SEC Company Response from BNB PLUS CORP. (BNBX) (CIK 0000744452) (BNBX) — May 9, 2007
BNB PLUS CORP. (BNBX) (CIK 0000744452)
Date: May 9, 2007 · CIK: 0000744452 · Accession: 0001188112-07-001405
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-122848
Referenced dates: March 13, 2007
Letter
VIA EDGAR AND FEDERAL EXPRESS Division of Corporation Finance Mail Stop Washington, D.C. 20549-3561 Re: Applied DNA Sciences, Inc. Registration Statement on Form SB-2 Filed January 15, 2005 File No. 333-122848
Dear Mr. Riedler:
On behalf of Applied DNA Sciences, Inc. (the “Company”), in response to the Staff’s comment letter dated March 13, 2007 (the “Comment Letter”) and the follow-up conference call on March 15, 2007 in connection with Amendment No.8 to the Company’s above-referenced Registration Statement on Form SB-2 (the “Registration Statement”), we hereby submit proposed changes to the financial statements for your review.
All responses to the comments set forth in this letter are submitted on behalf of the Company at its request. All responses to the accounting comments were prepared by the Company in consultation with its independent auditors. The following numbered paragraphs repeat the comments in the Comment Letter for your convenience, followed by the Company’s responses to those comments.
Amendment No. 8 to Registration Statement on Form SB-2
General
1.
Prior to requesting acceleration for effectiveness, please refer to Item 310(g) of Regulation S-B and amend your registration statement on Form SB-2 to provide updated financial statements.
Response: Updated financial statements shall be provided in accordance with Item 310(g) of Regulation S-B prior to requesting effectiveness of the Registration Statement.
Houston · New York · Washington DC · Austin · Dallas · Los Angeles · Minneapolis · San Antonio
Dubai · Hong Kong · London · Munich · Riyadh
Mr. Jeffrey P. Riedler
U.S. Securities and Exchange Commission
Division of Corporation Finance
May 9,
Page
Notes to Condensed Consolidated Financial Information
Note I - Restatement of Quarterly Financial Statements, page F-45
2.
We acknowledge your proposed revisions in response to comment 2 as well as the supplemental tabular restatement information that you have presented for the three and nine months ended June 30, 2006 and for the period from inception through June 30, 2006. Please provide us with the clarifying information that follows and revise the disclosure in your filing accordingly.
·
It appears based on your narrative in adjustment (b) of $390,000 you should be reducing selling, general, and administrative expenses. Clarify why the error occurred and the nature of the correction. Also, please clarify where the other side of the entry is recorded.
·
Based on the explanation provided in footnote (c), it is unclear why you recorded a $1,156,698 increase to “net gain (loss) in fair value of debt derivative and warrant liability.” If you recorded a derivative liability for warrants initially valued at $933,117 that you should have valued at $2,089,814, it appears that you would have incurred additional expense when you entered into the related financing transaction. Please tell us why you appear to have recorded income in correcting this error. Additionally, please revise footnote (c) to clarify the relationship between this error and the numerous financing transactions in “Note C” and tell us why you restated your June 30, 2006 Form 10-QSB to correct this error.
·
Based on the explanation provided in footnote (e), it is unclear why you recorded a net increase of $2,284,764 to your net income for the nine months ended June 30, 2006. According to the information in the table following footnote (e), you “undervalued” certain of the warrants issued to non-employees in connection with various financing transactions during your fiscal year ended September 30, 2005; it appears that correcting the related error would result in additional expense. Please also tell us why you appear to have restated your June 30, 2006 10-QSB rather than your September 30, 2005 Form 10-KSB to correct this error. Finally, please clarify what the $6,640,706 and $10,058,055 adjustments to other income (expense) represent since it is not apparent from the narrative discussion in footnote (e).
·
Please tell us where you recorded the $5,838,514 reduction to interest referenced in footnote (f). Please also clarify for us whether or not you should include a corresponding adjustment in your statements of operations for the three and nine months ended June 30, 2006.
·
Please refer to the table in footnote (g) and clarify how the $1,584,614 relates to footnote (a). Please also clarify why the reclass was an “error.”
Mr. Jeffrey P. Riedler
U.S. Securities and Exchange Commission
Division of Corporation Finance
May 9,
Page
·
Please address comment 2, bullet point 4 of our January 25, 2007 letter relating to the $1,365,000 error, as it is unclear how you have done so within the context of the proposed revisions and supplemental tabular disclosure that you have provided.
·
The $276,090 adjustment in your statement of cash flows does not appear to relate to footnote (k). Please clarify.
·
Clarify where you recorded the offsetting adjustment to the $1,846,500 in footnote (k). Please also clarify where you recorded this adjustment in your statement of operations.
Response: We propose to amend the June 30, 2006 unaudited financial statements to read as follows:
The accompanying condensed consolidated financial statements as of June 30, 2006 and the three and nine months ended June 30, 2006 and from September 16, 2002 (date of inception) through June 30, 2006 have been restated to correct its accounting for (a) the issuance of options and warrants in exchange for compensation and financing activities, (b) correcting the period reporting capitalized finance costs and current operating expenses and (c) errors in report preparation and miscellaneous accounting adjustments appropriate for the fair presentation of the financial statements.
The effect of the adjustments in the restated financial statements is an increase in net loss of $136,401 from September 16, 2002 (date of inception) through June 30, 2006 and an increase in net income of $766,698 and $2,148,364 for the three and nine month periods ended June 30, 2006, respectively. There was no effect on total cash flows provided by (used in) operations, investing or financing activities.
Mr. Jeffrey P. Riedler
U.S. Securities and Exchange Commission
Division of Corporation Finance
May 9,
Page
The following tables summarize the effects of these adjustments on the Company’s condensed consolidated balance sheet as of June 30, 2006, condensed consolidated statements of losses for the three and nine months ended June 30, 2006 and for the period from September 16, 2002 (date of inception) through June 30, 2006 and the condensed consolidated statements of cash flows for the nine months ended June 30, 2006 and for the period from September 16, 2002 (date of inception) through June 30, 2006:
Condensed Consolidated Balance Sheet
June 30,
As Previously Reported
Adjustment
Reference
As Restated
Cash
$
1,931,173
$
$
1,931,173
Accounts receivable, net
$
18,900
$
$
18,900
Advances and other receivables
$
11,611
$
$
11,611
Prepaid expenses
$
146,667
$
$
146,667
Total current assets
$
2,108,351
$
$
2,108,351
Property, plant and equipment, net
$
38,286
$
$
38,286
Deposits
$
8,322
$
$
8,322
Capitalized finance costs
$
1,437,862
$
$
1,437,862
Patents, net
$
17,376
$
$
17,376
Intellectual property, net
$
8,083,629
$
$
8,083,629
total assets
$
11,693,826
$
$
11,693,826
Accounts payable and accrued liabilities
$
4,680,849
$
$
4,680,849
Notes payable, related party
$
410,429
$
$
410,429
Total current liabilities
$
5,091,278
$
$
5,091,278
Convertible notes payable, net
$
3,306,371
$
$
3,306,371
Debt derivative and warrant liability
$
5,698,286
$
$
5,698,286
Total liabilities
$
14,095,935
$
$
14,095,935
Preferred stock
$
$
$
Common stock
$
118,582
$
$
118,582
Common stock subscription
$
(200,000
)
$
$
(200,000
)
Additional paid in capital
$
81,860,606
$
136,400
a
$
81,997,006
Accumulated deficit
$
(84,181,303
)
$
(136,400
)
a
$
(84,317,703
)
Total deficiency in stockholders’ equity
$
(2,402,109
)
$
$
(2,402,109
)
Total liabilities and Deficiency in Stockholders’ equity
$
11,693,826
$
$
11,693,826
Mr. Jeffrey P. Riedler
U.S. Securities and Exchange Commission
Division of Corporation Finance
May 9,
Page
Condensed Consolidated Statement of Income (Losses) For the Three Months Ended June 30,
Sales
$
18,900
$
Show Raw Text
CORRESP
1
filename1.htm
SEC Comment Response Letter
Fulbright
& Jaworski L.L.P.
A
Registered Limited Liability Partnership
666
Fifth
Avenue, 31st Floor
New
York,
New York 10103-3198
www.fulbright.com
mkraines@fulbright.com
direct
dial: (212) 318-3261
telephone:
facsimile:
(212)
318-3000
(212)
318-3400
May
9,
2007
VIA
EDGAR AND FEDERAL EXPRESS
Mr.
Jeffrey P. Riedler
Assistant
Director
U.S.
Securities and Exchange Commission
Division
of Corporation Finance
100
F
Street, N.E.
Mail
Stop
3561
Washington,
D.C. 20549-3561
Re:
Applied
DNA Sciences, Inc.
Registration
Statement on Form SB-2
Filed
January 15, 2005
File
No.
333-122848
Dear
Mr.
Riedler:
On
behalf
of Applied DNA Sciences, Inc. (the “Company”),
in
response to the Staff’s comment letter dated March 13, 2007 (the “Comment
Letter”)
and
the follow-up conference call on March 15, 2007 in connection with Amendment
No.8 to the Company’s above-referenced Registration Statement on Form SB-2 (the
“Registration
Statement”),
we
hereby submit proposed changes to the financial statements for your
review.
All
responses to the comments set forth in this letter are submitted on behalf
of
the Company at its request. All responses to the accounting comments were
prepared by the Company in consultation with its independent auditors. The
following numbered paragraphs repeat the comments in the Comment Letter for
your
convenience, followed by the Company’s responses to those comments.
Amendment
No. 8 to Registration Statement on Form SB-2
General
1.
Prior
to requesting acceleration for effectiveness, please refer to Item
310(g)
of Regulation S-B and amend your registration statement on Form SB-2
to
provide updated financial
statements.
Response:
Updated
financial statements shall be provided in accordance with Item 310(g) of
Regulation S-B prior to requesting effectiveness of the Registration
Statement.
Houston
·
New
York ·
Washington DC ·
Austin
·
Dallas ·
Los
Angeles ·
Minneapolis ·
San
Antonio
Dubai
·
Hong Kong ·
London
·
Munich ·
Riyadh
Mr.
Jeffrey P. Riedler
U.S.
Securities and Exchange Commission
Division
of Corporation Finance
May
9,
2007
Page
2
Notes
to Condensed Consolidated Financial Information
Note
I
- Restatement of Quarterly Financial Statements, page F-45
2.
We
acknowledge your proposed revisions in response to comment 2 as well
as
the supplemental tabular restatement information that you have presented
for the three and nine months ended June 30, 2006 and for the period
from
inception through June 30, 2006. Please provide us with the clarifying
information that follows and revise the disclosure in your filing
accordingly.
·
It
appears based on your narrative in adjustment (b) of $390,000 you
should
be reducing selling, general, and administrative expenses. Clarify
why the
error occurred and the nature of the correction. Also, please clarify
where the other side of the entry is
recorded.
·
Based
on the explanation provided in footnote (c), it is unclear why
you
recorded a $1,156,698 increase to “net gain (loss) in fair value of debt
derivative and warrant liability.” If you recorded a derivative liability
for warrants initially valued at $933,117 that you should have
valued at
$2,089,814, it appears that you would have incurred additional
expense
when you entered into the related financing transaction. Please
tell us
why you appear to have recorded income in correcting this error.
Additionally, please revise footnote (c) to clarify the relationship
between this error and the numerous financing transactions in “Note C” and
tell us why you restated your June 30, 2006 Form 10-QSB to correct
this
error.
·
Based
on the explanation provided in footnote (e), it is unclear why
you
recorded a net increase of $2,284,764 to your net income for the
nine
months ended June 30, 2006. According to the information in the
table
following footnote (e), you “undervalued” certain of the warrants issued
to non-employees in connection with various financing transactions
during
your fiscal year ended September 30, 2005; it appears that correcting
the
related error would result in additional expense. Please also tell
us why
you appear to have restated your June 30, 2006 10-QSB rather than
your
September 30, 2005 Form 10-KSB to correct this error. Finally,
please
clarify what the $6,640,706 and $10,058,055 adjustments to other
income
(expense) represent since it is not apparent from the narrative
discussion
in footnote (e).
·
Please
tell us where you recorded the $5,838,514 reduction to interest
referenced
in footnote (f). Please also clarify for us whether or not
you should
include a corresponding adjustment in your statements of operations
for
the three and nine months ended June 30,
2006.
·
Please
refer to the table in footnote (g) and clarify how the
$1,584,614 relates
to footnote (a). Please also clarify why the reclass
was an
“error.”
Mr.
Jeffrey P. Riedler
U.S.
Securities and Exchange Commission
Division
of Corporation Finance
May
9,
2007
Page
3
·
Please
address comment 2, bullet point 4 of our January
25, 2007 letter relating
to the $1,365,000 error, as it is unclear how you
have done so within the
context of the proposed revisions and supplemental
tabular disclosure that
you have
provided.
·
The
$276,090 adjustment in your statement of
cash flows does not appear to
relate to footnote (k). Please
clarify.
·
Clarify
where you recorded the offsetting adjustment
to the $1,846,500 in footnote
(k). Please also clarify where you
recorded this adjustment in your
statement of
operations.
Response:
We
propose to amend the June 30, 2006 unaudited financial statements to read as
follows:
The
accompanying condensed consolidated financial statements as of June 30, 2006
and
the three and nine months ended June 30, 2006 and from September 16, 2002 (date
of inception) through June 30, 2006 have been restated to correct its accounting
for (a) the issuance of options and warrants in exchange for compensation and
financing activities, (b) correcting the period reporting capitalized finance
costs and current operating expenses and (c) errors in report preparation and
miscellaneous accounting adjustments appropriate for the fair presentation
of
the financial statements.
The
effect of the adjustments in the restated financial statements is an increase
in
net loss of $136,401 from September 16, 2002 (date of inception) through June
30, 2006 and an increase in net income of $766,698 and $2,148,364 for the three
and nine month periods ended June 30, 2006, respectively. There was no effect
on
total cash flows provided by (used in) operations, investing or financing
activities.
Mr.
Jeffrey P. Riedler
U.S.
Securities and Exchange Commission
Division
of Corporation Finance
May
9,
2007
Page
4
The
following tables summarize the effects of these adjustments on the Company’s
condensed consolidated balance sheet as of June 30, 2006, condensed consolidated
statements of losses for the three and nine months ended June 30, 2006 and
for
the period from September 16, 2002 (date of inception) through June 30, 2006
and
the condensed consolidated statements of cash flows for the nine months ended
June 30, 2006 and for the period from September 16, 2002 (date of inception)
through June 30, 2006:
Condensed
Consolidated Balance Sheet
June
30,
2006
As Previously
Reported
Adjustment
Reference
As
Restated
Cash
$
1,931,173
$
$
1,931,173
Accounts
receivable, net
$
18,900
$
$
18,900
Advances
and other receivables
$
11,611
$
$
11,611
Prepaid
expenses
$
146,667
$
$
146,667
Total
current assets
$
2,108,351
$
$
2,108,351
Property,
plant and equipment, net
$
38,286
$
$
38,286
Deposits
$
8,322
$
$
8,322
Capitalized
finance costs
$
1,437,862
$
$
1,437,862
Patents,
net
$
17,376
$
$
17,376
Intellectual
property, net
$
8,083,629
$
$
8,083,629
total
assets
$
11,693,826
$
$
11,693,826
Accounts
payable and accrued liabilities
$
4,680,849
$
$
4,680,849
Notes
payable, related party
$
410,429
$
$
410,429
Total
current liabilities
$
5,091,278
$
$
5,091,278
Convertible
notes payable, net
$
3,306,371
$
$
3,306,371
Debt
derivative and warrant liability
$
5,698,286
$
$
5,698,286
Total
liabilities
$
14,095,935
$
$
14,095,935
Preferred
stock
$
6
$
$
6
Common
stock
$
118,582
$
$
118,582
Common
stock subscription
$
(200,000
)
$
$
(200,000
)
Additional
paid in capital
$
81,860,606
$
136,400
a
$
81,997,006
Accumulated
deficit
$
(84,181,303
)
$
(136,400
)
a
$
(84,317,703
)
Total
deficiency in stockholders’ equity
$
(2,402,109
)
$
$
(2,402,109
)
Total
liabilities and Deficiency in Stockholders’ equity
$
11,693,826
$
$
11,693,826
Mr.
Jeffrey P. Riedler
U.S.
Securities and Exchange Commission
Division
of Corporation Finance
May
9,
2007
Page
5
Condensed
Consolidated Statement of Income (Losses)
For the Three Months Ended June 30,
2006
Sales
$
18,900
$