----

----

| x | QUARTERLY      REPORT PURSUANT TO SECTION 13 OR 15(d) OF      THE SECURITIES EXCHANGE ACT OF 1934 |
|---|---------------------------------------------------------------------------------------------------|

| o | TRANSITION      REPORT PURSUANT TO SECTION 13 OR 15(d)      OF THE SECURITIES EXCHANGE ACT OF1934 |
|---|---------------------------------------------------------------------------------------------------|

| Nevada                                        | 59-2262718                  |
|-----------------------------------------------|-----------------------------|
| (State      or other jurisdiction of          | (I.R.S.      Employer       |
| incorporation      or organization)           | Identification      Number) |
|                                          |                        |
| 25 Health Sciences Drive, Suite      113      |                        |
| Stony Brook, New      York                    | 11790                       |
| (Address      of Principal Executive Offices) | (Zip      Code)             |

| · | Indicate      by check mark whether the registrant (1) filed all reports required to be      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during      the last 12 months (or for such shorter period that the registrant was      required to file such reports), and (2) has been subject to such filing      requirements for the past 90days. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | Indicate by check mark whether the registrant is a shell company      (as defined in Rule 12b-2 of the ExchangeAct). |
|--------|----------------------------------------------------------------------------------------------------------------------|

| · | The      number of shares of Common Stock, $0.001 par value, outstanding on August      17, 2007, was approximately160,499,549. |
|--------|---------------------------------------------------------------------------------------------------------------------------------|

| · | Transitional      Small Business Disclosure Format (checkone): |
|--------|----------------------------------------------------------------|

----

| APPLIED DNA SCIENCES, INC                                         |
|-------------------------------------------------------------------|
| AMENDMENT NO. 1 TO      QUARTERLY REPORT ON FORM 10-QSB/A FOR THE |
| QUARTERLY PERIOD ENDING JUNE      30, 2007                        |
|                                                              |   |   |
| Table of      Contents                                            |
|                                                              |   |   |
| PART I. FINANCIAL      INFORMATION                                |   |
|                                                              |   |   |   |
|                                                              | Item 1. Financial      Statements |   |
|                                                              |   |   |   |
|                                                              |   | Condensed      Consolidated Balance Sheet: June 30, 2007 (Unaudited) | 1 |
|                                                              |   |   |   |
|                                                              |   | Condensed      Consolidated Statements of Losses:Three      Months Ended June 30, 2007 and 2006 (Unaudited) and the Period from      September 16, 2002 (Date of Inception) Through June 30, 2007      (Unaudited) | 2 |
|                                                              |   |   |   |
|                                                              |   | Condensed      Consolidated Statement of Stockholder’s Equity (Deficiency):For      the Period from September 16, 2002 (Date of Inception) Through June 30,      2007 (Unaudited) | 3 |
|                                                              |   |   |   |
|                                                              |   | Condensed      Consolidated Statements of Cash Flows:Three      Months Ended June 30, 2007 and 2006 (Unaudited) and the Period from      September 16, 2002 (Date of Inception) Through June 30, 2007      (Unaudited) | 17 |
|                                                              |   |   |   |
|                                                              |   | Notes      to Unaudited Condensed Consolidated Financial Information: June 30,      2007 | 19 |
|                                                              |   |   |   |
|                                                              | Item 2. Management’s Discussion and      Analysis | 52 |
|                                                              |   |   |   |
|                                                              | Item 3 Controls and      Procedures | 71 |
|                                                              |   |   |  |
| PART II. OTHER      INFORMATION                                   |  |
|                                                              |   |   |   |
|                                                              | Item 1. Legal    Proceedings | 73 |
|                                                              |   |   |   |
|                                                              | Item 2. Unregistered Sales of Equity      Securities and Use of Proceeds | 74 |
|                                                              |   |   |   |
|                                                              | Item 3. Defaults Upon Senior      Securities | 74 |
|                                                              |   |   |   |
|                                                              | Item 4. Submission of Matters to a Vote      of Security Holders | 74 |
|                                                              |   |   |   |
|                                                              | Item 5. Other    Information | 74 |
|                                                              |   |   |   |
|                                                              | Item 6. Exhibits | 75 |
|                                                              |   |   |   |
| Signatures                                                        | 75 |

----

| APPLIED DNA SCIENCES,      INC.                                                                                       |   |
|-----------------------------------------------------------------------------------------------------------------------|--------|
| (A Development stage      company)                                                                                    |   |
| CONDENSED CONSOLIDATED BALANCE      SHEET                                                                             |   |
| (unaudited)                                                                                                           |   |
|                                                                                                                  |   | June      30, |   |
|                                                                                                                  |   | 2007 |   |
| ASSETS                                                                                                                |   |
| Current      assets:                                                                                                  |   |   |   |
| Cash                                                                                                                  |   | $ | 34,792 |   |
| Prepaid      expenses                                                                                                 |   |   | 138,875 |   |
| Total      current assets                                                                                             |   |   | 173,667 |   |
|                                                                                                                  |   |   |   |   |
| Property,      plant and equipment-net of accumulated depreciation of    $67,497                                      |   |   | 120,865 |   |
|                                                                                                                  |   |   |   |   |
| Other      assets:                                                                                                    |   |   |   |   |
| Deposits                                                                                                              |   |   | 13,822 |   |
| Capitalized      finance costs-net of accumulated amortization of$1,641,988                                           |   |   | 65,612 |   |
|                                                                                                                  |   |   |   |   |
| Intangible      assets:                                                                                               |   |   |   |   |
| Patients,      net of accumulated amortization of $23,732 (Note B)                                                    |   |   | 10,525 |   |
| Intellectual      property, net of accumulated amortization and write off of $7,611,943      (Note B)                 |   |   | 1,818,957 |   |
|                                                                                                                  |   |   |   |   |
| Total      Assets                                                                                                     |   | $ | 2,203,448 |   |
|                                                                                                                  |   |   |   |   |
| LIABILITIES      AND DEFICIENCY IN STOCKHOLDERS' EQUITY                                                               |
|                                                                                                                  |   |   |   |   |
| Current      liabilities:                                                                                             |   |   |   |   |
| Accounts      payable and accrued liabilities                                                                         |   | $ | 8,976,675 |   |
| Convertible      notes payable, net of unamortized discount (Note D)                                                  |   |   | 1,745,855 |   |
| Total      current liabilities                                                                                        |   |   | 10,722,530 |   |
|                                                                                                                  |   |   |   |   |
| Debt      derivative and warrant liability                                                                            |   |   | 4,468,404 |   |
|                                                                                                                  |   |   |   |   |
| Commitments      and contingencies (Note J)                                                                           |   |   |   |   |
|                                                                                                                  |   |   |   |   |
| Deficiency      in Stockholders' Equity- (Note F)                                                                     |   |   |   |   |
| Preferred      stock, par value $0.001 per share; 10,000,000 shares authorized; 60,000      issued and outstanding    |   |   | 6 |   |
| Common      stock, par value $0.001 per share; 410,000,000 shares authorized;      160,499,549 issued and outstanding |   |   | 160,499 |   |
| Additional      paid in capital                                                                                       |   |   | 87,420,306 |   |
| Accumulated      deficit                                                                                              |   |   | (100,568,297 | ) |
| Total      deficiency in stockholders' equity                                                                         |   |   | (12,987,486 | ) |
|                                                                                                                  |   |   |   |   |
| Total      liabilities and Deficiency in Stockholders' Equity                                                         |   | $ | 2,203,448 |   |
|                                                                                                                  |   |   |   |   |
| See      the accompanying notes to the consolidated financial      statements                                         |   |   |   |   |

----

| APPLIED DNA SCIENCES,      INC.                                                     |   |
|-------------------------------------------------------------------------------------|--------|
| (A DEVELOPMENT STAGE      COMPANY)                                                  |   |
| CONDENSED CONSOLIDATED      STATEMENTS OF LOSSES                                    |   |
| (unaudited)                                                                         |   |
|                                                                                |   |   |   |   |   |   |   |   |   | From      September 16, 2002 |   |
|                                                                                |   | For      the three months Ended June 30, |   | For      the nine months Ended June 30, |   | (Date      of Inception) |   |
|                                                                                |   | 2007 |   | 2006 |   | 2007 |   | 2006 |   | Through      June 30, 2007 |   |
|                                                                                |   |   |   | RESTATED |   |   |   | RESTATED |   |   |   |
| Sales                                                                               |   | $ | - |   | $ | 18,900 |   | $ | - |   | $ | 18,900 |   | $ | 18,900 |   |
| Cost      of sales                                                                  |   |   | - |   |   | (15,639 | ) |   | - |   |   | (15,639 | ) |   | 15,639 |   |
| Gross      Profit                                                                   |   |   | - |   |   | 3,261 |   |   | - |   |   | 3,261 |   |   | 3,261 |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating      expenses:                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling,      general and administrative                                            |   |   | 1,968,642 |   |   | 1,580,967 |   |   | 6,012,028 |   |   | 4,391,305 |   |   | 86,077,987 |   |
| Research      and development                                                       |   |   | 25,504 |   |   | - |   |   | 94,289 |   |   | 75,276 |   |   | 1,124,888 |   |
| Impairment      of intangible asset(s)                                              |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 5,655,011 |   |
| Depreciation      and amortization                                                  |   |   | 108,357 |   |   | 336,824 |   |   | 324,594 |   |   | 1,021,199 |   |   | 2,054,320 |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total      operating expenses                                                       |   |   | 2,102,503 |   |   | 1,917,791 |   |   | 6,430,912 |   |   | 5,487,780 |   |   | 94,912,207 |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NET      LOSS FROM OPERATIONS                                                       |   |   | (2,102,503 | ) |   | (1,914,530 | ) |   | (6,430,912 | ) |   | (5,484,519 | ) |   | (94,908,946 | ) |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      gain (loss) in revaluation of debt derivative and warrant      liabilities |   |   | 4,431,421 |   |   | 3,493,961 |   |   | 142,131 |   |   | 14,250,621 |   |   | 33,687,958 |   |
| Other      income                                                                   |   |   | (0 | ) |   | 8,483 |   |   | 977 |   |   | 17,976 |   |   | 111,807 |   |
| Interest      expense                                                               |   |   | (520,963 | ) |   | (826,827 | ) |   | (1,945,702 | ) |   | (3,177,229 | ) |   | (39,459,116 | ) |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      income (loss) before provision for income taxes                            |   |   | 1,807,954 |   |   | 761,087 |   |   | (8,233,506 | ) |   | 5,606,849 |   |   | (100,568,297 | ) |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income      taxes (benefit)                                                         |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NET      INCOME (LOSS)                                                              |   | $ | 1,807,954 |   | $ | 761,087 |   | $ | (8,233,506 | ) | $ | 5,606,849 |   | $ | (100,568,297 | ) |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      income (loss) per share-basic                                              |   | $ | 0.01 |   | $ | 0.01 |   | $ | (0.07 | ) | $ | 0.05 |   |   |   |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      loss per share-assuming fully diluted-Note A                               |   | $ | (0.02 | ) | $ | (0.02 | ) | $ | (0.05 | ) | $ | (0.04 | ) |   |   |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted      average shares outstanding-                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                               |   |   | 132,310,413 |   |   | 118,582,385 |   |   | 124,844,409 |   |   | 115,852,521 |   |   |   |   |
| Fully      diluted                                                                  |   |   | 170,056,948 |   |   | 177,501,849 |   |   | 162,590,944 |   |   | 181,716,985 |   |   |   |   |
|                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| See      the accompanying notes to the consolidated financial      statements       |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   |   |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Common      Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
| Issuance      of common stock                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| to      Founders in exchange                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for      services on September                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 16,      2002 at $.01 per share                                                                  |   |   | - |   |   | - |   |   | 100,000 |   | $ | 10 |   | $ | 990 |   | $ | - |   | $ | - |   | $ | - |   | $ | 1,000 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      Loss                                                                                    |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | - |   |   | (11,612 | ) |   | (11,612 | ) |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance      at September 30, 2002                                                               |   |   | - |   | $ | - |   |   | 100,000 |   | $ | 10 |   | $ | 990 |   | $ | - |   | $ | - |   | $ | (11,612 | ) | $ | (10,612 | ) |
| Issuance      of common stock in                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| connection      with merger with                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Prohealth      Medical Technologies,                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Inc      on October 1, 2002                                                                      |   |   | - |   |   | - |   |   | 10,178,352 |   |   | 1,015 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 1,015 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cancellation      of common stock                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| in      connection with merger with                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Prohealth      Medical                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Technologies,      Inc on October                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 21,      2002                                                                                    |   |   | - |   |   | - |   |   | (100,000 | ) |   | (10 | ) |   | (1,000 | ) |   | - |   |   | - |   |   | - |   |   | (1,010 | ) |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance      of common stock in                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for services in                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| October      2002 at $0.65 per                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share                                                                                            |   |   | - |   |   | - |   |   | 602,000 |   |   | 60 |   |   | 39,070 |   |   | - |   |   | - |   |   | - |   |   | 39,130 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance      of common stock in                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for subscription in                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| November      and December 2002                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| at      $0.065 per share                                                                         |   |   | - |   |   | - |   |   | 876,000 |   |   | 88 |   |   | 56,852 |   |   | - |   |   | (56,940 | ) |   | - |   |   | - |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cancellation      of common stock                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| in      January 2003 previously                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| issued      in exchange for                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| consulting      services                                                                         |   |   | - |   |   | - |   |   | (836,000 | ) |   | (84 | ) |   | (54,264 | ) |   | - |   |   | 54,340 |   |   | - |   |   | (8 | ) |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance      of common stock in                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for licensing services                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| valued      at $0.065 per share in                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| January      2003                                                                                |   |   | - |   |   | - |   |   | 1,500,000 |   |   | 150 |   |   | 97,350 |   |   | - |   |   | - |   |   | - |   |   | 97,500 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance      of common stock in                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for consulting                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| services      valued at $0.13 per                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      in January 2003                                                                       |   |   | - |   |   | - |   |   | 586,250 |   |   | 58 |   |   | 76,155 |   |   | - |   |   | - |   |   | - |   |   | 76,213 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance      of common stock in                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for consulting                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| services      at $0.065 per share in                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| February      2003                                                                               |   |   | - |   |   | - |   |   | 9,000 |   |   | 1 |   |   | 584 |   |   | - |   |   | - |   |   | - |   |   | 585 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance      of common stock to                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Founders      in exchange for                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| services      valued at $0.0001 per                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      in March 2003                                                                         |   |   | - |   |   | - |   |   | 10,140,000 |   |   | 1,014 |   |   | - |   |   | - |   |   | - |   |   | - |   |   | 1,014 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance      of common stock in                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for consulting                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| services      valued at $2.50 per                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      in March 2003                                                                         |   |   | - |   |   | - |   |   | 91,060 |   |   | 10 |   |   | 230,624 |   |   | - |   |   | - |   |   | - |   |   | 230,634 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |  | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |  |  |  |  |   |  |  |  |   |  |   |   |  |  |  |   |  |   |   |

| Issuance      of common stock in      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|---------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| exchange      for consulting services |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| valued      at $0.065 per share in    |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| March      2003                       |   |   | -      |   |   | -      |   |   | 6,000      |   |   | 1      |   |   | 389    |   |   | -      |   |   | -      |   |   | -      |   |   | 390    |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock subscribed in       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for cash at $1 per      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      in March 2003              |   |   | -      |   |   | -      |   |   | -          |   |   | -      |   |   | 18,000 |   |   | -      |   |   | -      |   |   | -      |   |   | 18,000 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| services      at $0.065 per           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      on April 1, 2003           |   |   | -      |   |   | -      |   |   | 860,000    |   |   | 86     |   |   | 55,814 |   |   | -      |   |   | -      |   |   | -      |   |   | 55,900 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for cash at $1.00 per   |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      on April 9, 2003           |   |   | -      |   |   | -      |   |   | 18,000     |   |   | 2      |   |   | -      |   |   | -      |   |   | -      |   |   | -      |   |   | 2      |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| at      $0.065 per share on April 9,  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 2003                                  |   |   | -      |   |   | -      |   |   | 9,000      |   |   | 1      |   |   | 584    |   |   | -      |   |   | -      |   |   | -      |   |   | 585    |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| at      $2.50 per share on April 23,  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 2003                                  |   |   | -      |   |   | -      |   |   | 5,000      |   |   | 1      |   |   | 12,499 |   |   | -      |   |   | -      |   |   | -      |   |   | 12,500 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| at      $2.50 per share, on June 12,  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 2003                                  |   |   | -      |   |   | -      |   |   | 10,000     |   |   | 1      |   |   | 24,999 |   |   | -      |   |   | -      |   |   | -      |   |   | 25,000 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for cash at $1.00 per   |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      on June 17, 2003           |   |   | -      |   |   | -      |   |   | 50,000     |   |   | 5      |   |   | 49,995 |   |   | -      |   |   | -      |   |   | -      |   |   | 50,000 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock subscribed in       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for cash at $2.50 per   |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      pursuant to a private      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| placement      on June 27, 2003       |   |   | -      |   |   | -      |   |   | -          |   |   | -      |   |   | -      |   |   | 24,000 |   |   | -      |   |   | -      |   |   | 24,000 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock retired in          |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for note payable        |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| at      $0.0118 per share,            |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| in      June 30, 2003                 |   |   | -      |   |   | -      |   |   | (7,500,000 | )      |   | (750   | )      |   | 750    |   |   | -      |   |   | -      |   |   | -      |   |   | -      |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| at      $0.065 per share, on June 30, |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 2003                                  |   |   | -      |   |   | -      |   |   | 270,000    |   |   | 27     |   |   | 17,523 |   |   | -      |   |   | -      |   |   | -      |   |   | 17,550 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock subscribed in       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for cash at $1.00 per   |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      pursuant to a private      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| placement      on June 30, 2003       |   |   | -      |   |   | -      |   |   | -          |   |   | -      |   |   | -      |   |   | 10,000 |   |   | -      |   |   | -      |   |   | 10,000 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Common      stock subscribed in       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| exchange      for cash at $2.50 per   |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| share      pursuant to a private      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| placement      on June 30, 2003       |   |   | -      |   |   | -      |   |   | -          |   |   | -      |   |   | -      |   |   | 24,000 |   |   | -      |   |   | -      |   |   | 24,000 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
|-------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|--------|--------|--------|-----------|--------|--------|---------|--------|--------|--------|--------|--------|------------|--------|--------|------------|--------|
| exchange      for consulting services     |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| at      approximately $2.01 per           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| share,      July 2003                     |   |   | -      |   |   | -      |   |   | 213,060    |   |   | 21     |   |   | 428,798   |   |   | -       |   |   | -      |   |   | -          |   |   | 428,819    |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock canceled in July        |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| 2003,      previously issued for          |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| services      rendered at $2.50 per       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| share                                     |   |   | -      |   |   | -      |   |   | (24,000    | )      |   | (2     | )      |   | (59,998   | )      |   | -       |   |   | -      |   |   | -          |   |   | (60,000    | )      |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| exchange      for options exercised       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| at      $1.00 per share in July 2003      |   |   | -      |   |   | -      |   |   | 20,000     |   |   | 2      |   |   | 19,998    |   |   | -       |   |   | -      |   |   | -          |   |   | 20,000     |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| exchange      for exercise of             |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| options      previously subscribed at     |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| $1.00      per share in July 2003         |   |   | -      |   |   | -      |   |   | 10,000     |   |   | 1      |   |   | 9,999     |   |   | (10,000 | )      |   | -      |   |   | -          |   |   | -          |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| exchange      for consulting services     |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| at      approximately $2.38 per           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Share      in August 2003                 |   |   | -      |   |   | -      |   |   | 172,500    |   |   | 17     |   |   | 410,915   |   |   | -       |   |   | -      |   |   | -          |   |   | 410,932    |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| exchange      for options exercised       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| at      $1.00 per share in August 2003    |   |   | -      |   |   | -      |   |   | 29,000     |   |   | 3      |   |   | 28,997    |   |   | -       |   |   | -      |   |   | -          |   |   | 29,000     |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| exchange      for consulting services     |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| at      approximately $2.42 per           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| share      in September 2003              |   |   | -      |   |   | -      |   |   | 395,260    |   |   | 40     |   |   | 952,957   |   |   | -       |   |   | -      |   |   | -          |   |   | 952,997    |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| exchange      for cash at $2.50 per       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| share-subscription                        |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| payable      in September 2003            |   |   | -      |   |   | -      |   |   | 19,200     |   |   | 2      |   |   | 47,998    |   |   | (48,000 | )      |   | -      |   |   | -          |   |   | -          |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| exchange      for cash at $2.50 per       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| share      pursuant to a private          |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| placement      in September 2003          |   |   | -      |   |   | -      |   |   | 6,400      |   |   | 1      |   |   | 15,999    |   |   | -       |   |   | -      |   |   | -          |   |   | 16,000     |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock issued in               |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| exchange      for options exercised       |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| at      $1.00 per share in September 2003 |   |   | -      |   |   | -      |   |   | 95,000     |   |   | 10     |   |   | 94,991    |   |   | -       |   |   | -      |   |   | -          |   |   | 95,001     |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      stock subscription            |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| receivable      reclassification          |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| adjustment                                |   |   | -      |   |   | -      |   |   | -          |   |   | -      |   |   | -         |   |   | -       |   |   | 2,600  |   |   | -          |   |   | 2,600      |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Common      Stock subscribed to           |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| at      $2.50 per share in September      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| 2003                                      |   |   | -      |   |   | -      |   |   | -          |   |   | -      |   |   | -         |   |   | 300,000 |   |   | -      |   |   | -          |   |   | 300,000    |   |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| Net      Loss for the year                |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |
| ended      September 30, 2003             |   |   | -      |   |   | -      |   |   | -          |   |   | -      |   |   | -         |   |   | -       |   |   | -      |   |   | (3,445,164 | )      |   | (3,445,164 | )      |
| Balance      at September 30, 2003        |   |   | -      |   | $      | -      |   |   | 17,811,082 |   | $      | 1,781  |   | $      | 2,577,568 |   | $      | 300,000 |   | $      | -      |   | $      | (3,456,776 | )      | $      | (577,427   | )      |
|                                      |   |   |   |   |   |   |   |   |       |   |   |   |   |   |      |   |   |    |   |   |   |   |   |       |   |   |       |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Preferred      shares issued in          |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
|------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|--------|------------|--------|--------|-------------|--------|--------|----------|--------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|
| exchange      for services at $25.00     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| per      share in October 2003           |   |   | 15,000 |   |   | 15     |   |   | -         |   |   | -          |   |   | -           |   |   | -        |   |   | -      |   |   | -      |   |   | 15        |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      approximately $2.85 per          |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Share      in October 2003               |   |   | -      |   |   | -      |   |   | 287,439   |   |   | 29         |   |   | 820,389     |   |   | -        |   |   | -      |   |   | -      |   |   | 820,418   |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for cash at $2.50 per      |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| share-subscription                       |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| payable      in October 2003             |   |   | -      |   |   | -      |   |   | 120,000   |   |   | 12         |   |   | 299,988     |   |   | (300,000 | )      |   | -      |   |   | -      |   |   | -         |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock canceled in            |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| October      2003, previously issued     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| for      services rendered at $2.50      |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| per      share                           |   |   | -      |   |   | -      |   |   | (100,000  | )      |   | (10        | )      |   | (249,990    | )      |   | -        |   |   | -      |   |   | -      |   |   | (250,000  | )      |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      approximately $3 per share in    |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| November      2003                       |   |   | -      |   |   | -      |   |   | 100,000   |   |   | 10         |   |   | 299,990     |   |   | -        |   |   | -      |   |   | -      |   |   | 300,000   |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock subscribed in          |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for cash at $2.50 per      |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| share      pursuant to a private         |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| placement      in November, 2003         |   |   | -      |   |   | -      |   |   | 100,000   |   |   | 10         |   |   | 249,990     |   |   | -        |   |   | -      |   |   | -      |   |   | 250,000   |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock subscribed in          |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for cash at $2.50 per      |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| share      pursuant to a private         |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| placement      in December, 2003         |   |   | -      |   |   | -      |   |   | 6,400     |   |   | 1          |   |   | 15,999      |   |   | -        |   |   | -      |   |   | -      |   |   | 16,000    |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      approximately $2.59 per          |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| share      in December 2003              |   |   | -      |   |   | -      |   |   | 2,125,500 |   |   | 213        |   |   | 5,504,737   |   |   | -        |   |   | -      |   |   | -      |   |   | 5,504,950 |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock subscribed to          |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      $2.50 per share in December 2003 |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
|                                     |   |   |   |   |   | -      |   |   | -         |   |   | -          |   |   | -           |   |   | 104,000  |   |   | -      |   |   | -      |   |   | 104,000   |   |
| Beneficial      conversion feature       |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| relating      to notes payable           |   |   | -      |   |   | -      |   |   | -         |   |   | -          |   |   | 1,168,474   |   |   | -        |   |   | -      |   |   | -      |   |   | 1,168,474 |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Beneficial      conversion feature       |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| relating      to warrants                |   |   | -      |   |   | -      |   |   | -         |   |   | -          |   |   | 206,526     |   |   | -        |   |   | -      |   |   | -      |   |   | 206,526   |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Adjust      common stock par value       |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| from      $0.0001 to $0.50 per share,    |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| per      amendment of articles dated     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      December 2004                    |   |   | -      |   |   | -      |   |   | -         |   |   | 10,223,166 |   |   | (10,223,166 | )      |   | -        |   |   | -      |   |   | -      |   |   | -         |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued pursuant        |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| to      subscription at $2.50 share      |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      January 2004                     |   |   | -      |   |   | -      |   |   | 41,600    |   |   | 20,800     |   |   | 83,200      |   |   | (104,000 | )      |   | -      |   |   | -      |   |   | -         |   |
|                                     |   |   |   |   |   |   |   |   |      |   |   |       |   |   |        |   |   |     |   |   |   |   |   |   |   |   |      |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
|------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|
| exchange      for consulting services    |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $2.95 per share in January 2004  |   |   | -      |   |   | -      |   |   | 13,040  |   |   | 6,520   |   |   | 31,948  |   |   | -      |   |   | -      |   |   | -      |   |   | 38,468  |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $2.60 per share in January 2004  |   |   | -      |   |   | -      |   |   | 123,000 |   |   | 61,500  |   |   | 258,300 |   |   | -      |   |   | -      |   |   | -      |   |   | 319,800 |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $3.05 per share in January 2004  |   |   | -      |   |   | -      |   |   | 1,000   |   |   | 500     |   |   | 2,550   |   |   | -      |   |   | -      |   |   | -      |   |   | 3,050   |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for employee services      |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $3.07 per share in February 2004 |   |   | -      |   |   | -      |   |   | 6,283   |   |   | 3,142   |   |   | 16,147  |   |   | -      |   |   | -      |   |   | -      |   |   | 19,289  |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $3.04 per share in March 2004    |   |   | -      |   |   | -      |   |   | 44,740  |   |   | 22,370  |   |   | 113,640 |   |   | -      |   |   | -      |   |   | -      |   |   | 136,010 |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      Stock issued for             |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| options      exercised at $1.00 per      |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| share      in March 2004                 |   |   | -      |   |   | -      |   |   | 55,000  |   |   | 27,500  |   |   | 27,500  |   |   | -      |   |   | -      |   |   | -      |   |   | 55,000  |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for employee services      |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $3.00 per share in March 2004    |   |   | -      |   |   | -      |   |   | 5,443   |   |   | 2,722   |   |   | 13,623  |   |   | -      |   |   | -      |   |   | -      |   |   | 16,345  |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for employee services      |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $3.15 per share in March 2004    |   |   | -      |   |   | -      |   |   | 5,769   |   |   | 2,885   |   |   | 15,292  |   |   | -      |   |   | -      |   |   | -      |   |   | 18,177  |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Preferred      shared converted to       |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| common      shares for consulting        |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| services      at $3.00 per share in      |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| March      2004                          |   |   | (5,000 | )      |   | (5     | )      |   | 125,000 |   |   | 62,500  |   |   | 312,500 |   |   | -      |   |   | -      |   |   | -      |   |   | 374,995 |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for employee services      |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $3.03 per share in March 2004    |   |   | -      |   |   | -      |   |   | 8,806   |   |   | 4,400   |   |   | 22,238  |   |   | -      |   |   | -      |   |   | -      |   |   | 26,638  |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      Stock issued pursuant        |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| to      subscription at $2.50 per        |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| share      in March 2004                 |   |   | -      |   |   | -      |   |   | 22,500  |   |   | 11,250  |   |   | (9,000  | )      |   | -      |   |   | -      |   |   | -      |   |   | 2,250   |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Beneficial      Conversion Feature       |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| relating      to Notes Payable           |   |   |   |   |   |   |   |   | -       |   |   | -       |   |   | 122,362 |   |   | -      |   |   | -      |   |   | -      |   |   | 122,362 |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Beneficial      Conversion Feature       |   |   | -      |   |   | -      |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| relating      to Warrants                |   |   |   |   |   |   |   |   | -       |   |   | -       |   |   | 177,638 |   |   | -      |   |   | -      |   |   | -      |   |   | 177,638 |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $2.58 per share in April 2004    |   |   | -      |   |   | -      |   |   | 9,860   |   |   | 4,930   |   |   | 20,511  |   |   | -      |   |   | -      |   |   | -      |   |   | 25,441  |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $2.35 per share in April 2004    |   |   | -      |   |   | -      |   |   | 11,712  |   |   | 5,856   |   |   | 21,667  |   |   | -      |   |   | -      |   |   | -      |   |   | 27,523  |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Common      stock issued in              |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| exchange      for consulting services    |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| at      $1.50 per share in April 2004    |   |   | -      |   |   | -      |   |   | 367,500 |   |   | 183,750 |   |   | 367,500 |   |   | -      |   |   | -      |   |   | -      |   |   | 551,250 |   |
|                                     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Common      stock returned to         |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
|---------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|--------|---------|--------|
| treasury      at $0.065 per share in  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| April      2004                       |   |   | -      |   |   | -      |   |   | (50,000 | )      |   | (25,000 | )      |   | 21,750  |   |   | -      |   |   | -      |   |   | -       |   |   | (3,250  | )      |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Preferred      stock converted to     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| common      stock for consulting      |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| services      at $1.01 per share      |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| in      May 2004                      |   |   | (4,000 | )      |   | (4     | )      |   | 100,000 |   |   | 50,000  |   |   | 51,250  |   |   | -      |   |   | -      |   |   | -       |   |   | 101,246 |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued per          |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| subscription      in May 2004         |   |   | -      |   |   | -      |   |   | 10,000  |   |   | 5,000   |   |   | (4,000  | )      |   | -      |   |   | (1,000 | )      |   | -       |   |   | -       |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| services      at $0.86 per            |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| share      in May 2004                |   |   | -      |   |   | -      |   |   | 137,000 |   |   | 68,500  |   |   | 50,730  |   |   | -      |   |   | -      |   |   | -       |   |   | 119,230 |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| services      at $1.15 per            |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| share      in May 2004                |   |   | -      |   |   | -      |   |   | 26,380  |   |   | 13,190  |   |   | 17,147  |   |   | -      |   |   | -      |   |   |  - |   |   | 30,337  |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock returned to         |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| treasury      at $0.065 per           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| share      in June 2004               |   |   | -      |   |   | -      |   |   | (5,000  | )      |   | (2,500  | )      |   | 2,175   |   |   | -      |   |   | -      |   |   | -       |   |   | (325    | )      |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| services      at $0.67 per            |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| share      in June 2004               |   |   | -      |   |   | -      |   |   | 270,500 |   |   | 135,250 |   |   | 45,310  |   |   | -      |   |   | -      |   |   | -       |   |   | 180,560 |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| at      $0.89 per share in June 2004  |   |   | -      |   |   | -      |   |   | 8,000   |   |   | 4,000   |   |   | 3,120   |   |   | -      |   |   | -      |   |   | -       |   |   | 7,120   |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| at      $0.65 per share in June 2004  |   |   | -      |   |   | -      |   |   | 50,000  |   |   | 25,000  |   |   | 7,250   |   |   | -      |   |   | -      |   |   | -       |   |   | 32,250  |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued pursuant     |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| to      a private placement at $1.00  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| per      share in June 2004           |   |   | -      |   |   | -      |   |   | 250,000 |   |   | 125,000 |   |   | 125,000 |   |   | -      |   |   | -      |   |   | -       |   |   | 250,000 |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| at      $0.54 per share in July 2004  |   |   | -      |   |   | -      |   |   | 100,000 |   |   | 50,000  |   |   | 4,000   |   |   | -      |   |   | -      |   |   | -       |   |   | 54,000  |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| at      $0.72 per share in July 2004  |   |   | -      |   |   | -      |   |   | 5,000   |   |   | 2,500   |   |   | 1,100   |   |   | -      |   |   | -      |   |   | -       |   |   | 3,600   |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting services |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| at      $0.47 per share in July 2004  |   |   | -      |   |   | -      |   |   | 100,000 |   |   | 50,000  |   |   | (2,749  | )      |   | -      |   |   | -      |   |   | -       |   |   | 47,251  |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| services      at $0.39 per            |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |
| share      in August 2004             |   |   | -      |   |   | -      |   |   | 100,000 |   |   | 50,000  |   |   | (11,000 | )      |   | -      |   |   | -      |   |   | -       |   |   | 39,000  |   |
|                                  |   |   |   |   |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |   |   |   |    |   |   |    |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Preferred      stock converted          |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
|-----------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|------------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|--------|-------------|--------|--------|-------------|--------|
| to      common stock for                |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| consulting      services at             |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| $0.39      per share in August 2004     |   |   | (2,000 | )      |   | (2     | )      |   | 50,000     |   |   | 25,000     |   |   | (5,500    | )      |   | -      |   |   | -      |   |   | -           |   |   | 19,498      |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting            |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.50 per              |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| share      in August 2004               |   |   | -      |   |   | -      |   |   | 100,000    |   |   | 50,000     |   |   | 250       |   |   | -      |   |   | -      |   |   | -           |   |   | 50,250      |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting            |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.56 per              |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| share      in August 2004               |   |   | -      |   |   | -      |   |   | 200,000    |   |   | 100,000    |   |   | 12,500    |   |   | -      |   |   | -      |   |   | -           |   |   | 112,500     |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting            |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.41 per              |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| share      in August 2004               |   |   | -      |   |   | -      |   |   | 92,500     |   |   | 46,250     |   |   | (8,605    | )      |   | -      |   |   | -      |   |   | -           |   |   | 37,645      |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting            |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.52 per              |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| share      in September 2004            |   |   | -      |   |   | -      |   |   | 1,000,000  |   |   | 500,000    |   |   | 17,500    |   |   | -      |   |   | -      |   |   | -           |   |   | 517,500     |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting            |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.46 per              |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| share      in September 2004            |   |   | -      |   |   | -      |   |   | 5,000      |   |   | 2,500      |   |   | (212      | )      |   | -      |   |   | -      |   |   | -           |   |   | 2,288       |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      stock issued pursuant       |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| to      subscription at $0.50 per       |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| share      in September 2004            |   |   | -      |   |   | -      |   |   | 40,000     |   |   | 20,000     |   |   | -         |   |   | -      |   |   | -      |   |   | -           |   |   | 20,000      |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Preferred      shares converted to      |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| common      stock for consulting        |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.41 per share in     |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| September      2004                     |   |   | (4,000 | )      |   | (4     | )      |   | 100,000    |   |   | 50,000     |   |   | 4,000     |   |   | -      |   |   | -      |   |   | -           |   |   | 53,996      |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Preferred      shares issued in         |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for service at $25 per    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| share      in September 2004            |   |   | 60,000 |   |   | 6      |   |   | -          |   |   | -          |   |   | 1,499,994 |   |   | -      |   |   | -      |   |   | -           |   |   | 1,500,000   |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Fair      value of 2,841,000 warrants   |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| issued      to non-employees and        |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| consultants      for services rendered  |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| at      approximately $0.71 per warrant |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| in      September 2004                  |   |   | -      |   |   | -      |   |   | -          |   |   | -          |   |   | 2,019,862 |   |   | -      |   |   | -      |   |   | -           |   |   | 2,019,862   |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |       |   |   |      |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Net      Loss                           |   |   | -      |   |   | -      |   |   | -          |   |   | -          |   |   | -         |   |   | -      |   |   | -      |   |   | (19,358,258 | )      |   | (19,358,258 | )      |
| Balance      at September 30, 2004      |   |   | 60,000 |   | $      | 6      |   |   | 23,981,054 |   | $      | 11,990,527 |   | $      | 6,118,993 |   | $      | -      |   | $      | (1,000 | )      | $      | (22,815,034 | )      | $      | (4,706,508  | )      |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
|-----------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|-----------|--------|--------|------------|--------|--------|----------|--------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|
| exchange      for consulting services   |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      $0.68 per share in October 2004 |   |   | -      |   |   | -      |   |   | 200,000    |   |   | 100,000   |   |   | 36,000     |   |   | -        |   |   | -      |   |   | -      |   |   | 136,000   |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock returned              |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| to      treasury at $0.60 per share     |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      October 2004                    |   |   | -      |   |   | -      |   |   | (1,069,600 | )      |   | (534,800  | )      |   | (107,297   | )      |   | -        |   |   | -      |   |   | -      |   |   | (642,097  | )      |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services   |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      $0.60 per share in October 2004 |   |   | -      |   |   | -      |   |   | 82,500     |   |   | 41,250    |   |   | 8,250      |   |   | -        |   |   | -      |   |   | -      |   |   | 49,500    |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued pursuant       |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| to      subscription at $0.60 per share |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      October 2004                    |   |   | -      |   |   | -      |   |   | 500,000    |   |   | 250,000   |   |   | 50,000     |   |   | (300,000 | )      |   | -      |   |   | -      |   |   | -         |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services   |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      $0.50 per share in October 2004 |   |   | -      |   |   | -      |   |   | 532,500    |   |   | 266,250   |   |   | -          |   |   | -        |   |   | -      |   |   | -      |   |   | 266,250   |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for debt at $0.50 per     |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| share      in October 2004              |   |   | -      |   |   | -      |   |   | 500,000    |   |   | 250,000   |   |   | -          |   |   | -        |   |   | -      |   |   | -      |   |   | 250,000   |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued pursuant       |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| to      subscription at $0.45 per share |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      October 2004                    |   |   | -      |   |   | -      |   |   | 1,000,000  |   |   | 500,000   |   |   | (50,000    | )      |   | (450,000 | )      |   | -      |   |   | -      |   |   | -         |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services   |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      $0.45 per share in October 2004 |   |   | -      |   |   | -      |   |   | 315,000    |   |   | 157,500   |   |   | (15,750    | )      |   | -        |   |   | -      |   |   | -      |   |   | 141,750   |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting            |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| services      at $0.47 per share        |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      November 2004                   |   |   | -      |   |   | -      |   |   | 100,000    |   |   | 50,000    |   |   | (3,000     | )      |   | -        |   |   | -      |   |   | -      |   |   | 47,000    |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting            |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| services      at $0.8 0 per share       |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      November 2004                   |   |   | -      |   |   | -      |   |   | 300,000    |   |   | 150,000   |   |   | 90,000     |   |   | -        |   |   | -      |   |   | -      |   |   | 240,000   |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting            |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| services      at $1.44 per share        |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      November 2004                   |   |   | -      |   |   | -      |   |   | 115,000    |   |   | 57,500    |   |   | 108,100    |   |   | -        |   |   | -      |   |   | -      |   |   | 165,600   |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| exchange      for employee              |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| services      at $1.44 per share        |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      November 2004                   |   |   | -      |   |   | -      |   |   | 5,000      |   |   | 2,500     |   |   | 4,700      |   |   | -        |   |   | -      |   |   | -      |   |   | 7,200     |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Warrants      exercised                 |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| at      $0.60 per share                 |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| in      November 2004                   |   |   | -      |   |   | -      |   |   | 60,000     |   |   | 30,000    |   |   | 6,000      |   |   | (4,000   | )      |   | -      |   |   | -      |   |   | 32,000    |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Beneficial      Conversion discount     |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| relating      to Notes Payable          |   |   | -      |   |   | -      |   |   | -          |   |   | -         |   |   | 1,465,000  |   |   | -        |   |   | -      |   |   | -      |   |   | 1,465,000 |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued at $0.016      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| per      share in exchange for note     |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| payable      in December 2004           |   |   | -      |   |   | -      |   |   | 5,500,000  |   |   | 2,750,000 |   |   | (2,661,500 | )      |   | -        |   |   | -      |   |   | -      |   |   | 88,500    |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in             |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| settlement      of debt at $0.50 per    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |
| share      in December 2004             |   |   | -      |   |   | -      |   |   | 2,930,000  |   |   | 1,465,000 |   |   | -          |   |   | (125,000 | )      |   | -      |   |   | -      |   |   | 1,340,000 |   |
|                                    |   |   |   |   |   |   |   |   |       |   |   |      |   |   |       |   |   |     |   |   |   |   |   |   |   |   |      |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Fair      value of 6,063,500 warrants     |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
|-------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|
| issued      to non employees and          |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| consultants      for services rendered    |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| at      $0.52 per warrant in October      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| and      December 2004                    |   |   | -      |   |   | -      |   |   | -         |   |   | -         |   |   | 3,169,052  |   |   | -      |   |   | -      |   |   | -      |   |   | 3,169,052  |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Warrants      exercised at $0.10 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in January 2005                |   |   | -      |   |   | -      |   |   | 25,000    |   |   | 12,500    |   |   | (10,000    | )      |   | -      |   |   | -      |   |   | -      |   |   | 2,500      |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Common      Stock issued in               |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| settlement      of debt at $0.33 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in January 2005                |   |   | -      |   |   | -      |   |   | 1,628,789 |   |   | 814,395   |   |   | (276,895   | )      |   | -      |   |   | -      |   |   | -      |   |   | 537,500    |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Warrants      exercised at $0.10 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in January 2005                |   |   | -      |   |   | -      |   |   | 17,500    |   |   | 8,750     |   |   | (7,000     | )      |   | -      |   |   | -      |   |   | -      |   |   | 1,750      |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Common      Stock issued in               |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| settlement      of debt at $0.33 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in January 2005                |   |   | -      |   |   | -      |   |   | 2,399,012 |   |   | 1,199,504 |   |   | (407,830   | )      |   | -      |   |   | -      |   |   | -      |   |   | 791,674    |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Common      Stock issued in               |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| exchange      for consulting              |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| services      at $1.30 per share          |   |   | -      |   |   | -      |   |   | 315,636   |   |   | 157,818   |   |   | 252,508    |   |   | -      |   |   | -      |   |   | -      |   |   | 410,326    |   |
| in      January 2005                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Fair      value of warrant liability      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| reclassed      due to registration rights |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| granted      in February 2005             |   |   | -      |   |   | -      |   |   | -         |   |   | -         |   |   | (3,108,851 | )      |   | -      |   |   | -      |   |   | -      |   |   | (3,108,851 | )      |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Common      Stock issued in               |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| exchange      for consulting              |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| services      at $1.44 per share          |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| in      February 2005                     |   |   | -      |   |   | -      |   |   | 5,796,785 |   |   | 2,898,393 |   |   | 5,418,814  |   |   | -      |   |   | -      |   |   | -      |   |   | 8,317,207  |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Fair      value of 55,000 warrants issued |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| to      consultants for services at $1.31 |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| per      warrant in February 2005         |   |   | -      |   |   | -      |   |   | -         |   |   | -         |   |   | 72,017     |   |   | -      |   |   | -      |   |   | -      |   |   | 72,017     |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Common      Stock issued in               |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| settlement      of debt at $0.33 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in February 2005               |   |   | -      |   |   | -      |   |   | 75,757    |   |   | 37,879    |   |   | (12,879    | )      |   | -      |   |   | -      |   |   | -      |   |   | 25,000     |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Warrants      exercised at $0.10 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in February 2005               |   |   | -      |   |   | -      |   |   | 20,000    |   |   | 10,000    |   |   | (8,000     | )      |   | -      |   |   | -      |   |   | -      |   |   | 2,000      |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Common      Stock issued in               |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| settlement      of debt at $0.33 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in February 2005               |   |   | -      |   |   | -      |   |   | 606,060   |   |   | 303,030   |   |   | (103,030   | )      |   | -      |   |   | -      |   |   | -      |   |   | 200,000    |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Warrants      exercised at $0.10 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in February 2005               |   |   | -      |   |   | -      |   |   | 45,000    |   |   | 22,500    |   |   | (18,000    | )      |   | -      |   |   | -      |   |   | -      |   |   | 4,500      |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Common      Stock issued in               |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| exchange      for related party debt      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| at      $1.31 per share in February       |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| 2005                                      |   |   | -      |   |   | -      |   |   | 1,500,000 |   |   | 750,000   |   |   | 1,215,000  |   |   | -      |   |   | -      |   |   | -      |   |   | 1,965,000  |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| Common      Stock issued in               |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| settlement      of debt at $0.33 per      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |
| share      in February 2005               |   |   | -      |   |   | -      |   |   | 278,433   |   |   | 139,217   |   |   | (47,334    | )      |   | -      |   |   | -      |   |   | -      |   |   | 91,883     |   |
|                                      |   |   |   |   |   |   |   |   |      |   |   |      |   |   |       |   |   |   |   |   |   |   |   |   |   |   |       |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Common      Stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
|---------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|-----------|--------|--------|---------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|
| exchange      for consulting services |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| at      $1.17 per share in February   |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| 2005                                  |   |   | -      |   |   | -      |   |   | 17,236     |   |   | 8,618     |   |   | 11,548  |   |   | -       |   |   | -      |   |   | -      |   |   | 20,166    |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for debt at $0.50 per   |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| share      in February 2005           |   |   | -      |   |   | -      |   |   | 300,000    |   |   | 150,000   |   |   | -       |   |   | -       |   |   | -      |   |   | -      |   |   | 150,000   |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      at $0.95 per share      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| in      February 2005                 |   |   | -      |   |   | -      |   |   | 716,500    |   |   | 358,250   |   |   | 322,425 |   |   | -       |   |   | -      |   |   | -      |   |   | 680,675   |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      at $0.95 per share      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| in      February 2005                 |   |   | -      |   |   | -      |   |   | 10,500     |   |   | 5,250     |   |   | 4,725   |   |   | -       |   |   | -      |   |   | -      |   |   | 9,975     |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for debt at $0.50 per   |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| share      in March 2005              |   |   | -      |   |   | -      |   |   | 13,202,000 |   |   | 6,601,000 |   |   | -       |   |   | -       |   |   | -      |   |   | -      |   |   | 6,601,000 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      at $1.19 per share      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| in      March 2005                    |   |   | -      |   |   | -      |   |   | 185,000    |   |   | 92,500    |   |   | 127,650 |   |   | -       |   |   | -      |   |   | -      |   |   | 220,150   |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Options      exercised at $0.60 per   |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| share      in March 2005              |   |   | -      |   |   | -      |   |   | 100,000    |   |   | 50,000    |   |   | 10,000  |   |   | -       |   |   | -      |   |   | -      |   |   | 60,000    |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      at $0.98 per share      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| in      March 2005                    |   |   | -      |   |   | -      |   |   | 1,675,272  |   |   | 837,636   |   |   | 804,131 |   |   | -       |   |   | -      |   |   | -      |   |   | 1,641,767 |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      at $0.92 per share      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| in      March 2005                    |   |   | -      |   |   | -      |   |   | 24,333     |   |   | 12,167    |   |   | 10,219  |   |   | -       |   |   | -      |   |   | -      |   |   | 22,386    |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      at $0.99 per share      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| in      March 2005                    |   |   | -      |   |   | -      |   |   | 15,000     |   |   | 7,500     |   |   | 7,350   |   |   | -       |   |   | -      |   |   | -      |   |   | 14,850    |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      stock issued in exchange  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| for      debt at $0.50 per share      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| in      March 2005                    |   |   | -      |   |   | -      |   |   | 1,240,000  |   |   | 620,000   |   |   | -       |   |   | -       |   |   | -      |   |   | -      |   |   | 620,000   |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      stock canceled for        |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| shares      issued in exchange of     |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| debt      in March 2005               |   |   | -      |   |   | -      |   |   | (500,000   | )      |   | (250,000  | )      |   | -       |   |   | -       |   |   | -      |   |   | -      |   |   | (250,000  | )      |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      stock subscribed          |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| canceled      in March 2005           |   |   | -      |   |   | -      |   |   | -          |   |   | -         |   |   | -       |   |   | 750,000 |   |   | -      |   |   | -      |   |   | 750,000   |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in           |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting          |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      at $0.89 per share      |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |
| in      March 2005                    |   |   | -      |   |   | -      |   |   | 10,000     |   |   | 5,000     |   |   | 3,900   |   |   | -       |   |   | -      |   |   | -      |   |   | 8,900     |   |
|                                  |   |   |   |   |   |   |   |   |       |   |   |      |   |   |    |   |   |    |   |   |   |   |   |   |   |   |      |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Adjust      common stock par value     |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
|----------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|--------|-------------|--------|--------|------------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|
| from      $0.50 to $0.001 per share,   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| per      amendment of Articles of      |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Incorporation      in March-05         |   |   | -      |   |   | -      |   |   | -       |   |   | (32,312,879 | )      |   | 32,312,879 |   |   | -       |   |   | -      |   |   | -      |   |   | -         |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Beneficial      Conversion discount    |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| relating      to Notes Payable in      |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| March      2005                        |   |   | -      |   |   | -      |   |   | -       |   |   | -           |   |   | 7,371,000  |   |   | -       |   |   | -      |   |   | -      |   |   | 7,371,000 |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Stock      options granted to          |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| employees      in exchange for         |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      rendered, at exercise    |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| price      below fair value of common  |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| stock      in March 2005               |   |   | -      |   |   | -      |   |   | -       |   |   | -           |   |   | 180,000    |   |   | -       |   |   | -      |   |   | -      |   |   | 180,000   |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in            |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services  |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| at      $0.80 per share in April 2005  |   |   | -      |   |   | -      |   |   | 160,000 |   |   | 160         |   |   | 127,840    |   |   | -       |   |   | -      |   |   | -      |   |   | 128,000   |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in            |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services  |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| at      $0.80 per share in April 2005  |   |   | -      |   |   | -      |   |   | 40,000  |   |   | 40          |   |   | 31,960     |   |   | -       |   |   | -      |   |   | -      |   |   | 32,000    |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in            |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services  |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| at      $0.75 per share in April 2005  |   |   | -      |   |   | -      |   |   | 850,000 |   |   | 850         |   |   | 636,650    |   |   | -       |   |   | -      |   |   | -      |   |   | 637,500   |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in            |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services  |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| at      $0.33 per share in April 2005  |   |   | -      |   |   | -      |   |   | 500,000 |   |   | 500         |   |   | 164,500    |   |   | -       |   |   | -      |   |   | -      |   |   | 165,000   |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock canceled during      |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| April      2005, previously issued for |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      rendered at $3.42 per    |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| share                                  |   |   | -      |   |   | -      |   |   | (10,000 | )      |   | (10         | )      |   | (34,190    | )      |   | -       |   |   | -      |   |   | -      |   |   | (34,200   | )      |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in            |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| settlement      of debt at $0.33 per   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| share      in April 2005               |   |   | -      |   |   | -      |   |   | 75,758  |   |   | 77          |   |   | 24,923     |   |   | (25,000 | )      |   | -      |   |   | -      |   |   | -         |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock issued in            |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| exchange      for consulting services  |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| at      $0.68 per share in April 2005  |   |   | -      |   |   | -      |   |   | 50,000  |   |   | 50          |   |   | 33,950     |   |   | -       |   |   | -      |   |   | -      |   |   | 34,000    |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Proceeds      received against         |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| subscription      payable in June      |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| 2005                                   |   |   | -      |   |   | -      |   |   | -       |   |   | -           |   |   | -          |   |   | 118,000 |   |   | -      |   |   | -      |   |   | 118,000   |   |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Common      Stock canceled in          |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| June      2005, previously issued for  |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| services      rendered at $0.50 per    |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| share                                  |   |   | -      |   |   | -      |   |   | (10,000 | )      |   | (10         | )      |   | (4,990     | )      |   | -       |   |   | -      |   |   | -      |   |   | (5,000    | )      |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| Cancellation      of previously        |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| granted      stock options granted     |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| to      employees for services         |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| rendered,      at exercise price       |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |
| below      fair value of common stock  |   |   | -      |   |   | -      |   |   | -       |   |   | -           |   |   | (180,000   | )      |   | -       |   |   | -      |   |   | -      |   |   | (180,000  | )      |
|                                   |   |   |   |   |   |   |   |   |    |   |   |        |   |   |       |   |   |    |   |   |   |   |   |   |   |   |      |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Common      Stock issued in                            |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
|--------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|-------------|--------|--------|---------|--------|--------|------------|--------|--------|--------|--------|--------|--------|--------|--------|-------------|--------|--------|-------------|--------|
| exchange      for consulting services                  |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| at      $0.60 per share in July 2005                   |   |   | -      |   |   | -      |   |   | 157,000     |   |   | 157     |   |   | 94,043     |   |   | -      |   |   | -      |   |   | -           |   |   | 94,200      |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock issued in                            |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for intellectual property                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| at      $0.67 per share in July 2005                   |   |   | -      |   |   | -      |   |   | 36,000,000  |   |   | 36,000  |   |   | 24,084,000 |   |   | -      |   |   | -      |   |   | -           |   |   | 24,120,000  |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock issued in                            |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting                           |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.60 per share                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| in      July 2005                                      |   |   | -      |   |   | -      |   |   | 640,000     |   |   | 640     |   |   | 383,360    |   |   | -      |   |   | -      |   |   | -           |   |   | 384,000     |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock issued in                            |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for employee services                    |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| at      $0.48 per share in July 2005                   |   |   | -      |   |   | -      |   |   | 8,000,000   |   |   | 8,000   |   |   | 3,832,000  |   |   | -      |   |   | -      |   |   | -           |   |   | 3,840,000   |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock issued in                            |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting                           |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.94 per share                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| in      July 2005                                      |   |   | -      |   |   | -      |   |   | 121,985     |   |   | 121     |   |   | 168,217    |   |   | -      |   |   | -      |   |   | -           |   |   | 168,338     |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock issued in                            |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting                           |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.48 per share                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| in      August 2005                                    |   |   | -      |   |   | -      |   |   | 250,000     |   |   | 250     |   |   | 119,750    |   |   | -      |   |   | -      |   |   | -           |   |   | 120,000     |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock penalty shares                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| issued      pursuant to pending SB-2                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| registration      at $0.62 per share in                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| September      2005                                    |   |   | -      |   |   | -      |   |   | 814,158     |   |   | 814     |   |   | 501,858    |   |   | -      |   |   | -      |   |   | -           |   |   | 502,672     |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock penalty shares                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| issued      pursuant to pending SB-2                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| registration      at $0.70 per share in                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| September      2005                                    |   |   | -      |   |   | -      |   |   | 391,224     |   |   | 391     |   |   | 273,466    |   |   | -      |   |   | -      |   |   | -           |   |   | 273,857     |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock issued in                            |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| exchange      for consulting                           |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| services      at $0.94 per share                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| in      September 2005                                 |   |   | -      |   |   | -      |   |   | 185,000     |   |   | 185     |   |   | 173,715    |   |   | -      |   |   | -      |   |   | -           |   |   | 173,900     |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      Stock returned in                          |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| September      2005, previously                        |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| issued      for services rendered at                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| $0.40      per share                                   |   |   | -      |   |   | -      |   |   | (740,000    | )      |   | (740    | )      |   | (453,232   | )      |   | 56,000 |   |   | 1,000  |   |   | -           |   |   | (396,972    | )      |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Net      Loss                                          |   |   | -      |   |   | -      |   |   | -           |   |   | -       |   |   | -          |   |   | -      |   |   | -      |   |   | (67,109,519 | )      |   | (67,109,519 | )      |
| Balance      as of September                           |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| 30,      2005                                          |   |   | 60,000 |   | $      | 6      |   |   | 112,230,392 |   | $      | 112,230 |   | $      | 82,320,715 |   | $      | 20,000 |   | $      | -      |   | $      | (89,924,553 | )      | $      | (7,471,602  | )      |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| Common      stock issued in exchange      for services |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| at      $0.50 per share                                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |
| in      October 2005                                   |   |   | -      |   |   | -      |   |   | 400,000     |   |   | 400     |   |   | 199,600    |   |   | -      |   |   | -      |   |   | -           |   |   | 200,000     |   |
|                                                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |        |   |   |        |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Common      Stock issued in                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
|--------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|-------------|--------|--------|---------|--------|--------|------------|--------|--------|---------|--------|--------|--------|--------|--------|-------------|--------|--------|------------|--------|
| exchange      for consulting               |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| services      at $0.75 per share           |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| in      October 2005                       |   |   | -      |   |   | -      |   |   | 100,000     |   |   | 100     |   |   | 74,900     |   |   | -       |   |   | -      |   |   | -           |   |   | 75,000     |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock returned in              |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| October      2005, previously              |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| issued      for services                   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| rendered      at $0.60 per share           |   |   | -      |   |   | -      |   |   | (350,000    | )      |   | (350    | )      |   | (209,650   | )      |   | -       |   |   | -      |   |   | -           |   |   | (210,000   | )      |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      stock issued pursuant          |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| to      subscription at $0.50 per          |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| share      in December 2005                |   |   | -      |   |   | -      |   |   | 40,000      |   |   | 40      |   |   | 19,960     |   |   | (20,000 | )      |   | -      |   |   | -           |   |   | -          |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock issued to investors      |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| pursuant      to registration rights       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| agreement      at $0.51 per share in       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| December      2005                         |   |   | -      |   |   | -      |   |   | 505,854     |   |   | 506     |   |   | 257,480    |   |   | -       |   |   | -      |   |   | -           |   |   | 257,986    |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock returned in              |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| January      2006, previously issued       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| for      services rendered at $0.60        |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| per      share                             |   |   | -      |   |   | -      |   |   | (250,000    | )      |   | (250    | )      |   | (149,750   | )      |   | -       |   |   | -      |   |   | -           |   |   | (150,000   | )      |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock issued to investors      |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| pursuant      to registration rights       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| agreement      at $0.32 per share          |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| in      January 2006                       |   |   | -      |   |   | -      |   |   | 806,212     |   |   | 806     |   |   | 257,182    |   |   | -       |   |   | -      |   |   | -           |   |   | 257,988    |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock issued to investors      |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| pursuant      to registration rights       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| agreement      at $0.20 per share          |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| in      January 2006                       |   |   | -      |   |   | -      |   |   | 1,289,927   |   |   | 1,290   |   |   | 256,695    |   |   | -       |   |   | -      |   |   | -           |   |   | 257,985    |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Fair      value of 200,000 warrants issued |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| to      consultants for services at $0.22  |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| per      warrant in January 2006           |   |   | -      |   |   | -      |   |   | -           |   |   | -       |   |   | 43,098     |   |   | -       |   |   | -      |   |   | -           |   |   | 43,098     |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock issued in                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| exchange      for consulting services      |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| at      $0.17 per share in February 2006   |   |   | -      |   |   | -      |   |   | 160,000     |   |   | 160     |   |   | 27,040     |   |   | -       |   |   | -      |   |   | -           |   |   | 27,200     |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock issued in                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| exchange      for consulting services      |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| at      $0.16 per share in February 2006   |   |   | -      |   |   | -      |   |   | 3,800,000   |   |   | 3,800   |   |   | 604,200    |   |   | -       |   |   | -      |   |   | -           |   |   | 608,000    |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock returned in              |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| March      2006, previously issued         |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| for      services rendered at $0.80        |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| per      share                             |   |   | -      |   |   | -      |   |   | (150,000    | )      |   | (150    | )      |   | (119,850   | )      |   | -       |   |   | -      |   |   | -           |   |   | (120,000   | )      |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Previously      issued warrants reclassed  |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| to      warrant liability                  |   |   | -      |   |   | -      |   |   | -           |   |   | -       |   |   | (1,584,614 | )      |   | -       |   |   | -      |   |   | -           |   |   | (1,584,614 | )      |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Common      Stock issued in exchange       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| for      consulting services at $0.20 per  |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| share      in July 2006                    |   |   | -      |   |   | -      |   |   | 2,400,000   |   |   | 2,400   |   |   | 477,600    |   |   | -       |   |   | -      |   |   | -           |   |   | 480,000    |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Fair      value of stock options granted   |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| to      employees in exchange for          |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| services      rendered in September 2006   |   |   | -      |   |   | -      |   |   | -           |   |   | -       |   |   | 153,000    |   |   | -       |   |   | -      |   |   | -           |   |   | 153,000    |   |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |
| Net      loss                              |   |   | -      |   |   | -      |   |   | -           |   |   | -       |   |   | -          |   |   | -       |   |   | -      |   |   | (2,410,237  | )      |   | (2,410,237 | )      |
| Balance      as of September 30, 2006      |   |   | 60,000 |   | $      | 6      |   | $      | 120,982,385 |   | $      | 120,982 |   | $      | 82,627,606 |   | $      | -       |   | $      | -      |   | $      | (92,334,791 | )      | $      | (9,586,197 | )      |
|                                       |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |    |   |   |   |   |   |        |   |   |       |   |

----

| APPLIED      DNA SCIENCES, INC                                                                   |   |
|--------------------------------------------------------------------------------------------------|--------|
| (A      development stage company)                                                               |   |
| CONDENSED      CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY,    (DEFICIENCY)                   |   |
| FOR      THE PERIOD SEPTEMBER 16, 2002 (DATE OF INCEPTION) THROUGH JUNE 30,      2007(unaudited) |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | Deficit |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Accumulated |   |   |   |
|                                                                                             |   |   |   | Preferred |   |   |   | Common |   | Paid      in |   | Common |   | Stock |   | During |   |   |   |
|                                                                                             |   | Preferred |   | Shares |   | Common |   | Stock |   | Capital |   | Stock |   | Subscription |   | Development |   |   |   |
|                                                                                             |   | Shares |   | Amount |   | Shares |   | Amount |   | Amount |   | Subscribed |   | Receivable |   | Stage |   | Total |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Common      stock issued in Dec 2006                             |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
|------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|-------------|--------|--------|---------|--------|--------|------------|--------|--------|--------|--------|--------|--------|--------|--------|--------------|--------|--------|-------------|--------|
| in      settlement of related party debt                         |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| at      $2.28 per share                                          |   |   | -      |   |   | -      |   |   | 180,000     |   |   | 180     |   |   | 410,249    |   |   | -      |   |   | -      |   |   | -            |   |   | 410,429     |   |
|                                                             |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| Common      stock issued in May 2007                             |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| in      settlement of convertible                                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| debenture      at $0.11per share                                 |   |   | -      |   |   | -      |   |   | 9,645,752   |   |   | 9,646   |   |   | 1,090,354  |   |   | -      |   |   | -      |   |   | -            |   |   | 1,100,000   |   |
|                                                             |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| Common      stock issued in June 2007                            |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| in      settlement of convertible                                |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| debenture      at $0.11per share                                 |   |   | -      |   |   | -      |   |   | 29,691,412  |   |   | 29,691  |   |   | 3,215,309  |   |   | -      |   |   | -      |   |   | -            |   |   | 3,245,000   |   |
|                                                             |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| Beneficial      conversion feature                               |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| relating      to convertible debenture                           |   |   | -      |   |   | -      |   |   | -           |   |   | -       |   |   | 76,788     |   |   | -      |   |   | -      |   |   | -            |   |   | 76,788      |   |
|                                                             |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
|                                                             |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| Net      loss                                                    |   |   | -      |   |   | -      |   |   | -           |   |   | -       |   |   | -          |   |   | -      |   |   | -      |   |   | (8,233,506   | )      |   | (8,233,506  | )      |
| Balance      as of June 30, 2007                                 |   |   | 60,000 |   | $      | 6      |   |   | 160,499,549 |   | $      | 160,499 |   | $      | 87,420,306 |   | $      | -      |   | $      | -      |   | $      | (100,568,297 | )      | $      | (12,987,486 | )      |
|                                                             |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |   |   |         |   |   |        |   |
| See      accompanying notes to consolidated financial statements |   |   |   |   |   |   |   |   |        |   |   |    |   |   |       |   |   |   |   |   |   |

----

| APPLIED DNA SCIENCES,      INC                                                                                          |   |
|-------------------------------------------------------------------------------------------------------------------------|--------|
| (A DEVELOPMENT STAGE      COMPANY)                                                                                      |   |
| CONDENSED CONSOLIDATED      STATEMENT OF CASH FLOWS                                                                     |   |
| (unaudited)                                                                                                             |   |
|                                                                                                                    |   |   |   |   |   | For      the Period |   |
|                                                                                                                    |   |   |   |   |   | September      16, 2002 |   |
|                                                                                                                    |   |   |   |   |   | (Date      of Inception) |   |
|                                                                                                                    |   | For      the nine months ended June 30, |   | through |   |
|                                                                                                                    |   | 2007 |   | 2006 |   | June      30, 2007 |   |
| Cash      flows from operating activities:                                                                              |   |   |   | RESTATED |   |   |   |
| Net      income (loss)                                                                                                  |   | $ | (8,233,506 | ) | $ | 5,606,849 |   | $ | (100,568,297 | ) |
| Adjustments      to reconcile net loss to net used in operating activities:                                             |   |   |   |   |   |   |   |   |   |   |
| Depreciation      and amortization                                                                                      |   |   | 324,594 |   |   | 1,021,199 |   |   | 2,054,320 |   |
| Organization      expenses                                                                                              |   |   | - |   |   | - |   |   | 88,500 |   |
| Impairment      of intangible assets                                                                                    |   |   | - |   |   | - |   |   | 5,655,011 |   |
| Preferred      shares issued in exchange for services                                                                   |   |   | - |   |   | - |   |   | 1,500,000 |   |
| Options      and warrants issued in exchange for services rendered                                                      |   |   | - |   |   | 43,100 |   |   | 11,001,255 |   |
| Income      attributable to repricing of warrants and debt derivatives                                                  |   |   | (142,131 | ) |   | (14,250,621 | ) |   | (33,687,959 | ) |
| Financing      costs attributable to issuance of warrants                                                               |   |   | - |   |   | 2,271,000 |   |   | 25,419,214 |   |
| Amortization      of beneficial conversion feature-convertible notes                                                    |   |   | 10,093 |   |   | - |   |   | 10,471,093 |   |
| Amortization      of capitalized financing costs                                                                        |   |   | 1,005,975 |   |   | 247,238 |   |   | 1,641,988 |   |
| Amortization      of debt discount attributable to convertible debentures                                               |   |   | 1,580,519 |   |   | 276,090 |   |   | 2,312,009 |   |
| Debt      in exchange for common stock at fair market price                                                             |   |   | - |   |   | - |   |   | 1,365,000 |   |
| Common      stock issued in exchange for services rendered                                                              |   |   | - |   |   | 710,200 |   |   | 31,964,573 |   |
| Common      stock exchanged for intellectual property in connection with costs of      acquiring      intangible assets |   |   | - |   |   | - |   |   | 14,689,100 |   |
| Common      stock issued in connection with penalties pursuant to      registration                                     |   |   | - |   |   | 773,958 |   |   | 1,550,487 |   |
| Common      stock canceled-previously issued for services rendered                                                      |   |   | - |   |   | (480,000 | ) |   | (1,343,845 | ) |
| Change      in assets and liabilities:                                                                                  |   |   |   |   |   |   |   |   |   |   |
| Decrease      (increase) in accounts receivable                                                                         |   |   | 9,631 |   |   | (18,900 | ) |   | - |   |
| Decrease      (increase) in prepaid expenses and deposits                                                               |   |   | (32,208 | ) |   | (145,849 | ) |   | (153,137 | ) |
| Decrease      (increase) in other assets                                                                                |   |   | 8,419 |   |   | 5,940 |   |   | (13,450 | ) |
| Increase      in due related parties                                                                                    |   |   | - |   |   | (52,662 | ) |   | 40,753 |   |
| Increase      (decrease) in accounts payable and accrued liabilities                                                    |   |   | 3,811,641 |   |   | 1,685,792 |   |   | 8,737,251 |   |
| Net      cash used in operating activities                                                                              |   |   | (1,656,973 | ) |   | (2,306,666 | ) |   | (17,276,134 | ) |
|                                                                                                                    |   |   |   |   |   |   |   |   |   |   |
| Cash      flows from investing activities:                                                                              |   |   |   |   |   |   |   |   |   |   |
| Payments      for patent filing                                                                                         |   |   | - |   |   | - |   |   | (25,698 | ) |
| Acquisition      (disposal) of property and equipment, net                                                              |   |   | (11,039 | ) |   | (35,851 | ) |   | (188,360 | ) |
| Net      cash provided by (used in) investing activities                                                                |   |   | (11,039 | ) |   | (35,851 | ) |   | (214,058 | ) |
|                                                                                                                    |   |   |   |   |   |   |   |   |   |   |
| Cash      flows from financing activities:                                                                              |   |   |   |   |   |   |   |   |   |   |
| Proceeds      from sale of common stock, net of cost                                                                    |   |   | - |   |   | - |   |   | 432,000 |   |
| Proceeds      from issuance of convertible notes, net of costs                                                          |   |   | 477,500 |   |   | 4,242,500 |   |   | 13,924,000 |   |
| Proceeds      from sale of options                                                                                      |   |   | - |   |   | - |   |   | 343,750 |   |
| Repayment      of debt                                                                                                  |   |   | - |   |   | - |   |   | (24,854 | ) |
| Proceeds      from loans                                                                                                |   |   | - |   |   | - |   |   | 2,750,000 |   |
| Advances      from shareholders                                                                                         |   |   | - |   |   | - |   |   | 100,088 |   |
| Net      cash provided by financing activities                                                                          |   |   | 477,500 |   |   | 4,242,500 |   |   | 17,524,984 |   |
|                                                                                                                    |   |   |   |   |   |   |   |   |   |   |
| Net      increase in cash and cash equivalents                                                                          |   |   | (1,190,512 | ) |   | 1,899,983 |   |   | 34,792 |   |
| Cash      and cash equivalents at beginning of period                                                                   |   |   | 1,225,304 |   |   | 31,190 |   |   | - |   |
| Cash      and cash equivalents at end of period                                                                         |   | $ | 34,792 |   | $ | 1,931,173 |   | $ | 34,792 |   |

----

| APPLIED DNA SCIENCES,      INC                                                        |   |
|---------------------------------------------------------------------------------------|--------|
| (A DEVELOPMENT STAGE      COMPANY)                                                    |   |
| CONDENSED CONSOLIDATED      STATEMENT OF CASH FLOWS                                   |   |
| (unaudited)                                                                           |   |
|                                                                                  |   |   |   |   |   | For      the Period |   |
|                                                                                  |   |   |   |   |   | September      16, 2002 |   |
|                                                                                  |   |   |   |   |   | (Date      of Inception) |   |
|                                                                                  |   | For      the nine months ended June 30, |   | through |   |
|                                                                                  |   | 2007 |   | 2006 |   | June      30, 2007 |   |
| Supplemental      Disclosures of Cash Flow Information:                               |   |   |   |   |   |   |   |
| Cash      paid during period for interest                                             |   |   | - |   |   | - |   |   | - |   |
| Cash      paid during period for taxes                                                |   |   | - |   |   | - |   |   | - |   |
|                                                                                  |   |   |   |   |   |   |   |   |   |   |
| Non-cash      transactions:                                                           |   |   |   |   |   |   |   |   |   |   |
| Common      stock issued for services                                                 |   |   | - |   |   | 710,200 |   |   | 31,964,573 |   |
| Common      stock issued in exchange for intellectual property                        |   |   | - |   |   | - |   |   |   |   |
| Common      stock issued in exchange for previously incurred debt                     |   |   | 4,361,200 |   |   | - |   |   | 2,313,500 |   |
| Common      stock canceled-previously issued for services rendered                    |   |   | - |   |   | (480,000 | ) |   | (1,343,845 | ) |
| Common      stock issued for ESOP shares                                              |   |   | - |   |   | - |   |   |   |   |
| Common      stock penalty shares issued pursuant to Pending SB-2      registration    |   |   | - |   |   | 773,958 |   |   |   |   |
| Amortization      of beneficial conversion feature                                    |   |   | - |   |   | - |   |   | 10,471,093 |   |
| Preferred      shares in exchange for service at $25 per share in September      2004 |   |   | - |   |   | - |   |   | 1,500,000 |   |
| Fair      value of options and warrants issued to consultants for      services       |   |   | - |   |   | 43,100 |   |   | 11,001,255 |   |
|                                                                                  |   |   |   |   |   |   |   |   |   |   |
| Acquisition:                                                                          |   |   |   |   |   |   |   |   |   |   |
| Common      stock retained                                                            |   |   | - |   |   | - |   |   | 1,015 |   |
| Assets      acquired                                                                  |   |   | - |   |   | - |   |   | (135 | ) |
| Total      consideration paid                                                         |   |   | - |   |   | - |   |   | 880 |   |
| Organizational      expenses-note issued in exchange for shares retired               |   |   |   |   |   |   |   |   | 88,500 |   |
| Common      stock issued in exchange for note payable                                 |   |   |   |   |   |   |   |   | 88,500 |   |
|                                                                                  |   |   |   |   |   |   |   |   |   |   |
| See      the accompanying notes to the consolidated financial      statements         |   |   |   |   |   |   |   |   |   |   |

----

|                          |   |   |    |
|-------------------------------|--------|--------|---------|
| Computer      equipment       |   | $      | 27,404  |   |
| Lab      equipment            |   |   | 54,974  |   |
| Furniture                     |   |   | 105,984 |   |
| Accumulated      depreciation |   |   | (67,497 | ) |
|                          |   |   |    |   |
| Net                           |   | $      | 120,865 |   |

----

----

|                                                                                      |   | Three      Months EndedJune      30, 2007 |       | Three      Months EndedJune      30, 2006 |   | Nine      Months Ended June      30, 2006 |   |
|-------------------------------------------------------------------------------------------|--------|-------------------------------------------|------------|-------------------------------------------|--------|-------------------------------------------|--------|
| Net      income used in computing basic net income per share                              |   | $                                         | 1,807,954  |                                      | $      | 761,087                                   |   | $ | 5,606,849 |   |
| Impact      of assumed assumptions:                                                       |   |                                      |       |                                      |   |                                      |   |   |   |   |
| Fair      value of warrants relating to convertible debt charged to interest      expense |   |                                      | -          |                                      |   | -                                         |   |   | 1,758,900 |   |
| Impact      of equity classified as liability:                                            |   |                                      |       |                                      |   |                                      |   |   |   |   |
| Gain      on warrant liability marked to fair value                                       |   |                                      | (4,431,421 | )                                         |   | (3,493,961                                | )      |   | (14,250,621 | ) |
| Net      loss in computing diluted net loss per share:                                    |   | $                                         | (2,623,467 | )                                         | $      | (2,732,874                                | )      | $ | (6,884,872 | ) |

----

SFAS 159permits entities to choose to measure many financial instruments, and certainother items, at fair value. SFAS 159applies to reporting periods beginning after November 15, 2007. The adoption ofSFAS 159 is not expected to have a material impact on the Company’s financialcondition or results of operations

----

|   | Developed      core technologies         |   | $      | 2,260,900  |   |
|--------|------------------------------------------|--------|--------|------------|--------|
|   | Developed      product technologies      |   |   | 7,170,000  |   |
|   | Total      amortizable intangible assets |   |   | 9,430,900  |   |
|   | Transaction      costs                   |   |   | 14,689,100 |   |
|   | Total      purchase price                |   | $      | 24,120,000 |   |

| Trade      secrets and developed technologies (Weighted average life of 7      years) |   | $      | 9,430,900  |   |
|---------------------------------------------------------------------------------------|--------|--------|------------|--------|
| Patents      (Weighted average life of 5 years)                                       |   |        | 34,257     |   |
| Total      Amortized identifiable intangible assets-Gross carrying value:             |   | $      | 9,465,157  |   |
| Less:                                                                                 |   |   |       |   |
| Accumulated      Amortization                                                         |   |   | (1,980,664 | )      |
| Impairment                                                                            |   |   | (5,655,011 | )      |
| Net:                                                                                  |   | $      | 1,829,482  |   |
| Residual      value:                                                                  |   | $      | 0          |   |

----

|   | 2007                     |   | $      | 277,982   |   |
|--------|--------------------------|--------|--------|-----------|--------|
|   | 2008                     |   |   | 370,642   |   |
|   | 2009                     |   |   | 365,504   |   |
|   | 2010                     |   |   | 363,791   |   |
|   | 2011      and thereafter |   |   | 451,563   |   |
|   | Total                    |   | $      | 1,829,482 |   |

----

|   | 10%      Secured Convertible Notes Payable dated March 8, 2006, net of unamortized      debt discount of $107,710 (see below)                 |   | $      | 1,392,290  |   |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|------------|--------|
|   | 10%      Secured Convertible Notes Payable, related party, dated April 23, 2007,      net of unamortized debt discount of $44,081 (see below) |   |   | 55,919     |   |
|   | 10%      Secured Convertible Notes Payable dated June 27, 2007 (See      below)                                                               |   |   | 100,000    |   |
|   | 10%      Secured Convertible Notes Payable dated June 27, 2007 (See      below)                                                               |   |   | 50,000     |   |
|   | 10%      Secured Convertible Notes Payable, related party, dated June 30, 2007, net      of unamortized debt discount of $102,354 (see below) |   |   | 147,646    |   |
|   |                                                                                                                                          |   |   | 1,745,855  |   |
|   | Less:      current portion                                                                                                                    |   |   | (1,745,855 | )      |
|   |                                                                                                                                          |   | $      | -          |   |

----

----

----

----

----

| ·   | 105,464      warrants entitling the holder to purchase 105,464 shares of the Company’s      common stock at the price of $0.10 per share.  These warrants were      issued in July, 2004 and lapse if unexercised by July, 2009. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | 1,602,500      warrants entitling the holder to purchase 1,602,500 shares of the      Company’s common stock at the price of $0.60 per share.  These      warrants were issued in October, 2003 and lapse if unexercised by October,      2008.   |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

| Exercise      Prices | Number      Outstanding | Warrants      Outstanding      Remaining      Contractual      Life (Years) | Weighted      Average      Exercise      Price | Weighted      Average      Exercisable | Exercisable      Weighted      Average      Exercise Price |
|----------------------|-------------------------|-----------------------------------------------------------------------------|------------------------------------------------|----------------------------------------|------------------------------------------------------------|
| $0.09                | 18,900,000              | 4.17                                                                        | $0.09                                          | 18,900,000                             | $0.09                                                      |
| $0.10                | 105,464                 | 2.01                                                                        | $0.10                                          | 105,464                                | $0.10                                                      |
| $0.20                | 5,000                   | 1.64                                                                        | $0.20                                          | 5,000                                  | $0.20                                                      |
| $0.50                | 17,450,000              | 3.02                                                                        | $0.50                                          | 16,450,000                             | $0.50                                                      |
| $0.55                | 9,000,000               | 1.72                                                                        | $0.55                                          | 9,000,000                              | $0.55                                                      |
| $0.60                | 8,847,000               | 2.63                                                                        | $0.60                                          | 8,847,000                              | $0.60                                                      |
| $0.70                | 950,000                 | 0.84                                                                        | $0.70                                          | 950,000                                | $0.70                                                      |
| $0.75                | 17,727,000              | 3.00                                                                        | $0.75                                          | 17,727,000                             | $0.75                                                      |
|                 | 72,984,464              |                                                                        |                                           | 71,984,464                             |                                                       |

|                                   |   | Number      of Shares |       |   | Weighted      Average Price |   |
|----------------------------------------|--------|-----------------------|------------|--------|----------------------------------|--------|
| Balance,      September 30, 2004       |   |                  | 4,870,253  |   |                             | $      | 0.63 |   |
| Granted                                |   |                  | 32,873,000 |   |                             |   | 0.71 |   |
| Exercised                              |   |                  | (142,500   | )      |                             |   | .0.34 |   |
| Canceled      or expired               |   |                  | (731,289   | )      |                             |   | 0.65 |   |
| Balance,      September 30, 2005       |   |                  | 36,869,464 |   |                             |   | 0.67 |   |
| Granted                                |   |                  | 35,500,000 |   |                             |   | 0.29 |   |
| Exercised                              |   |                  | -          |   |                             |   | - |   |
| Canceled      or expired               |   |                  | -          |   |                             |   | - |   |
| Outstanding      at September 30, 2006 |   |                  | 72,369,464 |   |                             |   | 0.48 |   |
| Granted                                |   |                  | 1,000,000  |   |                             |   | 0.50 |   |
| Exercised                              |   |                  | -          |   |                             |   | - |   |
| Canceled      or expired               |   |                  | (385,000   | )      |                             |   | (0.71 | ) |
| Balance,      June 30, 2007            |   |                  | 72,984,464 |   |                             | $      | 0.48 |   |

----

|   Options      Outstanding |   | Options      Exercisable |   |
|--------------------------------------|--------|--------------------------|--------|
|  ExercisePrices                 |   | Number      Outstanding  |   | Weighted      Average      Remaining      Contractual Life      (Years) |   | Weighted      Average      Exercise      Price |   | Number      Exercisable |   | Weighted      Average      Exercise      Price |   |
|                                 |   |                     |   |   |   |   |   |   |   |   |   |   |
|  $                              | 0.68   |                     |   | 3,660,000 |   |   | 4.25 |   | $ | 0.68 |   |   | 3,660,000 |   | $ | 0.68 |   |
|                                 | 0.09   |                     |   | 2,000,000 |   |   | 4.41 |   |   | 0.09 |   |   | 2,000,000 |   |   | 0.09 |   |
|                                 |   |                     |   | 5,660,000 |   |   |   |   |   |   |   |   | 5,660,000 |   |   | 0.47 |   |

|                                   |   | Number      of Shares |      | Weighted      Average      Exercise Price      Per Share |   |
|----------------------------------------|--------|-----------------------|-----------|----------------------------------------------------------|--------|
|                                   |   |                  |      |                                                     |   |
| Outstanding      at October 1, 2005    |   |                  | 3,660,000 |                                                     | $      | 0.68 |   |
| Granted                                |   |                  | 2,000,000 |                                                     |   | 0.09 |   |
| Exercised                              |   |                  | -         |                                                     |   | - |   |
| Cancelled      or expired              |   |                  | -         |                                                     |   | - |   |
| Outstanding      at September 30, 2006 |   |                  | 5,660,000 |                                                     | $      | 0.47 |   |
| Granted                                |   |                  | -         |                                                     |   | - |   |
| Exercised                              |   |                  | -         |                                                     |   | - |   |
| Canceled      or expired               |   |                  | -         |                                                     |   | - |   |
| Outstanding      at June 30, 2007      |   |                  | 5,660,000 |                                                     | $      | 0.47 |   |

----

----

----

----

----

|                                                |   |   |   |   |   | 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              |   |

----

|   |   | As      PreviouslyReported |   | Adjustment |   | Reference |   | As Restated |   |
|--------|--------|----------------------------|--------|------------|--------|-----------|--------|------------------|--------|

| 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  |   |
|                                                                |   |   |        |   |   |     |   |   |   |   |   |        |   |

|                                                                             |   | As      PreviouslyReported |       | Adjustment |   | Reference |   | As Restated |   |
|----------------------------------------------------------------------------------|--------|----------------------------|------------|------------|--------|-----------|--------|------------------|--------|
|                                                                             |   |                       |       |       |   |      |   |             |   |   |   |   |   |
| Sales                                                                            |   | $                          | 18,900     |       | $      |      |   |             |   |   |   | 18,900 |   |
| Cost      of sales                                                               |   | $                          | 15,639     |       | $      |      |   |             |   |   |   | 15,639 |   |
| Gross      margin                                                                |   | $                          | 3,261      |       | $      |      |   |             |   |   |   | 3,261 |   |
| Selling,      general & administrative                                       |   | $                          | 1,190,967  |       | $      | 390,000   |   |             | b      |   | $ | 1,580,967 |   |
| Research      and development                                                    |   | $                          | -          |       | $      |      |   |             |   |   | $ | - |   |
| Depreciation      and amortization                                               |   | $                          | 336,824    |       | $      |      |   |             |   |   |   | 336,824 |   |
| Total      operating expenses                                                    |   | $                          | 1,527,791  |       | $      | 390,000   |   |             | b      |   | $ | 1,917,791 |   |
| Net      loss from operations                                                    |   | $                          | (1,524,530 | )          | $      | (390,000  | )      |             | b      |   | $ | (1,914,530 | ) |
| Net      gain (loss) in fair value of debt derivative and      warrant liability |   | $                          | 2,337,263  |       | $      | 1,156,698 |   |             | c      |   | $ | 3,493,961 |   |
| Other      income (expense)                                                      |   | $                          | 8,483      |       | $      |      |   |             |   |   |   | 8,483 |   |
| Interest      income (expense)                                                   |   | $                          | (826,827   | )          | $      |      |   |             |   |   |   | (826,827 | ) |
| Net      income (loss)                                                           |   | $                          | (5,611     | )          | $      | 766,698   |   |             | b,c    |   | $ | 761,087 |   |
| Net      income (loss) per share-basic                                           |   | $                          | (0.00      | )          | $      | 0.01      |   |             |   |   | $ | 0.01 |   |
| Net      income (loss) per share-fully diluted                                   |   |                       | NA         |       | $      | 0.01      |   |             |   |   | $ | 0.01 |   |

----

|                                                                            | As Previously |         |         |    |        |   |             |
|---------------------------------------------------------------------------------|--------------------|--------------|--------------|---------|-------------|--------|------------------|
|                                                                            | Reported           |         | Adjustment   |    | Reference   |   | As Restated |
| Sales                                                                           | $             | 18,900  |    | $  |        |   |             | $  | 18,900  |
| Cost      of sales                                                              | $                  | 15,639       |         | $       |        |   |             | $ | 15,639 |
| Gross      margin                                                               | $                  | 3,261        |         | $       |        |   |             | $ | 3,261 |
| Selling,      general & administrative                                      | $                  | 4,955,055    |         | $       | (563,750)   |   | d                | $ | 4,391,305 |
| Research      and development                                                   | $                  | 75,276       |         | $       |        |   |             | 75,276 |
| Depreciation      and amortization                                              | $                  | 1,021,199    |         | $       |        |   |             | $ | 1,021,199 |
| Total      operating expenses                                                   | $                  | 6,051,530    |         | $       | (563,750)   |   | d                | $ | 5,487,780 |
| Net      loss from operations                                                   | $                  | (6,048,269)  |         | $       | 563,750)    |   | d                | $ | (5,484,519) |
| Net      gain (loss) in fair value of debt derivativeand      warrant liability | $                  | 18,606,563   |         | $       | (4,355,942) |   | e                | $ | 14,250,621 |
| Other      income (expense)                                                     | $             | 17,976       |         | $       |        |   |             | $ | 17,976 |
|                                                                            |               |         |         |    | (136,400)   |   | a                |   |   |
|                                                                            |               |         |         |    | (563,750)   |   | d                |   |   |
|                                                                            |               |         |         |    | 6,640,706   |   | e                |   |   |
| Interest      income (expense)                                                  | $                  | (9,117,785)  |         | $       | 5,940,556   |   |             | $ | (3,177,229) |
| Net      income (loss)                                                          | $                  | 3,458,485    |         | $       | 2,148,364   |   |             | $ | 5,606,849 |
| Net      income (loss) per share-basic                                          | $                  | 0.03         |         | 0.02    |        |   | $                | 0.05 |
| Net      income (loss) per share-fully diluted                                  |               | 0.02         |         | 0.01    |        |   | $                | 0.03 |

|                                                                            | As Previously |         |       |   |        |   |
|---------------------------------------------------------------------------------|--------------------|--------------|------------|--------|-------------|--------|
|                                                                            | Reported           |         | Adjustment |   | Reference   |   | As Restated |
| Sales                                                                           | $                  | 18,900       |       | $      |        |   |   | $ | 18,900 |
| Cost      of sales                                                              | $                  | 15,639       |       | $      |        |   |   | $ | 15,639 |
| Gross      margin                                                               | $                  | 3,261        |       | $      |        |   |   | $ | 3,261 |
| Selling,      general & administrative                                      | $                  | 70,072,368   |       | $      | 5,838,514   |   | f | $ | 75,910,882 |
| Research      and development                                                   | $                  | 968,711      |       | $      |        |   |   | 968,711 |
| Depreciation      and amortization                                              | $                  | 1,380,626    |       | $      |        |   |   | $ | 1,380,626 |
| Total      operating expenses                                                   | $                  | 72,421,705   |       | $      | 5,838,514   |   |   | $ | 78,260,219 |
| Net      loss from operations                                                   | $                  | (72,418,444) |       | $      | (5,838,514) |   |   | $ | (78,256,958) |
| Net      gain (loss) in fair value of debt derivativeand      warrant liability | $                  | 35,307,553   |       | $      | (4,355,942) |   | f | $ | 30,951,611 |
| Other      income (expense)                                                     | $                  | 49,318       |       | $      |        |   |   | $ | 49,318 |
| Interest      income (expense)                                                  | $                  | (47,119,730) |       | $      | 10,058,055  |   | f | $ | (37,061,675) |
| Net      income (loss)                                                          | $                  | (84,181,303) |       | $      | (136,401)   |   |   | $ | (84,317,703) |

----

|                                                                           | As Previously |         |       |    |          |   |             |    |
|--------------------------------------------------------------------------------|--------------------|--------------|------------|---------|---------------|--------|------------------|---------|
|                                                                           | Reported           |         | Adjustment |    | Reference     |   | As Restated |
| Cash      flows from operating activities:                                     |               |         |       |    |          |   |             |    |   |
| Net      income (loss)                                                         | $                  | 3,458,485    |       | $       | 2,148,364     |   |             | $       | 5,606,849 |
| Adjustments      to reconcile to net used in operating activities              |               |         |       |    |          |   |             |    |   |
| Depreciation      and amortization                                             | $                  | 1,021,199    |       | $       |          |   |             | $       | 1,021,199 |
| Organization      expenses                                                     | $                  |         |       | $       |          |   |             |    |
| Preferred      shares issued in exchange for services                          | $                  | -            |       | $       |          |   |             | $       | - |
| Warrants      issued to consultants                                            | $                  | 606,850      |       | $       | (563,750)     |   | d                | $       | 43,100 |
| Income      attributable to repricing of warrants and debt      derivatives    | $                  | (10,118,917) |       | $       | (4,131,704)   |   | g                | $  | (14,250,621)  |
| Financing      costs attributable to issuance of warrants                      | $                  |         |       | $       | 2,271,000     |   | h                | $       | 2,271,000 |
| Amortization      of beneficial conversion feature –convertible notes    | $                  | -            |       | $       |          |   |             | $       | - |
| Amortization      of capitalized finance costs                                 | $                  | 247,238      |       | $       |          |   |             | $       | 247,238 |
| Amortization      of debt discount attributable to convertible debenture  | $             | -       |       | $  | 276,090  |   | i                | $       | 276,090 |
| Fair      value of common stock issued to related party in excess of      debt | $                  | -            |       | $       |          |   |             | $       | - |
| Common      stock issued in exchange for services                              | $                  | 710,200      |       | $       |          |   |             | $       | 710,200 |
| Common      stock issued in exchange for intellectual property                 | $                  | -            |       | $       |          |   |             | $       | - |
| Common      stock issued as penalty in connection with financing               | $                  | 773,958      |       | $       |          |   |             | $       | 773,958 |
| Common      stock canceled-previously issued for services rendered             | $                  | (480,000)    |       | $       |          |   |             | $       | (480,000) |
| Change      in assets and liabilities:                                         |               |         |       |    |          |   |             |    |   |
| Increase      in accounts receivable                                           | $                  | (18,900)     |       | $       |          |   |             | $       | (18,900) |

----

|   | As Previously |   |       |   |      |   |             |   |
|--------|--------------------|--------|------------|--------|-----------|--------|------------------|--------|
|   | Reported           |   | Adjustment |   | Reference |   | As Restated |
|   |               |   |       |   |      |   |             |   |   |

| Increase      in prepaid expenses and deposits                       | $      | (145,849)   |   | $      |   |   |   | $      | (145,849)   |
|----------------------------------------------------------------------|--------|-------------|--------|--------|--------|--------|--------|--------|-------------|
| Decrease      in other assets                                        | $      | 5,940       |   | $      |   |   |   | $      | 5,940       |
| Decrease in due      related parties                                 | $      | (52,662)    |   | $      |   |   |   | $      | (52,662)    |
| Increase      (decrease) in accounts payable and accrued liabilities | $      | 1,685,792   |   | $      |   |   |   | $      | 1,685,792   |
| Net      cash used in operating activities                           | $      | (2,306,666) |   | $      |   |   |   | $      | (2,306,666) |
| Cash      flows from investing activities:                           |   |        |   |   |   |   |   |   |        |
| Payments      for patent filing                                      | $      | -           |   |   |   |   |   |   |        |
| Capital      expenditures                                            | $      | (35,851)    |   | $      |   |   |   | $      | (35,851)    |
| Net      cash used in investing activities                           | $      | (35,851)    |   | $      |   |   |   | $      | (35,851)    |
| Cash      flows from financing activities                            |   |        |   |   |   |   |   |   |        |
| Proceeds      from sales of common stock, net                        | $      | -           |   | $      |   |   |   | $      |        |
| Proceeds from      issuance of convertible notes                     | $      | 4,242,500   |   | $      |   |   |   | $      | 4,242,500   |
| Proceeds      from exercise of options and warrants                  | $      | -           |   | $      |   |   |   | $      | -           |
| Payment      of debt                                                 | $      | -           |   | $      |   |   |   | $      | -           |
| Proceeds      from loans                                             | $      | -           |   | $      |   |   |   | $      | -           |
| Advances      from shareholders                                      | $      | -           |   | $      |   |   |   | $      | -           |
| Net      cash provided by financing activities                       | $      | 4,242,500   |   | $      |   |   |   | $      | 4,242,500   |
| Net      increase in cash and cash equivalents                       | $      | 1,899,983   |   | $      |   |   |   | $      | 1,899,983   |
| Cash      and cash equivalents at beginning of period                | $      | 31,190      |   | $      |   |   |   | $      | 31,190      |
| Cash      and cash equivalents at end of period                      | $      | 1,931,173   |   | $      |   |   |   | $      | 1,931,173   |

----

|                                                                           |    | As Previously |   |    |          |   |      |    |               |
|--------------------------------------------------------------------------------|---------|--------------------|--------|---------|---------------|--------|-----------|---------|--------------------|
|                                                                           |    | Reported           |   |    | Adjustment    |   | Reference |    | As Restated   |
| Cash      flows from operating activities:                                     |    |               |   |    |          |   |      |    |               |
| Net      income (loss)                                                         | $       | (84,181,303)       |   | $       | (136,400)     |   | a         | $  | (84,317,703)  |
| Adjustments      to reconcile to net used in operating activities              |    |               |   |    |          |   |      |    |               |
| Depreciation      and amortization                                             | $       | 1,374,467          |   | $       | (5,756)       |   | j         | $       | 1,368,711          |
| Organization      expenses                                                     | $       | 88,500             |   | $       |          |   |      | 88,500  |
| Preferred      shares issued in exchange for services                          | $       | 1,500,000          |   | $       |          |   |      | $       | 1,500,000          |
| Warrants      issued to consultants                                            | $       | 3,583,016          |   | $       | 5,838,514     |   | f         | $       | 9,421,530          |
| Income      attributable to repricing of warrants and debt      derivatives    | $       | (26,819,908)       |   | $       | (4,131,703)   |   | g         | $       | (30,951,611)       |
| Financing      costs attributable to issuance of warrants                      | $       | 27,265,174         |   | $       | (1,846,500)   |   | k         | $       | 25,418,674         |
| Amortization      of beneficial conversion feature –convertible notes    | $       | 10,461,000         |   | $       |          |   |      | $       | 10,461,000         |
| Amortization      of capitalized finance costs                                 | $       | 247,238            |   | $       |          |   |      | $       | 247,238            |
| Amortization      of debt discount attributable to convertible debenture  | $  | -             |   | $  | 276,090  |   | i         | $       | 276,090            |
| Fair      value of common stock issued to related party in excess of      debt | $       | 1,365,000          |   | $       |          |   |      | $       | 1,365,000          |
| Common      stock issued in exchange for services                              | $       | 31,284,573         |   | $       |          |   |      | $       | 31,284,573         |
| Common      stock issued in exchange for intellectual property                 | $       | 14,689,100         |   | $       |          |   |      | $       | 14,689,100         |
| Common      stock issued as penalty in connection with financing               | $       | 1,550,487          |   | $       |          |   |      | $       | 1,550,487          |
| Common      stock canceled-previously issued for services rendered             | $       | (1,343,845)        |   | $       |          |   |      | $       | (1,343,845)        |
| Change      in assets and liabilities:                                         |    |               |   |    |          |   |      |    |               |
| Increase      in accounts receivable                                           | $       | (18,900)           |   | $       |          |   |      | $       | (18,900)           |

----

|   |   | As Previously |   |   |       |   |      |   |             |
|--------|--------|--------------------|--------|--------|------------|--------|-----------|--------|------------------|
|   |   | Reported           |   |   | Adjustment |   | Reference |   | As Restated |

| Increase      in prepaid expenses and deposits                       | $      | (163,472)    |   | $      |   |   |   | $      | (163,472)    |
|----------------------------------------------------------------------|--------|--------------|--------|--------|--------|--------|--------|--------|--------------|
| Decrease      in other assets                                        | $      | (3,128)      |   | $      |   |   |   | $      | (3,128)      |
| Decease      in due related parties                                  | $      | -            |   | $      |   |   |   | $      | -            |
| Increase      (decrease) in accounts payable and accrued liabilities | $      | 4,079,990    |   | $      | 5,755  |   | j      | $      | 4,085,745    |
| Net      cash used in operating activities                           | $      | (15,042,011) |   | $      |   |   |   | $      | (15,042,011) |
| Cash      flows from investing activities:                           |   |         |   |   |   |   |   |   |         |
| Payments      for patent filing                                      | $      | (25,698)     |   | $      |   |   |   | $      | (25,698)     |
| Capital      expenditures                                            | $      | (48,602)     |   | $      |   |   |   | $      | (48,602)     |
| Net      cash used in investing activities                           | $      | (74,300)     |   | $      |   |   |   | $      | (74,300)     |
| Cash      flows from financing activities                            |   |         |   |   |   |   |   |   |         |
| Proceeds      from sales of common stock, net                        | $      | 432,000      |   | $      |   |   |   | $      | 432,000      |
| Proceeds      form issuance of convertible notes                     | $      | 13,446,500   |   | $      |   |   |   |   | 13,446,500   |
| Proceeds      from exercise of options and warrants                  | $      | 343,750      |   | $      |   |   |   | $      | 343,750      |
| Payment      of debt                                                 | $      | (24,854)     |   | $      |   |   |   | $      | (24,854)     |
| Proceeds      from loans                                             | $      | 2,750,000    |   | $      |   |   |   | $      | 2,750,000    |
| Advances      from shareholders                                      | $      | 100,088      |   | $      |   |   |   | $      | 100,088      |
| Net      cash provided by financing activities                       | $      | 17,047,484   |   | $      |   |   |   | $      | 17,047,484   |
| Net      increase in cash and cash equivalents                       | $      | 1,931,173    |   | $      |   |   |   | $      | 1,931,173    |
| Cash      and cash equivalents at beginning of period                | $      | -            |   | $      |   |   |   | $      | -            |
| Cash      and cash equivalents at end of period                      | $      | 1,931,173    |   | $      |   |   |   | $      | 1,931,173    |

----

| a.   | During its review      of the issuance and valuation of equity instruments during the nine month      period ended June 30, 2006, the Company determined that certain warrants      to acquire the Company’s common stock, which were issued to non-employees      in connection with the Company’s financing activities, were not valued in      accordance with SFAS No. 123R.  The Company’s policy is to      charge the fair value of equity instruments such as preferred and common      stock, warrants and options, related to financing activities to interest      expense in the period the cost is incurred. The fair value of equity      instruments issued in connection with providing services to the Company by      non-employees is charged to general and administrative expenses in the      period the cost is incurred. The Company corrected the valuation of these      warrants as a net charge to interest expense and a credit to additional      paid in capital in the amount of $136,400. |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b.   | During its review      of the accounting for the issuance and valuation of the March 2006 debt      instruments, the Company determined that debt issuance costs of $390,000      were charged in error to operations as general and      administrative  expense during the three months ended March 31,      2006  instead of capitalized and amortized over the term of the      debt. The Company amended and restated its March 31, 2006 SEC Form 10-QSB      to correct the error in accounting. In connection with the review of the      accounting for the transaction and correction of the error, the Company      determined that during the three month period ended June 30, 2006, the      Company had reduced general and administrative expenses a further $390,000      in error.  The Company carried forward the error from March 31,      2006 to the June 30, 2006 10-QSB as originally filed, incorrectly reducing      the amounts recorded to selling general and administrative expenses for      the three month period ended June      2006  by  $390,000.  The Company amended the      March 2006 10-QSB to restate and correct the accounting for the cost      relating to the issuance of these debt instruments from selling, general      and administrative expenses to capitalized debt issuance costs. The      correction is intended to reflect the adjustment to capitalize financing      costs in the proper reporting period.  The net effect of this      adjustment on the three month period ended June 30, 2006 is to increase      operating expenses by $390,000.  The adjustment as a result of      the correction of the error has no net effect on operating expenses during      the nine month period ended June 30, 2006 and the period from September      16, 2002 (date of inception) to June 30, 2006. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| c.   | During the      Company’s review of the outstanding warrants and options to acquire the      Company’s common stock, the Company determined that the warrants must be      settled by the delivery of registered shares and the delivery of the      registered shares which event is not controlled by the      Company.  Therefore, management re-evaluated its accounting for      the warrants under the guidelines of SFAS No. 133 and EITF Issue No.      00-19, and concluded that the embedded conversion option did not meet the      SFAS No. 133 paragraph 11(a) scope exception. Accordingly, the Company      determined that the warrants should be reclassified as derivative      liabilities (see Note C).  In addition to incorrectly accounting      for the warrants as equity instruments, the Company determined that as of      March 31, 2006, the derivatives were valued in error and recorded an      increase in the warrant valuation with its amended March 31, 2006 10-QSB.      Although the fair value of related warrants were properly reflected in the      initial June 30, 2006 10-QSB, the change from the prior reporting period      due to the amended March 31, 2006 10-QSB resulted in an increase in      income  for the three months ended June 30, 2006  The      warrants were initially valued at $933,117.  The correct      valuation is $2,089,814, an increase of $1,156,698. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d.   | During its review      of the issuance and valuation of equity instruments, the Company      determined that $563,750, the cost related to the issuance of certain      warrants to acquire the Company’s common stock, which were issued during      the nine month period ended June 30, 2006 to non-employees in connection      with the Company’s financing activities, was recorded in error as selling,      general and administrative expenses instead of interest expense. Based      upon the Company’s policy of classifying the fair value of equity      instruments issued in connection with financing activities as interest      expense, the Company corrected the error by reclassifying the amount of      $563,750 to interest expense. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| e.   | During its review      of the issuance and valuation of equity instruments, the Company      determined that certain warrants to acquire the Company’s common stock,      which were issued to non-employees during the year ended September 30,      2005 in connection with the Company’s financing activities, were      erroneously recorded as having been issued during the nine month period      ended June 30, 2006. These transactions were recorded initially in error      as a charge to interest expense (initial valuation) of $6,640,706 and a      gain from mark to market change from the initial valuation of $4,355,942;      net $2,284,764 charge to operations.  In conjunction with the      September 30, 2005 amended 10-KSB, these errors were properly corrected to      reflect in the accounting period the issuance of the related warrants      recording the initial valuation (interest expense)  and      subsequent mark to market change. The amended June 30, 2006 10-QSB      reverses the initial erroneous recording.  The effect of the      error was an overstatement of $4,355,942 in the net gain in the fair value      of the debt derivative and warrant liability and an overstatement of      $6,640,706 in the net interest expense in the original filing, resulting      in a net increase of $2,284,764 in income for the nine months ended June      30, 2006.  This amount of $2,284,764 is comprised of the      corrections of errors in the recording and valuation of the following      warrants: |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                                         |   | Original      amount |     |   | Revised      Amount |   |      | Increase/(decrease) |   |
|--------------------------------------------------------------------------------------------------------------|--------|----------------------|----------|--------|---------------------|--------|-----------|---------------------|--------|
| Warrants issued      in December 2004                                                                        |   | $                    | 394,698  |   |                | $      | 3,169,052 |                |   | $ | 2,774,354 |   |
| Warrants issued      in February 2005                                                                        |   |                 | -        |   |                |   | 72,017    |                |   |   | 72,017 |   |
| Warrants issued      in June 2005 (Company determined warrants were not properly authorized and      issued) |   |                 | 849,047  |   |                |   | -         |                |   |   | (849,047 | ) |
| Warrants      previously cancelled, later determined issued                                                  |   |                 | (287,440 | )      |                |   | -         |                |   |   | 287,440 |   |
|                                                                                                         |   | $                    | 956,305  |   |                | $      | 3,241,069 |                |   | $ | 2,284,764 |   |

| f.   | During its review      of the issuance and valuation of equity instruments, the Company      determined that $5,838,514, the fair value of certain warrants to acquire      the Company’s common stock that were issued to non-employees during the      period from September 16, 2002 (date of inception) through September 30,      2005 in connection with payment for services rendered to the Company, was      erroneously recorded as interest expenses instead of selling, general and      administrative expenses. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Below is a summary      of the changes to the various line items for the period from September 16,      2002 (date of inception) through June 30, 2006: |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                      |   | Selling, general      and administrative |       |   | Gain/Loss in fair      value of warrant liability and debt derivative |   |       | Interest      expense |   |
|-------------------------------------------------------------------------------------------|--------|------------------------------------------|------------|--------|-----------------------------------------------------------------------|--------|------------|-----------------------|--------|
| Originally      reported:                                                                 |   | $                                        | 70,072,368 |   |                                                                  | $      | 35,307,553 |                  |   | $ | 47,119,730 |   |
| Reclassification      on fair value of warrants issued for services rendered (above)      |   |                                     | 5,838,514  |   |                                                                  |   | -          |                  |   |   | (5,838,514 | ) |
| Adjustment to      fair value of warrants issued in previous year (see e above)           |   |                                     |       |   |                                                                  |   | (4,355,942 | )                     |   |   | (4,355,942 | ) |
| Fair value of      unrecorded warrants issued in conjunction with financing (see a above) |   |                                     |       |   |                                                                  |   |       |                  |   |   | 136,401 |   |
| Amended      reported                                                                     |   | $                                        | 75,910,882 |   |                                                                  | $      | 30,951,611 |                  |   | $ | 37,061,675 |   |

----

| g.   | During its review of      the issuance and valuation of equity instruments, the Company reclassified      the amortization of debt discount attributable to the issuance of      $4,131,704 of convertible debt separately from the income attributable to      repricing of warrants and debt derivatives, as set forth below: |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Reclassification of      initial warrant valuations relating to financing from interest to separate      line item in cash flow statement as described in (h) below: |   | $      | 2,271,000 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|
| Change in non      warrant valuations as described in (e) above:                                                                                                     |   |   | 2,284,764 |   |
| Reclassification on      non financing warrants to selling, general and administrative as described      in (d) above                                                |   |   | (563,750  | )      |
| Reclassification of      warrants as described in (a) above                                                                                                          |   |   | (136,400  | )      |
| Reclassification of      amortization of debt discount to separate cash flow line item as described      in (i) below                                                |   |   | 276,090   |   |
| Total:                                                                                                                                                               |   | $      | 4,131,704 |   |

| h.   | During its review of      the issuance and valuation of equity instruments, the Company separately      reclassified from income attributable to repricing of warrants and debt      derivatives, the value of warrants issued in connection with the issuance      of debt having a fair value of $2,271,000. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| i.   | During its review of      the issuance and valuation of equity instruments, the Company reclassified      the amortization of debt discount attributable to the issuance of      convertible debt of $276,090 separately from income attributable to      repricing of warrants and debt derivatives. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| j.   | During its review of      capital expenditures and related depreciation and amortization, the      Company corrected a classification error of $5,756 between the      depreciation and amortization expenses line item and accounts payable      within the cash used in operating expenses. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| k.   | During its review of      the issuance and valuation of equity instruments, the Company determined      that $1,846,500, the fair value of certain warrants to acquire the      Company’s common stock issued to non-employees in connection with payment      for services rendered to the Company, was charged in error to interest      expense instead of selling, general and administrative expenses. This      adjustment is in conjunction with (a), (f) and (g) above. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | discuss      our future expectations; |
|--------------------|---------------------------------------|

| ·   | contain      projections of our future results of operations or of our financial      condition; and |
|--------------------|------------------------------------------------------------------------------------------------------|

| ·   | state      other “forward-looking”information. |
|--------------------|------------------------------------------------------------|

| ·   | assure      manufacturers, suppliers, distributors, retailers and end-users that their      products are authentic and can be forensically    authenticated; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | integrate      our SigNature DNA Markers with existing security solutions such as      barcodes, radio frequency identification (RFID) tags, holograms,      microchips and other securities measures;and |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | add      value to the “bottom-line” by helping to diminish product diversion and      counterfeiting. |
|--------------------|-------------------------------------------------------------------------------------------------------------------|

| ·   | continuing      to improve and customize our solution to meet our potential customers’      needs; |
|--------------------|----------------------------------------------------------------------------------------------------------|

| ·   | continuing      to develop and enhance our existing DNA marker authentication      technologies; |
|--------------------|--------------------------------------------------------------------------------------------------|

----

| ·   | expanding      our customer base both domestically and abroad by targeting high volume      markets; and |
|--------------------|----------------------------------------------------------------------------------------------------------|

| ·   | augmenting      our competitive position through strategic acquisitions and      alliances. |
|--------------------|---------------------------------------------------------------------------------------------|

----

| ·   | Equity      issued with registration rights |
|--------------------|---------------------------------------------|

| ·   | Warrant      liability |
|--------------------|------------------------|

| ·   | Fair      value of intangible assets |
|--------------------|--------------------------------------|

----

----

| Trade      secrets and developed technologies (Weighted average life of 7      years) |   | $      | 9,430,900  |   |
|---------------------------------------------------------------------------------------|--------|--------|------------|--------|
| Patents      (Weighted average life of 5 years)                                       |   |   | 34,257     |   |
| Total      Amortized identifiable intangible assets-Gross carrying value:             |   | $      | 9,465,157  |   |
| Less:                                                                                 |   |   |       |   |
| Accumulated      Amortization                                                         |   |   | (1,980,664 | )      |
| Impairment                                                                            |   |   | (5,655,011 | )      |
| Net:                                                                                  |   | $      | 1,829,482  |   |
| Residual      value:                                                                  |   | $      | 0          |   |

| 2007                     |   | $      | 277,982   |   |
|--------------------------|--------|--------|-----------|--------|
| 2008                     |   |   | 370,642   |   |
| 2009                     |   |   | 365,504   |   |
| 2010                     |   |   | 363,791   |   |
| 2011      and thereafter |   |   | 451,563   |   |
| Total                    |   | $      | 1,829,482 |   |

----

----

----

----

----

----

----

----

----

| ·   | availability,      quality and price relative to competitive solutions; |
|--------------------|-------------------------------------------------------------------------|

| ·   | customers’      opinions of the solutions’ utility; |
|--------------------|-----------------------------------------------------------------|

| ·   | ease      of use; |
|--------------------|-------------------|

| ·   | consistency      with prior practices; |
|--------------------|----------------------------------------|

| ·   | scientists’      opinions of the solutions’usefulness; |
|--------------------|--------------------------------------------------------------------|

| ·   | citation      of the solutions in published research;and |
|--------------------|----------------------------------------------------------|

| ·   | general      trends in anti-counterfeit and security solutions’ research. |
|--------------------|---------------------------------------------------------------------------------|

----

| ·   | product      performance, features and liability; |
|--------------------|---------------------------------------------------|

| ·   | price; |
|--------------------|--------|

| ·   | timing      of product introductions; |
|--------------------|---------------------------------------|

| ·   | ability      to develop, maintain and protect proprietary products and technologies; |
|--------------------|--------------------------------------------------------------------------------------|

| ·   | sales      and distribution capabilities; |
|--------------------|-------------------------------------------|

| ·   | technical      support and service; |
|--------------------|-------------------------------------|

| ·   | brand      loyalty; |
|--------------------|---------------------|

| ·   | applications      support; and |
|--------------------|--------------------------------|

| ·   | breadth      of product line. |
|--------------------|-------------------------------|

----

| ·   | operations      and financial systems; |
|--------------------|----------------------------------------|

| ·   | procedures      and controls; and |
|--------------------|-----------------------------------|

| ·   | training      and management of our employees. |
|--------------------|------------------------------------------------|

| ·   | difficulties      in staffing, managing and integrating international operations due to      language, cultural or otherdifferences; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------|

| ·   | different      or conflicting regulatory or legalrequirements; |
|--------------------|----------------------------------------------------------------|

| ·   | foreign      currency fluctuations; and |
|--------------------|-----------------------------------------|

| ·   | diversion      of significant time and attention of our  management. |
|--------------------|----------------------------------------------------------------------|

----

----

----

----

| ·   | that      a broker or dealer approve a person’s account for transactions in penny      stocks; and |
|--------------------|----------------------------------------------------------------------------------------------------------|

| ·   | the      broker or dealer receive from the investor a written agreement to the      transaction, setting forth the identity and quantity of the penny stock to      be purchased. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | obtain      financial information and investment experience objectives of the person;      and |
|--------------------|------------------------------------------------------------------------------------------------|

| ·   | make      a reasonable determination that the transactions in penny stocks are      suitable for that person and the person has sufficient knowledge and      experience in financial matters to be capable of evaluating the risks of      transactions in penny stocks. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | sets      forth the basis on which the broker or dealer made the suitability      determination; and |
|--------------------|------------------------------------------------------------------------------------------------------|

| ·   | that      the broker or dealer received a signed, written agreement from the      investor prior to the transaction. |
|--------------------|----------------------------------------------------------------------------------------------------------------------|

| ·   | accounting      for and disclosing the fair value of warrants and options to acquire our      common stock issued to non-employees as a current period      expense; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | accounting      for and disclosing the fair value of shares issued to a former Director in      exchange for previously incurreddebt; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------|

| ·   | accounting      for and disclosing the fair value of warrants issued to note holders and      consultants having registration rights;and |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | accounting      for and disclosing the revaluation for warrant liabilities as of each      reporting period. |
|--------------------|--------------------------------------------------------------------------------------------------------------|

----

| ·   | We      reviewed all convertible securities to identify any securities that may      have embedded beneficial conversion features or derivatives;      and |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | We      have improved the supervision and training of our accounting staff to      understand and implement applicable accounting requirements, policies and      procedures applicable to the accounting and disclosure of convertible      securities and derivatives. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

|                                                                    |                   |                   |                |
|-------------------------------------------------------------------------|------------------------|------------------------|---------------------|
| MATTER                                                             | FOR               | AGAINST/WITHHELD  | ABSTAINED      |
|  (1)      Election of Directors:                              |                   |                   |                |
|  James      A. Hayward                                        |  68,129,155  |  145,708     |                |
|  Yacov      Shamash                                           |  68,129,023  |  145,840     |                |
|  Jun-Jei      Sheu                                            |  66,493,485  |  1,781,378   |                |
|  Sanford      R. Simon                                        |  67,799,163  |  475,700     |                |
|  (2)      Ratification of Auditors                            |  67,895,259  |  249,050     |  130,554  |
|  (3)      Ratification and Approval of the Charter Amendment  |  64,915,372  |  3,326,883   |  32,607   |
|  (4)      Ratification and Approval of the Charter Amendment  |  44,010,949  |  2,904,837   |  127,756  |

| 3(i)1 | Articles      of Incorporation of Applied DNA Sciences, Inc. as amended, filed      herewith. |
|-------|-----------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|
| 3(i)2 | Certificate      of Designation , Powers, Preferences and Rights of the Founders' Series of      Convertible Preferred Stock, filedherewith.  |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1 | Joint      Development and Marketing Agreement, dated April 18, 2007 by and between      Applied DNA Sciences and International Imaging Materials, Inc. filed as an      exhibit to the current report on Form 8-K filed with the SEC on April 24,      2007 and incorporated herein byreference. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2 | Technology      Reseller Agreement, dated May 30, 2007 by and between Applied DNA Sciences      and Printcolor Screen Ltd. filed as an exhibit to the current report on      Form 8-K filed with the SEC on June 1, 2007 and incorporated herein by      reference. |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.3 | Feasibility      Study Agreement, dated June 27, 2007 by and between Applied DNA Sciences      and Supima filed as an exhibit to the current report on Form 8-K filed      with the SEC on July 3, 2007 and incorporated herein by      reference. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.1 | Certification      of Chief Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a),      promulgated under the Securities and Exchange Act of 1934, as      amended. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 31.2 | Certification      of Chief Financial Officer pursuant to Rule 13a-14 and Rule 15d 14(a),      promulgated under the Securities and Exchange Act of 1934, as      amended. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.1 | Certification      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of      the Sarbanes-Oxley Act of 2002 (Chief Executive  Officer). |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.2 | Certification      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of      the Sarbanes-Oxley Act of 2002 (Chief Financial  Officer). |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Date: February 29,      2008 | By: /s/ JAMES A.      HAYWARD                              |
|------------------------------|------------------------------------------------------------|
|                         | James A. Hayward                                           |
|                         | Chief      Executive Officer (Principal Executive Officer) |