L90 Seeks Hearing to Delay Nasdaq Delisting
The protest is calculated to buy L90 time, since once a company requests a hearing with Nasdaq, its stock cannot be delisted until the hearing is held and the stock market makes a determination about the company's shares.
L90, Los Angeles, said earlier this month it would delay filing its 2001 annual report with the Securities and Exchange Commission because of investigations into its financial dealings. L90 is conducting an internal review in response to an SEC investigation and a request for information by Nasdaq. Because of the review, L90 said, it cannot finalize the financial statements that must be included in its annual report, also known as a 10-K report.
The company said it would file its annual report once its internal review is completed. It is not known when that might be, but L90 said it hopes to complete its investigation before the Nasdaq hearing. No date has been set for that hearing.
In February, L90 began an internal review because of the inquiries into its finances. As a result, interactive entertainment network eUniverse Inc. in March called off a planned $50 million merger with L90.
Also in March, L90 said it hired an accountant to review its books in relation to its dealings with real estate portal Homestore.com. The accountant is checking any barter transactions involving L90 to determine whether its revenue may have been overstated or misstated in the second and third quarters of 2001. Subsequently, president/CEO John Bohan resigned and chief financial officer Thomas Sebastian was fired.
Homestore.com reduced its 2000 revenue by $41.4 million and increased its net loss for that period from $115.2 million to $146.1 million after completing an internal audit into the way its accountants booked ad and software sales revenue. The company said the audit revealed that some barter deals had been booked as cash transactions worth $36.4 million. The company also reported that about $5 million in software revenue was improperly booked and should have been deferred.