Impact of L1 Denial on GC application

[ssavla]

Received denial notice for my L1 extension notice. notice also mentions "Beneficiary can continue in current status till expiration of date mentioned in I-94". In my case, I-94 expires in Sep 2010.
Questions:
1. Is there any risk to my future L1/GC processing, if I continue to stay in US based on above.
2. can I apply for GC during this status