DNAprint Genomics (DNAG)

[worktoplay]

I'm not certain why there hasn't been further comment on this issue, but I'll throw it up again just for kicks.

The $35 Million is being acquired under a Rule 506, Regulation D exemption. This exemption allows the company, through a Private Placement, to raise an unlimited amount of funding, as long as the placement involves no more than 35 non-accredited investors. In other words, Dutchess will be reselling the shares to accredited investors, who will in turn be subject to Rule 144 of the Act of 1933. They'll be restricted shares.

This from the Preamble to the Dutchess Funding Agreement:

http://www.sec.gov/Archives/edgar/data/1127354/000114420404015688/v07224_ex10-49.txt

Whereas, such investments will be made in reliance upon the provisions of Section 4(2) under the Securities Act of 1933, as amended (the "1933 Act"), Rule 506 of Regulation D, and the rules and regulations promulgated thereunder, and/or upon such other exemption from the registration requirements of the 1933 Act as may be available with respect to any or all of the investments in Common Stock to be made hereunder; and

For those unfamiliar with Rule 506 of Reg D, here is some good information:

http://www.sec.gov/answers/rule506.htm

And for those that would like a bit more information on Rule 144, it is available at this link:

http://www.sec.gov/investor/pubs/rule144.htm

Now, for anyone that ridiculed the company a year ago about their inability to attract people willing to put up Private Placement dollars to fund DNAPrint, here is $35 million dollars that has been committed. A "mezzanine level" investor group.

Secondly, these investors apparently feel good enough about their investment to purchase shares at 96% of market that will carry a 12 month restriction on their resale.

Third, because they are restricted they won't place downward pressure on the market price. And as the company has only committed $25 Million of the $35 Million total to the Biofrontera investment, that leaves $10 Million (more than enough to cover the remaining LaJolla funding) for company operations.

Fourth, and this is PURELY speculation, if I'm DNAPrint, as soon as the registration statement is final, I'm either escaping LaJolla through a negotiated settlement, or I'm defaulting on the debenture and paying back the $325K, plus penalties, that I would owe. That would free up the 424,000,000+- shares included in the registration statement to cover the LaJolla deal and make them available to the Dutchess Private Placement. And if I can place those shares to Dutchess at 96% of market, versus selling them to LaJolla at 20-30% discount to market, I know what I'M going to do.

Fifth, as if the investor base wouldn't be jumping for enough joy at the departure of LaJolla, I'd have other news to release to start to create some excitement about this stock.

Of course, this is JMHO, and the opinions expressed at the end are based on my reading of the available information, but I'd suggest a closer look at the agreement for interested investors.

Later,
W2P