, Informative)

    by Skjellifetti (561341) on Thursday February 17, 2005 @12:57PM (#11702009) Journal
    You can only sell short if the last price is the same or higher than the previous price. This prevents short selling in a declining market which would have the effect of causing the price to crash. This is an SEC rule.
  • Re:Gloating? (Score:5, Informative)

    by ReelOddeeo (115880) on Thursday February 17, 2005 @01:28PM (#11702476)
    Slashdot only occaisionally has a story about SCO. And when they do, such as the current thread, it is already (very) old news.

    If you want to know what is going on with SCOXE, you need to follow Growlaw every day, and also the SCOX message board at Yahoo.

    This is very worthy of a Slashdot post. These bastards have told huge lies in the media and press. Made the most outrageous claims about Open Source, the GPL (unconstitutional, communists, etc.), created a cloud of FUD about Linux intellectual property, and even a FUD cloud about open source in general. They have engaged in a stock scam to unjustly enrich themselves while doing the previously mentioned things. They have claimed to own rights that they do not own. They have accused everyone who uses Linux (that is me personally) of owing them license money. They have sued Linux users (although not over Linux use per se). They have threatened to sue any Linux user (i.e. me personally). They have produced not one shred of evidence that they own anything in Linux.

    This is not gloating.

    The truth needs to come to light. Anyone found to have engaged in criminal activity should be prosecuted.
  • by bstone (145356) on Thursday February 17, 2005 @02:25PM (#11703212)
    Boies turned down the stock deal and renegotiated a cash deal. The cash to pay them is locked in, even in the case of the company going down or being bought out.
  • Re:Interesting (Score:4, Informative)

    by nelsonal (549144) on Thursday February 17, 2005 @06:29PM (#11706119) Journal
    Sort of, as a shareholder (even one share) you have full rights to place anything on the company's agenda as something to vote on at the annual meeting. Usually a vote of no confidence comes at the director rather than the managment level. Typically what happens is one big investor buys a decent sized block (say more than 10% and convinces all the little to medium sized investors) to vote with him for his slate of directors who will gut current managment and the company will follow the investor's ideas. Typically big investors only do this if they see some potential to increase the size of their portfolio (usually by splitting up the company). I've never heard of a hostile takeover that didn't involve at least one big investor coalition (Disney was pretty close, but Roy had the name in that case). If you scare managment enough but don't currently have 50% of the vote sealed up, you can sometimes get managment to buy your shares at an iflated value with an agreement you will go away. The term for that is greenmail, it was more common in the 1980s when disclosure was less available, but it does occasionally occur today.

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