I have been actively following both these tickers for last 9+ months. As of today, I see that:
- NQ is listed and being traded actively in NYSE whereas Fab is NOT being traded and is under the threat of delisting
- Both Fab and NQ have had short seller allegations to counter in the last 9+ months
- Both Fab and NQ have instituted investigation on internal procedures being performed by US based law offices
- Fab has released audited 10K for 2013 whereas NQ has issues provisional results for 2013. NQ is yet to file 10K and is delinquent
- NQ has released results of independent investigation committee to disprove short seller allegations while Fab is yet to do that
- NQ 's Ind Audit committee has found short comings in internal controls. And in the official press release of the report, NQ has admitted to work on correct them.
- Fab has admitted to non-disclosure of Bond offering and lack of internal controls in 10K.
Why is NQ being allowed to trade when internal controls are a problem in both companies ? Fab filed for 10K and still cannot trade. While NQ has some internal controls missing but being allowed to trade.
Internal control is not the determining factor of a stock trading or not trading. Also they are not going to get de-listed for this reason. I did a quick search of the last paragraph in the 10 and came up with numerous companies making the statement of "(COSO) in Internal Control — Integrated Framework" as not being effective and none were de listed for having that statement in the 10k.
A few of them were - Talbots (TLB) Kroger (KR) Diebold (DBD) and Talbots was purchased by Sycamore in 2012 for $193mil ($370mil including debt assumption) and the rest are still trading just fine.
=Internal control is not the determining factor of a stock trading or not trading.
You can't make that blanket statement. It CAN be, but usually isn't. FAB has more going against it than JUST that, so the NYSE has their discretion to use that as a reason to delist. They also have a purely arbitrary "in the public interest" grounds for delistment as do the other regulated exchanges.
FAB has not successfully defended serious allegations (kiosk count, piracy etc.) and those should have been easy. How hard is it to translate a list like Spencer said they would do? They never did refute the piracy specifically. Just the blanket statement of all allegations being baseless and without merit. This when they KNEW the bond offering was real so nothing can be believed.
Don't take my word. Read the civil complaints. They have not successfully defended a single allegation in over half a year. You can also read their correspondence with the SEC where they were forced to admit they changed auditors without BOD approval. This is unheard of and more evidence they have no proper controls and no clue about how corporations should function. This should have been vetted by the audit committee and approved by the full BOD. If the BOD didn't approve it then who did and who is actually running the company?
Shareholders elect the BOD and the BOD directs management. That is how it is supposed to work. What you have here is someone (Spencer and/or Busshaus?) dictating to the BOD and shareholders. That is not proper corporate governance. Then you have the Chairman of the Board (Zhang) off in his own little world doing as he wishes. This company is a sham and not ready for a regulated exchange. I will even give them the benefit of the doubt for argument's sake and say they are just a grossly incompetent enterprise and not a fraudulent one. Doesn't matter. A Pittsburgh office with a President in Florida clueless as to what is going on with Chinese operating subsidiaries isn't working.
Of course, they're common and all over the place....proving once again LBCB is an idiot. FAB was up for delisting because they did not file a timely 2013 10K and did not get the extension because their auditor would not offer up an unqualified opinion letter....nothing else. I've posted the SEC filing here detailing it. Doesn't deter him from more lies, but it's what you would expect from a desperate short.
=Why is NQ being allowed to trade when internal controls are a problem in both companies ? Fab filed for 10K and still cannot trade. While NQ has some internal controls missing but being allowed to trade.
FAB was halted before being delinquent in filings. They would still be trading if the delistment process began AFTER they became delinquent. Subsequently and irrelevant to the trading issue, they confirmed the illegal bond offering and have not successfully defended themselves against any other allegations while NQ has fought all allegations and whether you believe the results or not has released information supposedly refuting some allegations.
It all boils down to FAB NOT wanting to trade in an attempt to limit exposure in the lawsuits while NQ wants to remain trading. FAB brought this all on themselves through their own actions and inactions.
I will start a new thread with a technical point as to why FAB could file their 10-K while NQ has theirs held up by an auditor.
Assuming Exec mgmt of FAB goes in with the mindset "FAB NOT wanting to trade", Is it not easy for FAB to skip the July 16 meeting (or not even ask for it in first place) and get delisted automatically (thereby limiting the exposure for lawsuits) ? Why did they ask and get an appointment with NYSE listing requirements team ?
If I wanted to get thrown out of a class at school, I would skip the school or do misdemeanors enough to attract attention of administration so that they could throw me out on their volition. And once they throw me out, I would not contest their decision.