YEAH, I OPINION IS GO TO ANOTHER STOCK TO MAKE YOUR FORTURNE. THIS CAT IS DEAD.

Reported O4/01/05

Xybernaut said it is unable to predict when its 10-K will be filed.

The Fairfax, Va.-based company also disclosed Thursday that the SEC had subpoenaed documents and other information on Feb. 1.

Shares of the wearable computing device maker (XYBR: news, chart, profile) fell 21 cents, or 50 percent, to 21 cents in Instinet pre-open trading.

The company said the audit committee and independent counsel on Feb. 28 began investigating the internal control environment; documentation of the chairman's and chief executive's expenses and management's conduct in response.

Xybernaut disclosed Thursday that on Feb 1 it received a subpoena from the Northeast regional office of the SEC seeking " ... documents and other information relating to the sale of company securities by any person identified as a selling shareholder in any company registration statement or other public filing."

On Feb. 17, in response to shareholder inquiries, the company said in a statement that it knew of no business reason or financial condition that would explain the recent decline in its stock price.

With the second filing delay, the wearable computer technology firm said it will lose its right to file registration statements on form S-3, which could have affect its ability to raise additional funds and meet obligations.

The company also said it has identified material weaknesses related to expense reimbursement policies and procedures; recognition of revenue from product sales and monitoring of business risks.

Xybernaut said it has also received a Nasdaq notice on its shares trading below the $1 bid price requirement for continued listing.

Xybernaut said it has until Sept.26 to become compliant.

The company also said its fourth-quarter loss was $7.2 million on revenue of about $2.9 million.

For 2004, the company said it had a net loss of about $19.7 million on revenue of about $13.9 million.