Edgar Filing: iDNA, Inc.

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

(MARK ONE)

[X] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934

For the fiscal year ended January 31, 2007

[_] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934

For the Transition Period from ______ to ______

Commission file number 1-11601

iDNA, INC.
(Exact name of registrant as specified in its charter)

Delaware 34-1816760
(State of incorporation) (I.R.S. Employer Identification No.)

415 Madison Avenue, 7th Floor, New York New York 10017
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (212) 644-1400

Securities registered pursuant to Section 12(b) of the Act:
Title of class
NONE

Securities registered pursuant to Section 12(g) of the Act:

Title of each class
COMMON STOCK, PAR VALUE $.05 PER SHARE

Indicate by check mark if the registrant is a well known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [_] No [X]

Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act. Yes [_] No [X]

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 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 90 days. Yes [X] No [_]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [_]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and "large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large accelerated filer [_] Accelerated filer [_] Non-accelerated filer [X]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act) Yes [_] No [X]

Aggregate market value of the registrant's Common Stock held by non-affiliates
at July 31, 2006, was approximately $3,274,988 (Based on the closing price of
the registrant's Common Stock as quoted on the OTC Bulletin Board on July 29,
2006).

As of May 11, 2007, 9,954,614 shares of Common Stock of iDNA, Inc. were
outstanding.

DOCUMENTS INCORPORATED BY REFERENCE
None

TABLE OF CONTENTS

Page
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Part I

Item 1. Business.................................................. 1
1A. Risk Factors.............................................. 4
1B. Unresolved Staff Comments................................. 9
2. Properties................................................ 9
3. Legal Proceedings......................................... 9
4. Submission of Matters to a Vote of Security Holders....... 10

Part II

Item 5. Market for Registrant's Common Equity, Related
Stockholder Matters and Issuer Purchases of Equity
Securities............................................. 11
6. Selected Financial Data................................... 15
7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.................... 17
7A. Quantitative and Qualitative Disclosures About Market
Risk................................................... 36
8. Financial Statements and Supplementary Data............... 37
9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.................... 86
9A. Controls and Procedures................................... 86
9B. Other Information......................................... 86

Part III

Item 10. Directors, Executive Officers and Corporate Governance.... 86
11. Executive Compensation.................................... 89
12. Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters............. 100
13. Certain Relationships and Related Transactions, and
Director Independence.................................. 102
14. Principal Accounting Fees and Services................... 103

Part IV

Item 15. Exhibits and Financial Statement Schedules................ 105

PART I

Some of the information in this Annual Report on Form 10-K (including the
section regarding Management's Discussion and Analysis of Financial Condition
and Results of Operation) contains forward looking statements within the meaning
of the federal securities laws that relate to future events or our future
financial performance and involve known and unknown risks, uncertainties and
other factors that may cause us or our industry's actual results, levels of
activity, performance or achievements to be materially different from any future
results, levels of activity, performance or achievements expressed or implied by
the forward-looking statements. You should not rely on forward-looking
statements in this report. Forward-looking statements typically are identified
by use of terms such as "anticipate", "believe", "plan", "expect", "intend",
"may", "will", "should", "estimate", "predict", "potential", "continue" and
similar words although some forward-looking statements are expressed
differently. This report may contain forward-looking statements attributed to
third parties relating to their estimates regarding the growth of our markets.
All forward-looking statements address matters that involve risk and
uncertainties, and there are many important risks, uncertainties and other
factors that could cause our actual results, as well as those of the markets we
serve, levels of activity, performance, achievements and prospects to differ
materially from the forward-looking statements contained in this report. You
should also consider carefully the statements under other sections of this
report which address additional facts that could cause our actual results to
differ from those set forth in any forward-looking statements. We undertake no
obligation to publicly update or review any forward-looking statements, whether
as a result of new information, future developments or otherwise.

iDNA, Inc. ("iDNA") files reports with the Securities and Exchange
Commission ("SEC"). iDNA makes available on its website (www.idnausa.com) free
of charge its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q,
Current Reports on Form 8-K and amendments to those reports as soon as
reasonably practical after iDNA electronically files such materials with or
furnishes them to the SEC. Information appearing on iDNA's website is not part
of this Annual Report on Form 10-K. You can also read and copy any materials
iDNA files with the SEC at its Public Reference Room at 100 F Street, NE,
Washington DC 20549. You can obtain additional information about the operation
of the Public Reference Room by calling the SEC at 1-800-SEC-0330. In addition,
the SEC maintains an Internet site (www.sec.gov) that contains reports, proxy
and information statements regarding issuers that file electronically with the
SEC, including iDNA.

ITEM 1. BUSINESS.

GENERAL DEVELOPMENT OF BUSINESS

iDNA, Inc. ("the Company" or "iDNA"), began operations in 1969 and was
incorporated in Delaware in 1971. As a consequence of iDNA's consummation of a
series of acquisitions during the past four years, management has determined
during the fourth quarter of Fiscal 2007, iDNA's operations are now comprised of
three principal reportable segments: (i) strategic communications services, (ii)
information services and (iii) entertainment. iDNA manages each segment
separately as a consequence of different marketing, service requirements and
technology strategies.

The strategic communications services segment provides content development
via the design, development and production of media, collateral material,
logistics, support and/or broadcast services for presentations at corporate and
institutional events, meetings, training seminars and symposiums. The
presentations may be live at single or multi-site venues and can include video
conferencing, satellite

broadcasting and webcasting or the presentations may be provided via on-demand
access via internet websites, DVD or video tape.

The information services segment utilizes custom wireless communication
technology and proprietary software to facilitate client audience interaction,
participation and polling to collect, exchange and/or analyze data and
information in real-time during a meeting or event. The wireless communication
services are available as a turn-key service provided by iDNA during a scheduled
meeting or event or alternatively, a client can purchase from iDNA the required
electronic components and related proprietary software to administer its needs
independently.

As of consequence of iDNA's investment in the Angelika Film Centers, LLC
("AFC"), iDNA operates in the movie exhibition and entertainment industry.

Prior to Fiscal 2003, iDNA was engaged in the sub-prime used automobile
finance business. At that time, iDNA, then known as National Auto Credit, Inc.
("NAC"), invested in sub-prime used automobile consumer loans, which took the
form of installment loans collateralized by the related vehicle. NAC purchased
such loans, or interests in pools of such loans, from member dealerships, and
performed the related underwriting and collection functions. NAC formally
discontinued its automobile finance business effective December 31, 2001 (see
Note 17 to Notes to Consolidated Financial Statements).

iDNA continues to examine new business opportunities, which may be pursued
through the investment in or acquisition of existing corporate operating
businesses or other means. iDNA will also continue to pursue reductions and/or
synergies in its operating expenses and new debt or equity financing (although
there can be no assurance that iDNA will obtain such financing or that such
financing can be obtained on commercially reasonable terms) as means of
supplementing iDNA's resources available to pursue new acquisitions, joint
ventures or other business development opportunities. At January 31, 2007, iDNA
had cash and cash equivalents of $548,000 which together with any cash flow
derived from it investment in AFC and iDNA's operations may be used to pursue
such opportunities.

iDNA uses a January 31 year-end for financial reporting purposes.
References herein to the fiscal year ended January 31, 2007 shall be the term
"Fiscal 2007" and references to other "Fiscal" years shall mean the year, which
ended on January 31 of the year indicated. The terms the "Company" or "iDNA" as
used herein also refer, where appropriate, to NAC, the predecessor of the
Company, together with its subsidiaries unless the context otherwise requires.

iDNA's principal executive offices are located at 415 Madison Avenue, 7th
Floor, New York, New York, 10017. Its telephone number is 212-644-1400.

CORPORATE COMMUNICATION BUSINESS

Strategic Communication Services

iDNA, through its wholly-owned subsidiaries Campus Group Companies, Inc.
("CGC"), iDNA Healthcare and OMI Business Communications, Inc. ("OMI"), engages
in a broad range of strategic content development, management and broadcast
services to single and multiple site corporate and institutional events,
meetings and symposiums.

iDNA serves Fortune 100 pharmaceutical and financial services organizations
as well as other companies, institutions and industries seeking to develop
communication and education content for periodic

meetings, events and symposiums. Through a collaborative effort between iDNA and
its clients, relevant education, product information, regulatory requirements or
other communication initiatives are developed and executed. Frequently, these
services result in the development of corporate communication, education and/or
training videos which are then broadcast at a single site or simulcast via
satellite/internet to multiple sites both domestic and international.
Furthermore, once produced, such content is frequently modified and integrated
into a corporate website for future on-demand access by a broad range of
geographically dispersed users.

Information Services

iDNA, through its wholly-owned subsidiaries Audience Response Systems, Inc.
("ARS") and Option Technologies Interactive, LLC ("OTI"), provides custom
wireless communication technology and proprietary software systems ("iDNA
Insight") to facilitate client audience interaction, participation and polling
to collect, exchange and/or analyze data and information in real-time during a
meeting or event. Clients can obtain and respond dynamically in real-time to
audience preferences, attitudes or responses to specific queries within an
event. These data collection and analysis services assist in further engaging
corporate and other audiences in understanding and relating to the overall
communication program, ensuring better information retention, providing a record
of responses for regulatory and testing purposes and in many cases providing
clients with live field data not otherwise as easily obtained.

Each of ARS' and OTI's proprietary interactive audience response software
frequently utilizes various wireless communication electronic components using
either radio frequency ("RF") or infrared ("IR") technology. Although ARS' and
OTI's proprietary software are each distinct, custom software applications, they
both operate across a myriad of communication devices, including internet
applications. iDNA's wireless communication services are available as a turn-key
service provided by iDNA during a scheduled meeting or event or alternatively, a
client can purchase from iDNA the required electronic components and related
proprietary software to administer its needs independently. The electronic
components are readily available from a myriad of electronic component
suppliers.

Competition

The corporate communication, symposium, education and training industries
in which iDNA's strategic communication services and information services
segments primarily compete is very fragmented and highly competitive. Certain of
iDNA's competitors, including several diversified companies, may have greater
financial and other resources than iDNA. Most competitors generally operate on a
local or regional level. As clients increasingly require vendors to offer
comprehensive services and support sophisticated broadcast technologies, many
operators may not have the capital resources, management skills and technical
expertise necessary to compete, or to provide integrated communication services.
Although iDNA believes that it has certain creative design, technological,
managerial and other advantages over its competitors, there can be no assurance
that iDNA will maintain such advantages.

Clients

iDNA's clients include national and multi-national pharmaceutical and
financial services companies such as American Express Company, BearingPoint LLP,
Booz Allen Hamilton Inc. ("Booz Allen"), Caterpillar, Inc., KPMG Peat Marwick
LLP, Pfizer Inc. ("Pfizer"), PricewaterhouseCoopers LLP, R&D Strategic
Solutions, Inc. and Wells Fargo & Company as well as other companies seeking to
develop communication, education and/or training content for periodic events.

Revenues for Fiscal 2007, Fiscal 2006 and Fiscal 2005 were $15.4 million,
$14.1 million and $11.3 million, respectively. Pfizer accounted for 17% of
revenues for Fiscal 2007. Pfizer and BearingPoint, Inc. accounted for 21% and
13%, respectively of revenues for Fiscal 2006. Pfizer and R&D Strategic
Solutions, Inc. accounted for 36% and 13%, respectively, of revenues for Fiscal
2005.

Patents and Trademarks

iDNA does not hold any material patents for its current business
operations. iDNA does, however, maintain certain trademarks in connection with
its business such as Audience Response Systems(R), Power Poll(R), Compliance
XR(R), OptionFinder(R) and Option Power(R).

MOVIE EXHIBITION BUSINESS

iDNA engages in the movie exhibition business through its investment in
AFC. AFC is the owner of the Angelika Film Center which it holds under a long
term lease having a remaining term of approximately 19 years. AFC is owned 50%
by iDNA and 50% by Reading International, Inc. Each of the owners of AFC is
entitled to a proportionate share of the cash distributions that are paid by
AFC.

The Angelika Film Center is a 17,000 square foot, six screen multiplex
theater and cafe that focuses on the exhibition of art and specialty films. The
exhibition of art and specialty films, while seasonal in nature, is less so than
the film exhibition business in general. Art and specialty films tend to be
released more evenly over the course of the year and, if successful, tend to
enjoy a longer run than wide release films. Art and specialty films are obtained
from a number of sources ranging from divisions of the larger film distributors
specializing in specialty films to individuals that have acquired domestic
rights to one film. Generally film payment terms are based on an agreed upon
percentage of the box office receipts.

EMPLOYEES

As of January 31, 2007, iDNA employed eighty people on a full-time basis.
None of iDNA's employees are covered by a collective bargaining agreement. iDNA
believes it maintains good relations with its employees.

ITEM 1A. RISK FACTORS

The following are certain risk factors that could affect our business,
financial performance, and results of operations. These risk factors should be
considered in connection with evaluating the forward-looking statements
contained in this Annual Report on Form 10-K for Fiscal 2007, as the
forward-looking statements are based upon current expectations, and actual
results and conditions could differ materially from the current expectations.
Investing in iDNA securities involves a degree of risk, and before making an
investment decision, a prospective investor should consider these risk factors
as well as other information included or incorporated by reference in the other
reports iDNA files with the Securities and Exchange Commission.

In addition to other information set forth herein, consider carefully the
following risk factors in evaluating iDNA and its business. Any of these risks
could materially affect iDNA's business, financial condition, or results of
operations. These risks could also cause our actual results to differ materially
from those indicated in the forward-looking statements contained herein and
elsewhere. The risks described below are not

the only risks facing iDNA. Additional risks not currently known to us or those
we currently deem to be immaterial may also materially and adversely affect
iDNA's business operations.

iDNA is integrating significant new strategic components into its business plan

As a consequence of a series of acquisitions, investments and initiatives,
iDNA has been in the process of a strategic transformation of its operations to
a strategic communications, information services, technology, and entertainment
enterprise from a company engaged in the automobile financing business. iDNA
also operates in the movie exhibition segment, through the activities of AFC,
acquired in April 2000, and has added business communications, media services
and technology services such as satellite videoconferencing, multi-media
production services and corporate and institutional meeting services, web-site
development and content management as a result of the formation of iDNA
Healthcare in July 2006 and its acquisitions of OTI acquired in November 2005,
Campus and ARS (collectively known as the "Campus Group"), acquired in July
2003, and OMI, acquired in April 2003. There can be no assurance that iDNA will
be able to effectuate this new business plan successfully, that revenue growth
will occur once the plan is enacted, or that any of these new lines of business
will achieve profitability or sustain such profitability, once achieved.

iDNA's business is subject to significant competitive pressures

iDNA's competitors may have greater financial, technical and other
resources than iDNA, which may provide such competitors with certain advantages,
including the ability to allocate greater resources for development, marketing
and other purposes.

AFC faces varying degrees of competition from other motion picture
exhibitors with respect to licensing films and attracting customers. Competitors
have built theatres in the area where AFC operates. AFC also competes with a
number of other motion picture delivery systems including cable television,
pay-per-view, DVDs and videocassettes, satellite and home video systems. New
technologies for movie delivery (such as video on demand) could also have a
material adverse effect on AFC's business and results of operations. While the
impact of these alternative types of motion picture delivery systems on the
motion picture exhibition industry is difficult to determine precisely, there is
a risk that they could adversely affect attendance at motion pictures shown in
theatres. Movie theatres also face competition from a variety of other forms of
entertainment competing for the public's leisure time and disposable income,
including sporting events, concerts, live theatre and restaurants.

iDNA's performance may fluctuate when its clients are affected simultaneously by
the same economic or regulatory factors

iDNA's revenues are significantly concentrated in communications, media and
entertainment and iDNA's clients are concentrated within specific industries
including pharmaceuticals, legal and professional services, and financial
services. These industries are subject to fluctuations of business
communications needs based upon the timing of research and development
activities, new product launches, continuing educational support, marketplace
communication, general budgetary levels, regulatory changes and general economic
trends. Consequently, many of iDNA's clients will likely be influenced at the
same time by similar economic or regulatory factors, which can affect the level
of spending for advertising, marketing, promotion and communication services. In
the event of a decline, projected decline or delay in such spending, the
management of iDNA's clients may choose to cut back on spending for iDNA's
services. It is reasonable to expect that, if one client reduces or delays its
spending in response to a major economic factor, other clients will also decide
to reduce or delay their spending at approximately the same time. Accordingly,
iDNA's revenues are subject to fluctuations as a result of factors that affect
its client's expenditures.

iDNA has significant outstanding indebtedness

Principally as a consequence of the means in which iDNA has financed the
acquisitions of OTI, ARS and CGC (collectively, the "Campus Group") and OMI,
iDNA has outstanding debt in the amount of $14.7

million which bears interest at the weighted average rate of 5% per annum. The
indebtedness is secured by essentially all of iDNA's interest in OTI, The Campus
Group and OMI, respectively.

iDNA is subject to credit risk from its clients

iDNA extends credit to clients in the normal course of business. iDNA
continuously monitors collections and payments from clients and maintain an
allowance for doubtful accounts based upon historical experience and any
specific client collection issues that have been identified. Since accounts
receivable are concentrated in a relatively few number of clients, a significant
change in the liquidity or financial position of any of these clients could have
a material adverse impact on the collectability of the accounts receivable and
future operating results.

The businesses purchased by iDNA may turn out to be worth less than expected at
the time of acquisition

As a result of iDNA's series of acquisitions, iDNA carries goodwill as an
asset and management reviews the carrying value of its long-lived assets and
goodwill for impairment whenever events or changes in circumstances indicate
that the carrying amount of these assets may not be fully recoverable and it
annually assesses whether goodwill has been impaired by comparing the carrying
value of the goodwill to its fair value. When it is determined that the carrying
amount of long-lived assets and goodwill may not be fully recoverable,
impairment is measured by comparing an asset's estimated fair value to its
carrying value. The determination of fair value is based on quoted market prices
in active markets, if available, or independent appraisals; sales price
negotiations; or projected future cash flows discounted at a rate determined by
management to be commensurate with iDNA's business risk. The estimation of fair
value utilizing discounted forecasted cash flows includes significant judgments
regarding assumptions of revenue, operating and marketing costs; selling and
administrative expenses; interest rates; property and equipment additions and
retirements; and industry competition, general economic and business conditions,
among other factors.

During the second quarter of Fiscal 2007, the results of the operations of
the CGC reporting unit raised questions as to whether projections used at the
last valuation date were still valid. Accordingly, management performed
additional impairment tests as of July 31, 2006 for CGC and determined that
impairment charges were required at that date. Accordingly, based upon iDNA's
assessment, second quarter operations were charged $1.9 million and $2.6 million
for the estimated impairment of CGC's goodwill and other intangible assets,
respectively (see Note 2 to Notes to Consolidated Financial Statements).

iDNA's success is dependent upon key personnel

iDNA's success depends, in part, upon the continued services of key
personnel, such as: James J. McNamara, Chairman of the Board and Chief Executive
Officer; Robert V. Cuddihy, Jr., Chief Financial Officer and certain divisional
managers and sales strategists with iDNA. The loss of the services of any one of
them could have a material adverse effect on iDNA.

Future acquisitions or investments could disrupt iDNA's ongoing business,
distract management and employees, increase expenses and adversely affect
results of operations

iDNA has made three significant acquisitions since April 2003 and has
started another business. Management's attention may be diverted from operations
towards identifying potential acquisitions and negotiating and consummating
them. Any acquisitions or investments iDNA makes in the future will involve
risks. iDNA may not be able to make acquisitions or investments on commercially
acceptable terms. If iDNA does acquire another company, iDNA could have
difficulty retaining and assimilating the acquired company's personnel. In
addition, iDNA could have difficulty assimilating acquired products, services or
technologies into iDNA's existing operations. These difficulties could disrupt
iDNA's ongoing business, distract management and employees, increase expenses
and materially and adversely affect the results of operations. Furthermore, iDNA
may incur debt or issue equity securities to pay for any future acquisitions,
which could dilute its stockholders' ownership interest in iDNA or subordinate
it in priority to a senior obligation.

iDNA may not be able to hire, train, motivate, retain and manage professional
staff

iDNA's management must hire, train, motivate, retain and manage highly
skilled employees. Competition for skilled employees who can perform the
services that iDNA requires is intense. iDNA might not be able to hire enough of
them or to train, motivate, retain and manage the employees it does hire.
Hiring, training, motivating, retaining and managing employees with the skills
required is time-consuming and expensive.

iDNA is unlikely to pay dividends for the foreseeable future

iDNA has not paid cash dividends on the common stock. iDNA intends to
reinvest any earnings in its business to finance future growth and acquisitions.
Accordingly, iDNA's Board of Directors does not anticipate declaring any cash
dividends in the foreseeable future.

Adverse decisions in iDNA's litigation matters would adversely affect iDNA's
business

iDNA is involved in certain legal proceedings in the normal course of its
business. If a major case is decided against iDNA, iDNA could be held liable for
an amount that would adversely affect iDNA's ability to do business.
Additionally, iDNA maintained and continues to maintain self-insurance for
claims relating to bodily injury or property damage from accidents involving the
vehicles rented to customers by its discontinued automobile rental and finance
operations. iDNA was, when required by either governing state law or the terms
of its rental agreement, self-insured for the first $1.0 million per occurrence,
and for losses in excess of $5.0 million per occurrence, for bodily injury and
property damage resulting from accidents involving its rental vehicles. iDNA was
also self-insured, up to certain retained limits, for bodily injury and property
damage resulting from accidents involving iDNA vehicles operated by employees
within the scope of their employment. In connection therewith, iDNA established
certain reserves in its financial statements for the estimated cost of
satisfying those claims. If there is a material change in the assumptions used
or the ultimate outcome of the self-insurance claims, iDNA could experience
additional future charges to operations.

iDNA may be unable to fund its additional capital needs

iDNA's access to capital may be limited because of iDNA's indebtedness. As
a result, iDNA may be unable to make the capital expenditures that iDNA would
otherwise believe necessary. In addition, iDNA cannot assure its stockholders
that iDNA's business will generate sufficient cash flow from operations, that
currently anticipated revenue growth will be realized or that future capital
will be available to iDNA to enable it to fund its capital expenditure needs.

Certain Officers and Directors own a substantial portion of iDNA's Common Stock

As of May 11, 2007, iDNA's executive officers and directors beneficially
owned approximately 39.7% of iDNA's $0.05 par value common stock ("Common
Stock"). While no individual will be a beneficial owner of a majority of the
outstanding shares of iDNA's Common Stock, these stockholders will have
substantial influence and, if they act together, may be able to control
decisions on corporate matters, including the election of directors. Such
concentration of ownership may also have the effect of preventing a change in
control of iDNA. In addition, the interests of management may not always be
identical to the interests of non-management stockholders.

Future sales of iDNA's Common Stock in the public market could lower its stock
price and impair its ability to raise funds in new stock offerings

As of January 31, 2007, iDNA had outstanding 9,654,614 shares of common
stock. An aggregate of 5,114,035 additional shares of iDNA Common Stock may
become outstanding upon the exercise or conversion, as the case may be, of all
of the stock options, warrants and convertible debentures outstanding on such
date. If

the holders of a large number of these securities elect to exercise
them for or convert them into iDNA Common Stock and then sell the shares of iDNA
Common Stock they acquire, the market price of iDNA's Common Stock could
decline. Sales by existing stockholders of a large number of shares at any one
time could adversely affect the market price of iDNA's Common Stock and could
impair iDNA's ability to raise funds in additional stock offerings. Moreover,
the mere possibility that these sales could be made in the future may result in
the same effect even if these sales are not actually made.

Trading in iDNA's Common Stock has been and may continue to be limited, which
may make it difficult to resell shares

iDNA's Common Stock is quoted on the Over-the-Counter Bulletin Board. The
Over-the-Counter Bulletin Board is not, however, an exchange, and trading in
securities on the Over-the-Counter Bulletin Board is often more sporadic than
trading in securities listed on an exchange or NASDAQ. Consequently, an investor
may have difficulty reselling any shares of iDNA's Common Stock that it
purchases from the selling security holders.

The market price of iDNA's Common Stock can be highly volatile

The average daily trading volume of iDNA's Common Stock has generally been
low, which iDNA believes has had a significant effect on the historical market
price of iDNA's Common Stock. As a result, such market price has been highly
volatile and may not be indicative of the market price in a more liquid market.
The market price of iDNA's Common Stock could be subject to significant
fluctuations in response to a number of factors, including the depth and
liquidity of the market for iDNA's Common Stock, public announcements by iDNA,
its clients and its competitors, investor perception of iDNA and general
economic and other conditions, which may or may not relate to iDNA's
performance. Fluctuations in iDNA's Common Stock's market price may affect
iDNA's ability to raise capital.

Because iDNA's Common Stock is deemed to be "Penny Stock" under the Securities
Exchange Act of 1934, investors may not be readily able to resell iDNA's shares
in the public markets

The shares are currently defined as penny stock under the Securities
Exchange Act of 1934 and the rules of the Securities and Exchange Commission.
These rules impose additional sales practices and disclosure requirements on
broker-dealers who sell iDNA's shares to persons other than certain accredited
investors. For covered transactions, a broker-dealer must make a suitability
determination for each purchaser and receive a purchaser's written agreement
before the sale. In addition, the broker-dealer must make certain mandated
disclosures in transactions of penny stocks. These rules affect the ability of
broker-dealers to make a market in iDNA's Common Stock and adversely affect an
investor's ability to resell shares of iDNA's Common Stock.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

None.

ITEM 2. PROPERTIES.

iDNA occupies a series of leased facilities as follows:

Base Annual
Location Square Feet Rent Expiration of Term Purpose
-------------- ----------- ----------- ------------------ ---------------------------------------

Bohemia, NY 15,000 $100,000 April 2010 Warehouse and distribution
Evansville, IN 6,800 $ 57,000 September 2008 Sales, service and field support
New York, NY 6,838 $294,000 December 2012 Corporate Headquarters
New York, NY 2,656 $ 46,000 September 2007 Creative Services and Production Studio
Ogden, UT 3,500 $ 39,600 January 2007 Sales, service and field support
Orlando, FL 8,000 $ 35,000 September 2007 Sales, service and field support
Tuckahoe, NY 11,000 $ 75,000 April 2010 Creative Services and Production Studio

In addition to the above facilitates, OMI leases approximately 2,200 square
feet of office space and has subleased such space to an unrelated third party
through the remaining term of the lease which expires in September 2007. The
remaining base rent obligation, pursuant to the lease, is $78,000. The value of
the sublease is $60,000. For Fiscal 2007, OMI has charged to operations $18,000
for the excess lease obligation as compared to the value of the sublease.

ITEM 3. LEGAL PROCEEDINGS.

Self-Insurance Reserves for Property Damage and Personal Injury Claims.

iDNA, under the names Agency Rent-A-Car, Inc. ("ARAC"), Altra Auto Rental
and Automate Auto Rental, previously engaged in the rental of automobiles on a
short-term basis, principally to the insurance replacement market. In Fiscal
1996, iDNA discontinued its automobile rental fleet business through the sale of
certain assets and through certain leases to a national car rental company. All
liabilities related to the discontinued rental business, principally
self-insurance claims, were retained by ARAC.

iDNA's wholly-owned subsidiary ARAC maintained and continues to maintain
self-insurance for claims relating to bodily injury or property damage from
accidents involving the vehicles rented to customers by its discontinued
automobile rental operations occurring in Fiscal 1996 and prior. ARAC was, when
required by either governing state law or the terms of its rental agreement,
self-insured for the first $1.0 million per occurrence, and for losses in excess
of $5.0 million per occurrence, for bodily injury and property damage resulting
from accidents involving its rental vehicles. ARAC was also self-insured, up to
certain retained limits, for bodily injury and property damage resulting from
accidents involving ARAC vehicles operated by employees within the scope of
their employment.

ARAC is the subject to certain self-insurance claims and litigation
expenses relating to its discontinued automobile rental operations. iDNA's
management estimates the required self-insurance liability based upon specific
identification of the known matters subject to future claims, the nature of the
claim and the estimated costs to be incurred. These estimates include, but are
not limited to, ARAC's historical loss experience and projected loss factors.
The required self-insurance liability is subject to adjustment in the future
based upon changes in the nature of the remaining claims or the ultimate cost.
As a consequence of iDNA's sale of its automobile rental operations in 1995,
iDNA believes that all incurred claims have been reported to ARAC and that there
are no longer any incurred but not yet reported claims to be received by ARAC.
iDNA's self-insurance liability at January 31, 2007 and 2006 was $235,000 and
$235,000, respectively.

Because of the uncertainties related to several residual small claims and
legal proceedings involving iDNA's former rental operations and self-insurance
claims, it is difficult to project with precision the ultimate effect the
adjudication or settlement of these matters will have on iDNA. As additional
information regarding iDNA's potential liabilities becomes available, iDNA will
revise the estimates as appropriate.

Trademarks

On August 16, 2006, OTI was named as a defendant in a complaint filed in
the United States District Court for the Northern District of Illinois Eastern
Division (the "Court") entitled "Brahler ICS Konferenztechnik AG ("Brahler") vs.
Digivote, Inc., Option Technologies Interactive, LLC and Suneel Mirchandani".
The complaint alleges that since on or about September 2004 the defendants
wrongfully used and infringed upon Brahler's federally registered trademark
Digivote for their own commercial gain without the authorization of Brahler.

In January 2007, at the request of the parties, the Court held a settlement
conference during which all parties agreed in principal to a global settlement.
Pursuant to the terms of the proposed global settlement, OTI agreed not to use
the trademark Digivote (OTI had ceased that use substantially before the
litigation commenced) and to make a cash payment of $25,000 to Brahler. OTI's
co-defendants agreed to more numerous and complex settlement terms. Since the
January 2007 settlement conference, Brahler and OTI's co-defendants have been
unable to reduce into writing their portion of the global settlement and as a
consequence, the Court has ordered all of the parties to appear at another
settlement conference on May 18, 2007. The terms of the global settlement that
are currently in contention do not affect OTI's portion of the proposed global
settlement. As of January 31, 2007, iDNA has charged to operations $25,000
pursuant to the terms of the proposed global settlement.

This matter is in its early stage of review however, OTI and iDNA believe
that OTI has a number of affirmative defenses regarding this matter and we
intend to vigorously defend this litigation and/or enter into settlements of
claims where management deems appropriate. In the opinion of management, the
amount of ultimate liability with respect to this action, if any, is unlikely to
materially affect our financial position, results of operations or liquidity.

Other Litigation

In the normal course of its business, iDNA is named as defendant in legal
proceedings. It is the policy of iDNA to vigorously defend litigation and/or
enter into settlements of claims where management deems appropriate.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES.

MARKET INFORMATION

iDNA's Common Stock has been quoted on the Over-The-Counter Bulletin Board
(the "OTCBB"), operated by The Nasdaq Stock Market, Inc., since March 23, 1998.
As a consequence of iDNA's corporate name change, iDNA applied for and received
a new ticker symbol. Effective March 8, 2006, iDNA's Common Stock began to be
quoted under the ticker symbol "IDAI". Prior to March 8, 2006, iDNA's Common
Stock was quoted under the ticker symbol "NAKD".

The following table sets forth the range of the high and low closing
quotations for iDNA's Common Stock on the OTCBB during the periods indicated as
reported by the OTCBB. Such market quotations reflect inter-dealer prices,
without mark-up, mark-downs or commissions and may not necessarily represent
actual transactions

High Low
----- ----
Year ended January 31, 2007
First Quarter (February 1 - April 30) ....... $1.12 $.33
Second Quarter (May 1 - July 31) ............ 1.02 .46
Third Quarter (August 1 - October 31) ....... .50 .33
Fourth Quarter (November 1 - January 31) .... .99 .35

Year ended January 31, 2006
First Quarter (February 1 - April 30) ....... $ .75 $.32
Second Quarter (May 1 - July 31) ............ 1.30 .57
Third Quarter (August 1 - October 31) ....... .71 .51
Fourth Quarter (November 1 - January 31) .... .62 .33

STOCK PERFORMANCE GRAPH

The following graph compares the yearly change in iDNA's cumulative total
shareholder return on its Common Stock (based on the market price of iDNA's
Common Stock) with the cumulative total return of the S&P 600 Small Cap Index,
the Russell 2000 Index, and Reading International, Inc. (a theatre and real
estate concern). The comparisons shown in the graph below are based upon
historical data. The stock price performance shown in the graph below is not
necessarily indicative of, or intended to forecast, the future performance of
iDNA Common Stock. The stock performance graph shall not be deemed to be
"soliciting material" or to be "filed" with the Commission under the Securities
Act of 1933, as amended (the "Securities Act") or the Securities Exchange Act of
1934, as amended (the "Exchange Act"), or incorporated by reference by any
document so filed.

COMPARISON OF CUMULATIVE RETURN AMONG THE S&P 600
SMALL CAP INDEX, THE RUSSELL 2000 INDEX, READING
INTERNATIONAL AND iDNA, INC.

[CHART]

2/1/02 1/31/03 1/31/04 1/31/05 1/31/06 1/31/07
------ ------- ------- ------- ------- -------

iDNA, Inc. 100 100 428 228 264 593
S&P 600 Small Cap Index 100 81 119 137 162 174
Russell 2000 Index 100 77 120 129 152 166
Reading International, Inc. 100 210 323 417 421 453

For purposes of the above table, iDNA is compared to Reading International
Inc. because the company is engaged principally in the operation of various film
theatres. iDNA's current operations are comprised principally of its investment
in the Angelika Film Centers, LLC., strategic communication services and
information services.

STOCKHOLDERS

At May 11, 2007 there were 1,204 stockholders of record of iDNA's Common
Stock based upon a securities position listing furnished to iDNA by American
Stock Transfer & Trust Company, iDNA's transfer agent. On that date, the closing
bid quotation of iDNA's Common Stock on the OTCBB was $0.83 per share.

DIVIDEND POLICY

It has been iDNA's policy to retain any earnings and preserve its cash
resources to finance the growth of its business, provide resources for future
acquisition(s) and reduce outstanding debt and other liabilities; accordingly,
iDNA has generally not issued a cash dividend. iDNA intends to reinvest any
earnings in its business to finance future growth and acquisitions. Accordingly,
iDNA's Board of Directors does not anticipate declaring any cash dividends in
the foreseeable future. However, iDNA does from time to time reassess its cash
dividend policy and may declare and pay cash dividends in the future if
circumstances warrant. No cash dividends were declared during the fiscal years
ended January 31, 2007 and 2006.

RECENT SALE OF UNREGISTERED SECURITIES

iDNA did not engage in sales of unregistered securities during Fiscal 2007
that have not bee reported heretofore in a Quarterly Report on Form 10-Q or in a
Current Report on Form 8-K.

PURCHASE OF EQUITY SECURITIES

iDNA did not purchase any shares of Common Stock during the fourth quarter
of Fiscal 2007.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

2003 Restricted Stock Plan

iDNA sponsors a 2003 Restricted Stock Plan (the "2003 Plan") that provides
stock grants to all employees. The 2003 Plan authorizes the grant of up to a
maximum of 400,000 restricted shares of Common Stock to employees of iDNA.
During Fiscal 2004, there were 372,000 shares of Common Stock granted pursuant
to the terms of the 2003 Plan at an estimated fair value of $0.32 per share.
Each share granted is restricted and is not registered for resale. Each award
under the 2003 Plan vests at the rate of 20% per year over a five year period.
Shares granted under the 2003 Plan may not be sold, transferred, pledged or
otherwise disposed until they vest. During the vesting period, unvested shares
are voted by the manager of each business unit. No shares were granted to
executive officers or directors under the 2003 Plan. For Fiscal 2004, iDNA
recorded $119,000 of deferred compensation expense in connection with the 2003
Plan grants, which was reported as a component of shareholders' equity. The
deferred compensation expense is being amortized to operations on a
straight-line basis over the five year vesting period of the restricted Common
Stock. For Fiscal 2007, Fiscal 2006 and Fiscal 2005, deferred compensation
amortization expense was $24,000 per annum. No further grants were made under
the 2003 Plan during Fiscal 2007, Fiscal 2006 and Fiscal 2005.

The following table sets forth, as of January 31, 2007, relevant
information with respect to compensation plans (including individual
compensation arrangements) under which equity securities of iDNA are authorized
for issuance.

NUMBER OF SECURITIES TO BE WEIGHTED-AVERAGE NUMBER OF SECURITIES REMAINING AVAILABLE
ISSUED UPON EXERCISE OF EXERCISE PRICE OF FOR FUTURE ISSUANCE UNDER EQUITY
OUTSTANDING OPTIONS, WARRANTS OUTSTANDING OPTIONS, COMPENSATION PLANS (EXCLUDING SECURITIES
AND RIGHTS WARRANTS AND RIGHTS REFLECTED IN COLUMN (A))
PLAN CATEGORY ( A ) ( B ) ( C )
------------------------- ----------------------------- -------------------- ----------------------------------------

Equity compensation plans
approved by security
holders 3,230,702 $0.69 716,400

Equity compensation plans
not approved by security
holders -- -- 28,000
--------- ----- -------
Total 3,230,702 $0.69 744,400
--------- ----- -------

Shareholder Warrants

As a consequence of the New York Settlement Stipulation (as defined and
described in Note 18 to Notes to Consolidated Financial Statements), iDNA agreed
to issue to the class of Eligible Shareholders warrants to purchase additional
iDNA Common Stock. Each Eligible Shareholder (as defined and described in Note
18 to Notes to Consolidated Financial Statements) was required to submit a proof
of claim by December 15, 2005. Based upon the final submission of claims, iDNA
issued 100,282 warrants in April 2006 to Eligible Shareholders. Each warrant
issued by iDNA has a five year term and is exercisable for shares of iDNA Common
Stock at a price of $1.55 per share. For Fiscal 2006, iDNA charged to operations
$25,000 for the expense of the fair value of the warrants to be issued to the
Eligible Shareholders.

Issuance of Restricted Shares

In Fiscal 2007, iDNA issued 52,000 shares of unregistered treasury stock to
two employees as a bonus and issued an additional 10,000 shares of unregistered
stock to an unrelated third party for professional services. Such shares issued
were recorded at their then market value for an aggregate cost of $52,000, or a
weighted average of $0.83 per share. The restricted shares may not be sold or
otherwise transferred without registration under the Securities Act, as amended,
or applicable state securities laws or an exemption therefrom. In the event that
iDNA proposes to register any of its securities under the Securities Act,
whether for its own account or for the account of another shareholder, the
treasury stock issued may be included in such registration.

ITEM 6. SELECTED FINANCIAL DATA.

The following sets forth certain selected financial data appearing in or
derived from iDNA's historical financial statements, adjusted for the
discontinued operations of its automobile finance and auto rental businesses.
The selected financial data should be read in conjunction with the consolidated
financial statements appearing elsewhere herein, and with Item 7 - Management's
Discussion and Analysis of Financial Condition and Results of Operations (in
thousands, except per share amounts):

Years Ended January 31,
-----------------------------------------------
2007 2006 2005 2004 2003
------- ------- ------- ------- -------

STATEMENT OF OPERATIONS DATA
Revenues $15,444 $14,090 $11,343 $ 7,144 $ --
======= ======= ======= ======= =======
Operating costs and expenses $19,334 $16,621 $14,294 $11,001 $ 3,506
======= ======= ======= ======= =======
Loss from continuing operations $(7,591) $ (515) $(3,164) $(3,383) $ (419)
Discontinued operations, net of tax(1) 11 14 -- 401 310
------- ------- ------- ------- -------
Net loss $(7,580) $ (501) $(3,164) $(2,982) $ (109)
======= ======= ======= ======= =======
Basic and diluted (loss) earnings per share:
Continuing operations $ (.83) $ (.05) $ (.33) $ (.41) $ (.05)
Discontinued operations -- -- -- .05 .04
------- ------- ------- ------- -------
Total $ (.83) $ (.05) $ (.33) $ (.36) $ (.01)
======= ======= ======= ======= =======
Weighted average number of shares outstanding:
Basic 9,167 9,250 9,529 8,182 8,380
======= ======= ======= ======= =======
Diluted 9,167 9,250 9,529 8,182 8,380
======= ======= ======= ======= =======

As of January 31,
-----------------------------------------------
2007 2006 2005 2004 2003
------- ------- ------- ------- -------

BALANCE SHEET DATA
Cash and cash equivalents $ 548 $ 1,144 $ 471 $ 376 $ 1,873
Total assets $22,078 $28,847 $28,089 $30,916 $18,712
Long term debt and convertible debt $13,896 $12,941 $11,475 $11,794 $ --
Total stockholders' equity $ 2,745 $ 9,572 $10,577 $13,480 $16,110

(1) See Note 17 of Notes to Consolidated Financial Statements for further
discussion of discontinued operations.

The selected statements of operations data for the quarters ended April 30,
July 31, October 31, and January 31 for Fiscal 2007 and 2006 set forth below
have been derived from iDNA's unaudited quarterly historical financial
statements. The selected financial data should be read in conjunction with the
consolidated financial statements appearing elsewhere herein and with Item 7 -
Management's Discussion and Analysis of Financial Condition and Results of
Operations (in thousands, except per share data):

STATEMENT OF OPERATIONS DATA

For the Three Months Ended
--------------------------------------------------------------------------------------------
January 31, October 31, July 31, April 30, January 31, October 31, July 31, April 30,
2007 2006 2006 2006 2006 2005 2005 2005
----------- ----------- -------- --------- ----------- ----------- -------- ---------

Revenues $ 3,716 $4,758 $ 3,538 $ 3,432 $5,091 $4,503 $1,632 $ 2,864
======= ====== ======= ======= ====== ====== ====== =======
Gross profit $ 1,498 $2,204 $ 1,497 $ 1,098 $2,084 $2,113 $ 364 $ 1,367
======= ====== ======= ======= ====== ====== ====== =======
Loss from continuing operations $(1,020) $ (280) $(5,137) $(1,154) $ (317) $ 97 $ 79 $ (374)
Discontinued operations, net of tax(1) 8 1 1 1 (2) -- 14 2
------- ------ ------- ------- ------ ------ ------ -------
Net loss $(1,012) $ (279) $(5,136) $(1,153) $ (319) $ 97 $ 93 $ (372)
======= ====== ======= ======= ====== ====== ====== =======
Basic and diluted (loss)
earnings per share:
Continuing operations $ (.11) $ (.03) $ (.56) $ (.13) $ (.03) $ .01 $ .01 $ (.04)
Discontinued operations -- -- -- -- -- -- -- --
------- ------ ------- ------- ------ ------ ------ -------
Total $ (.11) $ (.03) $ (.56) $ (.13) $ (.03) $ .01 $ .01 $ (.04)
======= ====== ======= ======= ====== ====== ====== =======
Weighted average number of
shares outstanding:
Basic 9,451 9,098 9,081 9,036 8,839 8,540 9,457 10,083
======= ====== ======= ======= ====== ====== ====== =======
Diluted 9,451 9,098 9,081 9,036 8,839 8,540 9,457 10,083
======= ====== ======= ======= ====== ====== ====== =======

(1) See Note 17 of Notes to Consolidated Financial Statements for further
discussion of discontinued operations.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

GENERAL

iDNA, Inc. ("the Company" or "iDNA"), began operations in 1969 and was
incorporated in Delaware in 1971. As a consequence of iDNA's consummation of a
series of acquisitions during the past four years, iDNA's operations as of
Fiscal 2007 are now comprised of three principal reportable segments: (i)
strategic communications services, (ii) information services and (iii)
entertainment. iDNA manages each segment separately as a consequence of
different marketing, service requirements and technology strategies.

As of consequence of iDNA's investment in the Angelika Film Centers, LLC
("AFC"), iDNA operates in the movie exhibition and entertainment industry.

SIGNIFICANT DEVELOPMENTS FISCAL 2007

Strategic Initiatives for Fiscal 2007

iDNA implemented a number of strategic initiatives during Fiscal 2007
designed to assist iDNA with expanding its service offerings to clients,
creation of custom products and/or solutions for client communication programs,
diversification of its client base, formation of strategic business
relationships with third parties, effecting capital investments in new digital
mediums and formats, and launching of iDNA's corporate website and relocation of
its corporate offices to new facilities in New York City, New York.

iDNA's website (www.idnausa.com), launched in May 2006, is part of an
evolving program to unify iDNA's diverse product and service offerings under a
full-service, turn-key strategic communications umbrella. iDNA's website
provides information regarding the products and services available from iDNA,
insights into strategic communications and capabilities, and is a portal to more
detailed information. The website provides links, as needed, to individual
supporting iDNA subsidiary websites.

iDNA moved its New York-based headquarters to a new, expanded facility in
June 2006. The new offices house iDNA's executive offices and will also allow
for the consolidation of iDNA's facility with two other New York-based iDNA
offices which will move into the new facility; one move was completed in
December 2006 and the second move is scheduled for June 2007. Through the
consolidation of the New York facilities, iDNA will eliminate approximately
$254,000 in annual base rent expenses.

In July 2006, iDNA formed iDNA Healthcare Communications, Inc. ("iDNA
Healthcare"), to further focus iDNA's marketing efforts for strategic
communications services targeted specifically for the medical and pharmaceutical
symposium and the pharmaceutical-physician-patient communication markets. In
addition, iDNA Healthcare opened a New Jersey-based office, hired three new
pharmaceutical communications specialists and aligned the Concepts of Medicine
Division from the Campus Group Companies, Inc. ("Campus") into iDNA Healthcare.

During the third and fourth quarter of Fiscal 2007, iDNA consolidated and
streamlined its strategic communications marketing team into one unit from three
independent groups and reduced the marketing personnel head count by two
persons.

iDNA made a series of strategic capital investments principally during
Fiscal 2007 which aggregated $274,000 for additional wireless communication
service components, $44,000 in supporting data collectors and related computer
components and $123,000 in upgraded and new digital editing suites. Each capital
investment made by iDNA is expected to yield positive results in future periods
by obtaining new client projects, reducing costs of performing such projects and
providing unique, cost effective communication products not easily matched by
iDNA's competitors.

Employment Agreement with James J. McNamara

On November 29, 2006, the Board of Directors of iDNA approved, and iDNA
consummated, an employment agreement with James J. McNamara (the "Employment
Agreement"). Under the terms of the Employment Agreement, Mr. McNamara (i) shall
be employed as the Company's Chief Executive Officer for an initial term of
approximately three years, until January 31, 2010 (the "Initial Term"), and
shall receive (ii) an initial base salary of $590,000 per year, (iii) a signing
bonus in the form of a grant of iDNA's Common Stock of 500,000 shares, subject
to vesting over the term of the Employment Agreement, (iv) a grant of stock
options to acquire 500,000 shares of iDNA Common Stock, subject to vesting over
the term of the Employment Agreement, and (v) an annual bonus subject to
specific performance criterion established by iDNA's Board of Directors (see
Note 12 to Notes to Consolidated Financial Statements). As a consequence of the
grant of stock as a signing bonus and the grant of stock options, iDNA charged
to operations $290,000 and $75,000, respectively, for compensation expense for
the fair value of the stock at the time of grant

SIGNIFICANT DEVELOPMENTS FISCAL 2006

Name Change Approved

On January 31, 2006, the Company's shareholders approved, among other
corporate matters, the Board of Directors recommendation for a change of the
Company's name to iDNA, Inc. from National Auto Credit, Inc. The change of name
was proposed as a consequence of the Company's transformation of its business,
beginning in Fiscal 2001, to a strategic communications, information services
and entertainment company from a company that formerly invested in sub-prime
used automobile consumer loans.

On January 31, 2006, iDNA's shareholders also approved (i) an increase in
the Company's total number of shares of Common Stock, authorized for issuance
from 40,000,000 to 50,000,000 shares, (ii) an increase in the total number of
shares of the Company's preferred stock, par value $0.05 per share ("Preferred
Stock"), authorized for issuance from 2,000,000 to 5,000,000 shares, and (iii)
the creation of an equity compensation plan (the "2005 Equity Compensation
Plan"), under which performance-related incentives may be granted to designated
employees, certain consultants and advisors and non-employee directors of the
Company.

On February 14, 2006, the Company filed its Second Amended and Restated
Certificate of Incorporation with the Secretary of State of the State of
Delaware, thereby effecting (i) the Company's name change, (ii) an increase in
the total number of shares of the Company's authorized Common Stock and
Preferred Stock and (iii) other modernizing updates to the Company's Certificate
of Incorporation to reflect current Delaware law which had been approved by
iDNA's shareholders at the January 31, 2006 meeting.

Acquisition of Option Technologies Interactive, LLC.

On November 18, 2005, iDNA consummated the acquisition of 100% of the
membership interests of Option Technologies Interactive, LLC ("OTI") from
Flexner Wheatley & Associates ("FWA") and MeetingNet Interactive, Inc.
("MeetingNet"). OTI is a technology company providing interactive software and
hardware systems and services that facilitate audience interaction,
participation and polling to collect exchange and/or analyze data and
information in real-time for use in live events, training and education
satellite videoconferencing and corporate or institutional meeting services.
Prior to the acquisition of OTI, iDNA's subsidiary Audience Response Systems,
Inc. ("ARS") also provided similar services. With the acquisition of OTI, iDNA
(i) gained access to important new clients, industries and market segments, (ii)
acquired a fully developed and integrated propriety software that is an "add-in"
application module with Microsoft(R) Office PowerPoint(R) which, among other
attributes, allows clients to develop and self-administrate audience interaction
programs at smaller and other venues not then served by iDNA and (iii) expanded
its solutions-based communication product offering to meet dynamic demands of
current and potential clients. The significant value in the acquired company lay
principally in its (i) industry position, (ii) assembled workforce, (iii)
proprietary software, (iv) trademarks and (iv) client lists and client
relations.

In exchange for the acquisition of all of the outstanding membership
interests in OTI, iDNA (i) paid $744,000 at closing from iDNA's available cash
balances, (ii) issued to FWA and MeetingNet promissory notes in an aggregate
principal amount of $1.5 million ("OTI Promissory Notes") and (iii) issued an
aggregate of 496,250 shares of iDNA Common Stock to FWA and MeetingNet valued at
$258,000, representing the fair value of such number of shares of iDNA's Common
Stock at the date of acquisition. For financial reporting purposes, the
transaction was treated as a purchase with an effective date of November 18,
2005. The purchase price is subject to an upward and downward adjustment not to
exceed $412,500 based upon OTI meeting, or failing to meet, certain minimum
financial performance criterion for Fiscal 2007 and Fiscal 2008. As of January
31, 2007, OTI has not yet met all of the minimum financial performance criterion
and, as a consequence, an adjustment to the purchase price is not yet required.

SIGNIFICANT DEVELOPMENTS IN FISCAL 2005

Settlement of Shareholder Complaints Completed

In order to settle a derivative and class action entitled Robert Zadra, et
al v, James A. McNamara, et al (Index. No. 01-604859) (hereinafter referred to
as the "New York Action") that was commenced against iDNA and certain of its
directors in the Supreme Court of the State of New York, New York County (the
"New York Court"), iDNA entered into a November 2004 Amended Stipulation of
Settlement (the "New York Settlement Stipulation"). Under the terms of the New
York Settlement Stipulation, iDNA agreed (subject to certain terms

and conditions) to, among other things, (a) adopt or implement certain corporate
governance procedures or policies, (b) issue to a class of iDNA shareholders who
had continuously held iDNA Common Stock from December 14, 2000 through December
24, 2002 up to one million warrants (one warrant per 8.23 shares of Common Stock
held), with each warrant having a five year term and being exercisable for
shares of iDNA Common Stock at a price of $1.55 per share, (c) cancel 50% of
certain stock options granted on December 15, 2000, and (d) make certain
payments for legal fees for counsel to the plaintiffs in the New York Action. In
addition, the New York Settlement Stipulation created for the benefit of iDNA a
settlement fund in the amount of $2.5 million which has been funded by an
insurance policy (the "Settlement Fund"). The legal fees for counsel to the
plaintiffs in the New York Action were not to exceed 25% of the Settlement Fund.

In order to facilitate the settlement and dismissal of a separate
derivative action entitled In re National Auto Credit, Inc, Shareholders
Litigation (Index No. 19028 NC) (hereinafter referred to as the "Delaware
Action"), which had been commenced in the Chancery Court for the State of
Delaware (the "Delaware Court") against iDNA, as well as the New York Action, on
April 22, 2005, IDNA entered into a Stock Purchase Agreement (the "Agreement")
with Academy Capital Management, Inc., Diamond A. Partners, L.P., Diamond A.
Investors, L.P., Ridglea Investor Services, Inc. and William S. Banowsky
(hereinafter referred to collectively as the "Selling Stockholders"). The
Selling Stockholders had also raised objections to the settlement of the New
York Action. The New York Court (a) rejected the objections raised by the
Selling Stockholders and (b) approved as fair and in the best interests of iDNA
and its shareholders the proposed settlement of the New York Action as set forth
in the New York Settlement Stipulation. The Selling Stockholders then filed an
appeal (the "Appeal") to such determination by the New York Court.

Pursuant to the terms of the Agreement, the Selling Stockholders agreed,
among other things, to do the following:

o enter into a stipulation (to be filed with the New York Court)
pursuant to which they would (a) irrevocably withdraw, with prejudice,
any objections they had asserted or might have asserted with respect
to the settlement of the New York Action, (b) stipulate to the entry
of an order dismissing the New York Action and (c) agree to the
dismissal of the Appeal.

o enter into a stipulation (to be filed with the Appellate Division,
First Department, of the Supreme Court of the State of New York)
providing for the dismissal of the Appeal.

o enter into a stipulation (to be filed in the Delaware Court), pursuant
to which they would agree to the dismissal of the Delaware Action with
prejudice.

The Selling Stockholders executed and delivered to iDNA and iDNA filed with
the applicable New York Court and Delaware Court each of the stipulations
referred to above. Effective May 5, 2005, the New York Court entered a Final
Order and Judgment in which it approved the Stipulation of Dismissal of
Objections, finding the terms set forth therein fair, reasonable and adequate,
and dismissed the New York Action and the objections to the New York Settlement
with prejudice. Effective May, 13, 2005, the Appellate Division, First
Department, of the Supreme Court of the State of New York granted the dismissal
of the Appeal. Effective May 18, 2005, the Delaware Court granted an Order and
Judgment Dismissing Action with Prejudice with respect to the Delaware Action.
As a consequence of each of the above actions by the respective courts,
settlement of the New York Action and the Delaware Action, was deemed final in
June 2005 and iDNA received net proceeds of $2.0 million from iDNA's insurer
from the Settlement Fund for the New York Action.

portion of the legal fees incurred by the Selling Stockholders. Effective June
30, 2005, iDNA purchased 1,562,500 shares of iDNA Common Stock from the Selling
Stockholders.

As a consequence of the confirmation of the New York Settlement
Stipulation, the Dismissing Action with Prejudice of the Delaware Action and the
subsequent purchase by iDNA of Common Stock from the Selling Stockholders, for
Fiscal 2006, iDNA recorded (i) a charge to operations of $100,000 for legal fees
of the Selling Stockholders, (ii) a charge to operations of $208,000 for the
excess cost over the market value of the iDNA Common Stock acquired as of the
date of the Agreement, April 22, 2005, (iii) a charge to other income of $25,000
for the expense of the fair value of the warrants to be issued to Eligible
Shareholders and (iv) realized other income of $2.0 million for the net proceeds
received by iDNA from the Settlement Fund. The Eligible Shareholders had until
December 2005 to submit their claims for one warrant for each 8.23 shares of
Common Stock owned during the eligibility period, with each warrant having a
five year term and being exercisable for shares of Common Stock at a price of
$1.55 per share. Based upon the final submission of claims by Eligible
Shareholders, in April 2006 iDNA issued 100,282 warrants to the Eligible
Shareholders.

As acknowledged by the Selling Stockholders in the Agreement, iDNA was
willing to enter into the Agreement, settle the New York Action and the Delaware
Action and consummate the other transactions contemplated by the Agreement in
order to terminate prolonged and expensive litigation and iDNA's entry into the
Agreement would not constitute or be deemed to constitute or evidence any
improper or illegal conduct by or on behalf of iDNA (or any of its directors,
officers, employees and other agents or representatives) or any other wrongdoing
by iDNA (or any of its directors, officers, employees and other agents or
representatives). The Agreement was approved by the disinterested and
independent members of iDNA's Board of Directors.

CRITICAL ACCOUNTING POLICIES

iDNA's consolidated financial statements are prepared in accordance with
generally accepted accounting principles, which require iDNA to make estimates
and assumptions. Those estimates and assumptions affect the reported amounts of
assets and liabilities, the disclosure of contingent assets and liabilities, and
the reported revenues and expenses of iDNA. iDNA's significant accounting
policies are described in Note 1 of Notes to Consolidated Financial Statements.
However, certain accounting policies are deemed "critical", as they require
management's highest degree of judgment, estimates and assumptions. These
accounting estimates and disclosures have been discussed with the Audit
Committee of iDNA's Board of Directors. A discussion of iDNA's critical
accounting policies, the judgments and uncertainties affecting their
application, and the likelihood that materially different amounts would be
reported under different conditions or using different assumptions are as
follows:

Revenues: iDNA's service revenues are earned within short time periods,
generally less than one week. iDNA recognizes revenue from its strategic
communications segment, including video production, video editing, meeting
services and broadcast satellite or webcast services and its information
services segment when the services are complete and delivered or all technical
services have been rendered. Deposits and other prepayments are recorded as
deferred revenue until revenue is recognized. iDNA does not have licensing or
other arrangements that result in additional revenues following the delivery of
the video or a broadcast. Costs accumulated in the production of the video,
meeting services or broadcasts are deferred until the sale and delivery are
complete. Deferred production costs of $115,000 and $22,000, respectively, are
included as a component of other current assets at January 31, 2007 and 2006.

iDNA recognizes revenue from the sale of electronic equipment, proprietary
software and related components at the time of shipment. Deposits and other
prepayments received prior to shipment are recorded as deferred revenue until
the electronic equipment and related software is shipped. iDNA has licensing and
technical support arrangements for future software enhancements and upgrades for
technical support for previously delivered electronic equipment. Revenues
derived from licensing and technical support are recognized over the term of the
licensing and technical support period which are generally sold in increments of
one year of coverage. For Fiscal 2007, Fiscal 2006 and Fiscal 2005, electronic
equipment sales were $2.6 million, $1.3 million and $668,000, respectively.

iDNA recognizes revenue from website design and development when the
customer accepts the completed project. Deposits and other prepayments are
recorded as deferred revenue until revenue is recognized. These contracts are
generally limited to the design and development of websites and the presentation
of site library content developed by iDNA. Clients also have the option to
engage iDNA to maintain and upgrade their websites. These projects are separate
from the website development and design engagements, and the related revenue is
recognized over the term of the agreement, which is generally up to one year.

iDNA recognizes revenue from developing and maintaining websites pursuant
to the requirements of Statement of Position No. 97-2, "Software Revenue
Recognition" ("SOP 97-2"), as amended by Statement of Position No. 98-9,
"Software Revenue Recognition with Respect to Certain Arrangements." Under SOP
97-2, revenue attributable to an element in a customer arrangement is recognized
when persuasive evidence of an arrangement exists and delivery has occurred,
provided the fee is fixed or determinable, collectibility is probable and the
arrangement does not require significant customization of the software. If at
the outset of the customer arrangement, iDNA determines that the arrangement fee
is not fixed or determinable or that collectibility is not probable, iDNA defers
the revenue and recognizes the revenue when the arrangement fee becomes due and
payable or, when collectibility is uncertain, as cash is collected.

Cost of Revenues: Cost of revenues consists of direct expenses specifically
associated with client revenues. The cost of revenues includes direct salaries
and benefits, purchased products or services for clients, web hosting, support
services, and shipping and delivery costs.

Accounts Receivable: iDNA extends credit to clients in the normal course of
business. iDNA continuously monitors collections and payments from clients and
maintains an allowance for doubtful accounts based upon historical experience
and any specific client collection issues that have been identified. Since
accounts receivable are concentrated in a relatively few number of clients, a
significant change in the liquidity or financial position of any of these
clients could have a material adverse impact on the collectibility of the
accounts receivable and future operating results. iDNA does not have any
off-balance sheet credit exposure related to its customers.

Valuation of Long-Lived Assets and Goodwill: iDNA reviews the carrying
value of its long-lived assets whenever events or changes in circumstances
indicate that its carrying amount may not be recoverable. When indicators of
impairment exist, iDNA determines whether the estimated undiscounted sum of the
future cash flows of such assets is less than their carrying amounts. If less,
an impairment loss is recognized in the amount, if any, by which the carrying
amount of such assets exceeds their respective fair values. The determination of
fair value is based on quoted market prices in active markets, if available, or
independent appraisals; sales price negotiations; or projected future cash flows
discounted at a rate determined by management to be commensurate with iDNA's
business risk. The estimation of fair value utilizing discounted forecasted cash
flows includes significant judgments regarding assumptions of revenue, operating
and marketing costs; selling

and administrative expenses; interest rates; property and equipment additions
and retirements; industry competition; and general economic and business
conditions, among other factors.

Pursuant to iDNA's established accounting policies, iDNA conducted its
Fiscal 2006 annual analysis of goodwill as of January 31, 2006. iDNA estimated
the fair value of its reporting units and compared those values to the carrying
values of those reporting units. If the estimated fair value of the reporting
unit is less than the estimated book value, then an impairment is deemed to have
occurred. In estimating the fair value of each reporting unit, iDNA used
primarily the income approach (which utilizes forecasted discounted cash flows
to estimate the fair value of the reporting unit) and the market approach (which
estimates fair value based on market prices of comparable companies). iDNA
concluded that, as of January 31, 2006, there were no impairments of its
goodwill based upon the then estimated fair value of its reporting units.

However, during the second quarter of Fiscal 2007, as a consequence of
declining revenues and the loss of a client the results of the operations of the
Campus Group Companies, Inc. ("CGC") reporting unit raised questions as to
whether projections used at the last valuation date were still valid.
Accordingly, management performed additional impairment tests as of July 31,
2006 for CGC and determined that impairment charges were required at that date.
Accordingly, based upon iDNA's preliminary assessment, second quarter operations
for Fiscal 2007 were charged $1.9 million and $2.6 million for the estimated
impairment of CGC's goodwill and other intangible assets, respectively.
Additionally, iDNA determined it appropriate to reduce the useful life of the
CGC client relationships intangible asset from 17 years to 10 years. iDNA will
continue to monitor CGC's operations and will recognize further impairment
charges if and when deemed appropriate.

iDNA conducted its Fiscal 2007 annual analysis of goodwill as of January
31, 2007. iDNA estimated the fair value of its reporting units and compared
those values to the carrying values of those reporting units. If the estimated
fair value of the reporting unit is less than the estimated book value, then an
impairment is deemed to have occurred. In estimating the fair value of each
reporting unit, iDNA used primarily the income approach (which utilizes
forecasted discounted cash flows to estimate the fair value of the reporting
unit) and the market approach (which estimates fair value based on market prices
of comparable companies). iDNA concluded that as of January 31, 2007 there were
no additional impairments of its goodwill based upon the then estimated fair
value of its reporting units.

Self-Insurance Claims: iDNA's wholly-owned subsidiary ARAC, Inc. ("ARAC")
maintained and continues to maintain self-insurance for claims and associated
litigation expenses relating to bodily injury or property damage from accidents
involving the vehicles rented to customers by its discontinued automobile rental
operations occurring in Fiscal 1996 and prior. ARAC was, when required by either
governing state law or the terms of its rental agreement, self-insured for the
first $1.0 million per occurrence, and for losses in excess of $5.0 million per
occurrence, for bodily injury and property damage resulting from accidents
involving its rental vehicles. ARAC was also self-insured, up to certain
retained limits, for bodily injury and property damage resulting from accidents
involving ARAC vehicles operated by employees within the scope of their
employment.

ARAC is the subject to certain self-insurance claims and associated
litigation expenses relating to its discontinued automobile rental operations.
iDNA's management estimates the required self-insurance liability based upon
specific identification of the known matters subject to future claims, the
nature of the claim and the estimated costs to be incurred. These estimates
include, but are not limited to, ARAC's historical loss experience and projected
loss factors. The required self-insurance liability is subject to adjustment in
the future based upon changes in the nature of the remaining claims or the
ultimate cost. As a consequence of iDNA's sale of its automobile rental
operations in 1995, iDNA believes that all incurred claims have been reported to

ARAC and that there are no longer any incurred but not yet reported claims to be
received by ARAC. iDNA's self-insurance liability at January 31, 2007 and 2006
was $235,000 and $235,000, respectively.

Accounting for Stock-Based Compensation: Effective February 1, 2006, iDNA
adopted the provisions of Statement of Financial Accounting Standards ("SFAS")
No. 123R (revised 2004), Share-Based Payment, which replaces SFAS No. 123,
Accounting for Stock-Based Compensation ("SFAS No. 123(R)"), and supersedes APB
Opinion No. 25, Accounting for Stock Issued to Employees. SFAS No. 123R requires
all share-based payments to employees, including grants of employee stock
options, to be recognized in the financial statements based on their fair values
beginning with the first interim or annual period after December 15, 2005. The
pro forma disclosures previously permitted under SFAS 123 no longer will be an
alternative to financial statement recognition. iDNA elected the prospective
method of adopting SFAS No. 123R which requires that compensation expense be
recorded over the remaining periods for what would have been the remaining fair
value under SFAS No. 123 of all unvested stock options and restricted stock at
the beginning of the first quarter of adoption. The compensation costs for that
portion of awards is based on the grant-date fair value of the awards as
calculated for pro forma disclosures under SFAS No. 123.

Prior to the adoption of SFAS No. 123(R), iDNA followed the intrinsic value
method in accordance with APB No. 25 to account for its employee stock options.
Historically, substantially all stock options have been granted with an exercise
price equal to the fair market value of the iDNA's Common Stock. As a
consequence, no compensation expense was recognized from substantially all
option grants to employees, officers and directors.

In Fiscal 2007 and Fiscal 2006, iDNA issued 1,605,000 and 507,509 stock
options to iDNA's employees, officers, directors and advisors. In Fiscal 2006,
iDNA also cancelled 10,557 stock options. Each of the stock options granted in
Fiscal 2007 and Fiscal 2006 were subject to vesting and at January 31, 2007,
1,873,651 options had vested pursuant to the terms of the grants. No stock
options were granted in Fiscal 2005. As consequence of adopting SFAS 123(R),
iDNA has recorded charges to operations for stock-based compensation expense for
Fiscal 2007 of $724,000. If iDNA had recorded compensation expense using the
fair value method of SFAS 123R for Fiscal 2006, iDNA's net after tax charge to
operations would have been $67,000. For Fiscal 2005, iDNA would not have
incurred a charge to operations for compensation expense.

Income Taxes: iDNA recognizes deferred tax assets and liabilities based on
differences between the financial statement carrying amounts and the tax basis
of assets and liabilities. Loss carrybacks, reversal of deferred tax
liabilities, tax planning and estimates of future taxable income are considered
in assessing the need for a valuation allowance. At the time it is determined
that iDNA will more likely than not be able to realize deferred tax assets in
excess of the recorded amount, net of its valuation allowance, an adjustment to
reduce the valuation allowance would be recorded that would increase income in
the period such determination was made. Likewise, should management determine
that iDNA would not be able to realize all or part of net deferred tax assets
generated in the future, increase to the valuation allowance would be charged to
and reduce income in the period such determination was made.

RESULTS FROM CONTINUING OPERATIONS

The following table sets forth for Fiscal 2007, Fiscal 2006 and Fiscal 2005
certain statements of operations data by segment obtained from iDNA's
consolidated statement of operations (in thousands).

Strategic Communication Intersegment
Information Services Services Elimination
Year Ended January 31, Year Ended January 31, Year Ended January 31,
------------------------ -------------------------- ---------------------
2007 2006 2005 2007 2006 2005 2007 2006 2005
------ ------ ------ ------- ------ ------- ----- ----- -----

Revenues $9,478 $5,958 $4,522 $ 6,083 $8,322 $ 6,990 $(117) $(190) $(169)
Cost of revenues 5,510 3,581 2,374 3,754 4,771 4,691 (117) (190) (169)
Selling, general and
admininistrative expenses 4,486 2,289 1,697 4,582 4,088 3,561 -- -- --
Operating income (loss) (482) (54) 451 (6,807) (465) (1,354) -- -- --
Depreciation and
amortization expense 871 587 509 719 757 748 -- -- --
Impairment charge -- -- -- 4,482 -- -- -- -- --

Undistributed
Entertainment Corporate Expenses Consolidated
Year Ended January 31, Year Ended January 31, Year Ended January 31,
--------------------- ------------------------- ---------------------------
2007 2006 2005 2007 2006 2005 2007 2006 2005
---- ----- ------ ----- ------ ------- ------- ------- -------

Revenues $ -- $ -- $ -- $ -- $ -- $ -- $15,444 $14,090 $11,343
Cost of revenues -- -- -- -- -- -- 9,147 8,162 6,896
Selling, general and
admininistrative expenses 20 -- 4 1,099 2,082 2,136 10,187 8,459 7,398
Operating income (loss) 590 738 320 (902) 226 (2,551) (7,601) 445 (3,134)
Depreciation and
amortization expense -- -- -- 62 67 73 1,652 1,411 1,330
Impairment charge -- -- -- -- -- 4,482 -- --

Revenues: Revenues for Fiscal 2007, Fiscal 2006 and Fiscal 2005 were $15.4
million, $14.1 million and $11.3 million, respectively.

Revenues attributed to the information services segment increased $3.5
million to $9.5 million for Fiscal 2007 as compared to $6.0 million for Fiscal
2006. The increase in revenues was principally due to the net effects of (i) an
increase in revenues derived from OTI, acquired November 18, 2005, of $3.7
million, offset by, (ii) a decline of $206,000 in core information service
revenues as a consequence of changes in the timing and/or scope of the projects
during Fiscal 2007 as compared to Fiscal 2006. Revenues increased $1.4 million
to $6.0 million for Fiscal 2006 as compared to $4.5 million for Fiscal 2005. The
increase in revenues was principally due to (i) an increase in revenues derived
from OTI, acquired November 18, 2005, of $652,000 and (ii) an increase of
$783,000 in core information service revenues as a consequence of an increase in
the scope, size and number of projects served during Fiscal 2006 as compared to
Fiscal 2005.

Revenues attributed to the strategic communication services segment
decreased $2.2 million to $6.1 million for Fiscal 2007 as compared to $8.3
million for Fiscal 2006. The decrease in revenues was principally due to (i) a
series of projects performed in Fiscal 2006 which aggregated $1.8 million for a
client that were not repeated in Fiscal 2007 due to the client's budgetary
constraints and a change/reduction scope of its communications initiatives and
(ii) a decline of $347,000 attributed to a pharmaceutical client due to a change
in its budgetary spending from Fiscal 2006 to Fiscal 2007. Revenues increased
$1.3 million to $8.3 million for Fiscal 2006 as compared to $7.0 million for
Fiscal 2005. The increase in revenues was principally due to the net effects of
(i) an increase of $1.8 million for a series of new client communications
initiatives, offset by (ii) a

decrease of $502,000 principally due to a decrease in the scope, size and timing
of projects served during Fiscal 2006 as compared to Fiscal 2005.

The nature of iDNA's business is such that the nature and timing of
assignments completed for clients, and the resulting revenue, will vary from
period to period in terms of scope, size of projects and the ultimate revenues
derived. One of iDNA's strategic initiatives for Fiscal 2007 was the
consolidation of its previously decentralized marketing for strategic
communication services in an effort to improve the coordination and program
value for current and prospective clients. Each of iDNA's senior marketing
strategists develop new marketing initiatives, create new project opportunities,
seek new clients for its services and expand existing client relationships to
generate new revenues to reduce period to period fluctuations. Although no
assurances can be made, iDNA continues to seek revenue expansion through its new
marketing strategist's initiatives as a means to reduce year-to-year and
quarter-to-quarter fluctuations in its revenues as well as to ultimately
increase revenues. Generally, there is a six to twelve month investment period
in new client initiatives and relationships before iDNA expects to realize
revenues in the form of new projects and/or clients.

Cost of Revenues: Cost of revenues for Fiscal 2007, Fiscal 2006 and Fiscal
2005 were $9.1 million, $8.2 million and $6.9 million, respectively.

Cost of revenues attributed to the information services segment increased
$1.9 million to $5.5 million for Fiscal 2007 as compared to $3.6 million for
Fiscal 2006. The increase in cost of revenues was principally due to (i) an
increase in cost of revenues derived from OTI, acquired November 18, 2005, of
$1.7 million and (ii) an increase of $211,000 in core information service cost
of revenues as a consequence of increased project expenses and related overhead
during Fiscal 2007 as compared to Fiscal 2006. Cost of revenues increased $1.2
million to $3.6 million for Fiscal 2006 as compared to $2.4 million for Fiscal
2005. The increase in cost of revenues was due to (i) an increase in cost of
revenues derived from OTI, acquired November 18, 2005, of $355,000 and (ii) an
increase in of $852,000 in core information service cost of revenues as a
consequence of an increase in the scope, size and number of projects served
during Fiscal 2006 as compared to Fiscal 2005.

The gross profit realized by the information services segment for Fiscal
2007, Fiscal 2006 and Fiscal 2005 was $4.0 million, $2.4 million and $2.1
million, respectively. The gross profit increase of $1.6 million for Fiscal 2007
as compared to Fiscal 2006 is due principally to the net effects of (i) the
increase in gross profit derived from OTI, acquired November 18, 2005, of $2.0
million offset by (ii) a decrease of $417,000 in gross profit attributable to
the core information services as a consequence of (a) a decline in revenues of
$206,000 and (b) an increase of project expenses and related overhead during
Fiscal 2007 as compared to Fiscal 2006. The gross margin for Fiscal 2007 was
41.8% as compared to 39.9% for Fiscal 2006 and 47.5% for Fiscal 2005. The
increase in overall gross margin of 2.0% for Fiscal 2007 as compared to Fiscal
2006 is principally due to the net effects of (i) reduced variable project costs
of 4.9%, offset by, (ii) an increase in fixed production and overhead costs of
2.9%. The gross profit increase of $229,000 for Fiscal 2007 as compared to
Fiscal 2006 is principally due to the increase in gross profit derived from OTI.
Although revenues increased for Fiscal 2006 as compared to Fiscal 2005, the
gross margin for Fiscal 2006 decreased 7.6% to 39.9% as compared to 47.5% for
Fiscal 2005, principally due to the net effects of (i) an increase in direct
project costs of 8.6% that resulted in lower project margins, offset by, (ii) a
decrease of 1% of indirect production overhead.

Cost of revenues attributable to the strategic communication segment
decreased $1.0 million to $3.8 million for Fiscal 2007 as compared to $4.8
million for Fiscal 2006. The decrease in the costs of revenues was principally
due to a reduction in direct project costs as a consequence of the $2.2 million
decrease in revenues for Fiscal 2007. Cost of revenues for Fiscal 2006 increased
$80,000 to $4.8 million as compared to $4.7 million for Fiscal 2005. The
increase in cost of revenues was principally due to the net effects of (i) an
increase in direct project costs as a consequence of $1.3 million increase in
revenues, offset by, (ii) a favorable project mix and corresponding project
margins.

The gross profit realized by the strategic communication segment for Fiscal
2007, Fiscal 2006 and Fiscal 2005 was $2.3 million, $3.5 million and 2.3
million, respectively. The gross profit decrease of $1.2 million to $2.3 million
for Fiscal 2007 as compared to $3.5 million for Fiscal 2006 is principally due
to the decrease of revenues and corresponding project margins from Fiscal 2006
to Fiscal 2007. The gross margin for Fiscal 2007 was 38.2% as compared to 42.7%
for Fiscal 2006. The decrease in gross margin of 4.5% for Fiscal 2007 as
compared to Fiscal 2006 is principally due to (i) an unfavorable project price
variance of 2.6% and (ii) an increase in fixed production overhead costs, as a
percentage of revenues, of 1.9%. The gross profit increase of $1.2 million to
$3.5 million for Fiscal 2006 as compared to $2.3 million for Fiscal 2005 is
principally due to the increase of revenues and corresponding project margins
from Fiscal 2005 to Fiscal 2006. The gross margin for Fiscal 2006 was 42.7% as
compared to 32.9% for Fiscal 2005. The increase in gross margin of 9.8% for
Fiscal 2006 as compared to Fiscal 2005 is principally due to (i) a favorable
project price variance of 8.5% and (ii) a decrease in indirect production
overhead costs, as a percentage of revenues, of 1.3%.

Selling, General and Administrative Expense ("SG&A"): SG&A for Fiscal 2007,
Fiscal 2006 and Fiscal 2005 were $10.2 million, $8.5 million and $7.4 million,
respectively.

SG&A attributed to the information services segment increased $2.2 million
to $4.5 million for Fiscal 2007 as compared to $2.3 million for Fiscal 2006. The
increase in SG&A was principally due to (i) an increase of $2.0 million in SG&A
derived from OTI, acquired November 18, 2005, and (ii) an increase in SG&A of
$243,000 attributable to the core information services as a consequence of
increased marketing, personnel and professional service costs incurred. SG&A
increased $592,000 million to $2.3 million for Fiscal 2006 as compared to $1.7
million for Fiscal 2005. The increase in SG&A was due to (i) an increase of
$488,000 in SG&A derived from OTI, acquired November 18, 2005, and (ii) an
increase in of $104,000 in core information service SG&A.

SG&A attributable to the strategic communication services segment increased
$494,000 to $4.6 million for Fiscal 2007 as compared to $4.1 million for Fiscal
2006. The increase in SG&A was principally due to (i) an increase of $276,000 in
marketing personnel expenses, (ii) an increase of $112,000 in rent and related
facility costs and (iii) and an increase of $106,000 in other SG&A incurred.
SG&A increased $527,000 million to $4.1 million for Fiscal 2006 as compared to
$3.6 million for Fiscal 2005. The increase in SG&A was principally due to (i) an
increase of $229,000 in marketing personnel expenses, (ii) an increase of
$80,000 in rent and related facility costs and (iii) and an increase of $218,000
in professional services, including legal, insurance, consulting and accounting
fees and other SG&A incurred.

SG&A for undistributed corporate expenses for Fiscal 2007, Fiscal 2006 and
Fiscal 2005 were $1.1 million, $2.1 million and $2.1 million, respectively. The
corporate expenses incurred by iDNA relate principally to expenses incurred at
its executive offices for executive and corporate finance personnel, certain
employee benefits, professional services such as consulting, legal and
accounting fees, corporate insurance, corporate marketing initiatives and the
costs associated with maintaining its New York facility. iDNA allocates to its
various business segments or units the proportionate share of corporate expenses
that directly relate to and/or benefit each business segment or unit. The
undistributed corporate expense reflect the remaining

expenses incurred but not directly attributable to a business segment or unit.
The decline in corporate SG&A of $1.0 million for Fiscal 2007 as compared to
Fiscal 2006 is due principally to (i) a reduction in legal expenses of $225,000,
(ii) the elimination of the one-time charge incurred in Fiscal 2006 of $208,000
for the premium paid by iDNA over market value in order to acquire 1,562,500
shares of iDNA's Common Stock, and (iii) an increased proportionate share of
corporate expense allocated to OTI, acquired November 18, 2005, of $625,000.

Interest Income: Interest income is derived principally from interest
earned on iDNA's investments in commercial paper, and money market accounts.
Interest earned on iDNA investments for Fiscal 2007, Fiscal 2006 and Fiscal 2005
was $19,000, $20,000 and $6,000, respectively. The change in interest income
over each Fiscal period is due principally to changes in the weighted average
investment balances during the periods.

In addition to the interest income earned on investments, iDNA also
recorded interest income as a result of (i) interest associated with the net
proceeds received from the New York Settlement Stipulation of $24,000 in Fiscal
2006 and (ii) a claim for an income tax refund from 1995 through 1996 which was
received in Fiscal 2005. In Fiscal 2005, iDNA realized interest income of
$243,000 as a result of a final determination of refund by the Internal Revenue
Service ("IRS").

Income from Investment in AFC: iDNA accounts for its investment in AFC
using the equity method. For Fiscal 2007, Fiscal 2006 and Fiscal 2005, iDNA's
share of the net income of AFC was $609,000, $744,000 and $344,000,
respectively. AFC's fiscal year ends December 31. The following sets forth
summarized operating results for AFC (in thousands):

Years Ended December 31,
------------------------
2006 2005 2004
------ ------ ------
Revenues $6,328 $6,487 $5,093

Film rental 1,570 1,488 941
Operating costs 2,467 2,492 2,505
Depreciation and amortization 775 752 787
General and administrative expenses 298 268 171
------ ------ ------
5,110 5,000 4,404
------ ------ ------
Net income $1,218 $1,487 $ 689
====== ====== ======
iDNA's proportionate share of net income $ 609 $ 744 $ 344
====== ====== ======

AFC's revenues decreased $159,000 to $6.3 million for the year ended
December 31, 2006 as compared to $6.5 million for the year ended December 31,
2005. The decrease in AFC's revenues was principally as a result of the net
effects of (i) a 5.2% decrease in attendance, offset by, (ii) an increase in
ticket prices of 1.2% and (iii) an increase in cafe, concessions and other
revenues of 3.7%, or $48,000. AFC's revenues can fluctuate from month-to-month
and year-to-year principally as a result of film attendance, and at times, the
ticket prices, depending on audience interest in, and the popularity of the
films AFC exhibits. AFC's revenues increased $1.4 million to $6.5 million for
the year ended December 31, 2005 as compared to $5.1 million for the year ended
December 31, 2004. The increase in AFC's revenues was principally as a result of
(i) a 25.1% increase in attendance, (ii) an increase in ticket prices of 4.8%
and (iii) an increase in cafe, concessions and other revenues of 26.4%, or
$264,000.

For the years ended December 31, 2006, 2005 and 2004, film rental expense,
as a percentage of revenues, were 24.8%, 22.9% and 18.5%, respectively. Film
rental expense generally is a factor of a fixed percentage rental rate per film
multiplied by the number of tickets sold. AFC experiences fluctuations in film
rental expense, as a percentage of revenue, depending upon the rental rate per
film, length of time the film is exhibited and the popularity of the film.

For the years ended December 31, 2006, 2005 and 2004, operating costs were
$2.5 million, $2.5 million and $2.5 million, respectively. Furthermore,
operating costs, as a percentage of revenues were 39.0%, 38.4% and 49.2% for the
years ended December 31, 2006, 2005 and 2004, respectively. The nature of AFC's
operating costs tend to generally be more fixed overhead related costs and
advertising expenses. Due to the fixed overhead nature of AFC's operating
expenses, these costs are not significantly affected by fluctuations in
attendance from period to period as the expenses remained stable from the year
ended December 31, 2004 through the year ended December 31, 2006.

As a result of the net cash flow realized by AFC, distributions by AFC to
iDNA for Fiscal 2007, Fiscal 2006 and Fiscal 2005 were $1.2 million, $878,000
and $937,000, respectively. The timing and dollar value of AFC distributions are
dependent upon the combined effects of (i) the operating performance of AFC from
period-to-period and (ii) working capital of AFC at the time of distribution.

Interest Expense: For Fiscal 2007, Fiscal 2006 and Fiscal 2005, iDNA
incurred interest expense of $488,000, $662,000 and $776,000 respectively.
During Fiscal 2007, Fiscal 2006 and Fiscal 2005, iDNA's weighted average of
borrowings was $14.4 million, $13.0 million and $13.1 million, respectively. The
effective weighted average rate of interest expense incurred for each of Fiscal
2007, Fiscal 2006 and Fiscal 2005 was 3.4%, 5.1% and 5.7%, respectively. iDNA
financed a portion of the cost of its acquisitions through the issuance of
promissory notes, bearing interest at 5% per annum, to the selling shareholders
or members. The aggregate weighted average of the promissory notes issued and
outstanding as a consequence of financing acquisitions for Fiscal 2007, Fiscal
2006 and Fiscal 2005 were $13.5 million, $12.6 million and $12.4 million,
respectively.

The effective weighted average rate of interest for Fiscal 2007 was 3.4% as
compared to 5.1% for Fiscal 2006. The decline in the effective interest rate is
due principally to the suspension of interest attributable to the Base Notes,
Trailing Notes and Convertible Note (each defined below) (collectively, the
"Campus Notes") for the period August 1, 2006 through January 31, 2007 (see the
interest expense abatement discussion below). The aggregate value of the Campus
Notes outstanding during the interest suspension period was $12.1 million and
the value of the foregone interest was $314,000. The effective weighted average
rate of interest for Fiscal 2006 declined to 5.1% as compared to 5.7% for Fiscal
2005 principally due to the retirement at the end of Fiscal 2005 of a $1.0
million short-term promissory note which bore interest at 20% per annum.

Interest expense abatement: The Campus Notes issued by iDNA to acquire
Audience Response Systems, Inc. ("ARS") and CGC (collectively, the "Campus
Group") bear interest at 5% per annum and are repayable in quarterly
installments according to a formula based upon the future cash flows realized
from The Campus Group. For the trailing twelve month period ended July 31, 2006,
The Campus Group's financial performance fell below certain minimum operating
cash flow thresholds established pursuant to the terms of the Campus Notes. As a
consequence, the interest expense incurred by iDNA during the twelve month
period ended July 31, 2006 was abated. As a consequence of the interest
abatement, iDNA realized a gain from the abatement of interest on the promissory
notes of $631,000 for Fiscal 2007. As a consequence of the financial performance
of the Campus Group continuing to fall below the minimum operating cash flow
thresholds (see the above interest expense discussion), additional interest
expense has been suspended until the thresholds are met. Prospectively, once the
thresholds are met, interest will begin to accrue pursuant to the terms of the

Campus Notes; however, iDNA is not obligated to pay any principal or interest on
the Notes until October 31, 2007.

Income Taxes: For Fiscal 2007, iDNA recorded income tax benefits of $10,000
from continuing operations and $7,000 attributable to discontinued operations.
The aggregate income tax benefits of $7,000 for Fiscal 2007 represent refunds
received from income taxes attributable to iDNA's discontinued auto rental and
finance operations. For Fiscal 2006, iDNA incurred $70,000 in income tax expense
from continuing operations comprised of (i) $25,000 in federal alternate minimum
income tax expense and (ii) $45,000 for state and local income taxes. For Fiscal
2005, iDNA recorded income tax expense of $30,000 comprised of various state and
local income taxes.

As of January 31, 2007 iDNA has federal net operating loss carryforwards of
$88.8 million that may be used to reduce future taxable income, subject to
limitations. Such net operating loss carryforwards will expire: $22.5 million in
Fiscal 2019, $23.4 million in Fiscal 2020, $21.9 million in Fiscal 2021, $10.6
million in Fiscal 2022, $5.1 million in Fiscal 2023, $3.0 million in Fiscal
2024, $607,000 in Fiscal 2025 and $1.7 million in Fiscal 2027. As of January 31,
2007, iDNA has state and local operating loss carryforwards of $48.7 million
which will expire: $5.7 million in Fiscal 2018, $1.1 million in Fiscal 2019,
$14.2 million, in Fiscal 2021, $9.8 million in Fiscal 2022, $9.1 million in
Fiscal 2023, $4.4 million in Fiscal 2024, $525,000 in Fiscal 2025 and $3.9
million in Fiscal 2027.

As a consequence of iDNA's November 3, 2000 repurchase of shares of its
Common Stock, iDNA underwent a "change in ownership" as defined for the purposes
of Sections 382 and 383 of the Internal Revenue Code. As a result of the "change
in ownership" described above, the use of net operating loss carryforwards
totaling $61.0 million ("Section 382 NOL") incurred prior to November 3, 2000
will be subject to significant annual limitation. As of January 31, 2007, iDNA
has utilized approximately $858,000 of the Section 382 NOL. Furthermore, an iDNA
subsidiary has a Separate Return Loss Year that is also subject to "change of
ownership" limitations of $2.2 million as of January 31, 2007. The use of the
net operating loss carryforwards incurred after November 3, 2000, which total
$26.5 million as of January 31, 2007, are not subject to the Section 382
limitation.

As of January 31, 2007, iDNA also has unused low income housing credits
totaling $4.3 million which expire: $569,000 in Fiscal 2013, $820,000 in Fiscal
2019, $953,000 in Fiscal 2020, $968,000 in Fiscal 2021, $898,000 in Fiscal 2022,
$50,000 in Fiscal 2023, $12,000 in Fiscal 2024 and $10,000 in Fiscal 2025. Of
such low income housing credits, $3.1 million were generated prior to November
3, 2000 and are therefore subject to the Section 383 limitation described above.

As of January 31, 2007, iDNA has $919,000 of minimum tax credits, which may
be applied against any future regular income taxes which exceed alternative
minimum taxes. These credits may be carried forward indefinitely and are also
subject to the Section 383 limitation.

SEASONALITY OF BUSINESS

iDNA's revenues are derived from services performed for clients principally
on a project-by-project basis. The nature, scope and timing of client projects
are determined independently by each client based upon their own internal
operating and communications needs which fluctuate from quarter-to-quarter and
year-to-year. To date, iDNA has not experienced any determinable revenue trends
based upon seasonality.

DISCONTINUED OPERATIONS

iDNA, under the names Agency Rent-A-Car, Inc. ("ARAC"), Altra Auto Rental
and Automate Auto Rental, previously engaged in the rental of automobiles on a
short-term basis, principally to the insurance replacement market. During Fiscal
1996, iDNA disposed of its rental fleet business through the sale of certain
assets and through certain leases to a national car rental company. All
liabilities related to the discontinued rental business, principally
self-insurance claims, were retained by ARAC.

The results of both the auto rental and finance operations are included in
the results of discontinued operations. For Fiscal 2007, Fiscal 2006 and Fiscal
2005, the results of the discontinued operations principally represent the
effects of the residual collection of previously charged off loans, and the
settlement of, and changes in iDNA's, provisions for income taxes and reserves
for claims against ARAC related to the self-insured claims.

LIQUIDITY AND CAPITAL RESOURCES

As a consequence of periodic fluctuations in iDNA's working capital needs
based upon the timing of collections, distributions from AFC, and periods of
increased production activity, on July 20, 2006, iDNA consummated a Loan and
Security Agreement ("Loan Agreement") with a lender and issued a Promissory Note
(the "Note") in the principal amount of $1.0 million. The lender, Seasons Go
Round, was an unaffiliated third party lender. Pursuant to the terms of the
Note, (i) the outstanding principal of the Note is due February 15, 2008, (ii)
iDNA is required to pay interest only, monthly and in arrears, during the term
of the Note and (iii) the Note bears interest at fourteen percent (14%) per
annum. iDNA may prepay the Note at any time and without a prepayment penalty.
The Note is secured by a perfected first priority security interest in and to,
and a lien on and pledge of, iDNA's right, title and interest in and to
virtually all of iDNA's assets. The lien does not extend to the common stock or
membership interests of certain subsidiaries - the Campus Group and Option
Technologies Interactive, LLC. The proceeds derived from the Note were used for
(i) capital expenditures of approximately $316,000 for additional wireless
communication service electronic components ("Wireless Systems"), (ii) initial
start-up capital of approximately $100,000 for the expansion of iDNA's medical
communications group and (iii) general working capital.

Prior to the issuance of the Note, iDNA had no external source of financing
and has operated on its existing cash balances, cash flows from operations and
distributions from its investment in AFC. iDNA will continue to pursue
reductions in its operating expenses, invest in marketing initiatives and seek
new debt or equity financing (though there can be no assurance iDNA will obtain
such financing) as means of supplementing iDNA's resources available to pursue
new acquisitions, joint ventures or other business development opportunities. At
January 31, 2007, iDNA had unrestricted cash of $548,000, which together with
any cash flow derived from its investment in AFC and the operations of iDNA's
corporate communications business will be used to pursue such opportunities.

As a consequence of iDNA's acquisition of OTI, effective November 18, 2005,
iDNA issued to FWA and MeetingNet the OTI Promissory Notes in the aggregate
principal amount of $1.5 million. The OTI Promissory Notes bear interest at a
rate of 5% per annum and are repayable in quarterly installments according to a
formula based upon the future cash flows realized from OTI's operations. The OTI
Promissory Notes are secured by the membership interests of OTI. At January 31,
2007, iDNA had outstanding principal obligations under the terms of the OTI
Promissory Notes of $1.1 million and an accrued interest obligation of $15,000.

In July 2004, iDNA initiated a private placement (the "iDNA Private
Placement") whereby iDNA offered for sale up to 1.3 million shares of
unregistered, restricted treasury stock at $0.25 per share. Pursuant to the
terms of the iDNA Private Placement, iDNA sold an aggregate of 950,000 shares of
its treasury stock at $0.25 per share from which it derived net proceeds of
approximately $237,000. The restricted shares may not be sold or otherwise
transferred without registration under the Securities Act and applicable state
securities laws or an exemption therefrom. In the event that iDNA proposes to
register any of its securities under the Securities Act, whether for its own
account or for the account of another shareholder, the treasury stock issued
pursuant to the iDNA Private Placement will be included in such registration.

On July 14, 2004 iDNA consummated a Loan and Security Agreement ("Prior
Loan Agreement") with a lender and issued a promissory note in the principal
amount of $1.0 million (the "Promissory Note"). The lender, Time Passages Corp.,
was an unaffiliated third party lender. Pursuant to the terms of the Promissory
Note, (i) the outstanding principal of the Promissory Note was due July 13,
2005, (ii) iDNA was required to pay interest only, monthly and in arrears,
during the term of the Promissory Note and (iii) the Promissory Note bore
interest at 20% per annum. iDNA was entitled to prepay the Note at any time and
without a prepayment penalty. The Promissory Note was secured by a perfected
first priority security interest in and to, and a lien on and pledge of, iDNA's
right, title and interest in and to virtually all of iDNA's assets. The lien did
not extend to the common stock of The Campus Group and other permitted liens. In
January 2005 and February 2005, iDNA prepaid $650,000 and $350,000 of principal,
respectively, retired the Promissory Note and the corresponding liens were
released.

As a consequence of iDNA's acquisition of The Campus Group effective July
31, 2003, iDNA issued to Mr. Campus and certain family trusts promissory notes
of $9.9 million and issued to a family trust a convertible promissory note of
$2.8 million. Of the $9.9 million in promissory notes issued by iDNA, $6.6
million of the promissory notes ("Base Notes") bear interest at 5% per annum
(see interest discussion above) and are repayable in quarterly installments
according to a formula based upon the future cash flows realized from The Campus
Group over a period not to exceed seven years. The remaining $3.3 million in
promissory notes ("Trailing Notes") issued by iDNA bear interest at 5% per annum
and are repayable in quarterly installments, commencing upon the retirement of
the Base Notes, according to a formula based upon the future cash flows realized
from The Campus Group over a period not to exceed three years subsequent to the
retirement of the Base Notes. The $2.8 million convertible promissory note (i)
bears interest at 5% per annum, payable quarterly in cash or accumulating as
principal at the election of iDNA, (ii) requires principal payments to commence
upon the retirement of the $9.9 million of Base Notes and the Trailing Notes and
is then repayable in quarterly installments according to a formula based upon
the future cash flows realized from The Campus Group over a period not to exceed
three years and (iii) is convertible at the option of the holder into shares of
iDNA Common Stock at a base conversion price of $1.50 per share. The holder may
not convert the convertible promissory note into iDNA Common Stock prior to
repayment of the Base Notes and the Trailing Notes. The promissory notes are
secured by the capital stock of the companies comprising The Campus Group. At
January 31, 2007, iDNA has outstanding principal obligations under the terms of
the Base Notes, Trailing Notes and the Convertible Notes of $6.0 million, $3.3
million and $2.8 million, respectively, and accrued interest obligations of
$156,000.

As a consequence of iDNA's acquisition of OMI Business Communications, Inc.
("OMI"), effective April 1, 2003, iDNA assumed $814,000 in bank debt and capital
lease obligations to financial institutions and issued a promissory note payable
to Mr. Dean Thompson in the principal amount of $153,000. The promissory note
bore interest at 5% per annum and was payable in monthly installments of
principal and interest over a 36 month period expiring April 2006. The
promissory note was repaid and retired in April 2006.

During 2001, OMI obtained a $300,000 bank term loan (the "Term Loan") to
finance certain capital expenditures. The Term Loan was payable in monthly
installments of $6,000, comprised of principal and interest, over a five year
term, expiring in July 2006. The Term Loan bore interest at the rate of 8.25%
per annum. The Term Loan was collateralized by substantially all of OMI's assets
and the personal guarantee of Mr. Thompson. The Term Loan was repaid and retired
in June 2006.

On April 25, 2002, OMI obtained a $402,000 loan guaranteed by the U.S.
Small Business Administration (the "SBA Loan") to finance losses incurred as a
result of the September 11, 2001 terrorist attacks in New York City. At January
31, 2007, the remaining balance of the SBA Loan of $329,000 is repayable in
monthly installments of $3,309 with the last payment due in April 2017. The SBA
Loan bears interest at the rate of 4% per annum. The SBA Loan is collateralized
by substantially all of OMI's assets and the personal guarantee of Mr. Thompson.

In September 2006, OMI consummated equipment financing in the form of a
capital lease with a financing institution to acquire $102,000 in various
digital media production and editing equipment. The capital lease is payable in
monthly installments with the last payment due in July 2009 and bears an implied
interest rate of 10%. The capital lease is collateralized by the digital media
production and editing equipment acquired by OMI. At January 31, 2007, the
remaining balance due under the capital lease was $85,000.

For Fiscal 2007, iDNA's cash and cash equivalents decreased $596,000 due to
the net effects of (i) cash flows used by operations of $1.2 million, (ii)
capital expenditures of $579,000, (iii) repayment of the amounts due to the
former OTI Members of $530,000, (iv) the repayment of debt of $453,000, offset
by (v) proceeds from AFC distributions of 1.2 million and (vi) proceeds from the
issuance of the Note and a capital lease of $1.0 million and $102,000,
respectively.

For Fiscal 2006, iDNA's cash and cash equivalents increased $673,000 due to
the net effects of (i) cash flows provided by operations of $2.5 million,
inclusive of the net proceeds of $2.0 million derived from the Settlement Fund,
(ii) proceeds from AFC distributions of $878,000, offset by, (iii) payments to
acquire iDNA Common Stock of $1.1 million, (iv) payments to acquire OTI, net of
cash acquired, of $827,000, (v) the repayment of debt of $524,000 and (vi)
capital expenditures of $285,000. The principal components of iDNA's cash flow
from operations for Fiscal 2006 included the collection of iDNA's income tax
refund of $826,000 and the net proceeds derived from the New York Settlement
Stipulation of $2.0 million. iDNA also used $7,000 of cash principally for legal
and claim expenses associated with iDNA's discontinued operations.

For Fiscal 2005, iDNA's cash and cash equivalents increased $95,000 due to
the net effects of (i) proceeds from the issuance of a promissory note of $1.0
million and the sale of treasury stock of $237,000, (ii) AFC distributions of
$937,000, offset by, (iii) the cash flows used by operations $635,000, inclusive
of net proceeds of $1.3 million from an income tax refund, (iv) capital
expenditures of $246,000, and (v) the repayment of debt of $1.0 million. iDNA
also used $152,000 of cash principally for legal and claim expenses associated
with iDNA's discontinued operations.

iDNA believes that the available cash and cash equivalents totaling
$548,000 at January 31, 2007 and any cash distributions from its investment in
AFC and cash flow from operations will be sufficient to pay operating expenses,
existing liabilities, fund existing debt repayments and fund its activities
through the next twelve months as iDNA explores new strategic business
alternatives. Additionally, as previously discussed, iDNA's lack of external
financing sources may limit its ability to pursue strategic business
alternatives being considered by iDNA's Board of Directors. Such limitations may
have an adverse impact on iDNA's financial position, results of operations and
liquidity.

The following table presents certain payments due under contractual
obligations with minimum firm commitments as of January 31, 2007 (in thousands):

Payments Due by Period
-----------------------------------------------------------
Less Than More Than
Contractual Obligations Total 1 Year 1 - 3 Years 3 - 5 Years 5 Years
--------------------------- ------- --------- ----------- ----------- ---------

Long-term Debt Obligations $14,616 $ 773 $2,617 $4,943 $6,283
Capital Lease Obligation 96 39 57 -- --
Operating Lease Obligation 2,720 791 988 659 282
Purchase Obligation -- -- -- -- --
Other Long-Term Liabilities -- -- -- -- --
------- ------ ------ ------ ------
$17,432 $1,603 $3,662 $5,602 $6,565
======= ====== ====== ====== ======

OFF-BALANCE SHEET ARRANGEMENTS

iDNA has no off-balance sheet arrangements.

OTHER

New Accounting Pronouncements

In June 2006, the FASB issued Financial Interpretation No. 48, Accounting
for Uncertainty in Income Taxes--an Interpretation of FASB Statement No. 109
("FIN No. 48"). This interpretation, among other things, creates a two-step
approach for evaluating uncertain tax positions. Recognition (step one) occurs
when an enterprise concludes that a tax position, based solely on its technical
merits, is more-likely-than-not to be sustained upon examination. Measurement
(step two) determines the amount of benefit that more-likely-than-not will be
realized upon settlement. De-recognition of a tax position that was previously
recognized would occur when a company subsequently determines that a tax
position no longer meets the more-likely-than-not threshold of being sustained.
FIN No. 48 specifically prohibits the use of a valuation allowance as a
substitute for de-recognition of tax positions, and it has expanded disclosure
requirements. FIN No. 48 is effective for our fiscal years beginning after
December 15, 2006, in which the impact of adoption should be accounted for as a
cumulative-effect adjustment to the beginning balance of retained earnings. iDNA
is currently evaluating the impact of the adoption of FIN No. 48 on iDNA's
reported consolidated financial position or results of operations.

In September 2006, the FASB issued Statement of Financial Accounting
Standards ("SFAS") No. 157, Fair Value Measurement ("SFAS No. 157"). SFAS No.
157 defines fair value, establishes a framework for measuring fair value in
accordance with Generally Accepted Accounting Principles (GAAP), and expands
disclosures about fair value measurements. The provisions of SFAS No. 157 are
effective for fiscal years beginning after November 15, 2007. iDNA does not
anticipate the application of this pronouncement will have a material impact on
iDNA's reported consolidated financial position or results of operations.

the current year materially affects the current year's income statement, the
prior period financial statements must be restated. SAB No. 108 is effective for
fiscal years ending after November 15, 2006. The adoption of SAB No. 108 did not
have a material impact on our consolidated financial statements.

Inflation

Inflation has not had a material effect on iDNA's business.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Like virtually all commercial enterprises, iDNA can be exposed to the risk
("market risk") that the cash flows to be received or paid relating to certain
financial instruments could change as a result of changes in interest rate,
exchange rates, commodity prices, equity prices and other market changes.

iDNA does not engage in trading activities, does not utilize interest rate
swaps or other derivative financial instruments and does not buy or sell foreign
currency, commodity or stock indexed futures or options. Accordingly, iDNA is
not exposed to market risk from these sources.

As of January 31, 2007, the interest rates under iDNA's long term and
convertible debt are fixed. As a result iDNA has limited market risk associated
with market interest rates.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
iDNA, Inc. and Subsidiaries
New York, New York

We have audited the accompanying consolidated balance sheets of iDNA, Inc.
and Subsidiaries as of January 31, 2007 and 2006 and the related consolidated
statements of operations, stockholders' equity and comprehensive income (loss)
and cash flows for each of the three years in the period ended January 31, 2007.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The Company is not
required to have, nor were we engaged to perform an audit of its internal
control over financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of iDNA, Inc.
and Subsidiaries as of January 31, 2007 and 2006 and the results of their
operations and their cash flows for each of the three years in the period ended
January 31, 2007 in conformity with accounting principles generally accepted in
the United States of America.

Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. Schedule II is presented for
purposes of additional analysis and is not a required part of the basic
financial statements. This schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the basic
financial statements taken as a whole.

/s/ Grant Thornton LLP
------------------------------------
Cleveland, Ohio
May 3, 2007

iDNA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

January 31,
---------------------
2007 2006
--------- ---------
ASSETS

Cash and cash equivalents (Note 1) $ 548 $ 1,144
Restricted cash (Note 1) 147
Accounts receivable, net of allowance
of $82 and $105, respectively (Note 1) 1,796 2,045
Income taxes refundable (Note 9) 19 --
Inventory (Note 1) 232 247
Prepaid expenses 293 277
Other current assets 115 22
--------- ---------
Total current assets 3,150 3,735
Property and equipment, net of accumulated
depreciation of $2,833 and $2,029, respectively (Notes 1 and 4) 2,752 2,919
Investment in AFC (Note 5) 7,224 7,822
Goodwill (Notes 1, 2 and 3) 2,728 5,879
Other intangible assets, net of accumulated
amortization of $2,183 and $1,430, respectively (Notes 1, 2 and 3) 6,115 8,352
Other assets 109 140
--------- ---------
$ 22,078 $ 28,847
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current maturities of long term obligations (Note 8) $ 805 $ 1,111
Accounts payable 1,621 1,463
Accrued income taxes (Note 9) 298 358
Deferred revenue (Note 1) 1,033 891
Due to former OTI Members (Note 8) -- 530
Self-insurance claims (Note 12) 235 235
Other liabilities (Note 7) 1,445 1,746
--------- ---------
Total current liabilities 5,437 6,334
Long term obligations (Note 8) 11,071 10,116
Convertible promissory note (Note 8) 2,825 2,825
--------- ---------
19,333 19,275
--------- ---------
COMMITMENTS AND CONTINGENCIES (Note 12) -- --
STOCKHOLDERS' EQUITY (Note 10)
Preferred stock -- --
Common stock - $.05 par value,
authorized 50,000,000 shares, issued
39,949,589 and 39,949,589 shares, respectively 1,997 1,997
Additional paid-in capital 174,837 174,479
Retained deficit 151,699 (144,034)
Deferred compensation (41) (65)
Treasury stock, at cost, 30,294,975 and 30,913,225
shares, respectively (22,349) (22,805)
--------- ---------
Total stockholders' equity 2,745 9,572
--------- ---------
$ 22,078 $ 28,847
========= =========

See accompanying notes to consolidated financial statements.

iDNA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Years Ended January 31,
---------------------------
2007 2006 2005
------- ------- -------

Revenues (Notes 1 and 14) $15,444 $14,090 $11,343
Cost of revenues (Note 1) 9,147 8,162 6,896
------- ------- -------
Gross profit 6,297 5,928 4,447
Selling, general and administrative 10,187 8,459 7,398
Impairment charge (Notes 1 and 2) 4,482 -- --
------- ------- -------
Loss from operations (8,372) (2,531) (2,951)
Interest income 19 44 249
Income from AFC investment (Note 5) 609 744 344
Interest expense (Note 8) (488) (662) (776)
Interest abatement (Note 8) 631 -- --
Other income (Note 18) -- 1,960 --
------- ------- -------
Loss from continuing operations
before income taxes (7,601) (445) (3,134)
Provision (benefit) for income taxes (Note 9) (10) 70 30
------- ------- -------
Loss from continuing operations (7,591) (515) (3,164)
Income from discontinued operations, net of tax (Note 17) 11 14 --
------- ------- -------
Net loss applicable to common stock $(7,580) $ (501) $(3,164)
======= ======= =======
Basic and diluted (loss) earnings per share:
Continuing operations $ (.83) $ (.05) $ (.33)
Discontinued operations -- -- --
------- ------- -------
Net loss per share $ (.83) $ (.05) $ (.33)
======= ======= =======
Weighted average number of shares outstanding:
Basic and diluted 9,167 9,250 9,529
======= ======= =======

See accompanying notes to consolidated financial statements.

iDNA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
AND COMPREHENSIVE INCOME (LOSS)
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

Preferred Stock Common Stock
--------------- ------------------ Additional
Par Par Paid-In Retained
Shares Value Shares Value Capital Deficit
------ ----- ---------- ------ ---------- ----------

BALANCE, JANUARY 31, 2004 -- $-- 39,949,589 $1,997 $174,454 ($139,746)

Net loss (3,164)
Treasury stock sold (473)
Deferred compensation expense
--- --- ---------- ------ -------- ----------
BALANCE, JANUARY 31, 2005 -- -- 39,949,589 1,997 174,454 (143,383)

Net loss (501)
Treasury stock issued for services (42)
Treasury stock issued to
acquire OTI (Note 3) (108)
Treasury stock purchased (Note 18)
Fair value of Eligible Shareholder
warrants to be issued (Note 18) 25
Deferred compensation expense
--- --- ---------- ------ -------- ----------
BALANCE, JANUARY 31, 2006 -- -- 39,949,589 1,997 174,479 (144,034)

Net loss (7,580)
Share-based compensation expense 358
Treasury stock issued (85)
Deferred compensation expense
--- --- ---------- ------ -------- ----------
BALANCE, JANUARY 31, 2007 -- $-- 39,949,589 $1,997 $174,837 $ (151,699)
=== === ========== ====== ======== ==========

Deferred Comprehensive
Treasury Compensation Income
Stock Expense Total (Loss)
--------- ------------ ------- -------------

BALANCE, JANUARY 31, 2004 ($23,112) ($113) $13,480

Net loss (3,164) (3,164)
Treasury stock sold 710 237
Deferred compensation expense 24 24
--------- ------- ------- -------
BALANCE, JANUARY 31, 2005 (22,402) (89) 10,577 $(3,164)
=======
Net loss (501) (501)
Treasury stock issued for services 75 33
Treasury stock issued to
acquire OTI (Note 3) 366 258
Treasury stock purchased (Note 18) (844) (844)
Fair value of Eligible Shareholder
warrants to be issued (Note 18) 25
Deferred compensation expense 24 24
--------- ------- ------- -------
BALANCE, JANUARY 31, 2006 (22,805) (65) 9,572 $ (501)
=======
Net loss (7,580) (7,580)
Share-based compensation expense 358
Treasury stock issued 456 371
Deferred compensation expense 24 24
--------- ------- ------- -------
BALANCE, JANUARY 31, 2007 $ (22,349) $ (41) $ 2,754 $ (7,580)
========= ======= ======= =======

See accompanying notes to consolidated financial statements.

IDNA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

Years Ended January 31,
---------------------------
2007 2006 2005
------- ------- -------

CASH FLOWS FROM CONTINUING OPERATING ACTIVITIES
Net loss $(7,580) $ (501) $(3,164)
Adjustments to reconcile net loss to net cash
provided by (used in) continuing operating activities:
Depreciation and amortization 1,652 1,411 1,330
Impairment charge 4,482
Income from AFC investment (609) (744) (344)
Share-based compensation expense 724 -- --
Stock issued as compensation for services rendered 5 33 --
Excess payment over fair value of tresury stock purchased -- 208 --
Amortization of deferred compensation expense 24 24 24
Fair value of Eligible Shareholder warrants -- 25 --
Changes in operating assets and liabilities:
Accounts receivable 249 882 (153)
Accrued income tax/refundable (79) 856 1,330
Accounts payable 158 77 17
Deferred revenue 141 (351) 418
Self insurance claims -- (21) (152)
Other operating assets and liabilities, net (363) 584 (93)
------- ------- -------
Net cash provided by (used in) operating activities (1,196) 2,483 (787)
------- ------- -------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of OTI net of cash acquired -- (827) --
Purchase of letter of credit, increase in restricted cash (147) -- --
Proceeds from AFC distributions 1,207 878 937
Purchase of other property and equipment (579) (285) (246)
------- ------- -------
Net cash provided by (used in) investing activities 481 (234) 691
------- ------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of promissory note 1,000 -- 1,000
Proceeds from borrowings under a capital lease 102 -- --
Proceeds from sale of treasury stock 237
Payments on debt, notes payable and capital lease (453) (524) (1,046)
Payments to acquire treasury stock -- (1,052) --
Payments to retire due to the former OTI Members (530) -- --
------- ------- -------
Net cash provided by (used in) financing activities 119 (1,576) 191
------- ------- -------
Increase (decrease) in cash and cash equivalents from operations (596) 673 95
Cash and cash equivalents at beginning of year 1,144 471 376
------- ------- -------
Cash and cash equivalents at end of year $ 548 $ 1,144 $ 471
======= ======= =======

- continued -

See accompanying notes to consolidated financial statements.

iDNA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
(IN THOUSANDS)

Years Ended January 31,
-----------------------
2007 2006 2005
---- ------- ----
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid $166 $ 489 $624
==== ======= ====
Income taxes paid $ 55 $ 45 $ 67
==== ======= ====
Acquisition of OTI:
Non-cash assets acquired $ 3,605
Liabilities assumed (1,031)
-------
2,574
Promissory notes issued (1,489)
Treasury stock issued (258)
-------
Cash paid, net of cash acquired $ 827
=======

See accompanying notes to consolidated financial statements.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION: iDNA, Inc. ("the Company" or "iDNA") began operations in 1969
and was incorporated in Delaware in 1971. As a consequence of iDNA's
consummation of a series of acquisitions during the past four years, management
has determined during the fourth quarter of Fiscal 2007, iDNA's operations are
now comprised of three principal reportable segments: (i) strategic
communications services, (ii) information services and (iii) entertainment. iDNA
manages each segment separately as a consequence of different marketing, service
requirements and technology strategies (see Note 13).

As of consequence of iDNA's investment in the Angelika Film Centers, LLC
("AFC"), iDNA operates in the movie exhibition and entertainment industry (see
Note 5).

iDNA continues to examine new business opportunities, which may be pursued
through the investment in or acquisition of existing corporate operating
businesses or other means.

PRINCIPLES OF CONSOLIDATION: The consolidated financial statements include
the accounts of iDNA and its wholly owned subsidiaries and its investment in
AFC, a 50% owned limited liability company, which is accounted for under the
equity method. All material intercompany accounts and transactions have been
eliminated in consolidation.

ESTIMATES: The preparation of financial statements and the accompanying
notes thereto, in conformity with generally accepted accounting principles,
requires management to make estimates and assumptions that affect reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and reported amounts of
revenues and expenses during the respective reporting periods. Actual results
could differ from those estimates.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

CASH EQUIVALENTS: All highly liquid investments, such as commercial paper
and debt instruments with initial maturities of three months or less are
considered to be cash equivalents. Cash equivalents are stated at cost, which
approximates the market value. As of January 31, 2007, the Company's cash
balance, inclusive of its restricted cash, was $695,000 and the bank balance was
$981,000. Of the total bank balance, $422,000 was covered by federal depository
insurance and $559,000 was uninsured.

RESTRICTED CASH: In June 2006, iDNA obtained a letter of credit in an
amount of $147,000 that was issued in favor of the landlord of iDNA's new New
York headquarters. The letter of credit is collateralized by an interest bearing
money market account in the same amount. Therefore, $147,000 is classified as
restricted cash as of January 31, 2007.

GOODWILL AND OTHER INTANGIBLE ASSETS: Intangible assets with indefinite
lives, including goodwill, are not subject to amortization but are subject to
testing for impairment at least annually or whenever there is an impairment
indicator.

In its acquisition of Option Technologies Interactive, LLC ("OTI") on
November 18, 2005 (see Note 3), iDNA acquired certain intangible assets
including client relationships and lists and a non-competition agreement with an
aggregate fair value of $703,000. The useful lives of these intangibles are
estimated to be 7 years and 5 years, respectively. The intangible assets with
definite useful lives are amortized using the straight-line method over those
lives. For the Fiscal 2007 and from November 18, 2005, the date of acquisition,
to January 31, 2006, iDNA charged to operations $114,000 and $10,000,
respectively, for the amortization of these intangible assets.

In its acquisition of The Campus Group on July 31, 2003, iDNA acquired
certain intangible assets including client relationships and lists and a
non-competition agreement with an initial aggregate fair value of $9.5 million.
The adjusted useful lives (see Note 2) of these intangibles are estimated to be
10 years and 9 years, respectively. The intangible assets with definite useful
lives are amortized using the straight-line method over those lives. For Fiscal
2007, Fiscal 2006 and Fiscal 2005, charged to operations $639,000, $568,000 and
$568,000 respectively, for the amortization of these intangible assets.

IMPAIRMENT OF LONG-LIVED ASSETS: iDNA reviews the carrying value of its
long-lived assets (other than goodwill) whenever events or changes in
circumstances indicate that its carrying amount may not be recoverable. When
indicators of impairment exist, iDNA determines whether the estimated
undiscounted sum of the future cash flows of such assets is less than their
carrying amounts. If less, an impairment loss is recognized in the amount, if
any, by which the carrying amount of such assets exceeds their respective fair
values. The determination of fair value is based on quoted market prices in
active markets, if available, or independent appraisals; sales price
negotiations; or projected future cash flows discounted at a rate determined by
management to be commensurate with iDNA's business risk. The estimation of fair
value utilizing discounted forecasted cash flows includes significant judgments
regarding assumptions of revenue, operating and marketing costs; selling and
administrative expenses; interest rates; property and equipment additions and
retirements; industry competition; and general economic and business conditions,
among other factors.

Certain of these long-lived assets were disposed of or have been
written-down to their estimated fair value during Fiscal 2007 (see Note 2).

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

ACCOUNTS RECEIVABLE: Accounts receivable are recorded at the invoiced
amount and do not bear interest. The allowance for doubtful accounts is iDNA's
best estimate of the amount of probable credit losses in iDNA's existing
accounts receivable. iDNA determines the allowance based on analysis of
historical bad debts, client concentrations, client credit-worthiness and
current economic trends. iDNA reviews its allowance for doubtful accounts
quarterly. Past-due balances over 90 days and specified other balances are
reviewed individually for collectibility. All other balances are reviewed on an
aggregate basis. Account balances are written off against the allowance after
all means of collection have been exhausted and the potential for recovery is
considered remote. iDNA does not have any off-balance sheet credit exposure
related to its clients.

INVENTORY: Inventory is comprised principally of electronic equipment and
related components held for sale to clients. Inventory is valued at the lower of
cost or market using the first-in - first-out inventory cost method.

PROPERTY AND EQUIPMENT: Property and equipment is stated at cost (see Note
4). Depreciation is computed using the straight-line method over the estimated
useful lives of the assets, which range from eighteen months to ten years.
Leasehold improvements are amortized using the straight-line method over the
shorter of the lease term or the estimated useful lives of the related
improvements.

INCOME TAXES: Deferred income taxes are provided for all temporary
differences between the book and tax basis of assets and liabilities. Deferred
income taxes are adjusted to reflect new tax rates when they are enacted into
law. The effect on deferred tax assets and liabilities of a change in tax rates
is recognized in income in the period that includes the enactment date. A
valuation allowance is recognized if it is anticipated that some or all of a net
deferred tax asset may not be realized (see Note 9).

SELF-INSURANCE CLAIMS: iDNA's wholly-owned subsidiary ARAC, Inc. ("ARAC")
is the subject to certain self-insurance claims and associated litigation
expenses relating to its discontinued automobile rental operations (see Notes 12
and 17). iDNA's management estimates the required self-insurance liability based
upon specific identification of the known matters subject to future claims, the
nature of the claim and the estimated costs to be incurred. These estimates
include, but are not limited to, ARAC's historical loss experience and projected
loss factors. The required self-insurance liability is subject to adjustment in
the future based upon changes in the nature of the remaining claims or the
ultimate cost. As a consequence of iDNA's sale of its automobile rental
operations in 1995, iDNA believes that all incurred claims have been reported to
ARAC and that there are no longer any incurred but not yet reported claims to be
received by ARAC.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

REVENUES: iDNA's revenues are earned within short time periods, generally
less than one week. iDNA recognizes revenue from its strategic communications
segment, including the video production, video editing, meeting services and
broadcast satellite or webcast services, and its information services segment
when the services are complete and delivered or all technical services have been
rendered. Deposits and other prepayments are recorded as deferred revenue until
revenue is recognized. iDNA does not have licensing or other arrangements that
result in additional revenues following the delivery of the video or a
broadcast. Costs accumulated in the production of the video, meeting services or
broadcasts are deferred until the sale and delivery are complete. Deferred
production costs of $115,000 and $22,000, respectively, are included as a
component of other current assets at January 31, 2007 and 2006.

iDNA recognizes revenue from the sale of electronic equipment, proprietary
software and related components at the time of shipment. Deposits and other
prepayments received prior to shipment are recorded as deferred revenue until
the electronic equipment and related software is shipped. iDNA has licensing and
technical support arrangements for future software enhancements and upgrades for
technical support for previously delivered electronic equipment. Revenues
derived from licensing and technical support are recognized over the term of the
licensing and technical support period which generally are sold in increments of
one year of coverage. For Fiscal 2007, Fiscal 2006 and Fiscal 2005, electronic
equipment sales were $2.6 million, $1.3 million and $668,000, respectively.

COST OF REVENUES: Cost of revenues consists of direct expenses specifically
associated with client revenues. The cost of revenues includes direct salaries
and benefits, purchased products or services for clients, web hosting, support
services and shipping and delivery costs.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

RESEARCH AND DEVELOPMENT COSTS: As a consequence of the acquisition of OTI,
iDNA incurs certain research and development costs. Research and development
costs are comprised principally of personnel costs incurred for enhancements,
modifications, updates, service and support expenditures for iDNA proprietary
software. Research and development costs are charged to operations as incurred
and are included as a component of costs of revenues for Fiscal 2007 and from
November 18, 2005, the date of acquisition of OTI, to January 31, 2006, iDNA
charged $416,000 and $75,000 to research and development expense.

ACCOUNTING FOR STOCK-BASED COMPENSATION: Effective February 1, 2006, iDNA
adopted the provisions of Statement of Financial Accounting Standards ("SFAS")
No. 123R (revised 2004), Share-Based Payment ("SFAS No. 123(R)"), which replaces
SFAS No. 123, Accounting for Stock-Based Compensation ("SFAS No. 123"), and
supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees. SFAS
No. 123(R) requires all share-based payments to employees, including grants of
employee stock options, to be recognized in the financial statements based on
their fair values beginning with the first interim or annual period after
December 15, 2005. The pro forma disclosures previously permitted under SFAS No.
123 no longer will be an alternative to financial statement recognition. iDNA
elected the prospective method of adopting SFAS No. 123(R) which requires that
compensation expense be recorded over the remaining periods for what would have
been the remaining fair value under SFAS No. 123 of all unvested stock options
and restricted stock at the beginning of the first quarter of adoption. The
compensation costs for that portion of awards is based on the grant-date fair
value of the awards as calculated for pro forma disclosures under SFAS No. 123.

Prior to the adoption of SFAS No. 123(R), iDNA followed the intrinsic value
method in accordance with APB No. 25 to account for its employee stock options.
Historically, substantially all stock options have been granted with an exercise
price equal to the fair market value of the iDNA $0.05 par value common stock
("Common Stock"). As a consequence, no compensation expense was recognized from
substantially all option grants to employees, officers and directors.

In Fiscal 2007 and Fiscal 2006, iDNA issued 1,605,000 and 507,509 stock
options to iDNA's employees, officers, directors and advisors. In Fiscal 2006,
iDNA also cancelled 10,557 stock options. Each of the stock options granted in
Fiscal 2007 and Fiscal 2006 were subject to vesting and at January 31, 2007,
1,873,651 options had vested pursuant to the terms of the grant. No stock
options were granted in Fiscal 2005. As consequence of adopting SFAS No. 123(R),
iDNA has recorded charges to operations for stock-based compensation expense for
Fiscal 2007 of $724,000. If iDNA had recorded compensation expense using the
fair value method of SFAS No. 123(R) for Fiscal 2006, iDNA's net after tax
charge to operations would have been $67,000. For Fiscal 2005, iDNA would not
have incurred a charge to operations for compensation expense.

EARNINGS PER SHARE: Basic earnings (loss) per share is computed by dividing
net income (loss) by the weighted-average number of shares of iDNA Common Stock
outstanding for the year. Dilutive earnings per share for all years presented is
the same as basic earnings per share because the inclusion of common stock
equivalents would have an anti-dilutive effect on loss per share for Fiscal
2007, Fiscal 2006, and Fiscal 2005. Common stock equivalents, in the form of
stock options, which were excluded from the earnings (loss) per share due to
their dilutive effect were 3,230,702, 1,681,952, and 1,630,000 for Fiscal 2007,
Fiscal 2006 and Fiscal 2005, respectively.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

NEW ACCOUNTING PRONOUNCEMENTS: In June 2006, the FASB issued Financial
Interpretation No. 48, Accounting for Uncertainty in Income Taxes--an
Interpretation of FASB Statement No. 109 ("FIN No. 48"). This interpretation,
among other things, creates a two-step approach for evaluating uncertain tax
positions. Recognition (step one) occurs when an enterprise concludes that a tax
position, based solely on its technical merits, is more-likely-than-not to be
sustained upon examination. Measurement (step two) determines the amount of
benefit that more-likely-than-not will be realized upon settlement.
De-recognition of a tax position that was previously recognized would occur when
a company subsequently determines that a tax position no longer meets the
more-likely-than-not threshold of being sustained. FIN No. 48 specifically
prohibits the use of a valuation allowance as a substitute for de-recognition of
tax positions, and it has expanded disclosure requirements. FIN No. 48 is
effective for our fiscal years beginning after December 15, 2006, in which the
impact of adoption should be accounted for as a cumulative-effect adjustment to
the beginning balance of retained earnings. iDNA is currently evaluating the
impact of the adoption of FIN No. 48 on iDNA's reported consolidated financial
position or results of operations.

In September 2006, the Securities and Exchange Commission released Staff
Accounting Bulletin No. 108 ("SAB No. 108") to address diversity in practice
regarding consideration of the effects of prior year errors when quantifying
misstatements in current year financial statements. The SEC staff concluded that
registrants should quantify financial statement errors using both a balance
sheet approach and an income statement approach and evaluate whether either
approach results in quantifying a misstatement that, when all relevant
quantitative and qualitative factors are considered, is material. SAB No. 108
states that if correcting an error in the current year materially affects the
current year's income statement, the prior period financial statements must be
restated. SAB No. 108 is effective for fiscal years ending after November 15,
2006. The adoption of SAB No. 108 did not have a material impact on our
consolidated financial statements.

RECLASSIFICATIONS: Certain prior year amounts have been reclassified to
conform to the current year presentation.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 2 - IMPAIRMENT OF LONG-LIVED ASSETS AND GOODWILL

Pursuant to iDNA's established accounting policies, iDNA conducted its
Fiscal 2006 annual analysis of goodwill as of January 31, 2006. iDNA estimated
the fair value of its reporting units and compared those values to the carrying
values of those reporting units. If the estimated fair value of the reporting
unit is less than the estimated book value, then an impairment is deemed to have
occurred. In estimating the fair value of each reporting unit, iDNA used
primarily the income approach (which utilizes forecasted discounted cash flows
to estimate the fair value of the reporting unit). iDNA concluded that as of
January 31, 2006 there was no impairment of its goodwill based upon the then
estimated fair value of its reporting units.

However, during the second quarter of Fiscal 2007, as a consequence of
declining revenues and the loss of a client the results of the operations of the
Campus Group Companies, Inc. ("CGC") reporting unit raised questions as to
whether projections used at the last valuation date were still valid.
Accordingly, management performed additional impairment tests as of July 31,
2006 for CGC and determined that impairment charges were required at that date.
Accordingly, based upon iDNA's preliminary assessment, second quarter operations
for Fiscal 2007 were charged $2.6 million and $1.9 million for the estimated
impairment of CGC's goodwill and other intangible assets, respectively.
Additionally, iDNA determined it appropriate to reduce the useful life of the
CGC client relationships intangible asset from 17 years to 10 years. iDNA will
continue to monitor CGC's operations and will recognize further impairment
charges if and when deemed appropriate.

iDNA conducted its Fiscal 2007 annual analysis of goodwill as of January
31, 2007. iDNA estimated the fair value of its reporting units and compared
those values to the carrying values of those reporting units. If the estimated
fair value of the reporting unit is less than the estimated book value, then an
impairment is deemed to have occurred. In estimating the fair value of each
reporting unit, iDNA used primarily the income approach (which utilizes
forecasted discounted cash flows to estimate the fair value of the reporting
unit). iDNA concluded that as of January 31, 2007 there were no additional
impairments of its goodwill based upon the then estimated fair value of its
reporting units.

NOTE 3 - ACQUISITION

OTI

On November 18, 2005, iDNA consummated the acquisition of 100% of the
membership interests of OTI from Flexner Wheatley & Associates ("FWA") and
MeetingNet Interactive, Inc. ("MeetingNet"). OTI is an information services and
technology company providing interactive software and hardware systems and
services that facilitates audience interaction, participation and polling to
collect, exchange and/or analyze data and information in real-time for use in
live events, training and education satellite videoconferencing and corporate or
institutional meeting services. Prior to the acquisition of OTI, iDNA's
subsidiary Audience Response Systems, Inc. ("ARS"), also provided similar
services. With the acquisition of OTI, iDNA (i) gained access to important new
clients, industries and market segments, (ii) acquired a fully developed and
integrated propriety software that is an "add-in" application module with
Microsoft(R) Office PowerPoint(R) which, among other attributes, allows clients
to develop and self-administrate audience interaction and data collection
programs at smaller and other venues not then currently served by iDNA and (iii)
expanded its solutions-based communication product offering to meet dynamic
demands of current and potential clients. The significant value in the
acquisition lay principally in its (i) industry position, (ii) assembled
workforce, (iii) proprietary software, (iv) trademarks and (iv) client lists and
client relations.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 3 - ACQUISITION (CONTINUED)

In exchange for the acquisition of all of the outstanding membership
interests of OTI, iDNA (i) paid $744,000 at closing from iDNA's available cash
balances, (ii) issued to FWA and MeetingNet promissory notes in an aggregate
principal amount of $1.5 million ("OTI Promissory Notes") and (iii) issued an
aggregate of 496,250 shares of iDNA's Common Stock to FWA and MeetingNet valued
at $258,000, representing the fair value of such number of shares of iDNA's
Common Stock at the date of acquisition. For financial reporting purposes, the
transaction was treated as a purchase with an effective date of November 18,
2005. The purchase price is subject to an upward and downward adjustment not to
exceed $412,500 based upon OTI's meeting, or failing to meet, certain minimum
financial performance criterion for Fiscal 2007 and Fiscal 2008. As of January
31, 2007, OTI has not yet met all the minimum financial performance criterion
and, as a consequence, an adjustment to the purchase price is not required.

In connection with the OTI acquisition, Mark Fite, entered into an
employment agreement with OTI under which he has agreed to serve as President of
OTI for an initial term of three years. Under the terms of the employment
agreement, Mr. Fite will be entitled to base compensation of $150,000 per year,
a grant of stock options to acquire 60,000 shares of iDNA Common Stock, subject
to vesting in three equal annual installments over the term of the employment
agreement and a performance bonus based upon the operating results of OTI. iDNA
also granted stock options to all active OTI employees to acquire an aggregate
of 66,500 shares of iDNA Common Stock, subject to vesting over a three year
period and subject to OTI's meeting certain minimum financial performance
criterion for Fiscal 2007 and Fiscal 2008. The exercise price for the stock
options granted to Mr. Fite and the OTI employees was set at the fair value of
iDNA's Common Stock as of the date of the OTI acquisition, $0.52 per share.

The components and allocation of the purchase price were as follows (in
thousands):

Amount
------
Components of purchase price:
Cash paid at closing $ 744
Promissory notes issued at closing 1,489
Common stock issued at closing 258
Transaction costs 268
------
Total purchase price $2,759
======
Allocation of purchase price:
Current assets $1,303
Property and equipment 1,381
Goodwill arising in the acquisition 403
Other intangible assets 703
------
3,790
Accounts payable and accrued expenses (497)
Due to former OTI Members (534)
------
Net assets acquired $2,759
======

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 3 - ACQUISITION (CONTINUED)

As a consequence of the OTI acquisition and in accordance with SFAS No. 141
Business Combinations, iDNA recorded goodwill and other intangible assets of
$403,000 and $703,000, respectively. iDNA has estimated lives for these
intangible assets of 5 to 7 years. For Fiscal 2007 and for the period of
November 18, 2005, the date of acquisition, to January 31, 2006, iDNA charged to
operations $114,000 and $10,000, respectively, for the amortization of these
intangibles. iDNA engaged the valuation services of an independent third party
appraisal company to assist iDNA with respect to the final determination of the
fair value of tangible and intangible assets acquired in accordance with SFAS
No. 141 Business Combinations. The valuation analysis was completed in October
2006 and as a consequence of the results of the analysis, adjustments to the
purchase price allocation have been recorded.

iDNA does not expect amortization of goodwill or other intangibles, if any,
to be deductible for income tax purposes.

The following sets forth the pro forma condensed results of operations of
iDNA and OTI for Fiscal 2006 as if the acquisition was consummated on February
1, 2005. Prior to OTI's acquisition, OTI, used a December 31 year end, and
accordingly the pro forma results have been prepared by combining the historical
results for iDNA for the year ended January 31 with the historical results of,
OTI for the year ended December 31. These pro forma results have been prepared
for illustrative purposes only and do not purport to be indicative of what would
have occurred had the acquisition been in effect for the periods indicated or
the results which may occur in the future. Pro forma revenues, net loss and loss
per share are as follows (in thousands):

Year Ended
January 31,
2006
-----------
Service revenues $18,990
=======
Net income (loss) from continuing operations $ 153
=======
Income (loss) per share from continuing operations $ 0.02
=======

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 4 - PROPERTY AND EQUIPMENT

The components of property and equipment are as follows (in thousands):

January 31,
--------------------
Description 2007 2006 Estimated Useful Life
----------- ------- ---------- ---------------------

Leasehold improvements $ 368 $ 357 Lesser of useful life or term of lease
Machinery & equipment 2,008 2,039 5 years
Computer equipment 1,108 955 3 years
Furniture & fixtures 308 261 5 years
Automobiles 59 59 2 - 3 years
Software 1,576 1,112 5 to 10 years
Small tools 28 35 18 to 24 months
Film library 130 130 5 years
------ ------
5,585 4,948
Less
Accumulated depreciation (2,833) (2,029)
------ ------
$ 2,752 $ 2,919
======= =======

Depreciation expense was $899,000, $833,000 and, $762,000 for Fiscal 2007,
Fiscal 2006 and Fiscal 2005, respectively.

NOTE 5 - INVESTMENT IN AFC

On April 5, 2000, iDNA, through its wholly owned subsidiary National
Cinemas, Inc., purchased a 50% membership interest in AFC. AFC is the owner and
operator of the Angelika Film Center, which is a multiplex cinema and cafe
complex in the Soho District of Manhattan in New York City. The 50% membership
interest was purchased from Reading International, Inc. ("Reading") for an
initial investment of $11.1 million. At April 5, 2000, the investment exceeded
iDNA's share of the net assets of AFC by approximately $5.6 million, which is
being treated in a manner similar to goodwill (see Note 1).

While AFC is currently owned 50% by iDNA and 50% by Reading, its articles
and bylaws provide that for all matters subject to a vote of the members, a
majority is required, except that in the event of a tie vote, the Chairman of
Reading shall cast the deciding vote.

iDNA uses the equity method to account for its investment in AFC. AFC uses
a December 31 year-end for financial reporting purposes. iDNA reports on a
January 31 year-end, and for its fiscal quarters ending April 30, July 31,
October 31 and January 31 records its pro-rata share of AFC's earnings on the
basis of AFC's fiscal quarters ending March 31, June 30, September 30, and
December 31, respectively. For Fiscal 2007, Fiscal 2006 and Fiscal 2005, iDNA
recorded income from its investment in AFC of $609,000, $744,000, and $344,000,
respectively, representing its share of AFC's income.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 5 - INVESTMENT IN AFC (CONTINUED)

Summarized financial statement information for AFC as of December 31, 2006
and 2005 and for the years ended December 31, 2006, 2005 and 2004 is as follows
(in thousands):

December 31,
---------------
2006 2005
------ ------
CONDENSED BALANCE SHEET:
Current assets $1,223 $1,135
Property and equipment, net 833 1,029
Intangible with definitive life 5,707 6,299
Other assets 80 89
------ ------
$7,843 $8,552
====== ======
Current liabilities $ 480 $ 877
Non-current liabilities 2,083 1,949
Members' equity 5,280 5,726
------ ------
$7,843 $8,552
====== ======

For the Year
Ended December 31,
------------------------
2006 2005 2004
------ ------ ------
CONDENSED STATEMENT OF EARNINGS:
Revenues $6,328 $6,487 $5,093

NOTE 6 - FINANCIAL INSTRUMENTS

iDNA has various financial instruments including cash and cash equivalents,
investments in affordable housing limited partnerships, miscellaneous other
assets, promissory notes and a loan guaranteed by the U.S. Small Business
Administration (the "SBA Loan"). Many of these instruments are short-term in
nature and the fair value of these financial instruments has been estimated
based on available market information and appropriate valuation methodologies.
iDNA has determined that the carrying values of such short-term assets and
promissory notes approximate estimated fair values. The OTI Promissory Note,
Base Promissory Notes, Trailing Notes and Convertible debt (see Note 8) are
stated at cost since the obligations arose pursuant to the terms of their
underlying purchase agreements and there is currently no market prices available
of similar instruments.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 7 - OTHER LIABILITIES

The components of other liabilities are as follows (in thousands):

January 31,
---------------
2007 2006
------ ------
Accrued interest $ 176 $ 485
Accrued salary, wages and related benefits 427 595
Accrued expenses 790 619
Accrued state and local taxes 52 47
------ ------
Total $1,445 $1,746
====== ======

NOTE 8 - CURRENT AND LONG TERM OBLIGATIONS

On July 20, 2006, iDNA consummated a Loan and Security Agreement with a
lender and issued a Promissory Note (the "Note") of $1.0 million. The lender,
Seasons Go Round, was an unaffiliated third party lender. Pursuant to the terms
of the Note, (i) the outstanding principal of the Note is due February 15, 2008,
(ii) iDNA is required to pay interest only, monthly and in arrears, during the
term and (iii) the Note bears interest at fourteen percent (14%) per annum. iDNA
may prepay the Note at any time and without a prepayment penalty. The Note is
secured by a perfected first priority security interest in and to, and a lien on
and pledge of iDNA's right, title and interest in and to virtually all of iDNA's
assets not previously pledged pursuant to other long term obligations. At
January 31, 2007, the balance of the Note was $1.0 million.

As a consequence of iDNA's acquisition of OTI effective November 18, 2005,
iDNA issued to FWA and MeetingNet the OTI Promissory Notes of $1.5 million. The
OTI Promissory Notes bear interest at the rate of 5% per annum and are repayable
in quarterly installments according to a formula based upon the future cash
flows realized from OTI's operations. The OTI Promissory Notes are secured by
the membership interests of OTI. At January 31, 2007, iDNA had outstanding
principal obligations under the terms of the OTI Promissory Notes of $1.1
million and an accrued interest obligation of $15,000.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 8 - CURRENT AND LONG TERM OBLIGATIONS (CONTINUED)

As a consequence of iDNA's acquisition of The Campus Group effective July
31, 2003, iDNA issued to Mr. Campus and certain family trusts promissory notes
of $9.9 million and issued to a family trust a convertible promissory note of
$2.8 million (collectively, the "Campus Notes"). Of the $9.9 million in
promissory notes issued by iDNA, $6.6 million of the promissory notes ("Base
Notes") bear interest at 5% per annum and are repayable in quarterly
installments according to a formula based upon the future cash flows realized
from The Campus Group over a period not to exceed seven years. The remaining
$3.3 million in promissory notes ("Trailing Notes") issued by iDNA bear interest
at 5% per annum and are repayable in quarterly installments, commencing upon the
retirement of the Base Notes, according to a formula based upon the future cash
flows realized from The Campus Group over a period not to exceed three years
subsequent to the retirement of the Base Notes. The $2.8 million convertible
promissory note (i) bears interest at 5% per annum, payable quarterly in cash or
accumulating as principal at the election of iDNA, (ii) requires principal
payments to commence upon the retirement of the Base Notes and Trailing Notes
and is then repayable in quarterly installments according to a formula based
upon the future cash flows realized from The Campus Group over a period not to
exceed three years and (iii) is convertible at the option of the holder into
shares of iDNA Common Stock at a base conversion price of $1.50 per share. The
holder may not convert the convertible promissory note into iDNA Common Stock
prior to repayment of the Base Notes and Trailing Notes. The promissory notes
are secured by the capital stock of the companies comprising The Campus Group.
At January 31, 2007, iDNA had outstanding principal obligations under the terms
of the Base Notes, Trailing Notes and Convertible Notes of $6.0 million, $3.3
million and $2.8 million, respectively and accrued interest obligations of
$156,000.

For the trailing twelve month period ended July 31, 2006, The Campus
Group's financial performance fell below certain minimum operating cash flow
thresholds established pursuant to the terms of the Campus Notes. As a
consequence, the interest expense incurred by iDNA during the twelve month
period ended July 31, 2006 was abated. As a consequence of the interest
abatement, iDNA realized a gain from the abatement of interest on the Campus
Notes of $631,000 during the second quarter of Fiscal 2007. For the period
August 1, 2006 through January 31, 2007, the Campus Group's financial
performance continued to fall below the minimum thresholds. As a consequence no
interest was incurred on the Campus Notes during the period August 1, 2006
through January 31, 2007. Prospectively, interest may accrue pursuant to the
terms of the Campus Notes; however, iDNA is not obligated to pay any principal
or interest on the Campus Notes until October 31, 2007.

As a consequence of iDNA's acquisition of OMI effective April 1, 2003, iDNA
assumed $814,000 in bank debt and capital lease obligations to financial
institutions and issued a promissory note payable to Dean Thompson, President
and former shareholder of OMI, in the amount of $153,000.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 8 - CURRENT AND LONG TERM OBLIGATIONS (CONTINUED)

On April 25, 2002, OMI obtained a $402,000 loan guaranteed by the U.S.
Small Business Administration (the "SBA Loan") to finance losses incurred as a
result of the September 11, 2001 terrorist attacks in New York City. At January
31, 2007, the remaining balance of the SBA Loan of $329,000 is repayable in
monthly installments of $3,309 with the last payment due in April 2017. The loan
bears interest at the rate of 4% per annum and is collateralized by
substantially all of OMI's assets and the personal guarantee of Mr. Thompson.

The promissory note payable to Mr. Thompson was payable in monthly
installments of principal and interest over a 36 month period expiring April
2006. The promissory note bore interest at 5% per annum. The promissory note was
repaid in full in Fiscal 2007.

The components of long term obligations and convertible debt at January 31,
2007 and January 31, 2006 are as follows (in thousands):

January 31,
-----------------
2007 2006
------- -------
Capital leases $ 85 $ --
Promissory note -- 32
Term loan -- 28
SBA loan 329 357
Promissory note 1,000 --
OTI promissory notes 1,141 1,489
Base promissory notes 6,046 6,046
Trailing promissory notes 3,275 3,275
Convertible debt 2,825 2,825
------- -------
14,701 14,052
Less current maturities (805) (1,111)
------- -------
Long-term obligations and
convertible debt $13,896 $12,941
======= =======

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 8 - CURRENT AND LONG TERM OBLIGATIONS (CONTINUED)

iDNA's current maturities and convertible debt obligations at January 31,
2007 are as follows (in thousands):

Amount
-------
2007 $ 812
2008 2,041
2009 633
2010 514
2011 4,429
Thereafter 6,283
-------
$14,712
Less - capital lease interest (11)
-------
$14,701
=======

The liability due to former OTI Members at January 31, 2006 represented the
net amount outstanding for various loans and advances made by the former members
of OTI prior to the OTI acquisition by iDNA. The loans and advances do not bear
interest. Pursuant to the terms of the Member Interest Purchase Agreement,
repayments to reduce the loans and advances are to be made periodically when
cash requirements of OTI permit and were repaid in full prior to May 18, 2006.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 9 - INCOME TAXES

The components of the provision (benefit) for income taxes, in the
consolidated statement of operations are as follows (in thousands):

Years Ended January 31,
-----------------------
2007 2006 2005
---- ---- ----
Current
Federal $(19) $30 $--
Foreign (7) -- --
State 9 45 30
---- --- ---
(17) 75 30
Deferred
Federal -- -- --
Foreign -- -- --
State -- -- --
---- --- ---
-- -- --
---- --- ---
Total (17) 75 30

Allocated to discontinued operations 7 (5) --
---- --- ---
Continuing operations $(10) $70 $30
==== === ===

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 9 - INCOME TAXES (CONTINUED)

As a consequence of iDNA's November 3, 2000 repurchase of shares of its
Common Stock, iDNA underwent a "change in ownership" as defined for the purposes
of Sections 382 and 383 of the Internal Revenue Code. As a result of the "change
in ownership" described above, the use of net operating loss carryforwards
totaling approximately $61.0 million ("Section 382 NOL") incurred prior to
November 3, 2000 will be subject to significant annual limitation. As of January
31, 2007, iDNA has utilized approximately $858,000 of the Section 382 NOL.
Furthermore, an iDNA subsidiary has a Separate Return Loss Year that is also
subject to "change of ownership" limitations of $2.2 million as of January 31,
2007. The use of the net operating loss carryforwards incurred after November 3,
2000, which total $26.5 million as of January 31, 2007, are not subject to the
Section 382 limitation.

The components of the net deferred tax asset (liability) are as follows (in
thousands):

January 31,
-------------------
2007 2006
-------- --------
Deferred tax assets:
Self-insurance claims $ 82 $ 82
Impairment charge 1,976 --
State income taxes 93 106
Accrued liabilities 150 158
Stock options 125 --
Tax credits carryforwards 5,213 5,214
Net operating loss carryforwards (federal and state) 33,389 32,417
Other 15 10
-------- --------
Total deferred tax assets 41,043 37,987
-------- --------
Deferred tax liabilities:
Depreciation (89) (92)
Limited partnership investments (1,562) (1,293)
-------- --------
Total deferred tax liabilities (1,651) (1,385)
-------- --------
Net deferred tax asset before valuation allowance 39,392 36,602
Less: valuation allowance (39,392) (36,602)
-------- --------
Net deferred tax asset $ -- $ --
======== ========

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 9 - INCOME TAXES (CONTINUED)

A valuation allowance for all of iDNA's net deferred tax assets has been
provided as iDNA is unable to determine, at this time, that the generation of
future taxable income against which the net operating loss and tax credit
carryforwards could be used can be predicted to be more likely than not. The net
change in the valuation allowance for Fiscal 2007, Fiscal 2006 and Fiscal 2005
was $2.8 million, ($443,000) and $2.4 million, respectively.

Reconciliations of the federal statutory tax rate to the effective tax rate
for continuing operations are as follows:

Years Ended January 31,
-----------------------
2007 2006 2005
----- ----- -----
Statutory rate (35.0)% (35.0)% (35.0)%
Permanent differences 1.2 159.8 13.8
State income taxes (net of federal tax benefit) 0.1 6.6 0.6
Deferred tax valuation allowance 36.7 (98.1) 76.6
Tax credits -- (4.1) 4.1
Expense due to AMT NOL limitation -- 5.6 --
Adjustment to NOL carryforward (5.2) (20.9) (58.5)
Other 2.1 1.8 (0.7)
----- ----- -----
Effective Tax Rate (.1)% 15.7% .9%
===== ===== =====

NOTE 10 - STOCKHOLDERS' EQUITY AND PREFERRED STOCK

Preferred Stock

iDNA is authorized to issue up to 5,000,000 shares of Preferred Stock, in
one or more series, having such preferences and terms as the Board of Directors
may determine. At January 31, 2007 and 2006, there were no outstanding shares of
Preferred Stock.

Sale of Treasury Stock

In July 2004, iDNA initiated a private placement (the "iDNA Private
Placement") whereby iDNA offered for sale up to 1.3 million shares of
unregistered, restricted treasury stock at $0.25 per share. Pursuant to the
terms of the iDNA Private Placement, iDNA sold an aggregate of 950,000 shares of
its treasury stock at $0.25 per share from which it derived net proceeds of
approximately $237,000. The restricted shares may not be sold or otherwise
transferred without registration under the Securities and Exchange Act of 1933,
as amended, or applicable state securities laws or an exemption there from. In
the event that iDNA proposes to register any of its securities under the
Securities Act, whether for its own account or for the account of another
shareholder, the treasury stock issued pursuant to the iDNA Private Placement
will be included in such registration.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 10 - STOCKHOLDERS' EQUITY AND PREFERRED STOCK (CONTINUED)

Warrants to be Issued to Eligible Shareholders

As a consequence of the New York Settlement Stipulation (see Note 18), iDNA
agreed to issue to the class of Eligible Shareholders warrants to purchase
additional iDNA Common Stock. Each Eligible Shareholder was required to submit a
proof of claim by December 15, 2005. Based upon the final submission of claims,
iDNA issued 100,282 warrants in April 2006 to Eligible Shareholders. Each
warrant issued by iDNA has a five year term and is exercisable for shares of
iDNA Common Stock at a price of $1.55 per share. For Fiscal 2006, iDNA charged
other income $25,000 for the expense of the fair value of the warrants issued to
the Eligible Shareholders.

Stock Grants and Awards

In Fiscal 2007, iDNA issued 52,000 shares of unregistered treasury stock to
two employees as a bonus and issued an additional 10,000 shares of unregistered
stock to an unrelated third party for professional services. Such shares issued
were recorded at their then market value for an aggregate cost of $52,000, or a
weighted average of $0.83 per share. The restricted shares may not be sold or
otherwise transferred without registration under the Securities and Exchange Act
of 1933, as amended, and applicable state securities laws or an exemption
therefrom. In the event that iDNA proposes to register any of its securities
under the Securities Act, whether for its own account or for the account of
another shareholder, the treasury stock issued may be included in such
registration.

In February 2005, iDNA issued 100,000 shares of unregistered, restricted
treasury stock as compensation for professional services rendered by an
unrelated third party. Such shares issued were recorded at their then market
value of $0.33 per share for an aggregate cost of $33,000.

During Fiscal 2004, iDNA granted 372,000 shares of iDNA Common Stock
pursuant to the 2003 Restricted Stock Plan (see Note 11) valued at $119,000
representing the fair value of the iDNA Common Stock at the time of award.
Accordingly, iDNA recorded $119,000 of deferred compensation expense in
connection with the 2003 Plan grant, which was reported as a component of
stockholders' equity, during Fiscal 2004. The deferred compensation expense is
charged to operations over the 5 year vesting period of the stock grant. For
Fiscal 2007, 2006 and 2005, iDNA charged to operations $24,000 per annum.

Stockholders' Rights Plan

On September 26, 2001, iDNA's Board of Directors declared a dividend of one
preferred share purchase right (a "Right") for each outstanding share of iDNA
Common Stock to stockholders of record at the close of business on October 8,
2001 (the "Record Date"). Under certain circumstances, a Right may be exercised
to purchase from iDNA a unit consisting of one one-hundredth of a share (a
"Unit") of Series D Junior Participating Preferred Stock, par value $.05 per
share (the "Series D Preferred Stock") at a Purchase Price of $5.00 per Unit,
subject to adjustment.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 10 - STOCKHOLDERS' EQUITY AND PREFERRED STOCK (CONTINUED)

The Rights become exercisable upon the earlier of (i) ten business days
following a public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") has acquired beneficial ownership of
15% or more of the outstanding shares of iDNA Common Stock (the "Stock
Acquisition Date"), other than as a result of repurchases of stock by iDNA or
certain inadvertent actions by institutional or certain other stockholders, or
(ii) 10 business days (or such later date as the Board shall determine)
following the commencement of a tender offer or exchange offer that would result
in a person or group becoming an Acquiring Person. Once exercisable, and in some
circumstances if certain additional conditions are met, the rights plan allows
iDNA shareholders (other than the acquirer) to purchase, at a substantial
discount, iDNA Common Stock or common stock in the surviving acquirer in the
event of a merger.

The Rights will expire on September 26, 2011 and may be redeemed by iDNA
for $0.01 per Right at any time prior to the close of business on the later of
(i) the tenth business day following the acquisition by a person or group of
beneficial ownership of 15% or more of iDNA 's Common Stock or (ii) the tenth
business day (or such later date as the Board shall determine) following the
commencement of a tender offer or exchange offer that would result in a person
or group becoming an Acquiring Person.

NOTE 11 - BENEFITS PLANS

2005 Equity Compensation Plan

iDNA's 2005 Equity Compensation Plan ("The 2005 Plan") provides for the
granting of incentive and non-qualified stock options, stock appreciation
rights, and common stock and restricted common stock awards to key employees,
advisors and non-employee members of the Board of Directors. The total number of
shares available for options or awards granted under the 2005 Plan is 2,000,000
shares. During Fiscal 2007, iDNA granted 1,605,000 stock options and awards to
Officers, non-employee Directors, advisors and employees of iDNA and each stock
option is subject to vesting over a specific period of time and, in certain
cases, performance criterion. No options or other awards were granted under the
2005 Plan in Fiscal 2006 or Fiscal 2005. There were 395,000 shares available for
future stock awards or option grants at January 31, 2007.

1993 Equity Incentive Plan

iDNA's 1993 Equity Incentive Plan (the "1993 Plan") provides for the
granting of incentive and non-qualified stock options, stock appreciation
rights, and common stock and restricted common stock awards to key employees,
advisors and non-employee members of the Board of Directors. The total number of
shares available for options or awards granted under the 1993 Plan is 2,200,000
shares. No options were granted under the 1993 Plan during Fiscal 2007. During
Fiscal 2006, there were 507,509 stock options granted under the 1993 Plan, each
stock option subject to vesting over a specific period of time and, in certain
cases, performance criterion. There were 455,557 stock options cancelled under
the 1993 Plan during Fiscal 2006 principally as a consequence of the shareholder
settlement (see Note 18). Pursuant to the 1993 Plan, there were 321,400 shares
available for future stock awards or option grants at January 31, 2007. No
options were granted under the 1993 Plan in Fiscal 2005.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 11 - BENEFITS PLANS (CONTINUED)

A summary of all options granted, exercised, and cancelled under the 1993
Plan and the 2005 Plan for Fiscal 2007, Fiscal 2006 and Fiscal 2005 is as
follows:

Years Ended January 31,
---------------------------------------------------------------------------------------
2007 2006 2005
--------------------------- --------------------------- ---------------------------
Weighted Weighted Weighted
Average Average Average
Shares Exercise Price Shares Exercise Price Shares Exercise Price
---------- -------------- ---------- -------------- ---------- --------------

Options outstanding - beginning of year 1,681,952 $0.78 1,630,000 $0.80 1,630,000 $0.80
Granted 1,605,000 $0.59 507,509 $0.59 -- $ --
Exercised (56,250) $ -- -- $ -- -- $ --
Cancelled -- $ -- (455,557) $0.66 -- $ --
---------- ---------- ----------
Options outstanding - end of year 3,230,702 $0.69 1,681,952 $0.78 1,630,000 $0.80
========== ===== ========== ===== ========== =====
Exercisable, at end of year 1,873,651 1,285,000 1,630,000
========== ========== ==========
Available for grant 716,400 2,321,400 373,352
========== ========== ==========
Weighted average fair value per
share of options granted during year $ 0.43 $ 0.50 $ --
========== ========== ==========

The weighted average fair value using the Black-Scholes option pricing
model of the options granted during Fiscal 2007 and Fiscal 2006 was $0.43 and
$0.50 respectively.

The fair value of the stock options at the date of grant was estimated
using the Black-Scholes option-pricing model with the following weighted average
assumptions:

Year Ended January 31,
----------------------
2007 2006
---- ----
Expected life (years) 5.6 7.3
Interest rate 4.6% 4.6%
Dividend yield -- --
Volatility 129% 107%

The risk-free interest rate is based on U.S. Treasury interest rates at the
time of the grant whose term is consistent with the expected life of the stock
options. Expected volatility is based on iDNA's historical experience. Expected
life represents the period of time that options are expected to be outstanding
and is based on iDNA's historical experience or the simplified method, as
permitted by SEC Staff Accounting Bulletin No. 107 where appropriate. Expected
dividend yield was not considered in the option pricing formula since iDNA does
not pay dividends and has no current plans to do so in the future.

The outstanding options expire at dates through the year 2014. A summary of
stock options outstanding and exercisable as of January 31, 2007 is as follows:

Options Outstanding Options Exercisable
------------------------------------------------------ ------------------------------
Range of Weighted Average Weighted Average Weighted Average
Per Share Number Remaining Contractual Per Share Number Per Share
Exercise Prices Outstanding Life (years) Exercise Price Exercisable Exercise Price
--------------- ----------- --------------------- ---------------- ----------- ----------------

$0.00 to $0.51 368,750 4.91 $0.27 -- --
$0.52 to $0.92 2,236,952 4.93 $0.64 1,411,151 $0.64
$1.03 to $1.15 512,500 3.65 $1.05 387,500 $1.05
$1.30 112,500 2.43 $1.54 75,000 $1.66
--------- ---------
Total 3,230,702 1,873,651
========== =========

2003 Restricted Stock Plan

iDNA sponsors a 2003 Restricted Stock Plan (the "2003 Plan") that provides
stock grants to all employees. The 2003 Plan authorizes the grant of up to a
maximum of 400,000 restricted shares of Common Stock to employees of iDNA.
During Fiscal 2004, there were 372,000 shares of Common Stock granted pursuant
to the terms of the 2003 Plan at an estimated fair value of $0.32 per share.
Each share granted is restricted and is not registered for resale. Each award
under the 2003 Plan vests at the rate of 20% per year over a five year period.
Shares granted under the 2003 Plan may not be sold, transferred, pledged or
otherwise disposed until they vest. During the vesting period, unvested shares
are voted by the manager of each business unit. No shares were granted to
executive officers or directors under the 2003 Plan. For Fiscal 2004, iDNA
recorded deferred compensation expense of $119,000, in connection with the 2003
Plan grants, which was recorded as a component of shareholders' equity. The
deferred compensation expense is amortized on a straight-line basis over the 5
year vesting period of the restricted iDNA Common Stock. For Fiscal 2007, Fiscal
2006 and Fiscal 2005, deferred compensation amortization expense was $24,000 per
annum. No further grants were made under the 2003 Plan during Fiscal 2007,
Fiscal 2006 and Fiscal 2005.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 11 - BENEFITS PLANS (CONTINUED)

401(k) Savings and Profit Sharing Plan

iDNA maintained the iDNA 401(k) Savings and Profit Sharing Plan (the "iDNA
401k"), a defined contribution benefit program under IRS Code Section 401(k),
for Fiscal 2007, Fiscal 2006 and Fiscal 2005. The iDNA 401k covers substantially
all active iDNA employees who are at least 21 years of age and have completed 90
days of service. The iDNA 401k allows eligible employees to contribute up to 50%
of their compensation on a pre-tax basis. The iDNA 401k provides a safe harbor
matching contribution of (i) 100% of the first 3% of the employee's
contribution, (ii) 50% of the next 2% of the employees' contribution for a
maximum of 4% matching contribution and (iii) vesting for the iDNA matching
contribution is immediate. For Fiscal 2007, Fiscal 2006 and Fiscal 2005, the
charge to operations for iDNA's contribution to the iDNA 401k was $214,000,
$164,000 and $162,000, respectively.

As a consequence of iDNA's acquisition of OTI during Fiscal 2006, iDNA
maintained the Option Technologies Interactive, LLC 401(K) Profit Sharing Plan
("OTI 401k"), a defined contribution benefit program under IRS Code section
401(k), for the newly acquired employees of OTI for the period November 18,
2005, the date of acquisition, to December 31, 2005. Effective December 31,
2005, iDNA merged the OTI 401k plan into the iDNA 401k (the "2005 Plan Merger")
and all previously unvested balances for all active employees became vested at
December 31, 2005.

Prior to the 2005 Plan Merger, the OTI 401k covered substantially all OTI
employees who had completed one year of service. The OTI 401k allowed eligible
employees to contribute up to 50% of their compensation on a pre-tax basis. The
OTI 401k provided for a safe harbor matching contribution of (i) 100% of the
first 3% of the employee's contribution, (ii) 50% of the next 2% of the
employees' contribution for a maximum of 4% matching contribution and (iii)
vesting for the OTI matching contribution is immediate. iDNA charged to
operations OTI's matching contributions of $3,000 for the period November 18,
2005, the date of the acquisition, to December 31, 2005, the date of the 2005
Plan Merger.

iDNA does not provide post-retirement or post-employment benefits to its
employees.

NOTE 12 - COMMITMENTS AND CONTINGENCIES

Self-Insurance Reserves for Property Damage and Personal Injury Claims

iDNA's wholly-owned subsidiary ARAC is the subject to certain
self-insurance claims and litigation expenses relating to its discontinued
automobile rental operations (see Note 17). iDNA's management estimates the
required self-insurance liability based upon specific identification of the
known matters subject to future claims, the nature of the claim and the
estimated costs to be incurred. These estimates include, but are not limited to,
ARAC's historical loss experience and projected loss factors. The required
self-insurance liability is subject to adjustment in the future based upon
changes in the nature of the remaining claims or the ultimate cost. As a
consequence of iDNA's sale of its automobile rental operations in 1995, iDNA
believes that all incurred claims have been reported to ARAC and that there are
no longer any incurred but not yet reported claims to be received by ARAC.
iDNA's self-insurance liability at January 31, 2007 and 2006 was $235,000 and
$235,000, respectively.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 12 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

Because of the uncertainties related to several residual small claims and
legal proceedings involving iDNA's former rental operations and self-insurance
claims, it is difficult to project with precision the ultimate effect the
adjudication or settlement of these matters will have on iDNA. At January 31,
2007, iDNA had accrued $235,000 to cover all outstanding self-insurance
liabilities. As additional information regarding iDNA's potential liabilities
becomes available, iDNA will revise the estimates as appropriate.

Other Litigation

Lease Commitments

iDNA leases office and warehouse facilities in Florida, Indiana, New York
and Utah under leases expiring at various dates. iDNA's OMI subsidiary has
subleased a portion of its office in New York, NY to an unaffiliated third party
for the remainder of its term which expires in September 2007 at a base rate of
$60,000 to the end of the term. In addition to the lease base rents, iDNA is
generally required to pay increases over base period amounts for taxes and other
operating expense. At January 31, 2007, future minimum payments under
noncancellable operating leases, net of the effects of the sublease, are as
follows (in thousands):

Fiscal Year Amount
----------- ------
2008 $ 791
2009 514
2010 474
2011 351
2012 308
Thereafter 282
------
$2,720
======

Employment Agreement with James J. McNamara

On November 29, 2006, the Board of Directors of iDNA approved, and iDNA
consummated, an employment agreement with James J. McNamara (the "Employment
Agreement"). Under the terms of the Employment Agreement, Mr. McNamara shall be
employed as the Company's Chief Executive Officer for an initial term of
approximately three years, until January 31, 2010 (the "Initial Term"), and
shall receive an initial base salary of $590,000 per year (the "Base Salary"),
which shall increase annually by $15,000 each January 31st, beginning January
31, 2008 (each year under the Employment Agreement commencing January 31st, an
"Employment Year"). Mr. McNamara is also entitled to receive an annual bonus of
$100,000 if, at the end of a particular Employment Year, iDNA's common stock,
par value $0.05 per share ("Common Stock"), exceeds the previous Employment
Year's price per share by 125%. Furthermore, Mr. McNamara is also entitled to
incentive compensation of up to $200,000 in the event that iDNA achieves certain
performance objectives established by iDNA's Board of Directors. The incentive
compensation may also be increased by the Board of Directors if the Board
believes it appropriate to reward the Chief Executive Officer's performance for
a given year.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 12 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

In addition to cash compensation, the Employment Agreement provides Mr.
McNamara, as a signing bonus, a grant of 500,000 shares of Common Stock.
However, in the event of Mr. McNamara's resignation or termination for any
reason prior to the expiration of the Initial Term, iDNA may redeem and
repurchase, at the price of $0.01 per share, (i) 375,000 shares of Common Stock,
if such resignation or termination precedes the passage of one Employment Year
under the Employment Agreement, (ii) 250,000 shares of Common Stock, if such
resignation or termination occurs after the passage of one Employment Year but
prior to the completion of the second Employment Year under the Employment
Agreement, or (iii) 125,000 shares of Common Stock if such resignation or
termination follows the completion of two Employment Years but precedes the
completion of the third Employment Year under the Employment Agreement. As a
consequence of the grant of stock as a signing bonus, iDNA charged to operations
$290,000 for compensation expense for the fair value of the stock at the time of
grant

Besides the grant of shares of Common Stock, the Employment Agreement also
provides for Mr. McNamara to be granted stock options exercisable for the
purchase of 500,000 shares of Common Stock at the following exercise prices: (i)
125,000 options at $0.61 per share; (ii) 125,000 options at $0.73 per share;
(iii) 125,000 options at $0.88 per share; and (iv) 125,000 options at $1.05 per
share. The stock options, having a seven year term from the grant date, were
granted (upon approval by iDNA's Board of Directors) pursuant to the terms of
iDNA's 2005 Equity Compensation Plan. Of the 500,000 options granted, 125,000
options have vested (and are exercisable) immediately as of the grant date,
whereas 375,000 of the options are subject to vesting and become exercisable in
three equal, annual installments of 125,000 options each, provided that Mr.
McNamara is employed as of November 29, 2007, 2008 and 2009, respectively. As a
consequence of the grant of stock options, iDNA charged to operations $75,000
for compensation expense for the fair value of the vested portion of the stock
options at the time of grant

The Employment Agreement also provides for certain payments to Mr. McNamara
in the event of a termination without cause by iDNA or a termination for good
reason by Mr. McNamara, as follows: iDNA will pay to Mr. McNamara, in accordance
with iDNA's normal payroll payment practices, the lesser of (i) thirty months of
the Base Salary or (ii) one dollar ($1) less than the amount that would
constitute an "excess parachute payment" under Section 280G of the Internal
Revenue Code. As a result of such termination, iDNA shall also continue to
provide Mr. McNamara with all employee benefits in which he was participating or
which he was receiving as of the effective date of termination (or, if greater,
as of the end of the prior year) for thirty months following termination. At its
own election, iDNA may make a lump sum payment of eighteen months of base
compensation and employee benefits as full termination compensation pursuant to
the terms of the Employment Agreement.

If, upon a Change in Control (as defined in the Employment Agreement), as a
result of any payment or the vesting of any options pursuant to the terms of the
Employment Agreement (or pursuant to any other plan, agreement or program)
(collectively, a "Payment"), it is determined that Mr. McNamara would be subject
to the excise tax imposed by Section 4999 of the Internal Revenue Code (the
"Parachute Tax"), then Mr. McNamara shall be entitled to receive an additional
payment or payments (a "Gross-Up Payment") in an amount such that, after payment
by Mr. McNamara of all taxes (including any Parachute Tax) imposed upon the
Gross-Up Payment, Mr. McNamara will retain an amount of the Gross-Up Payment
equal to the Parachute Tax imposed upon the Payment.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 13 - SEGMENT INFORMATION

As a consequence of iDNA's consummation of a series of acquisitions during
the past three years, iDNA operations for Fiscal 2007 are now comprised of three
principal reportable segments, strategic communications services, information
services and entertainment. iDNA manages each segment separately as a
consequence of different marketing, service requirements and technology
strategies.

Strategic Communication Services

Information Services

Entertainment

As of consequence of iDNA's investment in AFC (see Note 5), iDNA operates
in the movie exhibition and entertainment industry.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 13 - SEGMENT INFORMATION (CONTINUED)

We evaluate the performance of our segments and allocate resources based on
revenues and operating income. The table below presents the information about
our reportable segments for our continuing operations used by our chief
operating decision-makers for Fiscal 2007, Fiscal 2006 and Fiscal 2005. Prior
fiscal periods have been conformed to the current presentation.

Strategic Undistributed
Information Communications Corporate Intersegment
Services Services Entertainment Expenses Elimination Total
----------- -------------- ------------- ------------- ------------ -------

YEAR ENDED JANUARY 31, 2007
Revenues $ 9,478 $ 6,083 $ -- $ -- $(117) $15,444
Operating income (loss) (482) (6,807) 590 (902) -- (7,601)
Identifiable assets 10,285 3,495 7,224 1,074 -- 22,078
Depreciation and
amortization expense 871 719 -- 62 -- 1,652
Impairment charge -- 4,482 -- -- 4,482
Capital expenditures 357 144 -- 78 -- 579
YEAR ENDED JANUARY 31, 2006
Revenues $ 5,958 $ 8,322 $ -- $ -- $(190) $14,090
Operating income (loss) (54) (465) 738 226 -- 445
Identifiable assets 10,819 9,047 7,836 1,145 -- 28,847
Depreciation and
amortization expense 587 757 -- 67 -- 1,411
Capital expenditures 222 57 -- 6 -- 285
YEAR ENDED JANUARY 31, 2005
Revenues $ 4,522 $ 6,990 $ -- $ -- $(169) $11,343
Operating income (loss) 451 (1,354) 320 (2,551) -- (3,134)
Identifiable assets 7,561 10,355 7,955 2,218 -- 28,089
Depreciation and
amortization expense 509 748 -- 73 -- 1,330
Capital expenditures 112 75 -- 59 -- 246

NOTE 14 - SIGNIFICANT CLIENTS

Revenues for Fiscal 2007, Fiscal 2006 and Fiscal 2005 were $15.4 million,
$14.1 million and $11.3 million, respectively. Pfizer, Inc. accounted for 17% of
revenues for Fiscal 2007. Pfizer Inc. and BearingPoint, Inc. accounted for 21%
and 13%, respectively of revenues for Fiscal 2006. Pfizer Inc. and R&D Strategic
Solutions, Inc. accounted for 36% and 13%, respectively, of revenues for Fiscal
2005.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 14 - SIGNIFICANT CLIENTS (CONTINUED)

iDNA is subject to account receivable credit concentrations from
time-to-time as a consequence of the timing, payment pattern and ultimate value
of large meeting or event schedules with its clients. These concentrations of
client meetings or events may impact our overall exposure to credit risk, either
positively or negatively, in that our clients may be similarly affected by
changes in economic, regulatory or other conditions that may impact the timing
and collectability of amounts due to iDNA. At January 31, 2007, two clients
comprised approximately 19.0% and 14.9%, respectively, of iDNA's accounts
receivable. Management believes that the provision for possible losses on
uncollectible accounts receivable is adequate for iDNA's credit loss exposure.
At January 31, 2007 and 2006, the allowance for doubtful accounts was $82,000
and $105,000, respectively.

NOTE 15 - QUARTERLY FINANCIAL DATA (UNAUDITED)

The following table presents unaudited quarterly financial information for
Fiscal 2007 and Fiscal 2006 (in thousands, except per share amounts):

Quarter
------------------------------------
First Second Third Fourth
------- ------- ------ -------

FISCAL 2007
Total service revenue $ 3,432 $ 3,538 $4,758 $ 3,716
Gross profit 1,098 1,497 2,204 1,498

Income (loss) from continuing operations $(1,154) $(5,137) $ (280) $(1,020)
Discontinued operations, net of tax 1 1 1 8
------- ------- ------ -------
Net income (loss) $(1,153) $(5,136) $ (279) $(1,012)
======= ======= ====== =======
Basic and diluted income (loss) earnings per share(1)
Continuing operations $ (.13) $ (.56) $ (.03) $ (.11)
Discontinued operations -- -- -- --
------- ------- ------ -------
Net income (loss) per share $ (.13) $ (.56) $ (.03) $ (.11)
======= ======= ====== =======
FISCAL 2006
Total service revenue $ 2,864 $ 1,632 $4,503 $ 5,091
Gross profit 1,367 364 2,113 2,084

Income (loss) from continuing operations $ (374) $ 79 $ 97 $ (317)
Discontinued operations, net of tax 2 14 -- (2)
------- ------- ------ -------
Net income (loss) $ (372) $ 93 $ 97 $ (319)
======= ======= ====== =======
Basic and diluted income (loss) earnings per share(1)
Continuing operations $ (.04) $ .01 $ .01 $ (.03)
Discontinued operations -- -- -- --
------- ------- ------ -------
Net income (loss) per share $ (.04) $ .01 $ .01 $ (.03)
======= ======= ====== =======

(1) The sum of the quarters do not equal year to date.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 16 - RELATED PARTY TRANSACTIONS

Pursuant to the terms of the OTI Membership Purchase Agreement dated
November 18, 2005, iDNA was obligated to repay the former OTI Members for
certain loans and advances made by the former OTI Members prior to the OTI
acquisition by iDNA. iDNA repaid in full the OTI Members loans and advances in
periodic installments, as required, during Fiscal 2007.

The Campus Group leases its corporate headquarters in Tuckahoe, New York
and its Bohemia, New York warehouse and distribution center from a former The
Campus Group shareholder. The leases expire in April 2010. The annual lease
commitment during the term is $175,000 per annum. iDNA charged to operations
rent expense of $175,000, $175,000 and $175,000 for Fiscal 2007, Fiscal 2006 and
Fiscal 2005, respectively.

NOTE 17 - DISCONTINUED OPERATIONS

Auto Rental and Finance Operations

iDNA, under the names Agency Rent-A-Car, Inc. ("ARAC"), Altra Auto Rental
and Automate Auto Rental, previously engaged in the rental of automobiles on a
short-term basis, principally to the insurance replacement market. During Fiscal
1996, iDNA disposed of its rental fleet business through the sale of certain
assets and through certain leases to a national car rental company. All
liabilities related to the discontinued rental business, principally
self-insurance claims, were retained by ARAC.

Prior to Fiscal 2002, iDNA was engaged in the sub-prime used automobile
finance business. At that time, iDNA, then known as National Auto Credit, Inc.
("NAC"), invested in sub-prime used automobile consumer loans, which took the
form of installment loans collateralized by the related vehicle. NAC purchased
such loans, or interested in pools of such loans, from member dealerships, and
performed the related underwriting and collection functions. NAC formally
discontinued its automobile finance business effective December 31, 2001.

The results of both the auto rental and finance operations are included in
the results of discontinued operations. For the years ended January 31, 2007,
2006 and 2005, the results of the discontinued operations principally represent
the effects of the residual collection of previously charged off loans, and the
settlement of, and changes in iDNA's, provisions for income taxes and reserves
for claims against ARAC related to the self-insured claims (see Note 12).

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 17 - DISCONTINUED OPERATIONS (CONTINUED)

Summarized results of discontinued operations are as follows (in
thousands):

Discontinued Operations
-----------------------
2007 2006 2005
---- ---- ----
Revenue $ 4 $20 $13

General and administrative expenses -- 1 13
--- --- ---
-- 1 13
--- --- ---
Income (loss) before income taxes 4 19 --
Provision (benefit) for income taxes (7) 5 --
--- --- ---
Income (loss) from discontinued operations $11 $14 $--
=== === ===

NOTE 18 - SHAREHOLDER COMPLAINT SETTLEMENT

Shareholder Complaints

In July and August 2001, iDNA received three separate derivative complaints
filed with the Court of Chancery of Delaware ("Delaware Court") by each of
Academy Capital Management, Inc ("Academy Complaint")., Levy Markovich,
("Markovich Complaint") and Harbor Finance Partners ("Harbor Complaint"), all
shareholders of iDNA, against James J. McNamara, John A. Gleason, William S.
Marshall, Henry Y.L. Toh, Donald Jasensky, Peter T. Zackaroff, Mallory Factor,
and Thomas F. Carney, Jr. (the "Director Defendants") and names iDNA as a
nominal defendant. By order of the Delaware Court on November 12, 2001, the
Academy, Markovich and Harbor Complaints were consolidated under the title "In
re National Auto Credit, Inc. Shareholders Litigation," Civil Action No. 19028
NC (Delaware Court) ("Delaware Action").

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 18 - SHAREHOLDER COMPLAINT SETTLEMENT (CONTINUED)

The Delaware Action principally sought: (i) a declaration that the Director
Defendants breached their fiduciary duties to iDNA, (ii) a judgment voiding an
employment agreement with James J. McNamara and rescinding a stock exchange
agreement in which iDNA acquired ZoomLot, (iii) a judgment voiding the grant of
stock options and the award of director fees allegedly related thereto, (iv) an
order directing the Director Defendants to account for alleged damages sustained
and profits obtained by the Director Defendants as a result of the alleged
various acts complained of, (v) the imposition of a constructive trust over
monies or other benefits received by the Director Defendants, (vi) a judgment
requiring the Director Defendants to promptly schedule an annual meeting of
shareholders and (vii) an award of costs and expenses.

On October 12, 2001, iDNA received a derivative complaint filed by Robert
Zadra, a shareholder of iDNA, that had been filed with the Supreme Court of the
State of New York ("New York Court") on or about October 12, 2001 against James
J. McNamara, John A. Gleason, William S. Marshall, Henry Y. L. Toh, Donald
Jasensky, Peter T. Zackaroff, Mallory Factor, Thomas F. Carney, Jr., and iDNA as
Defendants. On or about May 29, 2002 the complaint was amended to include class
action allegations (the "New York Action"). The New York Action contained
allegations similar to those in the Delaware Action concerning the Board's
approval of the employment agreement with James McNamara, option grants and past
and future compensation to the Director Defendants, and the ZoomLot transaction.
The New York Action sought (i) a declaration that as a result of approving these
transactions the Director Defendants breached their fiduciary duties to iDNA,
(ii) a judgment enjoining Director Defendants from proceeding with or exercising
the option agreements, (iii) rescission of the option grants to Director
Defendants, if exercised, (iv) an order directing the Director Defendants to
account for alleged profits and losses obtained by the Director Defendants as a
result of the alleged various acts complained of, (v) awarding compensatory
damages to iDNA and the class, together with prejudgment interest, and (vi) an
award of costs and expenses.

iDNA vigorously defended against each of the respective claims made in the
Delaware Action and New York Action, as it believed that the claims had no
merit.

The parties in the New York Action thereafter engaged in settlement
negotiations and, in December 2002, the parties entered into a stipulation of
settlement which was thereafter amended in November 2004 (the "New York
Settlement Stipulation"). Under the terms of the New York Settlement
Stipulation, iDNA agreed (subject to certain terms and conditions) to, among
other things, (a) adopt or implement certain corporate governance procedures or
policies, (b) issue to a class of iDNA shareholders who had continuously held
iDNA's Common Stock from December 14, 2000 through December 24, 2002
(hereinafter, the "Eligible Shareholders") up to one million warrants (one
warrant per 8.23 shares of Common Stock), with each warrant having a five year
term and being exercisable for shares of iDNA's Common Stock at a price of $1.55
per share, (c) cancel 50% of certain stock options granted on December 15, 2000,
and (d) make certain payments for legal fees for counsel to the plaintiffs in
the New York Action. The New York Settlement Stipulation created for the benefit
of iDNA a settlement fund in the amount of $2.5 million to be funded by an
insurance policy (the "Settlement Fund"). The New York Court also subsequently
approved $500,000 for legal fees for counsel to the plaintiffs in the New York
Action to be paid from the proceeds from the Settlement Fund.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 18 - SHAREHOLDER COMPLAINT SETTLEMENT (CONTINUED)

In order to facilitate the settlement and dismissal of the separate
Delaware Action as well as the New York Action, on April 22, 2005, iDNA entered
into a Stock Purchase Agreement ("Agreement") with Academy Capital Management,
Inc., Diamond A. Partners, L.P., Diamond A. Investors, L.P., Ridglea Investor
Services, Inc. and William S. Banowsky (hereinafter referred to collectively as
the "Selling Stockholders"). The Selling Stockholders had also raised objections
to the settlement of the New York Action. The New York Court (a) had rejected
the objections raised by the Selling Stockholders and (b) had approved as fair
and in the best interests of iDNA and its shareholders the proposed settlement
of the New York Action as set forth in the New York Settlement Stipulation. The
Selling Stockholders had then filed an appeal (the "Appeal") to such
determination by the New York Court.

Pursuant to the terms of the Agreement, the Selling Stockholders agreed,
among other things, to do the following:

o enter into a stipulation (to be filed with the Appellate Division,
First Department, of the Supreme Court of the State of New York)
providing for the dismissal of the Appeal.

o enter into a stipulation (to be filed in the Delaware Court), pursuant
to which they would agree to the dismissal of the Delaware Action with
prejudice.

Pursuant to the Agreement, iDNA agreed (subject to certain terms and
conditions set forth in the Agreement) to purchase from the Selling Stockholders
their 1,562,500 shares of iDNA Common Stock at a price of $0.6732 per share (or
a total purchase price of $1,051,875) and to contribute $100,000 to cover a
portion of the legal fees incurred by the Selling Stockholders. Effective June
30, 2005, iDNA purchased 1,562,500 shares of iDNA Common Stock from the Selling
Stockholders.

iDNA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JANUARY 31, 2007, 2006 AND 2005

NOTE 18 - SHAREHOLDER COMPLAINT SETTLEMENT (CONTINUED)

As a consequence of the confirmation of the New York Settlement
Stipulation, the Dismissing Action with Prejudice of the Delaware Action and the
subsequent purchase by iDNA of Common Stock from the Selling Stockholders, for
Fiscal 2006, iDNA recorded (i) a charge to operations of $100,000 for legal fees
of the Selling Stockholders, (ii) a charge to operations of $208,000 for the
excess cost over the market value of the iDNA Common Stock acquired as of the
date of the Agreement, April 22, 2005, (iii) a charge to other income of $25,000
for the expense of the fair value of the warrants to be issued to Eligible
Shareholders and (iv) realized other income of $2.0 million for the net proceeds
received by iDNA from the Settlement Fund. The Eligible Shareholders had until
December 2005 to submit their claim for one warrant for each 8.23 shares of
Common Stock owned during the eligibility period, with each warrant having a
five year term and being exercisable for shares of Common Stock at a price of
$1.55 per share. Based upon the final submission of claims by Eligible
Shareholders, in April 2006 iDNA issued 100,282 warrants to the Eligible
Shareholders.

FINANCIAL STATEMENTS AND REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

ANGELIKA FILM CENTERS, LLC

At December 28, 2006 and December 29, 2005

and

For the Years Ended December 28, 2006, December 29, 2005 and
December 30, 2004

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors
ANGELIKA FILM CENTERS, LLC

We have audited the accompanying balance sheets of Angelika Film Centers, LLC (a
Delaware limited liability company) as of December 28, 2006 and December 29,
2005, and the related statements of income, members' equity and cash flows for
the years ended December 28, 2006, December 29, 2005 and December 30, 2004.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States of America). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The Company is not
required to have, nor were we engaged to perform an audit of its internal
control over financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Angelika Film Centers, LLC as
of December 28, 2006 and December 29, 2005, and the results of its operations
and its cash flows for the years ended December 28, 2006, December 29, 2005 and
December 30, 2004 in conformity with accounting principles generally accepted in
the United States of America.

/s/ Grant Thornton
----------------------------------
Cleveland, Ohio
May 1, 2007

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

BALANCE SHEETS
(dollar amounts in thousands)

December 28, 2006 and December 29, 2005

DECEMBER 28, DECEMBER 29,
2006 2005
------------ ------------
ASSETS
Current Assets
Cash $ 257 $ 889
Trade and other receivables 120 224
Concession inventories (Note A) 13 9
Prepaid expenses and other current assets 8 13
Due from affiliates (Note E) 825 --
------ ------
Total current assets 1,223 1,135
Property, Equipment and Leasehold Improvements,
net (Note B) 833 1,029
Intangible With Definitive Life (Note A) 5,707 6,299
Deposits 80 89
------ ------
TOTAL ASSETS $7,843 $8,552
====== ======
LIABILITIES AND MEMBERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities $ 338 $ 555
Due to affiliates (Note E) -- 240
Deferred income and other obligations 142 82
------ ------
Total current liabilities 480 877
Accrued Rental Obligations (Note C) 2,083 1,949
------ ------
Total liabilities 2,563 2,826
Commitments and Contingencies (Note D) -- --

Members' Equity (Note A) 5,280 5,726
------ ------
TOTAL LIABILITIES AND MEMBERS' EQUITY $7,843 $8,552
====== ======

The accompanying notes to financial statements are an integral
part of these statements.

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

STATEMENTS OF INCOME
(dollar amounts in thousands)

For the years ended December 28, 2006, December 29, 2005 and
December 30, 2004

DECEMBER 28, DECEMBER 29, DECEMBER 30,
2006 2005 2004
------------ ------------ ------------

Revenue
Theatre income $5,015 $5,222 $4,092
Theatre concessions 677 666 508
Cafe concession sales 418 412 329
Rental and other income 218 187 164
------ ------ ------
Total operating income 6,328 6,487 5,093

Operating costs and expenses
Film rental 1,570 1,488 941
Operating costs 2,467 2,492 2,505
General and administrative expenses 231 209 135
Depreciation and amortization 775 752 787
------ ------ ------
Total operating costs and expenses 5,043 4,941 4,368
------ ------ ------
Income from operations 1,285 1,546 725
State and local income tax expense (Note A) 67 59 36
------ ------ ------
NET INCOME $1,218 $1,487 $ 689
====== ====== ======

The accompanying notes are an integral part of these financial statements.

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

STATEMENTS OF MEMBERS' EQUITY
(dollar amounts in thousands)

For the years ended December 28, 2006, December 29, 2005 and December 30, 2004

NATIONAL READING
CINEMAS, INTERNATIONAL
INC. INC. TOTAL
-------- ------------- -------
BALANCE AT DECEMBER 25, 2003 $ 3,789 $ 3,790 $ 7,579
Distribution to members (1,137) (611) (1,748)
Net income 344 345 689
------- ------- -------
BALANCE AT DECEMBER 30, 2004 2,996 3,524 6,520
Distribution to members (878) (1,403) (2,281)
Net income 743 744 1,487
------- ------- -------
BALANCE AT DECEMBER 29, 2005 2,861 2,865 5,726
Distribution to members (1,209) (455) (1,664)
Net income 609 609 1,218
------- ------- -------
BALANCE AT DECEMBER 28, 2006 $ 2,261 $ 3,019 $ 5,280
======= ======= =======

The accompanying notes are an integral part of these financial statements.

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

STATEMENTS OF CASH FLOWS
(dollar amounts in thousands)

For the years ended December 28, 2006, December 29, 2005 and December 30, 2004

DECEMBER 28, DECEMBER 29, DECEMBER 30,
2006 2005 2004
------------ ------------ ------------

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,218 $ 1,487 $ 689
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 775 752 788
Deferred rental expense 134 170 169
Changes in assets and liabilities associated with
operating activities:
Trade and other receivables 104 (163) (45)
Due to (from) affiliates (1,065) 199 326
Concession inventories (4) (2) --
Prepaid expenses and other current assets 5 4 (4)
Accounts payable and accrued liabilities (217) 115 (23)
Deferred income and other obligations 60 (20) 30
Security deposit 9 -- --
------- ------- -------
Net cash provided by operating activities 1,019 2,542 1,930
------- ------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, equipment and
leasehold improvements 13 (42) --
------- ------- -------
Net cash provided by (used in) investing activities 13 (42) --
------- ------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distribution to members (1,664) (2,281) (1,748)
------- ------- -------
NET INCREASE (DECREASE) IN CASH (632) 219 182
Cash at beginning of year 889 670 488
------- ------- -------
Cash at end of period $ 257 $ 889 $ 670
======= ======= =======
Supplemental Disclosures of Cash Flow Information:
Cash paid during the year for income taxes $ 67 $ 59 $ 36
======= ======= =======

The accompanying notes are an integral part of these financial statements.

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

NOTES TO FINANCIAL STATEMENTS

Years Ended December 28, 2006, December 29, 2005 and December 30, 2004

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS

Angelika Film Centers LLC ("AFC") is a Delaware limited liability company,
whose membership interests at December 28, 2006 are held 50% by Reading
International, Inc. ("RDI") and 50% by National Cinemas, Inc. ("NCI"), a
wholly-owned subsidiary of IDNA, Inc.

AFC is the owner and operator of the Angelika Film Center, which is a
multiplex cinema and cafe complex in the Soho District of Manhattan in New
York City.

FISCAL YEAR

AFC's fiscal year ends on the last Thursday of December. The twelve months
ended December 28, 2006, December 29, 2005 and December 30, 2004 contained
52, 52 and 53 weeks, respectively. Unless stated otherwise, references
herein are to AFC's fiscal years.

CASH AND CASH EQUIVALENTS

AFC considers all highly liquid investments and money market accounts with
original maturities of three months or less to be cash equivalents.

CONCESSION INVENTORIES

Inventories are comprised of concession goods and are stated at lower of
cost (first-in, first-out method) or market.

PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Property, equipment and leasehold improvements are stated at cost.
Depreciation is computed using the straight-line method over the estimated
useful lives of the assets, which range from 7 to 12 years. Leasehold
improvements are amortized using the straight-line method over the shorter
of the lease term or the estimated useful lives of the related
improvements.

REVENUE RECOGNITION

Theater revenue is recognized when film tickets are purchased at the box
office. Concession revenue arises from the sale of food and other
merchandise and is recognized upon delivery. Revenues derived from gift
certificates are recognized when the certificates are redeemed.

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

Years Ended December 28, 2006, December 29, 2005 and December 30, 2004

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

INCOME TAXES

AFC is a limited liability company; therefore, no federal income taxes have
been provided for its operations. Any tax liability or benefit arising from
the AFC's income or losses is the responsibility of the individual members.
AFC provides for state and city income taxes, as applicable in accordance
with Statement of Financial Accounting Standards No. 109, Accounting for
Income Taxes (SFAS 109).

INTANGIBLE WITH DEFINITIVE LIFE

AFC originally recorded $11,810,000 as an intangible in conjunction with an
asset acquisition during fiscal year 1996. AFC had an independent
appraisal, which was used to determine the fair value of assets acquired.
AFC is amortizing the intangible on a straight-line basis over a
twenty-year period, which represents the term of the long-term lease on the
Angelika Film Center complex. Accumulated amortization of the intangible is
$6,101,000 and $5,511,000 at December 28, 2006 and December 29, 2005,
respectively. The amortization expense is $590,000 for each of the next
five years.

ADVERTISING EXPENSE

Advertising costs are expensed as incurred. Gross advertising expenses were
approximately $289,000, $296,000 and $290,000 for the years ended December
28, 2006, December 29, 2005 and December 30, 2004, respectively.
Reimbursements received for cooperative advertising are netted against
advertising expenses amounted to $260,000, $296,000 and $233,000 for the
years ended December 28, 2006, December 29, 2005 and December 30, 2004,
respectively.

FAIR VALUE OF FINANCIAL INSTRUMENTS

AFC has various financial instruments including cash, trade and other
receivables and accounts payable and accrued liabilities. These instruments
are short-term in nature and AFC has determined that their carrying values
approximate estimated fair values.

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

Years Ended December 28, 2006, December 29, 2005 and December 30, 2004

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

IMPAIRMENT OF LONG-LIVED ASSETS

AFC reviews the carrying value of its long-lived assets whenever events or
changes in circumstances indicate that its carrying amount may not be
recoverable. If there were such indicators of impairment, AFC would
determine whether the estimated undiscounted sum of the future cash flows
to be derived from such assets is less than their carrying amounts. If
less, an impairment loss would be recognized based on the excess of the
carrying amounts of such assets over their respective fair values. AFC
would determine the fair values by using quoted market prices, if
available, for such assets; or if quoted market prices are not available,
AFC would discount the expected estimated future cash flows. No impairment
was recorded during the 12 months ended December 28, 2006 and December 29,
2005.

ESTIMATES

The preparation of financial statements and the accompanying notes thereto,
in conformity with generally accepted accounting principles, requires
management to make estimates and assumptions that affect reported amounts
of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and reported amounts of
revenues and expenses during the respective reporting periods. Actual
results could differ from those estimates.

NOTE B - PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS

At December 28, 2006 and December 29, 2005, a summary of property,
equipment and leasehold improvements is as follows (in thousands):

DECEMBER 29, DECEMBER 29,
2005 2005
------------ ------------
Leasehold improvements $1,353 $1,339
Furniture, fixtures and equipment 905 932
------ ------
2,258 2,271
Less accumulated depreciation 1,425 1,242
------ ------
PROPERTY, EQUIPMENT AND
LEASEHOLD IMPROVEMENTS, NET $ 833 $1,029
====== ======

NOTE C - LEASE COMMITMENTS

AFC leases a theater under a non-cancelable operating lease which matures
in August 2026. Rental expense was $827,000, including deferred rent
expense of $134,000 for the year ended December 28, 2006 and $827,000,
including amortization of deferred rent expense of $170,000 and $169,000,
for the years ended December 29, 2005 and December 30, 2004, respectively.

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

Years Ended December 28, 2006, December 29, 2005 and December 30, 2004

NOTE C - LEASE COMMITMENTS - CONTINUED

At December 28, 2006, future minimum rental commitments for the next five
years were as follows (in thousands):

2007 $ 741
2008 741
2009 741
2010 741
2011 795
Thereafter 14,527
-------
TOTAL MINIMUM LEASE PAYMENTS $18,286
=======

AFC has scheduled rent increases under the theater lease. The accompanying
statement of operations reflects rent expense on a straight-line basis over
the term of the theater lease. Deferred rental obligations of $2,083,000
and $1,949,000 representing the excess of expense recognized to date over
the lease payments are reflected in the accompanying balance sheets as of
December 28, 2006 and December 29, 2005, respectively.

NOTE D - COMMITMENTS AND CONTINGENCIES

AFC has been involved in various lawsuits. The ultimate outcome of these
lawsuits is not always determinable; however, in the opinion of management,
based in part upon advice of counsel, the amount of losses that might be
sustained, if any, would not materially affect the financial position,
results of operations and liquidity of AFC.

ANGELIKA FILM CENTERS, LLC
(A Limited Liability Company)

NOTES TO FINANCIAL STATEMENTS - CONTINUED

Years Ended December 28, 2006, December 29, 2005 and December 30, 2004

NOTE E - RELATED PARTY TRANSACTIONS

Citadel Cinemas, Inc. ("Citadel"), an affiliate of RDI, operates and
manages the Angelika Film Centers pursuant to a management agreement (the
"Agreement") entered into with the AFC in August 1996. This Agreement was
assigned to Citadel from another affiliate of RDI effective June 1, 2000.

Citadel is to be paid an annual base management fee of $152,000 as adjusted
by Consumer Price Index ("CPI") adjustments plus a bonus fee contingent on
the attainment of certain income levels (as defined in the Agreement). The
management fee amounted to the base fee of $152,000 for the year ended
December 28, 2006, $208,000 for December 29, 2005 and $125,000 for December
30, 2004. During 2005, a $56,000 adjustment to the base management fee was
made to catch up for CPI increases that relate to prior periods.

AFC's leasehold interest in the theater is guaranteed by both the Reading
Company, an affiliate of RDI, and Reading Entertainment, Inc., an affiliate
of RDI, through the day prior to the 15th anniversary of the lease
commencement.

At December 28, 2006 and December 29, 2005, AFC had a net aggregate
receivable (payable) balance of $825,000 and $(240,000) to Citadel. This
amount is comprised of monies collected by affiliated entities of Citadel
for gift certificates and credit card purchases offset by amounts paid by
Citadel on behalf of AFC.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

There have been no changes in accountants due to disagreements on
accounting principals or practices, financial statement disclosure or auditing
scope or procedure and no "reportable events" (as defined in Regulation S-K Item
304(a)(1)(v)during the 24 months prior to January 31, 2007.

ITEM 9A. CONTROLS AND PROCEDURES.

As of the end of the period covered by this Annual Report, we carried out,
under the supervision and with the participation of our management, including
our Chief Executive Officer and Chief Financial Officer (the "Certifying
Officers"), an evaluation of the effectiveness of our "disclosure controls and
procedures" (as the term is defined under the Rules 13a-15(e) and 15d-15(e)
promulgated under the Exchange Act). Based on this evaluation, the Certifying
Officers have concluded that our disclosure controls and procedures are
effective to ensure that material information is recorded, processed, summarized
and reported by management on a timely basis in order to comply with our
disclosure obligations under the Exchange Act, and the rules and regulations
promulgated thereunder.

Further, based on an evaluation carried out under the supervision and with
the participation of our management, including our Certifying Officers, there
were no changes in our internal controls over financial reporting during the
fourth fiscal quarter that have materially affected, or are reasonably likely to
materially affect, our internal controls over financial reporting.

ITEM 9B. OTHER INFORMATION

None

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

The executive officers and directors of iDNA, as of May 11, 2007 are as
follows:

Name Age Position
---------------------- --- ------------------------------------------------
James J. McNamara 58 Chairman of the Board and
Chief Executive Officer
Robert V. Cuddihy, Jr. 47 Chief Financial Officer, Secretary and Treasurer
James M. Augur 71 Director
John A. Gleason 58 Director
Donald Shek 57 Director
Henry Y. L. Toh 49 Director

JAMES J. McNAMARA has been Chairman of the Board and Chief Executive
Officer since November 2000. Mr. McNamara has been a Director of iDNA since
February 1998 and previously served as its Chairman from April 1998 to November
1999. Mr. McNamara has also been President of Film Management Corporation (a
film company) since 1995, and he has been President and Chief Executive Officer
of Celebrity Entertainment, Inc. (an entertainment company) since 1992. Mr.
McNamara was Chairman of the Board and Chief Executive Officer of Princeton
Media Group, Inc. (a magazine publisher) from 1994 to 1998.

ROBERT V. CUDDIHY, JR. has been iDNA's Chief Financial Officer and
Treasurer since September 2001. Mr. Cuddihy has been iDNA's Secretary since
January 2003. Mr. Cuddihy was an independent financial consultant to iDNA from
May 2001 to August 2001. From July 1987 to March 2001, Mr. Cuddihy was the Chief
Financial Officer of HMG Worldwide Corporation, a company engaged in in-store
marketing and retail store fixturing design and manufacture, and also served as
a Director from February 1998 to May 2001. HMG Worldwide Corporation effected an
assignment of their assets for the benefit of creditors in 2002. From July 1981
to July 1987, Mr. Cuddihy was with KPMG Peat Marwick, Certified Public
Accountants, where he last served as a senior audit manager.

JAMES M. AUGUR has been a Director of iDNA since May 2004. Mr. Augur has
been a commercial and residential architect for over 30 years. Mr. Augur
currently serves as a consultant to owners and developers for land planning and
architectural services and is the Chairman and President of JMA and Associates.

JOHN A. GLEASON has been a Director of iDNA since April 2000. Mr. Gleason
previously served as Director of iDNA from February 1998 to September 1999. From
1995 to 1998, Mr. Gleason served on iDNA's Dealer Advisory Board, serving as
Chairman of such panel from 1996 to 1998. Mr. Gleason has been the President and
principal of Automax, Inc., an independent car dealership since 1987. Mr.
Gleason has been the President of New Franklin, Inc., an automobile finance
consulting firm, since 1992 and has been a partner in Coslar Properties LLC, a
real estate firm, since 1995.

DONALD SHEK has been a Director of iDNA since December 2003. Mr. Shek has
been a financial consultant in private practice since January 1998. From 1993 to
2002, Mr. Shek was a Registered Representative for the Financial West Group, a
NASD broker/dealer.

HENRY Y. L. TOH has been a Director of iDNA since December 1998. Mr. Toh is
also a Director of three other public companies, (i) C2 Global Technologies,
Inc.,(an Internet telephone company), since 1992, (ii) Isolagen, Inc. (a
biotechnology company) since January 2004 and (iii) Teletouch Communications,
Inc. (a retail provider of Internet, cellular and paging services provider)
since December 2001. From September 2004 until August 2005, Mr Toh served as a
director of Vaso Active Pharmaceuticals, Inc. Mr. Toh has been the principal
officer of Four M. International, Inc. (a private investment entity) and as a
director and Chief Executive Officer of Amerique Investments since 1992. Mr. Toh
was also a Director of Bigmar, Inc, a pharmaceutical company, from April 2002 to
February 2004. Mr. Toh began his career with KPMG Peat Marwick from 1980 to
1992, where he specialized in international taxation and mergers and
acquisitions.

Audit Committee

The duties and responsibilities of the Audit Committee are to oversee the
selection and retention of iDNA's independent public accountants, to review the
scope and cost of the audit, to review the performance and procedures of the
independent auditors, to review the final report of the independent auditors, to
be available for consultation with the independent auditors, to review with
iDNA's Chief Financial Officer and independent auditors corporate accounting
practices and policies and financial controls and to perform all other duties as
the Board of Directors may from time to time designate. The Audit Committee of
iDNA is comprised of three independent members of the iDNA Board of Directors,
Mr. Gleason, Mr. Shek and Mr. Toh. Mr. Shek and Mr. Toh each qualify as an
"audit committee financial expert" within the meaning of Rule 407(d)(5)(ii) of
Regulation S-K.

Code of Ethics

The Board of Directors of iDNA maintains a written Code of Business
Conduct, Ethics and Corporate Governance (the "Code of Ethics") that applies to
each of iDNA's Board members, executive officers and employees. The Code of
Ethics addresses individual and peer responsibilities, as well as
responsibilities to the employees, business partners, shareholders, the public
and other stakeholders in iDNA, and covers various subject matters, including
(i) prohibitions on conflicts of interest (including the protection of corporate
opportunities, (ii) protections for the Company's confidential and proprietary
information and that of its business partners, (iii) fair treatment for iDNA's
employees and business partners, (iv) protection and proper use of iDNA's
assets, (v) compliance with laws, rules and regulations (including insider
trading laws) and (vi) encouragement of the reporting of any unlawful or
unethical behavior. A copy of the Code of Ethics will be provided free of
charge, upon written request to the following address: iDNA, Inc. 415 Madison
Avenue, 7th Floor, New York, NY 10017, Attention: Robert V. Cuddihy, Jr.

In conjunction with the adoption of the Code of Ethics, the Board also
maintains a written Policy Statement Regarding Securities Trades by Company
Personnel (the "Insider Trading Policy"). The Insider Trading Policy governs the
use by officers, directors and employees of iDNA (or any related persons) of
material non-public information related to iDNA or any of its subsidiaries,
prohibiting (i) the purchase or sale of the iDNA's securities via the use of
such information, (ii) engaging in any other action to take advantage of such
information and (iii) the communication of such material non-public information
to other persons not having a need to know the information for legitimate,
iDNA-related reasons.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
all of iDNA's officers and directors, and persons who own more than ten percent
of a registered class of iDNA equity securities, to file reports of ownership
and changes in ownership of equity securities of iDNA with the SEC and any
applicable stock exchange. Officers, directors and greater than ten percent
stockholders are required by SEC regulation to furnish iDNA with copies of all
Section 16(a) reports that they file. Based solely upon a review of Forms 3, 4,
and 5 furnished to iDNA pursuant to the Exchange Act during Fiscal 2007, iDNA
believes that none of its officers, directors and greater than 10% beneficial
owners failed to file such reports on a timely basis during the most recent
fiscal year.

ITEM 11. EXECUTIVE COMPENSATION.

COMPENSATION DISCUSSION AND ANALYSIS

The purpose of this Compensation Discussion and Analysis is to describe and
analyze the material elements of compensation provided to our named executive
officers for Fiscal 2007. This analysis focuses on the compensation paid to our
"named executives", which is a defined term generally encompassing all persons
that served as our principal executive officer or principal financial officer at
any time during the year, as well as certain other highly paid executive
officers serving in such positions at the end of the fiscal year. During Fiscal
2007, iDNA's named executive officers consisted of (i) James McNamara, Chairman
of the Board and Chief Executive Officer and (ii) Robert V. Cuddihy, Jr., Chief
Financial Officer, Secretary and Treasurer.

Overview of Compensation and Process

iDNA's executive compensation program is designed to attract, retain,
motivate and reward executives with the skills and dedication necessary to
provide the leadership, strategic direction and vision to anticipate and respond
to current and future market opportunities or trends. The executive compensation
program design considers (i) issues pertaining to policies for allocating
long-term incentive and currently paid out compensation, (ii) the manner in
which compensation is allocated between cash and non-cash compensation, (iii) an
executive officer's current and future roles, responsibilities and expectations,
and (iv) an executive officer's performance individually and as a part of the
management team.

The compensation components for iDNA's executives include (i) salary, (ii)
merit based performance bonuses, (iii) long term equity compensation through
stock awards via Common Stock grants and/or stock options, (iv) employee fringe
benefits including health, life and disability insurance and participation in
the iDNA 401(k) savings and profit sharing plan, and (v) perquisites. iDNA's
compensation program is designed to strengthen the relationship between
compensation, both cash and equity-based, and performance by emphasizing
variable, at-risk compensation that is dependent upon the successful achievement
of specified corporate, business unit and individual performance goals. iDNA's
compensation program is characterized by a balance between at-risk incentive
cash and equity-based compensation, on one hand, and an executive's base
compensation. iDNA's compensation program is designed to be competitive with
corresponding programs of other corporate communications, advertising,
technology and entertainment businesses while also providing consideration to
each executive's unique skills and contributions to the long term strategic
goals of iDNA.

Each fiscal year, the Compensation and Stock Option Committee of iDNA's
Board of Directors (the "Compensation Committee") meets, together with our
executive management to in order to (i) discuss corporate and individual
performance objectives for the previous year, (ii) review the performance
against the objectives as well as the specific management responsibilities,
(iii) establish current year corporate and individual performance objectives,
and (iv) review management strategies to achieve such objectives. Through this
process, the compensation elements for executives are aligned with the long term
interests of our shareholders and thereby maximize shareholder value. Base
compensation for each executive is established either via a mutually agreed upon
employment contract between iDNA and the executive or at a scheduled meeting of
our Compensation Committee. All executive employment agreements are negotiated,
reduced to writing, reviewed and approved by the Compensation Committee and
confirmed by iDNA's Board of Directors prior to execution by iDNA.

Total Overall Compensation

To assist iDNA in establishing targeted overall compensation for our named
executive officers (i.e. the aggregate level of compensation to be paid if
stated performance goals are fully met), the Compensation Committee periodically
engages an independent compensation consultant. During Fiscal 2007, the
Compensation Committee engaged an independent compensation consultant, Michael
Preston (the "Consultant"), to assist iDNA in structuring a new employment
agreement with its Chief Executive Officer, James McNamara. At the request of
the Compensation Committee, the Consultant conducted a study of the compensation
programs at various public companies in the corporate communications,
advertising, technology or entertainment businesses. The selected companies had
similar attributes as iDNA with respect to (i) market capitalization, (ii)
annual revenues, (iii) number of employees, (iv) stock price and (v) types of
executive management recruited by such companies. In addition, the Compensation
Committee discussed with the Consultant (i) iDNA's current and historical
operations, (ii) its wind down and exit process from the now discontinued
sub-prime auto finance and rental business, (iii) its entrance into the
strategic communications, information services and entertainment segments, and
(iv) iDNA's vision and strategic plans for the future.

The results of the Consultant's study provided the Compensation Committee
with a starting point to create a comprehensive compensation program for iDNA's
Chief Executive Officer that balances the strategic vision mutually shared by
all parties, while also providing due consideration to the significant
contributions made by Mr. McNamara during his tenure with iDNA and the future
expectations of our Board of Directors and our Compensation Committee. As a
consequence of (i) the Compensation Committee's efforts and due diligence, (ii)
the study and recommendations provided by the Consultant, (iii) the Compensation
Committee's consultation with iDNA's independent general counsel, (iv) various
Compensation Committee meetings and discussions and (v) direct negotiations held
over a six month period of time with Mr. McNamara, the Compensation Committee
developed a comprehensive compensation program for Mr. McNamara which is
consistent with our compensation philosophy of balancing current base
compensation with at-risk incentive cash and equity-based compensation

Employment Contracts, Termination of Employment and Change-In-Control
Arrangements

On November 29, 2006, iDNA's Board of Directors approved, and iDNA
consummated, an employment agreement with Mr. McNamara (the "Employment
Agreement"). Under the terms of the Employment Agreement, Mr. McNamara shall be
employed as the Company's Chief Executive Officer for an initial term of
approximately three years, until January 31, 2010 (the "Initial Term"), with an
initial base salary of $590,000 per year (the "Base Salary"), which shall
increase annually by $15,000 each January 31st, beginning January 31, 2008 (each
year under the Employment Agreement commencing January 31st, an "Employment
Year"). Mr. McNamara is also entitled to receive an annual bonus of $100,000 if,
at the end of a particular Employment Year, iDNA's Common Stock, exceeds the
previous Employment Year's price per share by 125%. Furthermore, Mr. McNamara is
also entitled to incentive compensation of up to $200,000 in the event that iDNA
achieves certain performance objectives established by iDNA's Board of
Directors. The incentive compensation may also be increased by the Board of
Directors if the Board believes it appropriate to reward the Chief Executive
Officer's performance for a given year.

In addition to cash compensation, the Employment Agreement provides Mr.
McNamara, as a signing bonus, a grant of 500,000 shares of Common Stock.
However, in the event of Mr. McNamara's resignation or termination for any
reason prior to the expiration of the Initial Term, iDNA may redeem and
repurchase, at the price of $0.01 per share, (i) 375,000 shares of Common Stock,
if such resignation or termination precedes the passage of one Employment Year
under the Employment Agreement, (ii) 250,000 shares of Common Stock, if such
resignation or termination occurs after the passage of one Employment Year but
prior to the completion of the second Employment Year under the Employment
Agreement, or (iii) 125,000 shares of Common Stock if such resignation or
termination follows the completion of two Employment Years but precedes the
completion of the third Employment Year under the Employment Agreement. As a
consequence of the grant of stock as a signing bonus, iDNA charged to operations
$290,000 in compensation expense for the fair value of the stock at the time of
grant

In addition to Mr. McNamara's Employment Agreement, iDNA maintains an
employment agreement with Mr. Cuddihy, our Chief Financial Officer, Secretary
and Treasurer. Under the terms of the agreement, Mr. Cuddihy is employed as
Chief Financial Officer and Treasurer (he was subsequently appointed as our
Secretary as well) at a base salary of $240,000 per year and a minimum annual
bonus of $25,000 per year. Mr. Cuddihy is also entitled to iDNA employee
benefits including health insurance, 401-K plan and related programs. The
initial three year term of the agreement expired in December 31, 2004 however,
the agreement has been renewed on a month-to-month basis unless 90 days prior
written notice of termination is provided by either party. In the event that the
agreement is terminated by iDNA without cause, Mr. Cuddihy shall receive one
year's worth of compensation in the form of severance compensation. During
Fiscal 2007, in consideration for Mr. Cuddihy's achievements iDNA's Board of
Directors granted Mr. Cuddihy options to acquire 150,000 shares of Common Stock.
The stock options granted Mr. Cuddihy are subject to vesting over three years.
As a consequence of the grant of stock options, iDNA charged to operations
$17,000 for compensation expense for the fair value of the vested portion of the
stock options at the time of grant

In keeping with our executive compensation program and philosophy for
incentivizing the performance of our named executive officers, we have also
established the equity compensation plans described below.

2005 Equity Compensation Plan

iDNA's 2005 Equity Compensation Plan ("2005 Plan") was created in Fiscal
2006 and approved by iDNA's shareholders on January 31, 2006. The 2005 Plan
provides for the granting of incentive and non-qualified stock options, stock
appreciation rights, and common stock and restricted common stock awards (all of
which are sometimes collectively referred to as "Grants") to key employees,
certain consultants and advisors who perform services for iDNA and non-employee
members of the Board of Directors of iDNA. Grants may be awarded singlely, in
combination or in tandem. In addition, Grants may be made in combination or in
tandem with, in replacement of, or as the payment for grants or rights under any
other compensation plan of the iDNA, including the 2005 Plan or the plan of any
acquired entity. The total number of shares available for options or awards
under the 2005 Plan is 2,000,000 shares. During Fiscal 2007, iDNA granted
1,605,000 stock options and awards to Officers, non-employee Directors, advisors
and employees of iDNA and each stock option is subject to vesting over a
specific period of time and, in certain cases, performance criterion. No options
or other awards were granted under the 2005 Plan in Fiscal 2006 or Fiscal 2005.
There were 395,000 shares available for future stock awards or option grants at
January 31, 2007

1993 Equity Incentive Plan

iDNA's 1993 Equity Incentive Plan (the "1993 Plan") provides for the grant
of incentive options, non-qualified options, stock appreciation rights,
restricted stock appreciation rights, restricted stock and Common Stock (all of
which are sometimes collectively referred to as "Awards") to the executive
officers listed in the Summary Compensation Table below as well as to other
employees of iDNA and its subsidiaries, any former employee of iDNA eligible to
receive an assumed or replacement award or award settlement, and non employee
members of iDNA's Board of Directors. Awards may be granted singlely, in
combination or in tandem. In addition, Awards may be made in combination or in
tandem with, in replacement of, or as the payment for grants or rights under any
other compensation plan of the iDNA, including the 1993 Plan or the plan of any
acquired entity.

The total number of shares available for options or awards under the 1993
Plan is 2,200,000 shares. No options were granted under the 1993 Plan during
Fiscal 2007. During Fiscal 2006, there were 507,509 stock options granted under
the 1993 Plan, each stock option subject to vesting over a specific period of
time and, in certain cases, performance criterion. There were 455,557 stock
options cancelled under the 1993 Plan during Fiscal 2006 principally as a
consequence of the terms of the New York Settlement Stipulation. Pursuant to the
1993 Plan, there were 321,400 shares available for future stock awards or option
grants at January 31, 2006. No options were granted under the 1993 Plan in
Fiscal 2005.

The shares to be issued under the 2005 Plan and 1993 Plan may be authorized
and un-issued shares, treasury shares or a combination thereof. The Compensation
Committee administers these two plans, along with the 2003 Plan (as hereinafter
defined). The directors serving on the Compensation Committee must be
"disinterested persons" as defined under the 2005 Plan and 1993 Plan.

Any compensation income realized by a participant with respect to any Grant
or Award under the 2005 Plan or 1993 Plan, respectively, shall be subject to
withholding by iDNA of income, employment or other taxes required by federal,
state, local or foreign law. The Compensation Committee may in its discretion
satisfy the withholding requirement by causing the entity or subsidiary
employing the participant to withhold the appropriate amount of any and all of
such taxes from any other compensation otherwise payable to such participant.

2003 Restricted Stock Plan

iDNA sponsored a 2003 Restricted Stock Plan (the "2003 Plan") that provides
stock grants to all employees. The 2003 Plan authorizes the grant of up to a
maximum of 400,000 restricted shares of Common Stock to employees of iDNA.
During Fiscal 2004, there were 372,000 shares of Common Stock granted pursuant
to the terms of the 2003 Plan at an estimated fair value of $0.32 per share.
Each share granted is restricted and is not registered for resale. Each award
under the 2003 Plan vests at the rate of 20% per year over a five year period.
Shares granted under the 2003 Plan may not be sold, transferred, pledged or
otherwise disposed until they vest. During the vesting period, unvested shares
are voted by the manager of each business unit. No shares were granted to
executive officers or directors under the 2003 Plan. For Fiscal 2004, iDNA
recorded $119,000 of deferred compensation expense in connection with the 2003
Plan grants which was reported as a component of shareholders' equity. The
deferred compensation expense is amortized on a straight-line basis over the 5
year vesting period of the restricted iDNA Common Stock. For Fiscal 2006, Fiscal
2005 and Fiscal 2004, deferred compensation amortization expense was $24,000,
$24,000 and $6,000, respectively. No further grants were made under the 2003
Plan during Fiscal 2007, Fiscal 2006 and Fiscal 2005.

SUMMARY COMPENSATION DATA

The following table sets forth all information regarding compensation paid
by iDNA for Fiscal 2007, Fiscal 2006 and Fiscal 2005 to (i) any persons who,
during Fiscal 2007 served as iDNA's (i) Chief Executive Officer or President
(ii) Chief Financial Officer and (iii) the individuals, other than persons who
served as the Chief Executive Officer and Chief Financial Officer, who served as
an executive officer of iDNA at January 31, 2007 and whose income exceeded
$100,000.

SUMMARY COMPENSATION TABLE

Change in
Pension
Value and
Non-Equity Non-Qualified
Incentive Deferred
Stock Option Plan Compensation All Other
Name and Principal Salary Bonus Awards Awards Compensation Earnings Compensation Total
Positions* Year ($) ($) (1) ($) ($) (1) ($) (1) ($) ($) ($)
------------------------ ---- -------- -------- -------- ------- ------------ ------------- ------------ --------

James J. McNamara 2007 $513,846 $ -- $290,000(2) $75,300(3) $-- $-- $76,800(4) $955,946
Chairman and 2006 $500,000 $250,000 $ -- $ -- $-- $-- $95,140(4) $845,140
Chief Executive Officer 2005 $500,000 $250,000 $ -- $ -- $-- $-- $91,740(4) $841,740

Robert V. Cuddihy, Jr. 2007 $265,000 $ -- $ -- $17,375(5) $-- $-- $30,228(6) $312,603
Chief Financial Officer, 2006 $265,000 $ 39,800 $ -- $ -- $-- $-- $38,307(6) $343,107
Secretary and Treasurer 2005 $265,000 $ 30,250 $ -- $ -- $-- $-- $37,907(6) $333,157

(*) Employees who were Directors did not receive any additional compensation
for serving on the Board of Directors.

(1) Represents the compensation expense incurred by iDNA in the respective
fiscal year in connection with the grants of Common Stock or stock
options, as applicable, calculated in accordance with SFAS No. 123(R).

(2) Pursuant to the terms of Mr. McNamara's Employment Agreement, Mr.
McNamara received a signing bonus in the form of a grant of iDNA's
Common Stock of 500,000 shares, subject to vesting over the term of
the agreement. For Fiscal 2007, iDNA charged to operations $290,000
for the fair value at the date of grant for the 500,000 shares of
Common Stock issued to Mr. McNamara.

(3) Pursuant to the terms of Mr. McNamara's Employment Agreement, Mr.
McNamara received options to acquire 500,000 shares of Common Stock,
subject to vesting over the term of the agreement. For Fiscal 2007,
iDNA charged to operations $75,300 for the fair value of the vested
portion of the stock options granted to Mr. McNamara.

(4) The amounts included in all other compensation for Fiscal 2007, Fiscal
2006 and Fiscal 2005 include (i) executive life insurance premiums of
$50,000, $68,740 and $68,740, respectively, (ii) auto allowance of
$18,000, $18,000 and $18,000, respectively, and (iii) employee
benefits paid to the iDNA 401(k) savings and profit sharing plan of
$8,800, $8,400 and $8,000, respectively.

(5) During Fiscal 2007, iDNA's Board of Directors granted Mr. Cuddihy
options to acquire 150,000 shares of Common Stock. The stock options
granted Mr. Cuddihy are subject to vesting over three years. For
Fiscal 2007, iDNA charged to operations $17,375 for the fair value of
the vested portion of the stock options granted to Mr. Cuddihy.

(6) The amounts included in all other compensation for Fiscal 2007, Fiscal
2006 and Fiscal 2005 include (i) auto allowance and expenses of
$21,428, $29,907 and $29,907, respectively, and (ii) employee benefits
paid to the iDNA 401(k) savings and profit sharing plan of $8,800,
$8,400 and $8,000, respectively.

GRANTS OF PLAN-BASED AWARDS DURING FISCAL 2007

The following table sets forth certain information concerning the grant of
stock and stock options made to iDNA's named executive officers during Fiscal
2007.

GRANTS OF PLAN BASED AWARDS DURING FISCAL YEAR 2007

All Other All Other
Estimated Estimated Stock Option
Possible Payouts Possible Payouts Awards: Awards:
Under Non-Equity Under Equity Number of Number of
Incentive Plan Awards Incentive Plan Awards Shares of Securities
---------------------------- ---------------------------- Stock or Underlying
Grant Threshold Target Maximum Threshold Target Maximum Units Options
Name Date ($) ($) ($) ($) ($) ($) (#) (#)
------------------------ ---------- --------- ------ ------- --------- ------ ------- ---------- ----------

James J. McNamara 11/29/2006 $-- $-- $-- $-- $-- $-- 500,000 (2) --
Chairman and 11/29/2006 $-- $-- $-- $-- $-- $-- -- 125,000 (3)
Chief Executive Officer 11/29/2006 $-- $-- $-- $-- $-- $-- -- 125,000 (3)
11/29/2006 $-- $-- $-- $-- $-- $-- -- 125,000 (3)
11/29/2006 $-- $-- $-- $-- $-- $-- -- 125,000 (3)
Robert V. Cuddihy, Jr. 1/23/2007 $-- $-- $-- $-- $-- $-- -- 150,000 (4)
Chief Financial Officer,
Secretary and Treasurer

Grant
Exercise Date Fair
or Base Value of
Price of Stock and
Option Option
Awards Awards
Name ($/Sh) ($) (1)
------------------------ -------- ---------

James J. McNamara $ -- $290,000
Chairman and $0.61 $ 64,651
Chief Executive Officer $0.73 $ 63,895
$0.88 $ 63,053
$1.05 $ 62,204
Robert V. Cuddihy, Jr. $0.52 $ 69,498
Chief Financial Officer,
Secretary and Treasurer

(1) Amounts represent the full grant date fair value of restricted Common Stock
or stock option, as applicable, calculated in accordance with SFAS No.
123(R).

(2) Pursuant to the terms of Mr. McNamara's Employment Agreement, Mr. McNamara
received in addition to cash compensation, as a signing bonus 500,000
shares of Common Stock. However, in the event of Mr. McNamara's resignation
or termination for any reason prior to the expiration of the Initial Term,
iDNA may redeem and repurchase, at the price of $0.01 per share, (i)
375,000 shares of Common Stock, if such resignation or termination precedes
the passage of one Employment Year under the Employment Agreement, (ii)
250,000 shares of Common Stock, if such resignation or termination occurs
after the passage of one Employment Year but prior to the completion of the
second Employment Year under the Employment Agreement, or (iii) 125,000
shares of Common Stock if such resignation or termination follows the
completion of two Employment Years but precedes the completion of the third
Employment Year under the Employment Agreement.

(3) Pursuant to the terms of Mr. McNamara's Employment Agreement, Mr. McNamara
received a grant of stock options exercisable for the purchase of 500,000
shares of Common Stock at predetermined exercise prices. The stock options,
have a seven year term from the grant date, were granted pursuant to the
terms of iDNA's 2005 Equity Compensation Plan. Of the 500,000 options
granted, 125,000 options have vested (and are exercisable) immediately as
of the grant date, whereas 375,000 of the options are subject to vesting
and become exercisable in three equal, annual installments of 125,000
options each, provided that Mr. McNamara is employed as of November 29,
2007, 2008 and 2009, respectively.

(4) The shares underlying the option vest in four equal installments on January
23, 2007, December 31, 2007, December 31, 2008 and December 31, 2009.

OUTSTANDING EQUITY AWARDS

The following table sets forth certain information concerning outstanding
stock options for iDNA's named executive officers at January 31, 2007.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

Option Awards
------------------------------------------------------------------
Equity
Incentive
Plan
Number of Number of Awards:
Securities Securities Number of
Underlying Underlying Underlying
Unexericsed Unexericsed Unexericsed Option Option
Options # Options # Unearned Exercise Expiration
Name Exercisable Unexercisable Options (#) Price ($) Date
------------------------ ----------- ------------- ----------- --------- ----------

James J. McNamara 375,000 -- $0.66 12/16/2010
Chairman and 125,000 -- $0.61 11/29/2013
Chief Executive Officer -- 125,000 (1) -- $0.73 11/29/2013
-- 125,000 (1) -- $0.88 11/29/2013
-- 125,000 (1) -- $1.05 11/29/2013
Robert V. Cuddihy, Jr. 37,500 112,500 (2) -- $0.52 1/23/2012
Chief Financial Officer,
Secretary and Treasurer

Stock Awards
------------------------------------------------------------
Equity Equity
Incentive Plan Incentive Plan
Awards: Awards:
Number of Market or
Number of Market Value Unearned Payout Value
Shares or of Shares or Shares, Units of Unearned
Units of Units of or Other Shares, Units
Stock That Stock That Rights That or Other Rights
Have Not Have Not Have Not That Have Not
Name Vested (#) Vested (#) Vested (#) Vested (#)
------------------------ ---------- ------------ -------------- ---------------

James J. McNamara -- -- -- --
Chairman and -- -- -- --
Chief Executive Officer -- -- -- --
-- -- -- --
-- -- -- --
Robert V. Cuddihy, Jr. -- -- -- --
Chief Financial Officer,
Secretary and Treasurer

(1) Pursuant to the terms of Mr. McNamara's Employment Agreement, the stock
options vest in annual installment of 125,000 options on November 29, 2007,
November 29, 2008 and November 29, 2009.

(2) The options vest in annual installment of 37,500 options on December 31,
2007, December 31, 2008 and December 31, 2009.

The following table sets forth certain information concerning the exercise
of options and the vesting of stock awards for iDNA's named executives during
Fiscal 2007.

Option Awards Stock Awards
-------------------------------- --------------------------------
Number of Number of
Shares Acquired Value Realized Shares Acquired Value Realized
on Exercise on Exercise on Vesting on Vesting
Name (#) ($) (#) ($)
------------------------ --------------- -------------- --------------- --------------

James J. McNamara -- $-- 500,000 $290,000 (1)
Chairman and
Chief Executive Officer
Robert V. Cuddihy, Jr. -- $-- -- $ --
Chief Financial Officer,
Secretary and Treasurer

(1) The dollar value is calculated by multiplying the number if shares awarded
that have vested by the market value of the Common Stock on the vesting
date of November 29, 2006.

PENSION BENEFITS

The table disclosing the actuarial present value of each named executive
officer's accumulated benefit under defined benefit plans, the number of years
of credited service under each such plan, and the amount of pension benefits
paid to each named executive officer during the year is omitted because iDNA did
not have a defined benefit plan providing benefits that cover its executive
officers. The only retirement plan available to iDNA's executive officers in
Fiscal 2007 was iDNA's qualified 401(k) savings and profit sharing plan.

NON-QUALIFIED DEFERRED COMPENSATION

The table disclosing contributions to non-qualified, defined contributions
and other deferred compensation plans and each named executive officer's
withdrawals, earnings and fiscal year-end balances in those plans is omitted
because iDNA did not have deferred compensation plans or benefits for its
executive officers.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL

Please see the above section entitled "Employment Contracts, Termination of
Employment and Change in Control Arrangements" which describes the individual
agreements between iDNA and its named executive officers with respect to
payments that iDNA may be required to make to such named executive officers upon
termination of their employment or upon a change in control.

DIRECTOR COMPENSATION

The following table sets forth certain information concerning iDNA's
non-employee directors' compensation for Fiscal 2007.

DIRECTOR COMPENSATION TABLE - FISCAL 2007

CHANGE IN
PENSION VALUE
NON-EQUITY AND NON-
FEES EARNED INCENTIVE QUALIFIED
OF PAID IN STOCK OPTION PLAN DEFERRED ALL OTHER
CASH AWARDS AWARDS COMPENSATION COMPENSATION COMPENSATION TOTAL
NAME (1) ($) ($) ($) (2) ($) ($) ($) ($)
--------------- ----------- ------ -------- ------------ ------------- ------------ -------

James M. Augur $15,000 $-- $10,343 (3) $-- $-- $-- $25,343
John A. Gleason $25,000 $-- $10,343 (4) $-- $-- $-- $35,343
Donald Shek $25,000 $-- $10,343 (5) $-- $-- $-- $35,343
Henry Y. L. Toh $25,000 $-- $10,343 (6) $-- $-- $-- $35,343

(1) Each member of the Board of Directors receives annual compensation of
$15,000 per annum. Non-employee directors serving on the Audit Committee of
the Board of Directors are also entitled to additional compensation of
$10,000 per annum. The members of the Board of Directors are also entitled
to reimbursement for all reasonable fees and expenses incurred in
connection with the performance of services on behalf of iDNA. Fees and
expenses are reimbursed upon submission to iDNA of appropriate
documentation for such fees and expenses in accordance with then-current
iDNA policy.

(2) Amounts represent the compensation expense incurred by iDNA in Fiscal 2007
in connection with grants of stock options calculated in accordance with
SFAS No. 123(R).

(3) The full grant date fair value of the stock options issued to Mr. Augur
during Fiscal 2007 calculated in accordance with SFAS No. 123(R) was
$20,686. As of January 31, 2007, Mr. Augur held options, which have fully
vested, to purchase an aggregate of 25,000 shares of Common Stock.

(4) The full grant date fair value of the stock options issued to Mr. Gleason
during Fiscal 2007 calculated in accordance with SFAS No. 123(R) was
$20,686. As of January 31, 2007, Mr. Gleason held options, which have fully
vested, to purchase an aggregate of 235,000 shares of Common Stock.

(5) The full grant date fair value of the stock options issued to Mr. Shek
during Fiscal 2007 calculated in accordance with SFAS No. 123(R) was
$20,686. As of January 31, 2007, Mr. Shek held options, which have fully
vested, to purchase an aggregate of 25,000 shares of Common Stock.

(6) The full grant date fair value of the stock options issued to Mr. Toh
during Fiscal 2007 calculated in accordance with SFAS No. 123(R) was
$20,686. As of January 31, 2007, Mr. Toh held options, which have fully
vested, to purchase an aggregate of 235,000 shares of Common Stock.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

iDNA's Compensation Committee is comprised entirely of independent
directors (James M. Augur and John A. Gleason), neither of whom are present or
past employees or officers of iDNA. No member of the Compensation Committee has
had any relationship with iDNA requiring disclosure under Item 404 of Regulation
S-K promulgated by the Securities and Exchange Commission. None of iDNA's
executive officers has served on the board of directors or compensation
committee (or other committee serving an equivalent function) of any other
entity, one of whose executive officers has served on iDNA's Board of Directors
or its Compensation Committee.

COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Board of Directors has reviewed and
discussed the Compensation Discussion and Analysis (found above in this Annual
Report on Form 10-K) with management. Based on the review and discussions, the
Compensation Committee recommended to iDNA's Board of Directors that the
Compensation Discussion and Analysis be included in this Annual Report on Form
10-K.

Respectfully submitted,

Compensation Committee

James M. Augur
John A. Gleason

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS.

The following table sets forth certain information as of May 11, 2007 with
respect to: (1) all persons known by iDNA to be the beneficial owners of five
percent or more of iDNA Common Stock; (2) each executive officer and director;
and (3) all executive officers and directors of iDNA as a group.

Name and Address of Amount and Nature Approximate
Beneficial Owner(1) Beneficially Ownership Percentage of Class(2)
----------------------------------- ---------------------- ----------------------

James McNamara(3) 3,510,075 32.4%
415 Madison Ave 7th Floor
New York, New York 10017

John A. Gleason(4) 260,000 2.6%
415 Madison Ave 7th Floor
New York, New York 10017

Henry Y. L. Toh(4) 260,000 2.6%
415 Madison Ave 7th Floor
New York, New York 10017

Robert V. Cuddihy, Jr.(5) 350,000 3.5%
415 Madison Ave 7th Floor
New York, New York 10017

James M. Augur(6) 50,000 0.5%
415 Madison Ave 7th Floor
New York, New York 10017

Donald Shek(6) 50,000 0.5%
415 Madison Ave 7th Floor
New York, New York 10017

Campus Family 2000 Trust(7) 1,883,333 16.3%
42 Oak Avenue
Tuckahoe, New York 10707

All executive officers and 4,480,075 39.7%
Directors as a group (6 persons)(8)

----------
(1) Pursuant to rules promulgated under the Exchange Act of 1934, an individual
is considered to beneficially own shares of iDNA Common Stock if he or she
directly or indirectly has or shares (i) voting power, which includes the
power to vote or direct the voting of shares; or (2) investment power,
which includes the power to dispose or direct the disposition of the
shares. Unless otherwise noted, iDNA believes that all shares listed in the
table are owned of record by each individual named as beneficial owner and
that such individual has sole voting and dispositive power with respect to
the shares of iDNA Common Stock owned by each of them. Such person's
percentage ownership is determined by assuming that the options or
convertible securities that

100

are held by such person, and which are exercisable within 60 days from the
date of the table, have been exercised or converted, as the case may be.

(2) Based on 9,954,364 shares outstanding as of May 11, 2007

(3) Includes 2,635,075 shares of iDNA Common Stock and 875,000 shares issuable
upon exercise of options.

(4) Includes 260,000 shares issuable upon exercise of options.

(5) Includes 150,000 shares issuable upon exercise of options.

(6) Includes 50,000 shares issuable upon exercise of options.

(7) Pursuant to the terms of the $2.8 million Convertible Promissory Note
outstanding at January 31, 2007, the holder has the option to convert the
note into Common Stock at the rate of $1.50 per share for an aggregate of
1,883,333 shares of iDNA Common Stock if fully converted.

(8) Includes 2,835,075 shares outstanding and 1,645,000 shares issuable upon
exercise of options.

CHANGE IN CONTROL

iDNA knows of no arrangements (including any pledge by any persons of any
of its securities) which may result in a subsequent change of control of iDNA.

EQUITY COMPENSATION PLAN INFORMATION

The following table sets forth, as of January 31, 2007, with respect to
compensation plans (including individual compensation arrangements) under which
equity securities of iDNA are authorized for issuance.

NUMBER OF
SECURITIES
REMAINING
NUMBER OF AVAILABLE FOR FUTURE
SECURITIES TO BE ISSUANCE UNDER
ISSUED UPON WEIGHTED-AVERAGE EQUITY
EXERCISE OF EXERCISE PRICE OF COMPENSATION
OUTSTANDING OUTSTANDING PLANS (EXCLUDING
OPTIONS, WARRANTS OPTIONS, WARRANTS SECURITIES REFLECTED
AND RIGHTS AND RIGHTS IN COLUMN (A))
PLAN CATEGORY ( A ) ( B ) ( C )
------------------ ----------------- ----------------- --------------------
Equity
compensation plans
approved by
security holders 3,230,702 $0.69 716,400

Equity
compensation plans
not approved by
security holders -- -- 28,000
--------- ----- -------
Total 3,230,702 $0.69 744,400
--------- ----- -------

101

Issuance of Restricted Shares

In Fiscal 2007, iDNA issued 52,000 shares of unregistered treasury stock to
two employees as a bonus and issued an additional 10,000 shares of unregistered
stock to an unrelated third party for professional services. Such shares issued
were recorded at their then market value for an aggregate cost of $52,000, or a
weighted average of $0.83 per share. The restricted shares may not be sold or
otherwise transferred without registration under the Securities Act, as amended,
and applicable state securities laws or an exemption therefrom. In the event
that iDNA proposes to register any of its securities under the Securities Act,
whether for its own account or for the account of another shareholder, the
treasury stock issued may be included in such registration.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE.

In accordance with the terms of iDNA's Code of Ethics, which was adopted by
iDNA's Board of Directors, iDNA has a written policy that requires the Audit
Committee of its Board of Directors to review and approve, in advance, the terms
and conditions of all related person transactions. Related person transactions
to which this policy applies includes any transaction to which iDNA may be party
with any of its directors, executive officers or 5% stockholders or their
respective immediate family members. In each such case, the related person is
required to work with the Board of Directors and/or the Audit Committee, as
appropriate, to monitor any potential conflict of interest (or appearance
thereof) raised by the subject transaction and to ensure that the counter-party
to the transaction is acting in the best interests of the Company and its
stockholders. Although iDNA has not entered into any transactions with any
related persons since the start of Fiscal 2007 that require disclosure under
Item 404(a) of Regulation S-K promulgated by the Securities and Exchange
Commission, if it were to do so in the future, any such transaction would need
to be approved by the Audit Committee of iDNA's Board of Directors prior
thereto. Any transaction entered into by iDNA with any related person will need
to be on commercially available terms that are as favorable to iDNA as would be
obtainable from an unaffiliated party.

With the exception of James J. McNamara, who serves as iDNA's Chief
Executive Officer, the remaining four of the Company's five Directors are not
affiliated with the Company in any capacity (except, in the cases of Mr. Gleason
and Mr. Toh, by virtue of their directorship and stock ownership) and should
therefore be considered "independent," as independence is defined by Rule
4200(a)(15) of the NASD listing standards, as applicable and as may be modified
or supplemented. In addition, all members of the Company's Audit Committee (Mr.
Gleason, Mr. Shek and Mr. Toh), Compensation Committee (Mr. Augur and Mr.
Gleason) and Corporate Governance and Nominating Committee (Mr. Augur, Mr. Shek
and Mr. Toh) are likewise independent, as determined under the aforementioned
definition.

102

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

Audit Fees

Audit fees incurred by iDNA were for professional services rendered for the
audit of our annual financial statements on Form 10-K for Fiscal 2007 and Fiscal
2006, the review of the financial statements included in our quarterly reports
on Form 10-Q for Fiscal 2007 and Fiscal 2006 and services in connection with our
statutory and regulatory filings for Fiscal 2007 and Fiscal 2006. iDNA charged
to operations $248,000 and $236,000 for audit fees for Fiscal 2007 and Fiscal
2006, respectively.

Audit-Related Fees

Audit related fees incurred by iDNA were for assurance and related services
rendered that are reasonably related to the audit and reviews of our financial
statements for Fiscal 2007 and Fiscal 2006, exclusive of the Audit Fees above.
These fees include benefit plans audits, assistance with registration statements
and comfort letters and consents not performed directly in connection with
audits. iDNA charged to operations $12,000 and $10,000 for audit related fees
for Fiscal 2007 and Fiscal 2006, respectively.

Tax Fees

Tax fees incurred by iDNA were for services related to tax compliance,
consulting and planning services rendered during Fiscal 2007 and Fiscal 2006 and
included preparation of tax returns, review of restrictions on net operating
loss carryforwards and other general tax services. iDNA charged to operations
$90,000 and $102,000 for tax fees for Fiscal 2007 and Fiscal 2004, respectively.

All Other Fees

iDNA did not incur fees for any services rendered by its principal
accountant, other than the fees disclosed above relating to audit, audit-related
and tax services, during Fiscal 2007 and Fiscal 2006.

Audit and Non-Audit Service Pre-Approval Policy

In accordance with the requirements of the Sarbanes-Oxley Act of 2002 and
the rules and regulations promulgated thereunder, the Audit Committee has
adopted an informal approval policy that it believes will result in an effective
and efficient procedure for the pre-approval of services performed by iDNA's
independent auditor.

Audit Services. Audit Services include the annual financial statement audit
(including quarterly reviews) and other procedures required to be performed by
the independent auditor in order for it to form an opinion on our financial
statements. The Audit Committee may pre-approve specified annual audit services
engagement terms and fees and other specified audit fees. All other audit
services must be specifically approved in advance by the Audit Committee. The
Audit Committee monitors the audit services engagement and may approve, if
necessary, any changes in terms, conditions and fees resulting from changes in
audit scope or other items.

Audit-Related Services. Audit-related services are assurance and related
services that are reasonably related to the performance of the audit or review
of our financial statements which historically have been provided to us by the
independent auditor and are consistent with the SEC's rules on auditor
independence. The Audit Committee may pre-approve specified audit-related
services within pre-approved fee levels. All other audit-related services must
be approved in advance by the Audit Committee.

Tax Services. The Audit Committee may pre-approve specified tax services
that the Audit Committee believes would not impair the independence of the
auditor and that are consistent with SEC rules and guidance. All other tax
services must be specifically approved by the Audit Committee.

103

All Other Services. Other services are services provided by the independent
auditor that do not fall within the established audit, audit-related and tax
services categories. The Audit Committee may pre-approve specified other
services that do not fall within any of the specified prohibited categories of
services.

Procedures. All requests for services to be provided by the independent
auditor, which must include a detailed description of the services to be
rendered and the amount of corresponding fees, are submitted to the Chief
Financial Officer. The Chief Financial Officer authorizes services that have
been pre-approved by the Audit Committee. If there is any question as to whether
a proposed service fits within a pre-approved service, the Audit Committee chair
is consulted for a determination. The Chief Financial Officer submits requests
or applications to provide services that have not been pre-approved by the Audit
Committee, which must include an affirmation by the Chief Financial Officer and
the independent auditor that the request or application is consistent with the
SEC's rules on auditor independence, to the Audit Committee (or its chair or any
of its other members pursuant to delegated authority) for approval.

104

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

(a)(1) The following financial statements are included in Part II, Item 8 of
this Annual Report on Form 10-K:

Financial Statements of the Company
Report of Independent Certified Public Accountants
Financial Statements:
Consolidated Balance Sheets - as of
January 31, 2007 and 2006
Consolidated Statements of Operations -
Years Ended January 31, 2007, 2006 and 2005
Consolidated Statements of Stockholders' Equity and Comprehensive Income
(Loss) - Years Ended January 31, 2007, 2006 and 2005
Consolidated Statements of Cash Flows -
Years Ended January 31, 2007, 2006 and 2005
Notes to Consolidated Financial Statements -
Years Ended January 31, 2007, 2006 and 2005

Financial Statements of AFC

Report of Independent Certified Public Accountants
Financial Statements:
Balance Sheets as of December 28, 2006 and December 29, 2005
Statements of Operations for the Years Ended
December 28, 2006, December 29, 2005 and December 30, 2004
Statements of Members' Equity for the Years Ended
December 28, 2006 and December 29, 2005
Statements of Cash Flows for the Years Ended
December 28, 2006, December 29, 2005 and December 30, 2004
Notes to Financial Statements for the Years Ended
December 28, 2006, December 29, 2005 and December 30, 2004

105

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES (CONT.)

(a)(2) The following financial statement schedule for the years ended January
31, 2007, 2006 and 2005 is submitted herewith:

Schedule II - Valuation and Qualifying Accounts

All other schedules are omitted because the required information either
is not applicable or is shown in the consolidated financial statements or
notes.

(a)(3) Exhibits

Description
-----------
2.1 Agreement of Merger (incorporated by reference to Exhibit 2 to the
Company's Form 8 B dated December 27, 1995, SEC File No. 1-11601).

2.2 Settlement Agreement and Release (Including Agreement for Sale of Shares)
by and among the Company, Mr. Frankino, individually and as trustee and
president of the Samuel J. Frankino and Connie M. Frankino Charitable
Foundation, trustee of the Corrine L. Dodero Trust for the Arts and
Sciences and managing partner of the Frankino and Frankino Investment
Company, dated November 3, 2000 (incorporated by reference to Exhibit 2.1
to the Company's Form 8-K dated November 17, 2000, SEC File No. 1-11601).

2.3 Stock Purchase and Standstill Agreement by and among the Company, Reading
Entertainment, Inc., FA, Inc., Citadel Holding Corporation, and Craig
Corporation, dated November 3, 2000 (incorporated by reference to Exhibit
2.2 on the Current Report on Form 8-K filed November 17, 2000, SEC File No.
1-11601).

2.4 Merger Agreement and Plan of Reorganization by and among ZLT Acquisition
Corp., a Delaware and a wholly-owned subsidiary of the Company.; ZoomLot
Corporation, a Delaware corporation, including all of its subsidiaries; and
Ernest C. Garcia II, Verde Reinsurance Company, Ltd., a Nevis Island
corporation, Ernie Garcia III 2000 Trust, Brian Garcia 2000 Trust, Ray
Fidel, Steven Johnson, Mark Sauder, EJMS Investors Limited Partnership, an
Arizona limited partnership, Colin Bachinsky, Chris Rompalo, Donna Clawson,
Mary Reiner, and Kathy Chacon dated December 15, 2000 (incorporated by
reference to Exhibit 2 of the Current Report on Form 8-K filed January 2,
2001, SEC File No. 1-11601).

2.5 Stock Purchase and Standstill Agreement by and among Reading Entertainment,
Inc., FA, Inc., Citadel Holding Corporation, Craig Corporation, and the
Company, dated as of December 15, 2000, (incorporated by reference to
Exhibit 99.1 of the Current Report on Form 8-K filed January 2, 2001, SEC
File No. 1-11601).

106

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES (CONT.)

3.1 Second Amended and Restated Certificate of Incorporation of the Company
(incorporated by reference to Exhibit 99.1 to the Company's Current
Report on Form 8-K filed November 4, 2004, SEC File No. 1-11601).

3.2 Second Amended and Restated By-Laws of the Company dated November 3,
2005 (incorporated by reference to Exhibit 99.2 to the Company's
Current Report on Form 8-K filed November 4, 2005, SEC File No.
1-11601).

4.1 Certificate of Designation, Number, Powers, Preferences and Relative,
Participating, Optional and Other Special Rights and the
Qualifications, Limitations, Restrictions, and Other Distinguishing
Characteristics of the Series A Convertible Preferred Stock of the
Company, dated as of April 5, 2000 (incorporated by reference to
Exhibit 10.3 of the Current Report on Form 8-K filed on April 20, 2000,
File No. 1-11601).

4.2 Certificate of Designations of Series B and C Preferred Stock of the
Company dated as of December 15, 2000 (incorporated by reference to
Exhibit 4.1 of the Current Report on Form 8-K filed January 2, 2001,
SEC File No. 1-11601).

4.3 Certificate of Designation for the Series D Junior Participating
Preferred Stock (incorporated by reference to the Company's Current
Report on Form 8-K, dated October 9, 2001, SEC File No. 1-11601).

4.4 Specimen Stock Certificate - the Company (incorporated by reference to
the Company's Annual Report on Form 10-K for the fiscal year ended
January 31, 1996, SEC File No. 1-11601).

4.5 Specimen Series C Redeemable Preferred Stock Certificate - the Company
(incorporated by reference to the Company's Annual Report on Form 10-K
for the fiscal year ended January 31, 2001, SEC File No. 1-11601).

4.6 Rights Agreement, dated as of September 26, 2001, between the Company
and American Stock Transfer & Trust Company, which included the form of
Certificate of Designation for the Series D Junior Participating
Preferred Stock as Exhibit "A", the form of Rights Certificate as
Exhibit "B" and the Summary of Rights to Purchase Preferred Stock as
Exhibit "C" (incorporated herein by reference to the Company's Current
Report on Form 8-K, dated October 9, 2001, SEC File No. 1-11601).

10.1* The Company's 1993 Equity Incentive Plan (incorporated by reference to
the Company's Form S-8 Registration Statement as filed on December 28,
1993, File No. 33-51727).

10.2* The Company's 401(k) Savings and Retirement Plan and Trust
(incorporated by reference to the Company's Form S-8 Registration
Statement as filed on December 28, 1993, File No. 33-51727).

10.3 Purchase Agreement among the Company, National Cinemas, Inc., FA, Inc.
and Reading Entertainment, Inc., dated as of April 5, 2000
(incorporated by reference to Exhibit 10.1 of the Current Report on
Form 8-K filed on April 20, 2000, File No. 1-11601).

107

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES (CONT.)

10.4* Employment Agreement between Robert V. Cuddihy, Jr. and the Company
dated December 31, 2001 (exhibit to the Annual Report on Form 10-K
filed May 13, 2002, SEC File No. 1-11601).

10.5 Merger Agreement and Plan of Reorganization between the Company,
ORA/Metro Incorporated and Mr. Dean R. Thompson dated as of April 1,
2003 (exhibit to the Annual Report on Form 10-K filed April 30,
2003, SEC File No. 1-11601).

10.6* Employment Agreement and Non-Competition and Non-Solicitation
Agreement between OMI Communications, Inc. and Mr. Dean R. Thompson
dated as of April 1, 2003 (exhibit to the Annual Report on Form 10-K
filed April 30, 2003, SEC File No. 1-11601).

10.7* Non-Negotiable Promissory Note between the Company and Mr. Dean R.
Thompson dated as of April 1, 2003 (exhibit to the Annual Report on
Form 10-K filed April 30, 2003, SEC File No. 1-11601).

10.8 Registration Rights Agreement between the Company and Mr. Dean R.
Thompson dated as of April 1, 2003 (exhibit to the Annual Report on
Form 10-K filed April 30, 2003, SEC File No. 1-11601).

10.9 Stock Purchase Agreement between the Company, Campus Group
Companies, Inc., Audience Response Systems, Inc., Interactive
Conferencing Network, Inc. and Multi-Video Services, Inc. and Steven
Campus, the Campus Family 2000 Trust and the Trust Established Under
the Will of Nancy Campus (the "Campus Group Shareholders") dated
July 31, 2003 (exhibit to Form 8-K filed August 1, 2003, SEC File
No. 1-11601).

10.10 Lock-up, Standstill and Voting Agreement between the Company and The
Campus Group Shareholders dated July 31, 2003 (exhibit to Form 8-K
filed August 1, 2003, SEC File No. 1-11601).

10.11 Registration Rights Agreement between the Company and the Campus
Family 2000 Trust dated July 31, 2003 (exhibit to Form 8-K filed
August 1, 2003, SEC File No. 1-11601).

10.12* Employment Agreement, Non-Competition and Non-Solicitation Agreement
between the Campus Group Companies, Inc. and Steven Campus dated
July 31, 2003 (exhibit to Form 8-K filed August 1, 2003, SEC File
No. 1-11601).

10.13 Amendment to Lease [Tuckahoe Premises] between the Campus Group
Companies, Inc. and the Campus Family 2000 Trust dated July 31, 2003
(exhibit to Form 8-K filed August 1, 2003, SEC File No. 1-11601).

10.14 Amendment to Lease [Bohemia Premises] between the Campus Group
Companies, Inc. and the Campus Family 2002 Trust dated July 31, 2003
(exhibit to Form 8-K filed August 1, 2003, SEC File No. 1-11601).

10.15 Surety Agreement between The Campus Group and The Campus Group
Shareholders dated July 31, 2003 (exhibit to Form 8-K filed August
1, 2003, SEC File No. 1-11601).

108

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES (CONT.)

10.16 Security Agreement between The Campus Group and The Campus Group
Shareholders dated July 31, 2003 (exhibit to Form 8-K filed August 1,
2003, SEC File No. 1-11601).

10.17 Pledge Agreement between The Campus Group and the Campus Group
Shareholders dated July 31, 2003 (exhibit to Form 8-K filed August 1,
2003, SEC File No. 1-11601).

10.18* Non-Negotiable Promissory Notes between the Company and The Campus
Group Shareholders dated July 31, 2003 (exhibit to Form 8-K filed
August 1, 2003, SEC File No. 1-11601).

10.19* Non-Negotiable Convertible Promissory Note between the Company and the
Campus Family 2000 Trust dated July 31, 2003 (exhibit to Form 8-K filed
August 1, 2003, SEC File No. 1-11601).

10.20 November 2004 Amended Stipulation of Settlement between Robert Zadra
individually and on behalf of a class of persons similarly situated and
James J. McNamara, John A. Gleason, William S. Marshall, Henry Y.L.
Toh, Donald Jasensky, Peter Zackaroff, Mallory Factor, Thomas F.
Carney, Jr. and the Company (exhibit to Form 8-K filed April 22, 2005,
SEC File No. 1-11601).

10.21 Stock Purchase Agreement dated as of April 1, 2005 between the Company
and Academy Capital Management, Inc, Diamond A. Partners L.P., Diamond
A. Investors L.P., Ridglea Investor Services, Inc. and William S.
Banowsky (exhibit to Form 8-K filed April 22, 2005, SEC File No.
1-11601).

10.22 Audit Committee Charter adopted by the Board of Directors on November
3, 2005 (exhibit to Form 8-K filed November 7, 2005, SEC File No.
1-11601).

10.23 Corporate Governance and Nominating Committee Charter adopted by the
Board of Directors on November 3, 2005 (exhibit to Form 8-K filed
November 7, 2005, SEC File No. 1-11601).

10.24 Compensation and Stock Option Committee Charter adopted by the Board of
Directors on November 3, 2005 (exhibit to Form 8-K filed November 7,
2005, SEC File No. 1-11601).

10.25 Policy Statement Regarding Securities Trades by Company Personnel
adopted by the Board of Directors on November 3, 2005 (exhibit to Form
8-K filed November 7, 2005, SEC File No. 1-11601).

10.26 Membership Interest Purchase Agreement dated as of November 18, 2005
among the Company, Flexner Wheatley & Associates and MeetingNet
Interactive, Inc. (exhibit to Form 8-K filed November 18, 2005, SEC
File No. 1-11601).

10.27 Lockup, Standstill and Voting Agreement dated as of November 18, 2005
among the Company, Flexner Wheatley & Associates and MeetingNet
Interactive, Inc. (exhibit to Form 8-K filed November 18, 2005, SEC
File No. 1-11601).

109

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES (CONT.)

10.28 Registration Rights Agreement dated as of November 18, 2005 among the
Company, Flexner Wheatley & Associates and MeetingNet Interactive, Inc.
(exhibit to Form 8-K filed November 18, 2005, SEC File No. 1-11601).

10.29* Employment Agreement dated as of November 18, 2005 between OTI and Mark
A. Fite. (exhibit to Form 8-K filed November 18, 2005, SEC File No.
1-11601).

10.30 Non-Competition and Non-Solicitation Agreement dated as of November 18,
2005 among the Company, OTI, Flexner Wheatley & Associates, MeetingNet
Interactive, Inc., Mark A. Fite, William A. Flexner, Ray Franklin and
Kimbal Wheatley. (exhibit to Form 8-K filed November 18, 2005, SEC File
No. 1-11601).

10.31 Surety Agreement dated as of November 18, 2005 among the Company,
Flexner Wheatley & Associates and MeetingNet Interactive, Inc. (exhibit
to Form 8-K filed November 18, 2005, SEC File No. 1-11601).

10.32 Security Agreement from OTI dated as of November 18, 2005 among the
Company, Flexner Wheatley & Associates and MeetingNet Interactive, Inc.
(exhibit to Form 8-K filed November 18, 2005, SEC File No. 1-11601).

10.33 Security Agreement from the Company dated as of November 18, 2005 among
the Company, Flexner Wheatley & Associates and MeetingNet Interactive,
Inc. (exhibit to Form 8-K filed November 18, 2005, SEC File No.
1-11601).

10.34* Non-Negotiable Promissory Note Agreement dated November 18, 2005 issued
by the Company payable to Flexner Wheatley & Associates Inc. (exhibit
to Form 8-K filed November 18, 2005, SEC File No. 1-11601).

10.35* Non-Negotiable Promissory Note Agreement from the Company dated
November 18, 2005 payable to MeetingNet Interactive, Inc. (exhibit to
Form 8-K filed November 18, 2005, SEC File No. 1-11601).

10.36* The Company's 2005 Equity Compensation Plan (incorporated by reference
to Appendix B to the Company's Definitive Proxy Statement on Schedule
14A filed on December 14, 2005, SEC File No. 1-11601).

10.37 Loan and Security Agreement dated as of July 20, 2006 among the Company
and Seasons Go Round (incorporated by reference to Exhibit 99.1 of the
Current Report on Form 8-K filed July 24, 2006, SEC File No. 1-11601).

110

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES (CONT.)

10.38 Employment Agreement between the Company and James J. McNamara dated as
of November 29, 2006 (incorporated by reference to Exhibit 99.1 of the
Current Report on Form 8-K filed December 1, 2006, SEC File No.
1-11601).

14. Code of Business Conduct, Ethics and Corporate Governance (incorporated
by reference to Exhibit 99.4 to the Company's Current Report on Form
8-K filed on November 8, 2005, SEC File No. 1-11601).

21 Subsidiaries of iDNA, Inc. at January 31, 2007.

23 Consent of Independent Certified Public Accountants.

31.1 Certification of Principal Executive Officer required under Section 302
of the Sarbanes-Oxley Act of 2002

31.2 Certification of Principal Financial Officer required under Section 302
of the Sarbanes-Oxley Act of 2002

32.1 Certification of Principal Executive Officer pursuant to 18 U.S.C. 1350
as adopted under Section 906 of the Sarbanes-Oxley Act of 2002

32.2 Certification of Principal Financial Officer pursuant to 18 U.S.C. 1350
as adopted under Section 906 of the Sarbanes-Oxley Act of 2002

Items above indicated with an asterisk (*) are management contracts or
compensatory plans or arrangements

111

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

iDNA, Inc.
Registrant

Date May 11, 2007 By: /s/ James J. McNamara
------------------------------ --------------------------------------
James J. McNamara
Chairman of the Board and
Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated.

Principal Executive Officer Principal Financial and Accounting Officer

By: /s/ James J. McNamara By: /s/ Robert V. Cuddihy, Jr.
------------------------------- --------------------------------------
James J. McNamara Robert V. Cuddihy, Jr.
Chairman of the Board and Chief Financial Officer and Treasurer
Chief Executive Officer

Date May 11, 2007
------------------------------

Directors:

/s/ James M. Augur /s/ John A. Gleason
----------------------------------- ------------------------------------------
James M. Augur John A. Gleason

/s/ Donald Shek /s/ James J. McNamara
----------------------------------- ------------------------------------------
Donald Shek James J. McNamara

/s/ Henry Y. L. Toh
-----------------------------------
Henry Y. L. Toh

Date May 11, 2007
------------------------------

112

SCHEDULE II

VALUATION AND QUALIFYING ACCOUNTS
(In Thousands)

Column A Column B Column C Column D Column E
------------------------------- ------------ --------------------- ---------- ---------
Balance at Additions Charged to: Balance
beginning of --------------------- at end of
Description period Expenses Other Deductions period
------------------------------- ------------ --------- --------- ---------- ---------

Year ended January 31, 2007
Allowance for doubtful accounts $ 105 $ (4) $ -- $ 19 $ 82
Self-insurance claims $ 235 $ -- $ -- $ -- $ 235

Year ended January 31, 2006
Allowance for doubtful accounts $ 65 $ 5 $ 40(a) $ 5 $ 105
Self-insurance claims $ 256 $ -- $ -- $ 21(b) $ 235

Year ended January 31, 2005
Allowance for doubtful accounts $ 75 $ 4 $ -- $ 14 $ 65
Self-insurance claims $ 408 $ -- $ -- $ 152(b) $ 256

(a) Includes $40,000 provision for doubtful accounts at the date of the OTI
acquisition during Fiscal 2006.

(b) Cash disbursements related to self-insured claims.

113