EX-99.1 2 v353506_ex99-1.htm EXHIBIT 99.1

	FOR MORE INFORMATION:	Company Contact:
		Jacqueline Lemke
		President & CEO and CFO
		Phone:  765.497.5829
		jlemke@BASinc.com
		Agency Contact:
		Neil Berkman
		Berkman Associates
		Phone:  310.477.3118
		info@berkmanassociates.com

BASi Files Form 8K

Notice of Non-Compliance with a Continued Listing Rule

Non-Reliance on Previously Issued Financial Statements

WEST LAFAYETTE, IN -- August 21, 2013-- Bioanalytical Systems, Inc. (NASDAQ:BASI) announced today that on August 15, 2013, the Company received a letter from the Nasdaq Listing Qualifications Department stating that the Company no longer complies with the Listing Rules for continued listing of the Company's common shares on the Nasdaq Capital Market since the Company has not yet filed its Form 10-Q for the period ended June 30, 2013 with the Securities and Exchange Commission.

The Letter further stated that, under the listing rules, the Company has until October 14, 2013 to submit a plan to regain compliance. If the Company’s plan is accepted, the Company may be granted an exception of up to 180 calendar days from the initial filing’s due date, or until February 10, 2014, to regain compliance. The Company intends to comply with the dates given above in order to regain compliance with the listing rules.

On August 14, 2013, the Company filed a 12b-25 indicating that the Company could not, without unreasonable effort or expense, file its Form 10-Q for the three and nine months ended June 30, 2013 by the original due date of August 14, 2013 until management could resolve a complex accounting issue related to the accounting treatment for the outstanding warrants.

Non-Reliance on Previously Issued Financial Statements

On August 19, 2013, the Audit Committee of Bioanalytical Systems, in consultation with management, concluded that, because of an error identified in the Company’s previously issued financial statements for the fiscal years ended September 30, 2011, September 30, 2012 and the first two fiscal quarters of 2013, the Company should restate its previously issued financial statements for the relevant periods. Accordingly, investors should no longer rely upon the Company’s previously released financial statements and related auditors' reports for these periods or any earnings releases or other communications relating to these periods.

The error, identified by management, is related to the accounting for the Class A and B Warrants as part of the May 2011 public offering. At the time of the transaction, the Company incorrectly recorded the fair value of the warrants as equity. The proper treatment under ASC 815-40 would have been to record the fair value of the warrants as a liability due to the provision in Section 3e of the Common Stock Purchase Warrant that could require net cash settlement of the warrants. The Audit Committee and management have discussed the matters reported herein with the Company's prior and current independent registered accounting firms, as applicable. The Audit Committee, with the assistance of independent counsel, is conducting an investigation into the circumstances surrounding the error.

The Company is evaluating the debt covenants at each reporting period and expects to be in breach of the tangible net worth ratios in fiscal 2013. The Company is communicating with our lenders to obtain waivers for the applicable periods, if necessary.

The Company expects all amendments and restatements to the financial statements affected to be non-cash in nature.

The Company has determined that the below-detailed restatements of its financial statements resulted from a material weakness in its internal control over financial reporting, specifically related to its process and procedures related to the accounting for stock purchase warrants.  The Company has been actively engaged in developing a remediation plan to address the material weakness.  Implementation of the remediation plan is in process and consists of, among other things, redesigning the procedures to enhance its identification, capture, review, approval and recording of contractual terms included in equity arrangements. The Company also intends to seek the counsel of other experts in accounting before discussions with our auditors on future unusual and non-recurring transactions.

The following tables summarize the effects of the previously discussed unaudited restatement adjustments on the consolidated statements of operations for the periods ended:

		Three Months ended June 30, 2011												Fiscal 2011												Fiscal 2012
		As Reported				Error				Restated				As Reported				Error				Restated				As Reported				Error				Restated
Total revenue		$	8,478			$	-			$	8,478			$	33,144			$	-			$	33,144			$	28,208							$	28,208
Total cost of revenue			5,733				-				5,733				22,638				-				22,638				21,370								21,370
Gross profit			2,745				-				2,745				10,506				-				10,506				6,838				-				6,838
Total operating expenses			2,264				-				2,264				9,219				-				9,219				9,329								9,329
Restructuring charges			-				-				-				-				-				-				3,195								3,195
Operating income (loss)			481				-				481				1,287				-				1,287				(5,686	)			-				(5,686	)
Interest expense			(70	)			-				(70	)			(706	)			-				(706	)			(714	)							(714	)
Warrant valuation-(increase) decrease			-				(185	)			(185	)			-				1,759				1,759				-				73				73
Other income			7				-				7				12				-				12				12				-				12
Income (loss) before income taxes			418				(185	)			233				593				1,759				2,352				(6,388	)			73				(6,315	)
Income tax expense			-				-				-				50				-				50				2								2
Net income (loss)			418				(185	)			233				543				1,759				2,302				(6,390	)			73				(6,317	)
Less:  Deemed dividend for Series A Preferred Shares			(3,277	)			(2,229	)			(5,506	)			(3,277	)			(2,229	)			(5,506	)			-				-				-
Less:  Preferred stock dividends			(991	)			-				(991	)			(991	)			-				(991	)			-				-				-
Net income (loss) applicable to common shareholders		$	(3,850	)		$	(2,414	)		$	(6,264	)		$	(3,725	)		$	(470	)		$	(4,195	)		$	(6,390	)		$	73			$	(6,317	)
Basic net income (loss) per share		$	(0.65	)		$	(0.41	)		$	(1.06	)		$	(0.66	)		$	(0.08	)		$	(0.74	)		$	(0.89	)		$	0.01			$	(0.88	)

		Three Months ended December 31, 2012												Three Months ended March 31, 2013												Six Months ended March 31, 2013
		As Reported				Error				Restated				As Reported				Error				Restated				As Reported				Error				Restated
Total revenue		$	5,803			$	-			$	5,803			$	5,156			$	-			$	5,156			$	10,960			$	-			$	10,960
Total cost of revenue			3,948				-				3,948				3,898				-				3,898				7,846				-				7,846
Gross profit			1,855				-				1,855				1,258				-				1,258				3,114				-				3,114
Total operating expenses			1,553				-				1,553				1,267				-				1,267				2,820				-				2,820
Restructuring charges			-				-				-				-				-				-				-				-				-
Operating income (loss)			302				-				302				(9	)			-				(9	)			294				-				294
Interest expense			(165	)			-				(165	)			(163	)			-				(163	)			(329	)			-				(329	)
Warrant valuation-(increase) decrease			-				117				117				-				(142	)			(142	)			-				(25	)			(25	)
Other income			2				-				2				3				-				3				5				-				5
Income (loss) before income taxes			139				117				256				(169	)			(142	)			(311	)			(30	)			(25	)			(55	)
Income tax expense			-				-				-				-				-				-				-				-				-
Net income (loss)		$	139			$	117			$	256			$	(169	)		$	(142	)		$	(311	)		$	(30	)		$	(25	)		$	(55	)
Basic net income (loss) per share		$	0.02			$	0.01			$	0.03			$	(0.02	)		$	(0.02	)		$	(0.04	)		$	(0.00	)		$	(0.01	)		$	(0.01	)

The following tables summarize the effects of the previously discussed unaudited restatement adjustments on the consolidated balance sheet items.

		As of June 30, 2011												As of September 30, 2011												As of September 30, 2012
		As Reported				Error				Restated				As Reported				Error				Restated				As Reported				Error				Restated
Total assets		$	34,310			$	-			$	34,310			$	32,346			$	-			$	32,346			$	26,975							$	26,975
Total all other liabilities			18,057				-				18,057				16,760				-				16,760				17,385								17,385
Warrant liability			-				3,230				3,230				-				1,286				1,286				-				1,213				1,213
Total liabilities			18,057				3,230				21,287				16,760				1,286				18,046				17,385				1,213				18,598
Shareholders' equity:
Preferred Shares			2,135				-				2,135				2,135				-				2,135				1,335				-				1,335
Common Shares			1,690				-				1,690				1,698				-				1,698				1,871				-				1,871
Additional paid-in capital			19,370				(816	)			18,554				19,408				(816	)			18,592				20,451				(816	)			19,635
Accumulated deficit			(7,038	)			(2,414	)			(9,452	)			(7,706	)			(470	)			(8,176	)			(14,096	)			(397	)			(14,493	)
Accumulated other comprehensive income			96				-				96				51				-				51				29								29
Total shareholders' equity			16,253				(3,230	)			13,023				15,586				(1,286	)			14,300				9,590				(1,213	)			8,377
Total liabilities and shareholders' equity		$	34,310			$	-			$	34,310			$	32,346			$	-			$	32,346			$	26,975			$	-			$	26,975

		As of December 31, 2012												As of March 31, 2013
		As Reported				Error				Restated				As Reported				Error				Restated
Total assets		$	25,064			$	-			$	25,064			$	24,790							$	24,790
Total all other liabilities			15,232				-				15,232				14,999								14,999
Warrant liability			-				1,096				1,096				-				1,238				1,238
Total liabilities			15,232				1,096				16,328				14,999				1,238				16,237
Shareholders' equity:
Preferred Shares			1,335				-				1,335				1,335				-				1,335
Common Shares			1,876				-				1,876				1,880				-				1,880
Additional paid-in capital			20,541				(816	)			19,725				20,618				(816	)			19,802
Accumulated deficit			(13,957	)			(280	)			(14,237	)			(14,126	)			(422	)			(14,548	)
Accumulated other comprehensive income			37				-				37				84								84
Total shareholders' equity			9,832				(1,096	)			8,736				9,791				(1,238	)			8,553
Total liabilities and shareholders' equity		$	25,064			$	-			$	25,064			$	24,790			$	-			$	24,790

  Until the Company has restated and reissued its results for the applicable periods, investors and other users of the Company’s SEC filings are cautioned not to rely on the Company’s financial statements for (i) the quarterly periods ended June 30, and September 30, 2011, (ii) the annual period ended September 30, 2012, and (iii) the quarterly periods ended December 31, 2012 and March 31, 2013.

About Bioanalytical Systems, Inc.

BASi is a pharmaceutical development company providing contract research services and monitoring instruments to the world's leading drug development companies and medical research organizations. The company focuses on developing innovative services and products that increase efficiency and reduce the cost of taking a new drug to market. Visit www.BASinc.com for more about BASi.

This press release contains statements that constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Those statements include our expectations regarding changes in our results of operations to be reported for (i) the quarterly periods ended June 30, and September 30, 2011, (ii) the annual period ended September 30, 2012, and (iii) the quarterly periods ended December 31, 2012 and March 31, 2013 when filed with the SEC. Readers are cautioned that any such forward looking statements are not guarantees of future results and involve risks and uncertainties. In addition, we have based these forward-looking statements on our current expectations and projections about our third quarter results. Our work to address the warrant accounting issue is ongoing and the results discussed above may change as we complete our analysis.