Youbet.com to restate financial results for 2007

WOODLAND HILLS, California -- (PRESS RELEASE) -- Youbet.com, Inc. (NASDAQ: UBET) announced today that it intends to restate its financial statements as of and for the year ended December 31, 2007 in an amendment to the company's Form 10-K and its balance sheet at March 31, 2008 in an amendment to its first quarter Form 10-Q.

For the fourth quarter of 2007, the company recorded an impairment charge for the intangibles associated with the IRG business. Based upon a miscalculation at the time the company prepared its 2007 financial statements, the company originally accrued $3.2 million for a potential final earn-out payment which is due to be paid under the purchase agreement on August 31, 2008. Upon further review of the final earn-out payment calculation, management identified the error and currently believes the unpaid earn-out payment, as calculated in accordance with the agreement, is potentially $4.3 million, although the precise amount, if any, is subject to any claims that may be determined prior to the date such payment is due. Accordingly, the $1.1 million increase in the accrual will result in an equal increase to the impairment charge previously recorded in 2007 for the intangibles associated with the IRG business.