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Rrrrrrr, I think apdn1mill is referring to when the daily volume averaged < 100k.
Stock slid down to .04 from an average range .06 to .07.
Then came the DLA Mandate around Aug. 2012.
Sprinkle in a few Patric Cox / Agora pumps and we zoomed up/down a few times.
Now a new business plan is starting to take hold and we all expect to see quarter over quarter earnings improvement.
Cash burn is a concern and dilution/funding could rear itself.
Holding many patents and many vertical markets being nurtured.
Only A Matter Of Time.
What's that song... "know when to hold em"...
"Know when to fold em"...
Feelin lucky.
OAMOT
LOL, OAMOT (only a matter. Of time) Mike.
BTW, the reason I switched from ING 5 years ago was at the time you could only trade with 2 decimals. Not good for penny stocks.
OAMOT
Thanks WT, a continuous success story.
Can't (actually can/will) wait for adoption and widespread media recognition to take off.
Yea Mike, everyone, glad to contribute. Hey Mike how bout picking up a knock-off handbag and hanging it from the bulls nose.
Woops nevermind. Might cause a scare.
Pillar Technologies secures DNA authentication for brand protection
http://www.packagingdigest.com/brand-protection/pillar-technologies-secures-dna-authentication-brand-protection-140618
Brand protection is a concern for brand owners who have seen the brand equity of their own products and those of other brand owners undermined by counterfeiting. In response, Pillar Technologies, a business unit of ITW and supplier of induction cap sealers and surface treatment technologies, has formed a business partnership with Applied DNA Sciences, a provider of DNA-based security and product authentication. The agreement for marking and authenticating original products and packaging was reported by our sister publication, PlasticsToday, in an article that describes how Pillar will offer its customers the ability to prove the authenticity of its products by tightly binding ADNAS's SigNature DNA in new ways to existing and new physical substrates.
We go deeper into this timely development—especially the packaging aspects—in this Q&A with Pillar Technologies’ Rory A. Wolf, CEO/Business Unit Manager, surface modification & induction sealing systems, who reminds us that “Pillar has been in brand protection for many years with its induction-sealing systems. This collaboration with ADNAS is an extension of that experience.”
What led to this collaboration?
Wolf: It’s all about brand security. There have been a number of industries which both Applied DNA Sciences (ADNAS) and Pillar Technologies serve that have been impacted by counterfeiting. Existing industry verticals in military supply chains and in textiles served by ADNAS are already specifying DNA solutions for brand protection. These same verticals are served by Pillar Technologies, so the collaboration is a logical extension of our business models.
How will this technology work for Pillar’s customers?
Wolf: Much of the process technology is proprietary, but I can generally share that botanical DNA, branded by ADNAS as its SigNature DNA product, is arranged in a way that allows a specific consumer product to carry a unique product identifier in a predetermined location to authenticate the product. Existing and new physical substrates, in two- or three-dimensional orientations, are easily adapted to the DNA product. For Pillar customers, awareness of this DNA technology and its delivery and improved affixation to the surface with Pillar surface treatment technology will offer a convenient adaptation of the process.
How are the markers applied to the packaging materials?
Wolf: The DNA markers can be applied anywhere in the process and anywhere on the package. However, these decisions are made in collaboratively with the consumer products company so that authentication is optimized.
What is required to authenticate a product or package?
Wolf: From a consumables and capital equipment perspective, the brand owner/customer typically commits to installing the delivery methodology most conducive to their process. Sampling techniques involving brand owners as well as personnel within the ADNAS authentication network streamline the authentication process today. Lab analysis at ADNAS currently provides definitive authenticity (or lack thereof), with in-field authentication techniques also currently being calibrated to specific application processes within supply chains.
What product and packaging applications are possible?
Wolf: That’s what makes our collaboration so enabling. The combined implementation of our technologies allows for any flexible or rigid packaging to carry DNA. The same applies to all types of physical products manufactured by all types of product fabrication and decoration methods, such as plastic extrusion/molding, paper-making, weaving, metal fabrication, spunbonding, dyeing, printing, coating, adhesive application, etc. The opportunities to introduce the DNA product within the supply chain are limitless.
What is the timeframe for implementation of the tech at Pillar? And how seamless is it?
Wolf: Because our technologies are complimentary in their current states, the timeframe for implementation is immediate. Pillar’s surface modification technologies, particularly those involving atmospheric plasma-enhanced chemical vapor deposition (PECVD) methodologies, are currently in service commercially so there is no process change required. In summary, it is nearly completely seamless.
How does this arrangement expand ADNAS’s markets?
Wolf: This collaboration with Pillar Technologies has the potential to expand the ADNAS technology initially into food and beverage markets, and onto substrates such as polymer films, foils, synthetic/natural fabrics, glass, and natural fibers. Substrate configurations can be in the form of a web, a sheet, a yarn, or a 3D object.
How much of a cost premium does this represent?
Wolf: Because the DNA product is highly reliable in very low concentrations and its methods of delivery (including Pillar surface modification technologies) are well-established, the cost of product and delivery combined is extremely low. This becomes particularly imprtant when considering the significant scale and impact of lost revenues to globally-based counterfeiting opportunists.
What kind of interest do you anticipate?
Wolf: There is already established and working commercial applications within the financial industry (physical currencies and their transfer), the high-end apparel industry (fashion wear), government (military component parts, personal I.D.), and many others.
Is there anything else you’d like to mention?
Wolf: Because the application opportunities span so many industries which have been financially impacted by counterfeiting of their products, we are in the process of focusing our joint efforts on developing application solutions which are most synergistic to our mutual organizations, and which can be implemented quickly by our customers.
That's what I was thinking Shail. Some of these attending companys are big and have plenty of cash.
Investing in a microcap is not the only option.
Something new, unique and exciting as APDN would look attractive as a new acquisition.
Why buy a slice if you can afford the pizza shop in a world where pizza has not yet cought on.
The Dr was careful not to let Crede amass more than 9% of shares so the offer would have to be significant.
If we get financing we let it ride, otherwise...
Yea but tomorrow is another fundraiser.
http://www.adnas.com/sites/default/files/apdn_press_release_marcum.may_.21.2014.pdf
DLA / MDA who ?!
Wham bam thank you maam...
They served their purpose validating the Tech.
Now it's on to business.
Hey Mike OAMOT !
McS, rapid (85 mins) dna scan already here.
Via GE:
https://promo.gelifesciences.com/na/K12242/misc/Forensics_data_file.pdf
Development and test must be performed with the goal of meeting the four critical requirements above. Phase I development work should focus on meeting the first two critical requirements (difficult to copy, withstand normal use). Phase II should address the third critical requirement (cost-effective), plus investigate potential applications beyond electronic components. The third Phase should address the fourth critical component (simple fast detection).
PHASE III
Develop a plan to establish in-house detectability methods for electronic components that are 100% accurate in detecting remarked product. Determine implementation timeframe, and develop a cost estimate and time estimate for using equipment available for purchase to be used within the purchasing facility to determine whether components have been recoated. This in-house assessment capability must be stand-alone, but may include exchange of data with the developer in order to confirm encoded DNA information is accurate. MDA and developer present final information to DoD to develop plan forward for adoption (e.g., no adoption, adoption for only critical semiconductor components, full adoption). COMMERCIALIZATION: The developer will pursue commercialization of the various technologies and processes developed in prior Phases potential commercial uses in electronic components, and assess potential for marking mechanical parts or materials, labels, and other items determined to be at high risk for counterfeiting.
http://sbirsource.com/grantiq#/topics/86893
Bam, can you provide a link to:
This is expected to be completed by end of summer/fall per Karol.
SA Analysis
Applied DNA Sciences: An Unique Biotech Company Targeting The Anti-Counterfeiting Market
May 15 2014, 08:29 | by Grant Zeng
about: APDN
Summary
The only company that offers botanical DNA-based anti-counterfeiting solutions.
Revenue grew 85% and 86% for fiscal 1Q14 and 1H14 respectively, and will continue to grow in the rest of 2014 and beyond.
Valuation is very attractive.
Background
Applied DNA Sciences, Inc. (OTCQB:APDN) is a biotech company engaged in the research, development and commercialization of botanical-DNA based security and authentication solutions that can help protect the products, brands and intellectual property of companies, governments and consumers from theft, counterfeiting, fraud and diversion.
Currently, Applied DNA markets two principal anti-counterfeiting and product authentication solutions: SigNature DNA and BioMaterial Genotyping, both can be used in numerous industries, including cash-in-transit (transport and storage of banknotes), textiles and apparel, electronics, identity cards and other secure documents, pharmaceuticals, wine, and luxury consumer goods. Both platforms have spawned a series of product offerings which differ by the industry vertical to which the product is sold.
The Company's flagship product offering, SigNature DNA, uses the DNA of plants to manufacture highly customized and encrypted botanical DNA markers (SigNature DNA Markers) which are used to mark and authenticate products in a unique manner that essentially cannot be replicated. SigNature DNA Markers have been embedded into a range of products, including various inks, dyes, textile treatments, thermal ribbons, threads, varnishes and adhesives. These items can then be tested for the presence of SigNature DNA Markers through an instant field detection or a forensic level authentication. SigNature DNA Markers provide a secure, accurate and cost-effective means for users to incorporate forensic SigNature DNA Markers in a broad range of items, such as recovered banknotes, branded textiles and apparel products, pharmaceuticals and cosmetic products, identity cards and other secure documents, digital media, artwork and collectibles and fine wine. The forensic Signature DNA Markers can then be quickly and reliably authenticated to identify original products. Having the ability to reliably authenticate and identify counterfeit versions of such items enables companies and governments to detect, deter, interdict and prosecute counterfeiting enterprises and individuals.
BioMaterial GenoTyping refers to the development of genetic assays to distinguish between varieties or strains of biomaterials, such as cotton, wool, tobacco, fermented beverages, natural drugs and foods that contain their own source DNA. Applied DNA has developed two proprietary genetic tests: FiberTyping and PimaTyping, to track American Pima cotton from the field to finished garments. These genetic assays provide the cotton industry with the first authentication tools that can be applied throughout the U.S. and worldwide cotton industry from cotton growers, mills, wholesalers, distributors, manufacturers and retailers through trade groups and government agencies. Similar genetic assays can be developed for any biologically-derived product.
Applied DNA is currently focusing its efforts on the general anti-counterfeiting industry.
Counterfeiting, product diversion, piracy, forgery and identity theft, create significant and growing problems to companies in a wide range of industries as well as governments and individuals worldwide. The U.S. Chamber of Commerce reported in 2007 that counterfeiting and piracy cost the U.S. economy between $200-$250 billion per year, or an estimated 750,000 American jobs, and pose a real threat to consumer health and safety. The World Customs Organization and Interpol estimate that annual global trade in illegitimate goods was $650 billion in 2007.
The anti-counterfeiting business has broad application across many industries and government agencies.
Counterfeiting can occur in almost every industry and to every product. Applied DNA provides novel, effective, accurate, and easy to use anti-counterfeiting solutions to governments, companies and individuals to protect their tangible and intangible products.
Competitive Advantages of SigNature DNA
Counterfeiting has become a worldwide problem and as companies in almost every industry begin to address this problem, this will create huge opportunities for companies engaged in anti-counterfeiting business, such as Applied DNA.
Historically, counterfeiting, product diversion and other types of fraud have been combated by embedding various authentication systems and rare and easily distinguishable materials into products, such as radio frequency identification (RFID) devices and banknote threads in packaging, integrated circuit chips and magnetic strips in automatic teller machine cards, holograms on currency, elemental taggants in explosives, and radioactivity and rare molecules in crude oil. These techniques are effective but have generally been reverse-engineered and are easily replicated by counterfeiters, which limits their utilization as forensic methods for authentication of the sources of products and other items.
However, Applied DNA's principal product SigNature DNA uses a unique DNA technology which can not be replicated. Every living organism has a unique DNA code that determines the character and composition of its cells. The core technology of Applied DNA is to use the DNA of everyday plants to mark objects in a unique manner, and then identify these objects by detecting the absence or presence of the DNA.
The Company uses a series of patented technologies to create unique SigNature DNA Markers from plant DNA and apply them to a broad range of products.
We believe the key characteristics and benefits of the SigNature DNA offering are as follows:
The SigNature DNA markers are virtually impossible to copy: The Company uses DNA segments from one or more botanical sources, rearranges them into unique encrypted sequences, and then implement anti-counterfeit techniques. Because the portion of DNA in a SigNature DNA Marker used to identify the marker is so minute, it cannot be detected unless it is amplified. This amplification can only be achieved by applying matching strands of DNA (primer), and polymerase chain reaction (PCR) techniques. The sequence of the relevant DNA in a SigNature DNA Marker must be known in order to manufacture the primer for that DNA. As a result, the effort required to find, amplify, select and clone the relevant DNA in a SigNature DNA Marker would involve such enormous effort and expense that SigNature DNA Markers are virtually impossible to copy.
Simple and rapid authentication: The Company offers rapid readers capable of instantly testing for the presence or absence of any of the SigNature DNA Markers. In addition, when a forensic level of authentication is necessary, the Company offers in-house forensic DNA authentication, that will confirm authentication sequences in approximately 24-48 hours.
Low cost and high accuracy: The amount of DNA required for each marker is minute. The Company manufactures the identifying segment of DNA to be used in a SigNature DNA Marker by cloning them inside microorganisms such as yeast or bacteria, which are highly productive and inexpensive to grow. As a result, SigNature DNA Markers are relatively inexpensive when compared to other anti-counterfeiting devices. The probability of mistakenly identifying a SigNature DNA Marker is less than 1 in 1 trillion, so the authentication systems are highly accurate, and in fact, the SigNature PCR Kits can authenticate to a forensic level.
Easily integrated with other anti-counterfeit technologies: The Company's SigNature DNA Markers can be embedded onto RFID devices, banknote threads, labels, serial numbers, holograms, and other marking systems using inks, threads and other media. By so doing, poorly resolved platforms can be elevated to a forensic level and those that may be copied (such as holograms, UV and IR markers, RFID's and others) are now rendered uncopiable by the DNA.
Broad applicability and ingestible: The SigNature DNA Markers can be embedded into almost any consumer product, and virtually any other item. For instance, the indelible SigNature DNA Markers are safe to consume and can be used in pharmaceutical drug tablets and capsules.
The competitive advantages of SigNature DNA are summarized below:
SigNature DNA® Out Performs Others
Platform
Forensic Quality
Size of Marker
Scope
Security
Stability
Safety
SigNature DNA
v
v
v
v
v
v
Highest
large Complex
Unlimited Markers
Can not be copied
Stable and Tested
Safe, "Green" Botanical
Non DNA Taggants
x
x
x
x
x
x
Low to None
Varies
Limited Markers
Can be copied
can be unstable
Varies
Source: Applied DNA and Zacks Investment Research
Applied DNA Sciences is the only company that offers botanical DNA-based anti-counterfeiting solutions. Synthetic DNA is also used by other companies, but we believe Applied DNA's botanical DNA has many advantages over synthetic DNA.
Botanical DNA is double stranded vs synthetic DNA which is typically single stranded; Single stranded DNA is less stable
Botanical DNA is more complex making it harder to duplicate than synthetic DNA
Synthetic DNA has shorter sequences, limited size and requires sequencing for authentication. Sequencing is more prone to contamination than genotyping which is what Applied DNA uses to detect DNA.
Broad Applicability of Products and Services
The Company's SigNature DNA offering is as broadly applicable, convenient and inexpensive as existing authentication systems, while highly resistant to reverse-engineering or replication, so that it can either be applied independently or supplement existing systems in order to allow for a forensic level of authentication of the sources of a broad range of items, such as artwork and collectibles, fine wine, consumer products, digital and recording media, pharmaceuticals, financial instruments, identity cards and official documents.
The SigNature DNA solution consists of three steps: creating and encapsulating a specific encrypted DNA segment, applying it to a product or other item, and detecting the presence or absence of the specific segment. The first two steps are controlled exclusively by Applied DNA and its certified agents ensure the security of SigNature DNA Markers. Once applied, the presence of any of the SigNature DNA Markers can be detected by either Applied DNA or a customer in a simple spot test, or a sample taken from the product or other item can be analyzed forensically to obtain definitive proof of the presence or absence of a specific type of SigNature DNA Marker.
The SigNature DNA Markers may be directly embedded in products or other items, or otherwise attached by embedding them into media that is incorporated in or attached to the product or item. For example, the SigNature DNA Markers can be directly embedded in paper, metal, plastics, stone, ceramic, and other materials. The SigNature DNA Marker can be embedded in different media such as ink, adhesive, varnish, and thermal transfer ribbon to form a ready to use product.
Applied DNA has begun offering its products and services in Europe, the United States and Asia. We believe the Company's new DNA extraction protocol and methodologies are more effective than existing forensic systems. The combination of the SigNature DNA and BioMaterial Genotyping solutions covers the total authentication market, is applicable to multiple industry verticals, and can mark physical products on the front end and authenticate forensic DNA sequences on the back end.
A Clear Growth Strategy Is In Place
Applied DNA has begun to generate revenues principally from sales of SigNature DNA and BioMaterial Genotyping offerings. The Company is implementing a series of strategy to expand its product offering and penetrate new markets.
One of the strategies to expand its product offering is to customize and refine solutions to meet potential customers' needs. The Company is continuously attempting to improve its SigNature DNA solution by testing the incorporation of SigNature DNA Markers into different media, such as newly configured labels, inks or packaging elements, for use in new applications. Each prospective customer has specific needs and employs varying levels of existing security technologies with which SigNature DNA must be integrated. The ultimate goal is to develop a secure and cost-effective system for each potential customer that can be incorporated into that potential customer's products or items themselves or their packaging so that they can be tracked throughout the entire supply chain and distribution system.
The Company is also continuing to enhance detection technologies for authentication of its SigNature DNA Markers. The Company has also identified and is further examining opportunities to collaborate with companies and universities to develop a new line of detection technologies that will provide faster and more convenient ways to authenticate its SigNature DNA Markers.
At the front of market penetration and new market identification, Applied DNA is taking measures to target potential high-volume markets. The Company will continue to focus its efforts on target vertical markets that are characterized by a high level of vulnerability to counterfeiting, product diversion, piracy, fraud, identity theft, and unauthorized intrusion into physical locations and databases. Currently, the Company's target markets include art and collectibles, cash-in-transit, fine wine, consumer products, digital and recording media, pharmaceuticals, textile and apparel authentication and secure documents/homeland security. Once these markets have been significantly penetrated, Applied DNA intends to expand into additional related high volume markets.
If deemed appropriate, the Company also intends to pursue strategic acquisitions. These acquisitions should strengthen and complement the Company's core technologies, improve its competitive positioning, allow it to penetrate new markets, and grow its customer base. The Company also intends to work in collaboration with potential strategic partners in order to continue to market and sell new product lines derived from, but not limited to, DNA technology.
With respect to international expansion, in addition to its customers in the UK, the Company is working with Safe Solution to market its product and technology in Scandinavia and has already done some work with the Swedish police. The Company is also partnered with Printcolor who has offices in Switzerland and Germany to sell security inks in Europe, including the recently launched Cashield. The Company also has signed a contract with an international printing company with headquarters in Asia.
We believe Applied DNA is heading into the right direction. If executed correctly, these strategies will strengthen the Company's leadership position in the anti-counterfeiting industry and will ultimately boost the Company's top line and bottom line in the coming years.
Highest Quarterly Revenue Reported for Fiscal 2Q
Total Revenues for the fiscal 2Q14 ended March 31, 2014 were $637,146, an 85% increase year over year. Sequentially, revenues grew 7% for the fiscal second quarter of 2014.
Although second quarter revenues were less than our estimate of $800,000, these are the highest revenues reported for the second quarter of any fiscal year in the history of the company.
(click to enlarge)
During the quarter ended March 31, 2014, the Company entered into approximately $1 million of contracts and purchase orders, some of which are expected to be recognized in future quarters.
As of March 31, 2014, the Company also had $416K in deferred revenue, which will be recognized over the next 12 months.
Total operating expenses for fiscal 2Q14 increased to $3.7 million compared to $3.0 million for fiscal 2Q13, a 27% increase. This increase was primarily attributable to higher salary expense due to an increase in headcount from 38 as of March 31, 2013 to 52 as of March 31, 2014.
Net loss for the three months ended March 31, 2014 decreased to $2,750,436 ($0.00 per share) from a net loss of $3,127,631($0.00 per share) for the three months ended March 31, 2013.
For the first six months of this fiscal year, the Company generated approximately $1.2 million in revenue, an increase of 86% from the same period last fiscal year, the highest revenues reported for the first six months of any fiscal year in the Company's history.
Net loss for the six months ended March 31, 2014 decreased to $9,042,086 ($0.00 per share) from a net loss of $11,832,388 ($0.00 per share) for the six months ended March 31, 2013.
Revenue Will Continue to Grow Going Forward
We think fiscal second quarter was another strong quarter for APDN in terms of financial performance. APDN reported highest second quarter sales in the Company's history.
We think SG&A expenses will stabilize going forward since the Company has completed the move into new facility. Actually, SG&A expense declined to $3.3 million for 2Q14 from $3.8 million for the 1Q14, a decrease of 13%. APDN is positioned to deliver against high demand while continuing necessary product development without additional major expenditures.
In April, 2014, APDN and a provider of polyolefins signed a term sheet for mutual development and cooperation regarding the supply of markers - and related additives - for polyolefin products. With this agreement, APDN has the opportunity to enter a market for a vital industrial material with estimated production of 140 billion kg per year. The cooperation between the parties will explore and test the feasibility of the project. The contract provides for initial payments to APDN, comprised of development and exclusivity fees. The payment of further installments is dependent on achieving specific performance goals over a defined period of less than one year.
The Company is applying SigNature(R) DNA on a greater scale than it has in the past, expanding the universe of DNA-marked products, which in turn should increase the demand for authentications. The individual size of the Company's customers is also growing with multiple customers having revenues from $3 billion to $30 billion annually.
Therefore we expect continued revenue growth and bottom line improvement in the coming quarters.
(click to enlarge)
Balance Sheet Remained Relatively Strong
On Jul 22, 2013, APDN announced that it has entered into a Securities Purchase Agreement with an institutional accredited investor, Crede CG III, Ltd. to provide $7.5 million in financing.
Crede is an existing shareholder of the Company. At the initial closing, the Company received gross proceeds of $2,000,000 in exchange for restricted common stock priced at $0.187/share.
Pursuant to the Agreement, the investor is obligated to invest an additional $5,500,000 in the Company on the date a registration statement providing for the resale of the securities issued is declared effective by the Securities and Exchange Commission. This closing will be done at $1,000 per share of preferred stock with a conversion price the lesser of market value or $0.187/share. The investor is limited to 9.9% ownership at any given point in time. The investor is in a "passive" position and will not occupy a Board position. The preferred stock is subject to conversion into common stock at the Company's option following the effectiveness of the registration statement and automatically converts after one year.
Warrants issued as a part of this financing could contribute up to an additional $9.75 million in funds to the company if exercised for cash. The Warrants also have a cashless exercise feature. Warrants would be exercised at a strike price equal to $0.2431 per share which is a 30% premium to the original purchase price of $0.187/share.
This financing comes at an excellent time. It greatly boosted balance sheet of the Company. This financing will allow APDN to continue to scale its operations and broaden its product line to meet the demand of a growing number of contracts in electronics and other verticals, continue to hire top sales, operational, and scientific talent, leverage valuable assets acquired from RedWeb Technologies, and further expand the company's market share in Europe.
As of March31, 2014, Applied DNA had $2.0 in cash. According to our model, the Company's current cash balance along with its current customer base, projected cash flow and the minimum projected revenues for this remaining fiscal year will allow the company to have sufficient capital resources to meet projected cash flow requirements for the next twelve months.
APDN is at a crucial stage in the development of Applied DNA Sciences. The strong balance sheet will enhance its capacity to respond to growth opportunities.
APDN Shares Are Undervalued
We maintain our Outperform rating for APDN shares and reiterate our 12-month price target of $0.25 per share.
We are encouraged by the strong financial performance for the fiscal second quarter and fiscal first half of the year of the Company. Revenue increased 85% for the fiscal 2Q14 and 86% for the fiscal 1H14, respectively, which represented the highest second quarter and first half revenue ever in the Company's history.
Customer base has increased greatly from fiscal 2009 to present.
We remain optimistic about APDN's prospect. APDN's fundamentals remain strong. The Company's technology is unique and has competitive advantages over its peers. The Company is well positioned to boost its top line and bottom line in the coming years. According to our long term financial model, the Company's revenue will grow at a compound annual growth rate (OTCPK:CAGR) of 61% in the next 6 fiscal years from 2014 to 2020. The Company will become profitable in fiscal 2018 with net income of $2.0 million or EPS of $0.00 per share.
APDN is a high growth company. In terms of valuation, we think a P/E of 45x is appropriate for the Company. We apply a P/E of 45x to our estimated EPS of $0.01 in fiscal 2020, discounted at 20% for 5 years, we get our price target of $0.25 per share. This values the company at about $202 million in market cap, which is reasonable in our view. As long as the Company can execute its growth strategy, we believe value should be generated for shareholders.
But Cash burn is still our chief concern at this time.
Since APDN will become profitable in fiscal 2018, the Company still needs to raise funds for its operation until positive cash flow can be generated in 2017. We remind investors that any equity or convertible note financing will dilute the Company's current shareholder base and reduce its per share value.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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2 comments
One more thing.
A hundred pounds ago when I would have begun my paddle towards shore on my surfboard I would experience the drag of the wave building behind me.
This is where we are now.
Were about ready to stand up.
Thanks A4 for your detailed response.
I agree their authentication will be a major recurring revenue stream especially when the flow-down gains exponential momentum.
Dated today, not sure new...
EDITED POST NEW 3 DAYS OLD.
http://www.tmcnet.com/usubmit/2014/05/09/7821739.htm
United States : APPLIED DNA SCIENCES, IPS enter partnership [TendersInfo (India)]
(TendersInfo (India) Via Acquire Media NewsEdge) A biotechnology company that offers DNA-based authentication and security solutions and services, Applied DNA Sciences, Inc., has entered a partnership with an end-to-end product design and development services provider, Intelligent Product Solutions (IPS).
The deal involves the joint development of a range of products that expand the means of authenticity assurance for APDN's clients and their customers.
This will result in enhanced quality control and fraud detection for marked products.
CEO and President of Applied DNA Sciences, Dr. James A. Hayward, said : "The multi-discipline technical resource and depth of application knowledge that IPS brings to the table are unique. It is a pleasure to work with an accomplished team of professional innovators." The IPS team provides experience in security solution design from other sectors.
CEO at IPS, Mitchell Maiman, said : "We uniquely apply our engineering and design service capabilities for the betterment of a security procedure. We are excited to be working with Applied DNA Sciences." (c) 2014 Euclid Infotech Pvt. Ltd. Provided by Syndigate.info, an Albawaba.com company
From 10Q/A:In particular, we have multiple workstreams in progress toward a launch of new products for field detection and reading of optical marks which use the SigNature DNA ingredient.
Could this lead to an instant field test kit: So if scientists want to know whether two pieces of DNA are identical—say a known sequence from an anthrax spore and one from a suspicious-looking white powder—all they have to do is mix the samples, dye, and polymer in a test tube, turn on the light, and let the results shine for themselves. Of course, in this case, they’d be hoping to not see the light!
WOW YIP:Plus, the method is rapid and requires no expensive equipment, just a conventional laboratory fluorimeter. It has high potential to be made field deployable for rapid analysis of crime-scene evidence and to mount a more knowledgeable, speedy response to bioterror threats.
Thanks for sharing JC.
I'm fairly certain Patric Cox is an unassociated 3rd. Party with no direct relationship to ADNAS.
That said, the SP spiked after the mandate announcement (no pump then) back in Aug. 2012. About 6 months later another mini spike then retrace occured as a result of a 3rd party tease.
I'm sure many listening will be joyed to hear that another may be in the works.
With that said it will be interesting to watch the expected players jump in.
Thanks Pasta, this is truly an odd Penny.
They intentionally avoid any pumping from their end.
I suspect this is much of our frustration since we don't have a clear direction ( color analyzed / embellishments ) - "just the facts ma'am...".
Way back before the current management there was a pumper/dumper involved which caused a stink (I'm paraphrasing).
I believe this is why they do not self promote even ever so slightly.
Just don't shoot the messenger.
You welcome, the program is called UltraCompare by IDM computer solutions.
Differences between the 10Q & 10QA
I ran the two reports thru a text comparison program.
A * means a change.
A !> means a new line.
A !< means a deleted line.
Just the results are shown:
1 * 10-Q 1 t78214_10q.htm FORM 10-Q
* 10-Q/A 1 t79139_10qa.htm FORM 10-Q (AMENDMENT NO. 1)
=======
=======
9 * FORM 10-Q
* *FORM 10-Q /A *
!> *(Amendment No.1) *
=======
=======
31 * Commission File Number: 33-17387
* Commission File Number: 002-90539
=======
=======
!> *Explanatory Note *
!>
!>
!>
!> Applied DNA Sciences (the “Company”) is filing this Amendment No. 1
!> (the “Amendment”) to its Quarterly Report Form 10-Q for the quarterly
!> period ended December 31, 2013, previously filed with the Securities and
!> Exchange Commission (the “SEC”), on February 10, 2014 (the “Original
!> Filing”). The Registrant is filing this Amendment to amend our
!> disclosure in Part I, Item 4 “Controls and Procedures” to clarify and
!> amend the conclusion of our principal executive officer and principal
!> financial officer regarding the effectiveness of our disclosure controls
!> and procedures for the quarterly period ended December 31, 2013. This
!> Amendment is being filed in response to the Company determining that as
!> a result of the Company’s transition from a “smaller reporting company”
!> to an “accelerated filer” at the end of fiscal 2013, the Company was
!> required to include in the Original 10-K the auditor attestation report
!> on internal control over financial reporting required by Section 404(b)
!> of the Sarbanes-Oxley Act of 2002 (the “Auditor Attestation Report”). As
!> a result, the Company amended its 10-K, originally filed on December 20,
!> 2013 to include the auditor attestation report on internal control over
!> financial reporting required by Section 404(b) of the Sarbanes-Oxley Act
!> of 2002 and a Management’s Report on Internal Control over Financial
!> Reporting. The 10K/A was filed on May 1, 2014.
!>
!> In addition to the above, the Amendment includes the following changes
!> and additions to the Original 10-Q:
!>
!> · We have updated our Notes to our condensed consolidated financial
!> statements on Note I – Subsequent Events.
!>
!> · New certifications by our principal executive officer and principal
!> financial officer under Sections 302 and 906 of Sarbanes-Oxley Act of
!> 2002 are filed as exhibits to this Amendment.
!>
!> Except as described above, no other amendments have been made to the
!> Original Filing. This Amendment does not modify or update the
!> disclosures or financial information contained in the Original Filing in
!> any way other than as required to reflect the revisions discussed above.
!>
!>
!>
!>
!>
=======
=======
!>
!>
!>
=======
=======
576 * in the Company’s Annual Report on Form 10-K filed with the SEC.
* in the Company’s Annual Report on Form 10-K and Form 10-K/A filed with
!> the SEC.
=======
=======
!> *NOTE I - SUBSEQUENT EVENTS *
!>
!> On February 11, 2014, 746,835 shares of the Company’s common stock were
!> issued in connection with the cashless exercise of 1,000,000 warrants to
!> acquire the Company’s common stock.
!>
!> On February 6, 2014, the Company granted 2,500,000 options to purchase
!> the Company’s common stock at an exercise price of $0.16 per share for
!> five years to a consultant, with immediate vesting. This resulted in an
!> expense of $271,417 for the three months ended march 31, 2014.
!>
=======
=======
2250 * “Business” and elsewhere in our Annual Report on Form 10-K for the
* “Business” and elsewhere in our Annual Report on Form 10-K and Form
2251 * fiscal year ended September 30, 2013. All forward-looking statements
* 10-K/A for the fiscal year ended September 30, 2013. All
2252 * and risk factors included in this document are made as of the date
* forward-looking statements and risk factors included in this document
2253 * hereof, based on information available to us as of the date thereof, and
* are made as of the date hereof, based on information available to us as
2254 * we assume no obligations to update any forward-looking statement or risk
* of the date thereof, and we assume no obligations to update any
2255 * factor, unless we are required to do so by law.
* forward-looking statement or risk factor, unless we are required to do
!> so by law.
=======
=======
!>
!> *Remediation of Weakness in Internal Controls *
!>
!>
!>
!> We concluded that our disclosure controls and procedures were not
!> effective as of December 31, 2013 as the result of a material weakness
!> in our internal control over financial reporting as of September 30,
!> 2013, that was not yet remediated as of December 31, 2013. The material
!> weakness, which arose primarily due to the need for more enhanced and
!> formalized documentation and procedures regarding the financial
!> statement closing and review process, is further described in Item 4 of
!> this Quarterly Report on Form 10-Q/A. We are taking the following steps
!> to remediate this material weakness and to improve our disclosure
!> controls and procedures:
!>
!>
!>
!> · Our CEO has appointed a Sarbanes-Oxley project leadership team,
!> consisting of our CFO and our Controller, that will oversee the project;
!>
!> · Together with a consultant that we have engaged, we have enhanced
!> our review procedures and the documentation thereof; and
!>
!> · We are prepared to implement these enhanced procedures as we are
!> preparing our Form 10-Q for the period ended March 31, 2014.
!>
!>
=======
=======
2634 * None.
* On February 11, 2014, 746,835 shares of the Company’s common stock were
!> issued in connection with the cashless exercise of 1,000,000 warrants to
!> acquire the Company’s common stock.
!>
!>
!>
!> On February 6, 2014, the Company granted 2,500,000 options to purchase
!> the Company’s common stock at an exercise price of $0.16 per share for
!> five years to a consultant, with immediate vesting. This resulted in an
!> expense of $271,417 for the three month period ended March 31, 2014
!>
=======
=======
2729 * procedures were effective to ensure that the information required to be
* procedures were not effective to ensure that the information required
2730 * disclosed by us in reports that we file or submit under the Exchange Act
* to be disclosed by us in reports that we file or submit under the
2731 * is recorded, processed, summarized and reported within the time periods
* Exchange Act is recorded, processed, summarized and reported within the
2732 * specified in the SEC’s rules and forms.
* time periods specified in the SEC’s rules and forms due to a deficiency
!> in our disclosure controls that was determined to be a material weakness
!> as described below .
=======
=======
2734 * Changes in Internal Control over Financial Reporting
*
!> A material weakness is a deficiency, or a combination of deficiencies,
!> in internal control over financial reporting, such that there is a
!> reasonable possibility that a material misstatement of the company’s
!> annual or interim financial statements will not be prevented or detected
!> on a timely basis.
!>
!>
!>
!> The specific material weakness identified by the Company’s management as
!> of September 30, 2013, which was not yet remediated as of December 31,
!> 2013 is described as follows:
!>
=======
=======
2736 * During the fiscal quarter ended December 31, 2013, there were no changes
*
2737 * in our internal control over financial reporting that have materially
* Our management determined that, as of September 30, 2013, the Company’s
!> disclosure controls and internal control over financial reporting were
!> not effective, due to the need for more enhanced and formalized
!> documentation and procedures regarding the financial statement closing
!> and review process to ensure that the application of the Company’s
!> accounting policies and the presentation of disclosures in the Company’s
!> financial statements is adequate. Further, in the filing of our original
!> Form 10-K for the year ended September 30, 2013, we did not effectively
!> evaluate the impact of our unaffiliated aggregate market value being in
!> excess of $75 million (reported level of $113 million) at March 31,
!> 2013. Subsequent to the filing of our Form 10-K, our management
!> determined that we should have included a 404(b) attestation report from
!> our auditors in our Form 10-K.
!>
!>
!>
!> Despite the material weakness reported above, the Company’s management
!> believes that its condensed consolidated financial statements included
!> in this report fairly present in all material respects the Company’s
!> financial condition, results of operations, and cash flows for the
!> periods presented
!>
!>
!>
!> /Remediation of Material Weakness /
!>
!>
!>
!> Our management has developed a remediation action plan and we are
!> actively engaged in the implementation of the plan to fully remediate
!> our material weakness. The principal elements of our remediation plan
!> include the following:
!>
!>
!>
!> a. Our CEO has appointed a Sarbanes-Oxley project leadership team
!> consisting of our CFO and our Controller, that will oversee the project,
!>
!> b. Together with a consultant that we have engaged, we have enhanced
!> our review procedures and the documentation thereof, and,
!>
!> c. We are prepared to implement these enhanced procedures as we are
!> preparing our Form 10-Q for the period ended March 31, 2014.
!>
!>
!>
!> Further, we have amended our Form 10-K for the year ended September 30,
!> 2013 to include a 404(b) attestation opinion from our auditors.
!>
!>
!>
!> */Changes in Internal Control over Financial Reporting /*
!>
!>
!>
!> There were no additional changes, other than those detailed above under
!> Remediation of Material Weakness in our internal control over financial
!> reporting during the most recent fiscal quarter that has materially
=======
=======
!>
=======
=======
2746 * 10-K filed on December 20, 2013, includes a discussion of our legal
* 10-K filed on December 20, 2013 and on Form 10-K/A filed on May 1, 2014,
2747 * proceedings. During the three months ended December 31, 2013, there have
* includes a discussion of our legal proceedings. During the three months
2748 * been no material changes from the legal proceedings discussed in our
* ended December 31, 2013, there have been no material changes from the
2749 * Form 10-K. See Note G to our Notes to Condensed Consolidated Financial
* legal proceedings discussed in our Form 10-K. See Note G to our Notes to
2750 * Statements.
* Condensed Consolidated Financial Statements.
=======
=======
2777 * to the Company’s Annual Report on Form 10-K (filed with the SEC on
* to the Company’s Annual Report on Form 10-K/A, Amendment No 1 (filed
2778 * December 20, 2013) for the year ended September 30, 2013 for a list of
* with the SEC on May 1, 2014 ) for the year ended September 30, 2013 for
2779 * our risk factors.
* a list of our as amended risk factors.
=======
=======
2882 * Dated: February 10, 2014
* Dated: May 2 , 2014
=======
=======
2898 * (Duly authorized officer and
* /(principal financial officer and /
2899 * principal financial officer)
* /principal accounting officer) /
=======
------------------------------------------------------------------------------------------------------------------------
Page:
The last couple paragraphs in the comparison report deserve some board scrutiny - beyond my expertise.
This could explain the new CFO change.
From 10K/A
!> We concluded that our disclosure controls and procedures were not
!> effective as of September 30, 2013 and this deficiency constituted a
!> material weakness in our internal control over financial reporting as of
!> September 30, 2013. The material weakness, which arose primarily due to
!> the need for more enhanced and formalized documentation and procedures
!> regarding the financial statement closing and review process, is further
!> described in Item 9A of this Annual Report on Form 10-K. We are taking
!> the following steps to remediate this material weakness and to improve
!> our disclosure controls and procedures:
!>
!> · Our CEO has appointed a Sarbanes-Oxley project leadership team,
!> consisting of our CFO and our Controller, that will oversee the project;
!>
!> · Together with a consultant that we have engaged, we have enhanced
!> our review procedures and the documentation thereof; and
!>
!> · We are prepared to implement these enhanced procedures as we are
!> preparing our Form 10-Q for the period ended March 31, 2014.
!>
Differences between the 10K & 10KA
I ran the two reports thru a text comparison program.
A * means a change.
A !> means a new line.
A !< means a deleted line.
Just the results are shown:
------------------------------------------------------------------------------------------------------------------------
1 * 10-K 1 t77969_10k.htm FORM 10-K
* 10-K/A 1 t79133_10ka.htm FORM 10-K (AMENDMENT NO. 1)
=======
=======
10 * FORM 10-K
* *FORM 10-K**/A *
!> *(Amendment No. 1) *
=======
=======
98 * Accelerated filer o
* Accelerated filer x
=======
=======
102 * Smaller reporting company x
* Smaller reporting company £
=======
=======
!>
!> *Explanatory Note *
!>
!> Applied DNA Sciences, Inc. (the “Company”) is filing this Amendment No.
!> 1 (the “Amendment”) to its Annual Report on Form 10-K for the fiscal
!> year ended September 30, 2013, previously filed with the Securities and
!> Exchange Commission (the “SEC”) on December 20, 2013 (the “Original
!> 10-K”). The Company has determined that as a result of the Company’s
!> transition from a “smaller reporting company” to an “accelerated filer”
!> at the end of fiscal 2013, the Company was required to include in the
!> Original 10-K the auditor attestation report on internal control over
!> financial reporting required by Section 404(b) of the Sarbanes-Oxley Act
!> of 2002 (the “Auditor Attestation Report”). This Amendment includes,
!> among other changes and additions to the Original 10-K described below,
!> the Auditor Attestation Report and revisions to Management’s Report on
!> Internal Control over Financial Reporting.
!>
!> The Company was a smaller reporting company for fiscal year 2013 subject
!> to scaled disclosure requirements afforded to smaller reporting
!> companies. When a company is required to exit smaller reporting company
!> status, as the Company did at the end of fiscal 2013, it may continue to
!> provide scaled disclosure as a smaller reporting company through the
!> filing of the annual report on Form 10-K for that year, but, as an
!> accelerated filer, it is required to include an Auditor Attestation
!> Report. At the time the Company filed the Original 10-K in December
!> 2013, it believed that the contents of the Original 10-K were governed
!> by the disclosure requirements applicable to a smaller reporting company
!> and omitted the Auditor Attestation Report required for an accelerated
!> filer.
!>
!> In addition to the above, this Amendment includes the following changes
!> and additions to the Original 10-K:
!>
!> · Item 1 “Business- Target Markets” has been updated to clarify and
!> enhance the narrative section based on SEC comments the Company received
!> on February 20, 2014 and March 12, 2014. Certain other conforming
!> changes have been made.
!>
!> · We have included new risk factors relating to possible claims for
!> damages in connection with certain sales of shares of our stock in the
!> open market and the material weakness in internal control over financial
!> reporting identified in Management's Report on Internal Control over
!> Financial Reporting.
!>
!> · Our independent registered public accounting firm has revised their
!> audit report on our consolidated financial statements and added a
!> paragraph regarding their separate audit report on internal control over
!> financial reporting.
!>
!> · We have updated our Notes to our consolidated financial statement on
!> Note M – Subsequent Events.
!>
!> · New certifications by our principal executive officer and principal
!> financial officer under Sections 302 and 906 of Sarbanes-Oxley Act of
!> 2002 are filed as exhibits to this Amendment.
!>
!>
!>
!> Except as described above, no other amendments have been made to the
!> Original Filing. This Amendment does not modify or update the
!> disclosures or financial information contained in the Original Filing in
!> any way other than as required to reflect the revisions discussed above.
!>
!>
!>
!>
!>
!>
!>
!>
!>
=======
=======
214 * 29
* 30
=======
=======
223 * 30
* 31
=======
=======
228 * 37
* 38
=======
=======
234 * 41
* 42
=======
=======
239 * 44
* 45
=======
=======
244 * 45
* 46
=======
=======
253 * 46
* 47
=======
=======
684 * fiberTyping
* *fiberTyping*
=======
=======
859 * target markets include microcircuits and other electronics, homeland
* target markets include microcircuits and other electronics,
860 * security, cash-in-transit, textile and apparel authentication and law
* cash-in-transit and , textile and apparel authentication and our future
861 * enforcement, and our future target markets include identification cards
* target markets include homeland security, law enforcement,
862 * and secure documents, pharmaceuticals, consumer products, fine wine and
* identification cards and secure documents, pharmaceuticals, consumer
863 * art and collectibles. If and when we have significantly penetrated
* products, fine wine and art and collectibles. If and when we have
864 * these markets, we intend to expand into additional related high volume
* significantly penetrated these markets, we intend to expand into
865 * markets.
* additional related high volume markets.
=======
=======
880 * efforts on microcircuits and other electronics, homeland security,
* efforts on microcircuits and other electronics, cash-in-transit, and
881 * cash-in-transit, textile and apparel businesses and law enforcement. In
* textile and apparel businesses. In the future, the Company plans to
882 * the future, the Company plans to expand its focus to include
* expand its focus to include homeland security, law enforcement,
883 * identification cards and other secure documents, pharmaceuticals, wine
* identification cards and other secure documents, pharmaceuticals,
884 * and luxury consumer goods.
* consumer products, fine wine and arts and collectibles .
=======
=======
934 * Homeland Security
* The Defense Logistics Agency (“DLA”), a component of the U.S. Department
!> of Defense, requires that defense contractors provide items that have
!> been marked with botanically-generated DNA produced by us or our
!> authorized licensees. DNA marking is required on items falling within
!> Federal Supply Class (FSC) 5962, Electronic Microcircuits, which have
!> been determined to be at high risk for counterfeiting. A clause at
!> Defense Logistics Acquisition Directive (DLAD) 52.211-9074,
!> Deoxyribonucleic Acid (DNA) Marking on High Risk Items, is included in
!> new solicitations and contracts for FSC 5962 items when the item
!> description states that the item requires DNA marking. As of December
!> 12, 2013, we are providing unique DNA marks to 27 companies that sell
!> microcircuits and other electronics to the military and other markets.
!>
=======
=======
936 * The U.S. military is facing the challenge of the increasing intrusion of
*
937 * counterfeit electronics and other parts into its supply lines. This
* Our SigNature DNA solution provides secure, forensic, and cost-effective
938 * problem is not limited to electronics. Foreign suppliers using
* anti-counterfeiting, anti-piracy and identification solutions to the
939 * substandard materials could be producing rivets, bolts and screws that
* military organizations and other companies supplying microelectronics
940 * hold together everything from missile casings to ship ladders. The
* and similar products globally in need of securing their supply chains.
941 * explosion of counterfeit parts is being driven by an expanding global
*
942 <! economy and an emphasis on low-price contracting — both of which come as
943 <! the U.S. Department of Defense is relying more heavily on older
944 <! platforms, with parts that are becoming obsolete. The global
945 <! semiconductor market has been estimated to be as large as $300 billion
946 <! per year, all subject to the risks of counterfeiting. The US Department
947 <! of Defense is estimated to spend $4 billion per year in the
948 <! semiconductor market.
=======
=======
956 <!
957 <! On September 9, 2010, Homeland Security Newswire published an article
958 <! “Fake chips from China threaten U.S. military systems”in which a U.S.
959 <! Chamber of Commerce estimate finds that the global market for
960 <! counterfeit electronics may be as large as $10 billion. While these
961 <! references include daunting statistics, the underlying problem has not
962 <! changed because there was no satisfactory technological
963 <! solution. Senate hearings in November 2011 revealed the discovery of
964 <! over 1,800 incidents, totaling over 1 million parts, of counterfeit
965 <! electronic parts in the defense supply chain. According to the
966 <! semiconductor industry, counterfeiting results in a $7.5 billion loss in
967 <! revenue annually as well as a loss of 11,000 U.S. jobs.
968 <!
969 <! DNA-marking protects the consumer, the government and our service men
970 <! and women. The manufacturers can ensure that only properly screened,
971 <! original product goes to users. The same DNA marking can then protect
972 <! the manufacturers themselves in the form of returned product which they
973 <! must replace or repair. Broadly applicable, DNA marking could be
974 <! disseminated as industry best practices and military standards.
975 <!
976 <! The Defense Logistics Agency (“DLA”), a component of the U.S. Department
977 <! of Defense, has launched a new requirement that defense contractors
978 <! provide items that have been marked with botanically-generated DNA
979 <! produced by us or our authorized licensees. DNA marking must begin on
980 <! items falling within Federal Supply Class (FSC) 5962, Electronic
981 <! Microcircuits, which have been determined to be at high risk for
982 <! counterfeiting. A new clause at Defense Logistics Acquisition Directive
983 <! (DLAD) 52.211-9074, Deoxyribonucleic Acid (DNA) Marking on High Risk
984 <! Items, will be included in new solicitations and contracts for FSC 5962
985 <! items when the item description states that the item requires DNA marking.
986 <!
987 <! Our SigNature DNA solution can provide secure, forensic, and
988 <! cost-effective anti-counterfeiting, anti-piracy and identification
989 <! solutions to military organizations and other companies supplying
990 <! microelectronics and similar products globally in need of securing their
991 <! supply chains.
=======
=======
1010 *
*
1011 * We are able to incorporate our SigNature DNA Markers in cash degradation
* We incorporate our SigNature DNA Markers in cash degradation inks that
1012 * inks that are used in the cash-in-transit industry. This solvent-based
* are used in the cash-in-transit industry. This solvent-based ink marks
1013 * ink marks bank notes if the cash box is compromised and has the ability
* bank notes if the cash box is compromised and has the ability to
1014 * to penetrate the bank notes rapidly and permanently. We believe our
* penetrate the bank notes rapidly and permanently. We believe our
=======
=======
1016 * competing technologies.
* competing technologies.
=======
=======
!> Our SigNature T DNA anti-counter feiting system for DNA marking and
!> authentication of wool and cotton fibers is currently in use by our
!> customers. We are now marking product in the United States and abroad to
!> assure integrity of the textile supply chain.
!>
!>
!> */Future Markets: /*
!>
!>
!>
!> */Homeland Security /*
!>
!>
!>
!> The U.S. military is facing the challenge of the increasing intrusion of
!> counterfeit electronics and other parts into its supply lines. This
!> problem is not limited to electronics. Foreign suppliers using
!> substandard materials could be producing rivets, bolts and screws that
!> hold together everything from missile casings to ship ladders. The
!> explosion of counterfeit parts is being driven by an expanding global
!> economy and an emphasis on low-price contracting — both of which come as
!> the U.S. Department of Defense is relying more heavily on older
!> platforms, with parts that are becoming obsolete. The global
!> semiconductor market has been estimated to be as large as $300 billion
!> per year, all subject to the risks of counterfeiting. The US Department
!> of Defense is estimated to spend $4 billion per year in the
!> semiconductor market.
!>
!>
!>
!> On September 9, 2010, Homeland Security Newswire published an article
!> “Fake chips from China threaten U.S. military systems” in which a U.S.
!> Chamber of Commerce estimate finds that the global market for
!> counterfeit electronics may be as large as $10 billion. While these
!> references include daunting statistics, the underlying problem has not
!> changed because there was no satisfactory technological
!> solution. Senate hearings in November 2011 revealed the discovery of
!> over 1,800 incidents, totaling over 1 million parts, of counterfeit
!> electronic parts in the defense supply chain. According to the
!> semiconductor industry, counterfeiting results in a $7.5 billion loss in
!> revenue annually as well as a loss of 11,000 U.S. jobs.
!>
!>
!>
!> DNA-marking using our SigNature DNA marks, protects the consumer, the
!> government and our service men and women. The manufacturers can ensure
!> that only properly screened, original product goes to users. The same
!> DNA marking can then protect the manufacturers themselves in the form of
!> returned product which they must replace or repair. Broadly applicable,
!> DNA marking could be disseminated as industry best practices and
!> military standards.
!>
!>
!>
!> The Defense Logistics Agency (“DLA”), a component of the U.S. Department
!> of Defense, has launched a new requirement that defense contractors
!> provide items that have been marked with botanically-generated DNA
!> produced by us or our authorized licensees. DNA marking must begin on
!> items falling within Federal Supply Class (FSC) 5962, Electronic
!> Microcircuits, which have been determined to be at high risk for
!> counterfeiting. A new clause at Defense Logistics Acquisition Directive
!> (DLAD) 52.211-9074, Deoxyribonucleic Acid (DNA) Marking on High Risk
!> Items, will be included in new solicitations and contracts for FSC 5962
!> items when the item description states that the item requires DNA marking.
!>
!>
!>
!> Our SigNature DNA solution can provide secure, forensic, and
!> cost-effective anti-counterfeiting, anti-piracy and identification
!> solutions to military organizations and other companies supplying
!> microelectronics and similar products globally in need of securing their
!> supply chains.
!>
!>
=======
=======
1066 * by providing forensic quality evidence. Applied DNA Sciences, Inc. is
* by providing forensic quality evidence. We are working with the UK
1067 * working with the UK Metropolitan Police Service (MPS) by providing its
* Metropolitan Police Service (MPS) by providing its
=======
=======
1071 <! Future Markets:
1072 <!
=======
=======
1199 * identification number.”In some cases, drug makers are spending as much
* identification number.” In some cases, drug makers are spending as much
=======
=======
1202 * to company executives. Applied DNA Sciences’ unique DNA identifier
* to company executives. Our unique DNA identifier mark-embedded in the
1203 * mark-embedded in the ink of a unique serialized bar code can provide a
* ink of a unique serialized bar code can provide a layered security
1204 * layered security foundation for a customer solution in this market.
* foundation for a customer solution in this market.
=======
=======
!>
!> /We have identified a material weakness in our internal control over
!> financial reporting that could adversely affect our stock price and
!> ability to prepare complete and accurate financial statements in a
!> timely manner. /
!>
!>
!>
!> We concluded that our disclosure controls and procedures were not
!> effective as of September 30, 2013 and this deficiency constituted a
!> material weakness in our internal control over financial reporting as of
!> September 30, 2013. The material weakness, which arose primarily due to
!> the need for more enhanced and formalized documentation and procedures
!> regarding the financial statement closing and review process, is further
!> described in Item 9A of this Annual Report on Form 10-K. We are taking
!> steps to remediate this material weakness and to improve our disclosure
!> controls and procedures. We may, however, identify additional or future
!> material weaknesses or deficiencies. If we fail to remediate the
!> identified or any future material weakness or deficiency, or to maintain
!> our disclosure controls and procedures at the reasonable assurance
!> level, our financial statements and related disclosure could contain
!> material misstatements, the preparation and filing of our financial
!> statements and related filings could be delayed, and substantial costs
!> and resources may be required to remediate any weaknesses or
!> deficiencies or to improve our disclosure controls and procedures. If we
!> cannot produce reliable and timely financial statements, investors could
!> lose confidence in our reported financial information, the market price
!> of our stock could decline significantly, we may be unable to obtain
!> additional financing on acceptable terms, and our business and financial
!> condition could be harmed.
!>
!>
=======
=======
!>
!> We may be subject to claims for damages in connection with certain sales
!> of shares of our common stock in the open market.
!>
!> There may have been inadvertent violations of federal and state
!> securities laws in connection with certain sales of shares of our common
!> stock in the open market pursuant to a registration statement on Form
!> S-3 that we had filed to cover the resale of shares issued or to be
!> issued that was declared effective by the Securities and Exchange
!> Commission on July 31, 2013. On December 20, 2013, we filed our annual
!> report on Form 10-K for the fiscal year ended September 30, 2013 (the
!> "Original 2013 Form 10-K") which did not include the auditor attestation
!> report on internal control over financial reporting required by Section
!> 404(b) of Sarbanes-Oxley (the "Auditor Attestation Report"). We have
!> filed this amendment to the Original 2013 Form 10-K in order to include
!> the Auditor Attestation Report. There were approximately three months
!> when sales of shares may have occurred in open market transactions
!> pursuant to our registration statement when the use thereof should have
!> been suspended. Any such sales may have violated Section 5 or Section
!> 12(a)(1) of the Securities Act of 1933, as amended, and, as a result,
!> the Company may be liable for claims for damages. In addition, the
!> Securities and Exchange Commission and relevant state regulators could
!> impose monetary fines or other sanctions on us as provided under
!> relevant federal and state securities laws. The amount of such damages
!> and penalties, if any, cannot be determined at this time. If the payment
!> of damages or fines is significant, it could have a material, adverse
!> effect on our cash flow, financial condition or prospects.
!>
!>
=======
=======
!>
!> *Remediation of Weakness in Internal Controls *
!>
!>
!>
!> We concluded that our disclosure controls and procedures were not
!> effective as of September 30, 2013 and this deficiency constituted a
!> material weakness in our internal control over financial reporting as of
!> September 30, 2013. The material weakness, which arose primarily due to
!> the need for more enhanced and formalized documentation and procedures
!> regarding the financial statement closing and review process, is further
!> described in Item 9A of this Annual Report on Form 10-K. We are taking
!> the following steps to remediate this material weakness and to improve
!> our disclosure controls and procedures:
!>
!> · Our CEO has appointed a Sarbanes-Oxley project leadership team,
!> consisting of our CFO and our Controller, that will oversee the project;
!>
!> · Together with a consultant that we have engaged, we have enhanced
!> our review procedures and the documentation thereof; and
!>
!> · We are prepared to implement these enhanced procedures as we are
!> preparing our Form 10-Q for the period ended March 31, 2014.
!>
!>
=======
=======
!>
!> On December 20, 2013, 2,500,000 shares of the Company’s Common Stock
!> were issued in connection with a settlement resulting from the
!> termination of a consulting agreement. The fair value of the Common
!> Stock was determined using the Company’s stock price on December 20,
!> 2013. The total fair value of $337,500 was charged to operations.
!>
!>
!>
!> On February 11, 2014, 746,835 shares of the Company’s common stock were
!> issued in connection with the cashless exercise of 1,000,000 warrants to
!> acquire the Company’s common stock.
!>
!>
!>
=======
=======
!>
!> On February 6, 2014, the Company granted 2,500,000 options to purchase
!> the Company’s common stock at an exercise price of $0.16 per share for
!> five years to a consultant, with immediate vesting. This resulted in an
!> expense of $271,417 for the three month period ended March 31, 2014
!>
!>
=======
=======
!> *Management Report on Internal Control over Financial Reporting *
!>
!> Our management is responsible for establishing and maintaining adequate
!> internal control over financial reporting, as such term is defined in
!> Exchange Act Rules 13a-15(f) and 15d-15(f). Our internal control over
!> financial reporting was designed to provide reasonable assurance to the
!> Company’s management and board of directors regarding the preparation
!> and fair presentation of published consolidated financial statements.
!> Internal control over financial reporting is promulgated under the
!> Exchange Act as a process designed by, or under the supervision of, the
!> Company’s principal executive and principal financial officers and
!> effected by the Company’s board of directors, management and other
!> personnel, to provide reasonable assurance regarding the reliability of
!> financial reporting and the preparation of financial statements for
!> external purposes in accordance with generally accepted accounting
!> principles. Internal control over financial reporting, no matter how
!> well designed, has inherent limitations and may not prevent or detect
!> misstatements. Therefore, even effective internal control over financial
!> reporting can only provide reasonable assurance with respect to the
!> financial statement preparation and presentation.
!>
!>
!>
!> Our management has conducted, with the participation of our CEO and CFO,
!> an assessment, including testing of the effectiveness, of our internal
!> control over financial reporting as of September 30, 2013. Management’s
!> assessment of internal control over financial reporting was based on
!> assessment criteria established in the /1992 Internal Control—Integrated
!> Framework/ issued by the Committee of Sponsoring Organizations of the
!> Treadway Commission (“COSO”). Based on such evaluation, management
!> concluded that our internal control over financial reporting was not
!> effective as of September 30, 2013 due to a deficiency in our disclosure
!> controls that was determined to be a material weakness, as described below.
!>
!>
!>
!> A material weakness is a deficiency, or a combination of deficiencies,
!> in internal control over financial reporting, such that there is a
!> reasonable possibility that a material misstatement of the company’s
!> annual or interim financial statements will not be prevented or detected
!> on a timely basis.
!>
!>
!>
!> The specific material weakness identified by the Company’s management as
!> of September 30, 2013 is described as follows:
!>
!>
!>
!> Our management determined that, as of September 30, 2013, the Company’s
!> disclosure controls and internal control over financial reporting were
!> not effective, due to the need for more enhanced and formalized
!> documentation and procedures regarding the financial statement closing
!> and review process to ensure that the application of the Company’s
!> accounting policies and the presentation of disclosures in the Company’s
!> financial statements is adequate. Further, in the filing of our original
!> Form 10-K for the year ended September 30, 2013, we did not effectively
!> evaluate the impact of our unaffiliated aggregate market value being in
!> excess of $75 million (reported level of $113 million) at March 31,
!> 2013. Subsequent to the filing of our Form 10-K, our management
!> determined that we should have included a 404(b) attestation report from
!> our auditors in our Form 10-K.
!>
!>
!>
!> Despite the material weakness reported above, the Company’s management
!> believes that its consolidated financial statements included in this
!> report fairly present in all material respects the Company’s financial
!> condition, results of operations, and cash flows for the periods presented.
!>
!>
!>
!> /Remediation of Material Weakness /
!>
!>
!>
!> Our management has developed a remediation action plan and we are
!> actively engaged in the implementation of the plan to fully remediate
!> our material weakness. The principal elements of our remediation plan
!> include the following:
!>
!>
!>
!> a. Our CEO has appointed a Sarbanes-Oxley project leadership team,
!> consisting of our CFO and our Controller, that will oversee the project,
!>
!> b. Together with a consultant that we have engaged, we have enhanced
!> our review procedures and the documentation thereof, and,
!>
!> c. We are prepared to implement these enhanced procedures as we are
!> preparing our Form 10-Q for the period ended March 31, 2014.
!>
=======
=======
3549 * Evaluation of Disclosure Controls and Procedures
*
!> Further, we have amended our Form 10-K for the year ended September 30,
!> 2013 to include a 404(b) attestation opinion from our auditors.
!>
!> *Attestation Report of the Independent Registered Public Accounting Firm *
!>
!> The effectiveness of our internal control over financial reporting as of
!> September 30, 2013 has been audited by RBSM LLP, our independent
!> registered public accounting firm, who also audited our consolidated
!> financial statements included in this Annual Report on Form 10-K/A, as
!> stated in their reports which appear with our accompanying consolidated
!> financial statements.
!>
=======
=======
3551 * Under the supervision and with the participation of our management,
*
3552 * including Dr. James A. Hayward, our Chief Executive Officer, who was
* *Changes in Internal Control over Financial Reporting *
3553 * also our principal executive officer as well as our Acting Chief
*
3554 <! Financial Officer, on September 30, 2013, we conducted an evaluation of
3555 <! the effectiveness of the design and operation of our disclosure controls
3556 <! and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the
3557 <! Exchange Act, as of September 30, 2013. Disclosure controls and
3558 <! procedures are those controls and procedures designed to provide
3559 <! reasonable assurance that the information required to be disclosed in
3560 <! our Exchange Act filings is (1) recorded, processed, summarized and
3561 <! reported within the time periods specified in the SEC’s rules and forms,
3562 <! and (2) accumulated and communicated to management, including our Chief
3563 <! Executive Officer and Chief Financial Officer, as appropriate, to allow
3564 <! timely decisions regarding required disclosure.
3565 <!
3566 <! Based on that evaluation, our Chief Executive Officer and Acting Chief
3567 <! Financial Officer concluded that, as of September 30, 2013, our
3568 <! disclosure controls and procedures were effective.
3569 <!
3570 <! Management’s Annual Report on Internal Control over Financial Reporting
3571 <!
3572 <! Our management, including our Chief Executive Officer and Acting Chief
3573 <! Financial Officer, is responsible for establishing and maintaining
3574 <! adequate internal control over financial reporting, as such term is
3575 <! defined in Rule 13a-15(f) under the Exchange Act. Management conducted
3576 <! an assessment as of September 30, 2013 of the effectiveness of our
3577 <! internal control over financial reporting based on the framework
3578 <! inInternal Control – Integrated Framework issued by the Committee of
3579 <! Sponsoring Organizations of the Treadway Commission (“COSO”). Based on
3580 <! that evaluation, management concluded that our internal control over
3581 <! financial reporting was effective as of September 30, 2013, based on
3582 <! criteria inInternal Control – Integrated Framework issued by the COSO.
=======
=======
!>
!> There were no additional changes, other than those detailed above under
!> Remediation of Material Weakness in our internal control over financial
!> reporting during the most recent fiscal quarter that has materially
!> affected, or is reasonably likely to materially affect, our internal
!> control over financial reporting.
!>
!> 29
!>
!>
!>
!> REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
!>
!>
!>
!> To the Board of Directors and Stockholders of
!> Applied DNA Sciences, Inc.:
!>
!>
!>
!> We have audited Applied DNA Sciences, Inc.’s (the “Company”) internal
!> control over financial reporting as of September 30, 2013, based on
!> criteria established in /Internal Control - Integrated Framework (1992)/
!> issued by the Committee of Sponsoring Organizations of the Treadway
!> Commission (COSO). The Company’s management is responsible for
!> maintaining effective internal control over financial reporting and for
!> its assessment of the effectiveness of internal control over financial
!> reporting, included in the accompanying Management’s Report on Internal
!> Control over Financial Reporting. Our responsibility is to express an
!> opinion on the Company’s internal control over financial reporting based
!> on our audit.
!>
!>
!>
!> We conducted our audit in accordance with the standards of the Public
!> Company Accounting Oversight Board (United States). Those standards
!> require that we plan and perform the audit to obtain reasonable
!> assurance about whether effective internal control over financial
!> reporting was maintained in all material respects. Our audit of internal
!> control over financial reporting included obtaining an understanding of
!> internal control over financial reporting, assessing the risk that a
!> material weakness exists, and testing and evaluating the design and
!> operating effectiveness of internal control based on the assessed risk.
!> Our audit also included performing such other procedures as we
!> considered necessary in the circumstances. We believe that our audit
!> provides a reasonable basis for our opinion.
!>
!>
!>
!> A company’s internal control over financial reporting is a process
!> designed to provide reasonable assurance regarding the reliability of
!> financial reporting and the preparation of financial statements for
!> external purposes in accordance with generally accepted accounting
!> principles. A company’s internal control over financial reporting
!> includes those policies and procedures that (1) pertain to the
!> maintenance of records that, in reasonable detail, accurately and fairly
!> reflect the transactions and dispositions of the assets of the company;
!> (2) provide reasonable assurance that transactions are recorded as
!> necessary to permit preparation of financial statements in accordance
!> with generally accepted accounting principles, and that receipts and
!> expenditures of the company are being made only in accordance with
!> authorizations of management and directors of the company; and (3)
!> provide reasonable assurance regarding prevention or timely detection of
!> unauthorized acquisition, use, or disposition of the company’s assets
!> that could have a material effect on the financial statements.
!>
!>
!>
=======
=======
3585 * reporting may not prevent or detect misstatements should they occur.
* reporting may not prevent or detect misstatements. Also, projections of
3586 * Also, projections of any evaluation of effectiveness to future periods
* any evaluation of effectiveness to future periods are subject to the
3587 * are subject to the risk that controls may become inadequate because of
* risk that controls may become inadequate because of changes in
3588 * changes in conditions or that the degree of compliance with the control
* conditions, or that the degree of compliance with the policies or
3589 * procedure may deteriorate.
* procedures may deteriorate.
3590 *
*
3591 * This Annual Report does not include an attestation report of our
*
3592 * registered public accounting firm regarding internal control over
*
3593 * financial reporting. Management’s report is not subject to attestation
* A material weakness is a control deficiency, or combination of
3594 * by our registered public accounting firm pursuant to rules of the SEC
* deficiencies, in internal control over financial reporting, such that
3595 * that permit us to provide only management’s report in this Annual Report
* there is a reasonable possibility that a material misstatement of the
3596 * on Form 10-K.
* Company’s annual or interim financial statements will not be prevented
3597 *
* or detected on a timely basis. The following material weakness has been
3598 * Changes in Internal Control over Financial Reporting
* identified and included in management’s assessment. The material
3599 *
* weakness, which arose primarily due to the need for more enhanced and
3600 * There was no change in our internal control over financial reporting
* formalized documentation and procedures regarding the financial
3601 * during the most recent fiscal quarter that has materially affected, or
* statement closing and review process to ensure that the application of
3602 * is reasonably likely to materially affect, our internal control over
* the Company’s accounting policies and the presentation of disclosures in
3603 * financial reporting.
* the Company’s financial statements is adequate. Further, in the filing
!> of the Company’s original Form 10-K for the year ended September 30,
!> 2013, the Company’s management did not effectively evaluate the impact
!> of the Company’s unaffiliated aggregate market value being in excess of
!> $75 million (reported level of $113 million) at March 31, 2013, its most
!> recent second quarter end. Subsequent to the filing of its Form 10-K,
!> the Company’s management determined that the Companyshould have included
!> a 404(b) attestation report from us in its Form 10-K. This material
!> weakness was considered in determining the nature, timing, and extent of
!> audit tests applied in our audit of the September 30, 2013’s
!> consolidated financial statements, and this report does not affect our
!> report dated May 1, 2014 on those financial statements.
!>
!>
!>
!> In our opinion, because of the effect of the material weakness described
!> above on the achievement of the objectives of the control criteria,
!> Applied DNA Sciences, Inc. has not maintained effective internal control
!> over financial reporting as of September 30, 2013, based on criteria
!> established in /Internal Control - Integrated Framework (1992)/ issued
!> by the Committee of Sponsoring Organizations of the Treadway Commission
!> (COSO).
!>
!>
!>
!> We have also audited, in accordance with the standards of the Public
!> Company Accounting Oversight Board (United States), the consolidated
!> balance sheets of Applied DNA Sciences, Inc. as of September 30, 2013
!> and 2012, and the related consolidated statements of operations,
!> stockholders’ equity, and cash flows for each of the two years in the
!> period ended September 30, 2013 of Applied DNA Sciences, Inc., and our
!> report dated May 1, 2014 expressed an unqualified opinion.
!>
!>
!>
!> /s/ RBSM LLP
!>
!>
!>
!> New York, New York
!>
!> May 1, 2014
!>
=======
=======
3610 * 29
* 30
=======
=======
3724 * 30
* 31
=======
=======
3757 * 31
* 32
=======
=======
3863 * 32
* 33
=======
=======
3890 * 33
* 34
=======
=======
3969 * 34
* 35
=======
=======
4120 * 35
* 36
=======
=======
4227 * 36
* 37
=======
=======
4369 * 37
* 38
=======
=======
4563 * 38
* 39
=======
=======
4657 * 39
* 40
=======
=======
4817 * 40
* 41
=======
=======
4972 * 41
* 42
=======
=======
5102 * 42
* 43
=======
=======
5163 * 43
* 44
=======
=======
5216 * 44
* 45
=======
=======
5342 * 45
* 46
=======
=======
5374 * 46
* 47
=======
=======
5390 * Date: December 19, 2013
* Date: May 1, 2014
=======
=======
5413 * December 19, 2013
* May 1, 2014
=======
=======
5420 * Chief Financial Officer (Principal Financial Officer)
* Chief Financial Officer (/Principal Financial Officer/ and Principal
!> Accounting Officer )
=======
=======
5423 * December 19, 2013
* May 1, 2014
=======
=======
5425 *
*
=======
=======
5431 * December 19, 2013
* May 1, 2014
=======
=======
5439 * December 19, 2013
* May 1, 2014
=======
=======
5447 * December 19, 2013
* May 1, 2014
=======
=======
5455 * December 19, 2013
* May 1, 2014
=======
=======
5460 * 47
* 48
=======
=======
5573 * 48
* 49
=======
=======
5677 * Sciences, Inc. and Karol Gray.*†
* Sciences, Inc. and Karol Gray filed as an exhibit to the annual report
!> on Form 10-K filed with the Commission on December 20, 2013 and
!> incorporated herein by reference .*†
=======
=======
5715 * 49
* 50
=======
=======
5768 * 50
* 51
=======
=======
!> REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
!>
=======
=======
5816 * REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
*
5817 *
* To the Board of Directors and Stockholders of
5818 * To the Board of Directors
*
5819 * Applied DNA Sciences, Inc.
* Applied DNA Sciences, Inc.:
5820 * Stony Brook, New York
*
5821 *
* * *
!>
=======
=======
5825 * and cash flows for each of the two years period ended September 30,
* and cash flows for each of the two years in the period ended September
5826 * 2013. These consolidated financial statements are the responsibility of
* 30, 2013. These consolidated financial statements are the
5827 * the Company’s management. Our responsibility is to express an opinion
* responsibility of the Company’s management. Our responsibility is to
5828 * on these consolidated financial statements based on our audits.
* express an opinion on these consolidated financial statements based on
!> our audits.
!>
=======
=======
!>
=======
=======
5831 * Company Accounting Oversight Board (United States of America). Those
* Company Accounting Oversight Board (United States). Those standards
5832 * standards require that we plan and perform the audit to obtain
* require that we plan and perform the audit to obtain reasonable
5833 * reasonable assurance about whether the financial statements are free of
* assurance about whether the financial statements are free of material
5834 * material misstatements. The Company is not required to have, nor were
* misstatements. An audit includes examining, on a test basis, evidence
5835 * we engaged to perform, an audit of its internal control over financial
* supporting the amounts and disclosures in the financial statements. An
5836 * reporting. Our audit included consideration of internal control over
* audit also includes assessing the accounting principles used and
5837 * financial reporting as a basis for designing audit procedures that are
* significant estimates made by management, as well as evaluating the
5838 * appropriate in the circumstances, but not for the purpose of expressing
* overall financial statement presentation. We believe our audits provide
5839 * an opinion on the effectiveness of the Company’s internal control over
* a reasonable basis for our opinion.
5840 * financial reporting. Accordingly we express no such opinion. An audit
*
5841 <! includes examining, on a test basis, evidence supporting the amounts and
5842 <! disclosures in the financial statements. An audit also includes
5843 <! assessing the accounting principles used and significant estimates made
5844 <! by management, as well as evaluating the overall financial statement
5845 <! presentation. We believe our audits provide a reasonable basis for our
5846 <! opinion.
=======
=======
!>
=======
=======
5852 * for each of the two years period ended September 30, 2013, in conformity
* for each of the two years in the period ended September 30, 2013, in
5853 * with accounting principles generally accepted in the United States of
* conformity with accounting principles generally accepted in the United
5854 * America.
* States of America.
5855 <!
5856 <!
5857 <! /s/ RBSM LLP
5858 <!
=======
=======
5861 * New York, New York
*
5862 * December 19, 2013
* We have also audited, in accordance with the standards of the Public
!> Company Accounting Oversight Board (United States), the Company’s
!> internal control over financial reporting as of September 30, 2013,
!> based on the criteria established in Internal Control – Integrated
!> Framework 1992 issued by the Committee of Sponsoring Organizations of
!> the Treadway Commission (COSO) , and our report dated May 1, 2014
!> expressed an adverse opinion on the Company’s internal control over
!> financial reporting.
!>
=======
=======
!>
!> /s/ RBSM LLP
!>
!>
!>
!> New York, New York
!>
!> May 1, 2014
!>
=======
=======
!>
!> On December 20, 2013, 2,500,000 shares of the Company’s Common Stock was
!> issued in connection with a settlement resulting from the termination of
!> a consulting agreement. The fair value of the Common Stock was
!> determined using the Company’s stock price on December 20, 2013. The
!> total fair value of $337,500 was changes to operations.
!>
!> On February 11, 2014, 746,835 shares of the Company’s Common Stock were
!> issued in connection with the cashless exercise of 1,000,000 warrants to
!> acquire the Company’s Common Stock.
=======
=======
!>
!> On February 6, 2014, the Company granted 2,500,000 options to purchase
!> the Company’s common stock at an exercise price of $0.16 per share for
!> five years to a consultant, with immediate vesting. This resulted in an
!> expense of $271,417 for the three month period ended March 31, 2014.
!>
=======
------------------------------------------------------------------------------------------------------------------------
Page:
McS, a 10k/A is an amendment.
Thanks Yip, good thing it's an election year.
Otherwise a stalemate battle would break out.
Yup, this is a scarey / fascinating investment.
I been in other pennys and just a whiff of a lame MOU would spike the share price.
Not this puppy.
Perhaps someone is governing the volatility.
sheez.
Shail, we have the best industrial solution period.
We have patents, facilities, personnel and theoretical revenue for the time being.
The share price is not directly related to the above for day to day operations unless they have to use shares for funding.
Once we can draw a definite line towards profitability via increasing quarterly revenues the share price will be invincible.
Right now its pure emotion being played.
Potential gets old - we need to see the end of the tunnel, now.
In that case were gonna have to smash some eggs and cut a few players...
A flurry of empty PR's should generate a bunch of new bag-holders to keep da boat afloat a while longer.
fingers crossed.
You still have to build a team before you play the game.
They obviously see a need for this new employee's talent.
The demand is already there in the need to battle counterfeits.
They just need to steer customers to this solution and be able to deliver the products/services.
Momentum is shifting and the Revenue increases quarter over quarter will verify progress.
Were a global penny stock.
We gotta lay the eggs before we grow the chickens ;)
Security expert 'Bo' Dietl: "A New Generation of Crime Fighting
Not sure this was originally published 3-19 but good to review.
Published on Mar 19, 2014
DNA Authentication is a law enforcement technology milestone, as important as fingerprinting, according to Richard 'Bo' Dietl, renowned security expert. Dietl, one of New York city's most decorated detectives, and one-time member of the National Crime Commission, describes the DNANet "quick trace" technology.
Video:
Not your firewall flick.
I accidentally posted an old link then went back and cleared the post but the blank post remained.
Here's the link I cleared - an old chart analysis:
http://www.freenewspos.com/english/video/dna%20apdn%20cash/1
Sorry for the confusion.
Thanks again Yip: This sounds good: Concluded Action: Consistent without Change Concluded Date: 04/29/2014