The correct answer is E.
Transformation is change in genetic composition of a cell that results from a direct uptake, incorporation and expression of exogenous (external) genetic material namely DNA from its surroundings by the cell through its cell membrane.
In some species of bacteria, transformation takes place naturally but it can also be induced using artificial means in other species.
For transformation to happen , the bacteria must be in state of competence. This is a state of being able to take up exogenous DNA from the environment.