Software Vendor Workstream On Verge of Being Delisted by NASDAQ

There’s more trouble for Workstream (profile; site), the Canadian-headquartered talent software and services vendor. Already wrestling with an almost certain delisting of its stock because of its low price, Workstream is now appealing a second NASDAQ delisting notice it received because the company has not filed an annual report.

Workstream issued a press release today saying it had appealed the latest delisting order. That gives the company some breathing room while NASDAQ reviews the matter. Workstream could avoid delisting by filing its annual report, Form 10-K, as required by the Securities and Exchange Commission. Workstream is required to file 90 days after the end of its fiscal year on May 31.

Why the report has not been filed was not explained in the press release and company CFO Jay Markell could not be reached.

Company officials reported in July that Workstream’s fourth quarter ended in the black, the first time that has happened in the company’s history as a publicly held corporation. It reported an EBITDA of $516,000 for the fourth quarter ended May 3 compared to an EBITDA of ($4.5 million) for the previous quarter and ($1.3 million) for the fourth quarter last year. Only sketchy numbers were released then, however, with the company explaining there was some sort of analysis underway of its accounting for goodwill.

Nevertheless, delisting is almost inevitable for the company. In November 2007 the company was notified that it would be delisted by the NASDAQ exchange because its stock price had fallen below the $1 a share minimum. The company got an automatic extension to Nov. 17th., but with the stock trading around 16 cents a share for the last few months, Workstream will be dropped by NASDAQ. That will make it difficult for its shareholders to sell their stock. When they do, generally through private transactions, fees will be higher than when the shares are traded through an exchange.

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Earlier this year, Workstream was courted by payroll processor Empagio, which made a bid to acquire the company. Though unsolicted, Workstream and its board endorsed the merger, which would have created a new company with Workstream shareholders owning 25 percent. The deal eventually fell through.

Besides its software business, concentrated in on-demand compensation, performance and talent management in its TalentCenter 7.0 released last year, Workstream also owns and Allen and Associates, a candidate focused career management firm.

John Zappe is the editor of and a contributing editor of John was a newspaper reporter and editor until his geek gene lead him to launch his first website in 1994. He developed and managed online newspaper employment sites and sold advertising services to recruiters and employers. Before joining ERE Media in 2006, John was a senior consultant and analyst with Advanced Interactive Media and previously was Vice President of Digital Media for the Los Angeles Newspaper Group.

Besides writing for ERE, John consults with staffing firms and employment agencies, providing content and managing their social media programs. He also works with organizations and businesses to assist with audience development and marketing. In his spare time  he can be found hiking in the California mountains or competing in canine agility and obedience competitions.

You can contact him here.


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