Document:

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                                                                    Exhibit 10.3
                         EXCLUSIVE SUB-LICENSE AGREEMENT

         This Exclusive Sub-License Agreement  ("Agreement") is made, as of July
29, 2003, by and among Applied DNA Sciences, Inc., a Nevada corporation,  having
its  principal  offices  at  9255  Sunset  Boulevard,  Suite  805,  Los  Angles,
California 90069 (hereinafter referred to as "APDNA" or the "Company");  Biowell
Technology  Inc., a company duly  incorporated  and organized  under the laws of
Taiwan,  Republic of China, ("ROC), having its principal office at 18F, No. 959,
Chung-Cheng Rd., Chung-Ho City,  Taipei County,  Taiwan,  235 ROC,  (hereinafter
referred  to  as  "Biowell");  and  G.A.  Corporate  Finance,  Ltd.,  a  British
corporation,  having its  principal  offices  at 26  Eccleston  Square,  London,
England,  United Kingdom SW1 V1NS  (hereinafter  referred to as "UK Licensee""),
all which may be referred to as a "Party" or collectively as the "Parties."

                                    RECITALS:

1. APDNA is in the  business,  inter alia,  of providing  DNA-embedded  security
solutions for the prevention of fraud,  forgery and  counterfeiting  of products
and  intellectual  property  by  utilizing  a  patented  line  of  biotechnology
products.

2 UK Licensee is in the business,  inter alia, of developing  existing sales and
distribution  networks and  establishing  new networks,  with specific  focus on
businesses in market  segments in the United  Kingdom,  which  segments shall be
explored  and  further  defined  by  the  parties  as  the  development  process
progresses.

3. Biowell is a biotechnology  company;  having  developed  products such as DNA
based  anti-counterfeiting  technologies,  and owns the  rights to  patents  and
patent applications covering several aspects of the technologies.

4. APDNA holds an exclusive license from Biowell  Technologies,  Inc.("Biowell")
to sell and distribute its  technologies  in various  international  territories
pursuant to that certain Technology Exclusive Licensing Agreement, dated October
8, 2002, between APDNA and Biowell (the "Licensing Agreement").

5. APDNA desires to expand the geographical reach of its business activities and
the  distribution  of its  products to include the United  Kingdom  (hereinafter
referred to as the "UK" or the "Region").

6. UK Licensee  desires to provide  APDNA sales and  distribution  channels  for
intensive marketing of APDNA's products through UK Licensee's current and future
sales networks to business customers in the Region.

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7. APDNA and UK  Licensee  desire to enter into this  Agreement  in order to set
forth their  respective  rights and obligations with respect to the distribution
and marketing of APDNA's products in the Region.

DEFINITIONS

         Unless the context requires otherwise, whenever used in this Agreement,
the following terms and expressions shall have the following meanings:

         "Accepted New Product"  shall mean a new product that has  successfully
achieved  its Minimum  Guarantee by the  conclusion  of the required New Product
Initial  Exclusive Term, after which, a New Product License shall be granted and
will subject to the terms and conditions of this Agreement.

         "Agreement" shall mean this agreement including its Exhibits, as it may
be amended from time to time only by written agreement of all parties.

         "APDNA Products" means Products manufactured by APDNA or Biowell.

         "Business Day" means any day except a Saturday,  Sunday or other day on
which  commercial banks in the city of Taipei and New York are authorized by law
to close.

         "Business Methods" refers to business methods  developed,  licensed to,
and/or owned by Biowell relating to the Technology and Products.

         "Collaborative  Technologies" means any technology or product developed
by APDNA  and/or  Biowell and UK  Licensee  or as a result of the  collaborative
efforts of APDNA and/or Biowell and UK Licensee.

         "Company" shall mean APDNA

         "Confidential Information" includes all information, whether written or
oral,  in  whatever  form  disclosed,  concerning  any  technologies,  products,
developments,   business  methods,   business  plans,   marketing,   investment,
management,  financial and other business affairs in connection with all matters
relating to or arising out of this Agreement,  including without  limitation the
Technology, the Business Methods and Know How.

         "Customers" means any natural or legal person(s) or entities  primarily
solicited by UK Licensee under this Agreement in the Territory.

         "Delivery  Date" shall mean the date specified by UK Licensee  pursuant
to a Purchase  Order on which a Product or Product  Material  is  required to be
delivered by APDNA to UK Licensee.

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         "Float"  means  to  list  a  subject  company  on  an   internationally
recognized stock exchange or listing service.

          "Gross  Revenues"  shall mean any  revenue  generated  by UK  Licensee
directly or  indirectly  with  respect to any Product of APDNA  and/or  Biowell,
whether from products sales, sub-licensing, etc.

         "Intellectual Property Rights" shall mean:

         (a)      patents,  designs, utility models, schemes,  drawings,  design
                  rights, copyrights,  database rights, topography rights, trade
                  or service marks or names  (whether or not  registered) or any
                  similar rights in brands;

         (b)      applications  for any of the  foregoing and the right to apply
                  therefore in any jurisdiction;

         (c)      Know-How,  trade secrets,  proprietary and other  Confidential
                  Information;

         (d)      domain name registrations; and

         (e)      all or any similar or equivalent  rights arising or subsisting
                  in any jurisdiction.

         "Know-How" means all technical, operational and commercial Confidential
Information  (including but not limited to Confidential  Information relating to
product  development,  business plans,  business  models,  marketing,  and other
business  affairs of the  disclosing  party)  required for the  exploitation  of
Technology  or  related  to  the  Products,   and  including  such  Confidential
Information as may relate to any Intellectual Property therein.

         "Licensed   Products,"   means  Products  as  described  in  Exhibit  3
manufactured by UK Licensee incorporating Product Materials.

         "Maintain its Markets" means when UK Licensee  achieves  revenues equal
to or greater than the Minimum  Guarantees  outlined in the  Agreement  during a
specified time period.

         "Minimum  Guarantee" shall mean the minimum quantity of business volume
to be  generated  by UK  Licensee  on behalf of APDNA as  further  described  in
Section 1.3 and the attached Exhibit 2.

         "Net Profits" means Gross Revenue minus cost of goods.

         "New Product" means any new Product introduced pursuant to Section 1.3.

         "New Product  Initial  Exclusive Term" shall have the meaning set forth
in Section 1.3 .

         "New Product License" shall have the meaning set forth in Section 1.3.

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         "Product"  means  either  Licensed  Product  or APDNA  Product,  as the
context requires, as specified in Exhibit 3 attached hereto. Products in Exhibit
3 are also referred to as the "Initial Product Line."

          "Product  Materials"  means  any  and all raw  materials  required  to
manufacture the Licensed Products for resale in the Territory.

         "Purchase  Order"  shall  mean an  order  for  APDNA  Products  that UK
Licensee  submits and APDNA  accepts.  All Purchase  Orders will be gathered and
controlled by the terms of this Agreement  unless otherwise agreed to in writing
by UK Licensee and APDNA.

          "Technology" means all technology underlying the Licensed Products.

         "Territory" means the territories specified in Exhibit 1.

         "Unlicensed Territory" means any territory not included in Exhibit 1 of
this Agreement.

1.       Grant of Exclusive Right

1.1      Subject to the terms and  conditions of this  Agreement and for so long
         as UK Licensee is in compliance with all of its  obligations  hereunder
         and APDNA has a valid  license from  Biowell,  APDNA  hereby  grants an
         exclusive right (solely as stated in clauses (a) and (b) hereof) for UK
         Licensee to: (a) manufacture the Products using only Product  Materials
         purchased  from  APDNA or its  authorized  designees  for resale in the
         Territory;  and (b) resell the Products,  either  purchased  from APDNA
         directly  or  manufactured  by  UK  Licensee  using  Product  Materials
         purchased  from  APDNA,  in  the  Territory  (collectively,  "Exclusive
         License"). UK Licensee shall purchase Product Materials only from APDNA
         or  its  authorized   designees.   The  parties   understand  that  the
         exclusivity of the manufacturing  arrangement requires that UK Licensee
         give an  undivided  priority of the highest  loyalty to the Products in
         all  business  endeavours.  Notwithstanding  anything  to the  contrary
         stated  herein,  no  express or  implied  licenses  of any type for the
         Technology,  except as expressly stated in (a) and (b) above,  shall be
         granted to UK Licensee.  APDNA  represents  that it has a valid license
         with  Biowell and is in the process of  exercising  a Note for the five
         year license fee in the License Agreement and will forward such note to
         UK Licensee upon its completion.

1.2      Notwithstanding  anything to the contrary stated herein, APDNA reserves
         the right to enter into a world wide  agreement  to sell or license its
         products and  services to an  international  customer.  In the event of
         such an international  sale, the UK Licensee shall be entitled to a fee
         of 20% of Net Profits generated from such sale, when received by APDNA,
         if the corporate  headquarters of that international customer is solely
         based in the  Territory.  If UK Licensee  is the direct  source of such
         customer agreement,  fees will be shared as outlined in section 3 under
         "Revenue Sharing." UK Licensee may also purchase finished Products from
         APDNA for resale in the Territory  under the  procedures  otherwise set
         forth in this Agreement.

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1.3      Upon the terms specified in this section,  APDNA shall  sub-license any
         new improvements,  modifications or alterations related to the Products
         in this Agreement to UK Licensee (each, a "New  Improvement  License").
         Subject  to the terms of this  Agreement,  APDNA  shall  also  grant an
         exclusive  license to market every new anti-fraud  product developed by
         Biowell (to the extent it may contractually do so) and APDNA while this
         Agreement  remains in effect ("New Product  License",  which term shall
         also include New Improvement Licenses as the context so requires). Such
         New Product  License shall remain  exclusive for eighteen  months after
         the  date UK  Licensee's  New  Product  License  Application  has  been
         accepted (New Product Initial Exclusive Term"),  upon which acceptance,
         Licensee  can  sell  such New  Product  in the  Territory.  In order to
         maintain the  exclusivity of such New Product  License in UK Licensee's
         Territory for the eighteen month period, UK Licensee must provide APDNA
         with generated  Gross Revenues for every such New Product  amounting to
         US$100,000.00  ("Minimum  Guarantee for New Products") during the first
         eighteen  months.  Licensee is  required  to increase  its sales by 20%
         annually  for the second  full year after the  initial  eighteen  month
         period,  and an additional 20% for each of the third,  fourth and fifth
         years after the eighteen  month period,  in order to keep its exclusive
         license for any New  Products.  (See  Exhibit 4).  After the end of the
         fifth year,  these New Products will become  subject to all other terms
         and conditions of the Agreement.

1.4      APDNA  shall  provide   reasonable   telephonic  and  electronic   mail
         ("e-mail") customer support to UK Licensee (only to UK Licensee and not
         to UK Licensees  agents,  vendors or  customers) on an as needed basis,
         during APDNA's regular business hours. APDNA shall appoint a liaison to
         communicate  with  UK  Licensee,  and  UK  Licensee  shall  funnel  its
         inquiries  through  such  appointed  liaison  so  as  to  minimize  any
         disruption to the staff of APDNA.  UK Licensee  agrees to provide APDNA
         with  timely  written  notification   containing  specific  details  of
         problems to enable APDNA to diagnose and remedy any matters  brought to
         its attention  regarding  such  problems.  This provision is not a full
         warrantee  of  the   Products  and  is  merely  a  reasonable   efforts
         requirement upon APDNA.

1.5      UK Licensee may wish to build lab(s) in its Territory, at its own cost,
         for the purpose of analyzing,  testing  and/or  manufacturing  Licensed
         Products,  and APDNA agrees at its own  discretion and at UK Licensee's
         cost,  to assist UK Licensee by providing UK Licensee  with  reasonable
         professional  guidance,  technical support and training;  the terms and
         conditions of which  guidance,  support and training will be subject to
         an  additional  written  agreement  between.  A minimum fee to APDNA of
         $250,000  shall  be paid  by UK  Licensee  for  providing  the  support
         necessary to construct a laboratory

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2.       Term

2.1      Unless  otherwise  terminated  in  accordance  with  the  terms of this
         Agreement,  this  Agreement  shall  be  effective  as of  the  date  of
         execution  of this  Agreement,  and shall remain in effect for 5 (five)
         calendar  years  following  the execution of this  Agreement  ("Initial
         Term").  In the event that UK Licensee complies with all of the Minimum
         Guarantee  targets  described  in  Exhibit  2 and is not  otherwise  in
         default  under the terms of this  Agreement,  this  Agreement  shall be
         automatically  renewed for five  calendar  years  following the Initial
         Term ("Second  Term").  If during the Second Term, UK Licensee fails to
         comply with the Minimum  Guarantee target set forth in Exhibit 2 in any
         calendar year during such Second Term,  then UK Licensee  shall forfeit
         its exclusive license granted in Section 1 for the Products that failed
         to comply with the Minimum Guarantee.  If all Products fail to meet the
         Minimum Guarantee, APDNA reserves the right to terminate this Agreement
         with immediate  effect by giving written notice to UK Licensee.  APDNA,
         at its sole  discretion,  can determine  whether or not UK Licensee may
         then  continue  selling  Products  on  a  non-exclusive  basis  it  its
         territory.  APDNA may elect to retain UK  Licensee  on this basis until
         APDNA re-sells (sublicenses) the UK Territory.

2.2      In the event of  circumvention,  of this  Agreement  by  either  party,
         directly or indirectly;  the circumvented  party shall be entitled to a
         legal and monetary  penalty equal to the maximum  benefit it would have
         realized  from  such a  transaction  had the  circumventing  party  not
         circumvented  the relationship set forth in this Agreement plus any and
         all  expenses  including  but not  limited  to all costs  and  expenses
         incurred to recover the lost revenue.

2.3      To the extent an  affiliate  of APDNA or another  third  party known to
         APDNA  introduces  any clients to UK  Licensee  (either  leads  already
         identified  by APDNA or to be  identified  in the  future);  such party
         shall  receive a minimum  referral  fee equal to 10% of the Net Profits
         received by UK Licensee from such clients.

3.      Price and Payment

3.1      In connection with the  appointment of UK Licensee as APDNA's  licensee
         hereunder,  UK Licensee shall within 45 days from the effective date of
         this Agreement pay APDNA a one-time nonrefundable  discounted franchise
         fee of Three  Million U.S.  Dollars  (US$3,000,000)  ("Fee").  The Fee,
         represents  the full,  final and complete  consideration  payable by UK
         Licensee to APDNA in consideration for the distribution  rights granted
         hereunder.  The Fee shall be  payable by UK  Licensee  to APDNA by wire
         transfer  pursuant to  instructions to be provided by APDNA as follows:
         $25,000 shall be due and payable upon execution of this Agreement,  and
         APDNA will hold a promissory note ("Note") for $2,975,000,  which shall
         bear  interest  at a rate of 5% per

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         annum and shall be payable  over a five year  period  with  payments of
         unpaid  principal and accrued  interest  thereon at a rate of 15% of UK
         Licensee's  Net  Profits,  as  received  by UK  Licensee.  The  form of
         interest  bearing Note is attached hereto as Exhibit 8. Any amounts not
         paid during the term shall be immediately due and payable at the end of
         the  initial  five year  term;  provided,  however,  that as long as UK
         Licensee  continues meeting its Minimum  Guarantee  requirements at the
         end of the five (5) year  period and makes  payments  on the Note,  the
         five (5) year term shall be extended for another five (5) years.

 3.2     Interest.

         (i) APDNA intends to form a New  International  Subsidiary  sometime in
         2003.  APDNA  desires  to Float  this  company  on a  recognized  Stock
         Exchange but does not guarantee this event will take place ("New Public
         Company").  If this event does take  place,  the UK  Licensee  shall be
         required  to and  agrees to comply in  exchanging  the shares of the UK
         Licensee's entity for new shares in the New Public Company.  The number
         of shares that the UK  Licensee's  entity (to be formed by UK Licensee)
         shall  receive  in  the  New  Public  Company  will  be  based  upon  a
         proportional  share of  his/her/its  investment,  in  licensing  the UK
         market,  to the overall total investment  amounts of the other Entities
         that will be involved in the New Public Company.  The valuation of such
         investment and any other  valuations  either  specifically  required in
         this   Agreement  or   practically   required  by  the  nature  of  the
         transactions  set forth herein shall be approved by or made by APDNA in
         its sole  discretion.  When the UK  Licensee  exchanges  his shares for
         shares in the New Public  Company,  they will be  exchanged as follows:
         70% of the UK  Licensee's  entity  exchanges  shares in the New  Public
         Company  will  go to  the  UK  Licensee's  entity,  and  30%  of the UK
         Licensee's entity exchanged shares in the New Public Company will go to
         APDNA.

         (ii) This issuance of the shares by the APDNA New  Subsidiary  shall be
         executed  in full  accordance  with any  rules or laws  imposed  by any
         applicable regulatory body and those existing under the U.S. Securities
         Laws.  Furthermore,  the APDNA New Public Company shares issued will be
         duly  authorized,  validly  issued  and  outstanding,  fully  paid  and
         non-assessable and will not be subject to any liens or encumbrances. At
         such time as this event takes place the revenues from the UK Licensee's
         entity will flow as follows:  5% of the Net Profits generated by the UK
         Licensee in its  territory  will  remain with the  original UK Licensee
         (s), 20% will flow to APDNA and 75% will flow to the New Public Entity.

         (iii)  UK  Licensee  shall  receive  80% of the  Net  Profits  that  he
         generates prior to the  International  Subsidiary going public.  20% of
         the Net Profits  generated  by the UK

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         Company  (formed by UK Licensee)  prior to the Subsidiary  going public
         will go to APDNA, the US Company. These payments will be made quarterly
         based upon Net Profit.

         (iv) If UK Licensee sells  products,  services or rights,  or otherwise
         generates  revenue,  in a territory outside of the Region,  and if that
         outside territory has not yet been licensed by APDNA, UK Licensee shall
         receive 40% of the Net Profits from the initial  sale,  and APDNA shall
         receive 60% until such territory is sold by APDNA. UK Licensee.  If the
         outside  territory/franchise  has been sold or  licensed  by APDNA,  UK
         Licensee shall receive a referral fee of 10% of the Net Profits in year
         one and two.  Any years  following  the UK Licensee  will  receive a 5%
         override for the next three years, and 2% thereafter. UK Licensee shall
         not sell  products  outside  of its  territory  without  prior  written
         consent of APDNA.

3.3      The prices charged by APDNA for Products and Product Materials shall be
         those set forth as  Exhibit  5. All prices are FOB Taiwan or the United
         States  and  payment  to APDNA  from UK  Licensee  shall be due  thirty
         calendar  days after  delivery  of the  relevant  Products  and Product
         Material  to the  carrier  for  shipment  to UK  Licensee.  Prices  are
         exclusive  of  costs  of  transportation,  insurance,  taxes,  customs,
         duties,  landing,  storage  and  handling  fees,  and/or  documents  or
         certificates  required for  exportation or  importation,  which will be
         separately  itemized and billed to UK Licensee in accordance  with this
         Section 3.3. All Parties agree to negotiate a fee for APDNA Product and
         Product   Materials  that  will  make  the  UK  Licensee   commercially
         competitive in the Territory with any other potential  competition that
         may  arise  over  the  period.  This  competitive  rate  should  not be
         increased  more than the previous  calendar years  published  inflation
         rate in the United States or 10 percent,  whichever is higher,  without
         the consent of the UK Licensee.

3.4      No amounts  payable to APDNA  pursuant to the  Agreement may be reduced
         due to  counterclaim,  set-off,  adjustment  or  other  right  that  UK
         Licensee  may have  against  APDNA  unless the UK Licensee has received
         defective product at which time APDNA will be obligated to rectify this
         situation in accordance with the relevant terms of this Agreement.  Any
         payment  not  made  within  the due  date  specified  in each  relevant
         Purchase  Order  shall  bear  interest  at a rate  equal  to  the  rate
         specified in the relevant Purchase Order affected by the late payment.

3.4      APDNA reserves the right to request from the UK Licensee a cash deposit
         or  irrevocable  letter of credit in a form to be approved by APDNA and
         issued by a bank

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         acceptable to it in an amount not  exceeding the total credit  extended
         by APDNA for each  Purchase  Order,  provided  that APDNA  reserves the
         right to obtain an  increase  in the  amount of the letter of credit in
         its sole  discretion  (the "Letter of Credit").  UK Licensee  agrees to
         continuously  renew or replace the Letter of Credit,  as necessary,  to
         keep it in effect during the term of APDNA's  extension of credit to UK
         Licensee  under any Purchase  Order and shall within ten (10)  Business
         Days of any draw down on the Letter of Credit by APDNA,  replenish  any
         amounts  drawn down so that the  amount of the  Letter of Credit  never
         falls  below the amount set forth in this  Section,  as the same may be
         increased  pursuant to this  Section.  Nothing  contained  herein shall
         limit or be interpreted  to limit APDNA's right to remedies  against UK
         Licensee for breaches by UK Licensee of its obligations hereunder.

4.       Board of Advisor and Consultant

4.1      An  authorized  member or nominee of APDNA will have the right to serve
         in an  advisory  capacity  to UK  Licensee,  and will have the right to
         receive  notice  of and  participate  in the  meetings  of the board of
         director of UK Licensee without voting powers.

4.2      APDNA may form a new International consortium of which UK Licensee will
         have the right to have a representative as a member.

5. Obligations

5.1      UK Licensee will source,  solicit,  and attract potential  customers in
         the Territory for purchasing. Products either made by UK Licensee using
         Product  Materials  or  purchased  directly  from APDNA and UK Licensee
         shall  promote,  market,  and  extend the sale of the  Products  in the
         Territory to potential  customers in the  Territory.  UK Licensee shall
         not bind  APDNA to any  express or implied  legal  obligation  with any
         third parties,  including UK Licensee's customers, while UK Licensee is
         utilizing its license under this  Agreement.  UK Licensee shall market,
         promote,  and resell the Products on its own behalf and not as an agent
         or representative of APDNA.

5.2      UK Licensee  will perform any and all  post-sale  servicing of any type
         for  customers.  APDNA shall not  perform  any  support  services to UK
         Licensee's customers unless all parties agree otherwise in writing.

5.3      If any  dispute  arises in the  Territory  involving  APDNA  under this
         Agreement,  UKLicensee  will  use  its  best  endeavors  to  limit  the
         potential  damages  to APDNA  that  could  be  caused  by the  dispute.
         Further,  UK Licensee  will  inform  APDNA  without  undue delay of the
         nature of the  dispute  and comply with all  reasonable  directions  of
         APDNA in relation thereto.

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5.4      Subject to APDNA's prior written  approval,  UK Licensee shall have the
         right to sub-license  in its Territory in accordance  with this Section
         5.4.  Specifically,  UK Licensee  shall have the right to authorize any
         third party to receive or utilize  any  benefit  derived by UK Licensee
         under this Agreement.  Each such authorization or sub-licensing must be
         approved by APDNA and any  resulting  agreement  must be  co-signed  by
         APDNA.  APDNA shall be  reasonable  with any such  request.  Any new UK
         Licensee shall comply in all respects with the same restrictions placed
         on UK Licensee by APDNA in the original sub- license. Nothing hereunder
         shall  relieve UK License from its  obligations  under this  Agreement,
         including, but not limited to, its obligations under Section 6.

6.       Indemnity

         Each Party ("Indemnifying Party") will indemnify,  defend, and hold the
         other Party,  its officers,  successors,  assigns,  directors,  agents,
         employees,  and  affiliates  ("Indemnity  Parties")  harmless  from and
         against any and all liabilities,  damages,  losses,  expenses,  claims,
         demands, suits, fines or judgments, including reasonable attorney fees,
         costs  and  expenses  incidental  thereto,  which may be  suffered  by,
         accrued against,  charged to or recoverable from the Indemnity Parties,
         arising out of any third party  claim  resulting  from a breach of this
         Agreement or performance of its duties and rights  hereunder.  Promptly
         after receipt by the Indemnity  Parties of a threat of any action, or a
         notice of the  commencement  or filing of any action  against which the
         Indemnity Party may be indemnified hereunder, the Indemnity Party shall
         give written notice thereof to Indemnifying  Party.  Indemnifying Party
         shall have sole  control of the  defense  and of all  negotiations  for
         settlement  of such action.  The  indemnity  provided  herein shall not
         apply if the alleged  claim arises from any action or inaction  however
         attributable to Indemnity Parties. UK Licensee specifically indemnifies
         APDNA from any third party claims resulting directly or indirectly from
         its marketing and sales of Product to third parties.

7.       Product and Product Materials  Ordering  Procedure,  Forecasts,  Change
         Orders and Cancellation

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7.1      APDNA,  within the limitations  contained in this Agreement,  agrees to
         use best efforts to sell to UK Licensee, such quantities of Product and
         Product Materials as UK Licensee may order in accordance herewith.

7.2      Subject to the terms and  conditions  of this  Agreement,  APDNA hereby
         agrees to sell and UK Licensee  agrees to  purchase  the  Products  and
         Product Materials during the term of this Agreement.

7.3      UK Licensee agrees to meet the relevant as set forth in Section 1.3 and
         Exhibit 2 attached to this  Agreement  for each  relevant  sales period
         described  in Section  1.3 and  Exhibit 2.  Failure to meet the Minimum
         Guarantee on any single occasion  constitutes a material breach of this
         Agreement  permitting  APDNA to terminate this Agreement  after written
         notice has been given to the UK Licensee,  provided  that upon any such
         failure to meet the relevant  Minimum  Guarantee,  APDNA may either (i)
         provide UK Licensee  with a period in which to cure such  breach,  (ii)
         make the  license set forth  herein  non-exclusive  or (iii)  otherwise
         terminate this  Agreement,  and the decision of APDNA to follow any one
         of (i) - (iii) s at its sole discretion.

7.4      Approximately thirty (30) Business Days prior to the first calendar day
         of each calendar month during the term of this  Agreement,  UK Licensee
         will  provide  APDNA  with a [six (6)]  month  forward-looking  rolling
         forecast  for  internal  planning  requirements  (the  "Forecast").  UK
         Licensee  shall  provide  the first of such  Forecast  three (3) months
         after the execution date of this Agreement.

7.5      Purchases shall be initiated by UK Licensee's written or electronically
         dispatched  Purchase  Orders  referencing  the  quantity,  the Product,
         applicable price,  shipping  instructions and requested Delivery Dates.
         All Purchase  Orders for Products  and Product  Materials  placed by UK
         Licensee  hereunder  shall be governed by the terms and  conditions  of
         this  Agreement.  In the event of a conflict  between the provisions of
         this Agreement and the terms and  conditions of UK Licensee's  Purchase
         Order   or   APDNA's   acknowledgement   or  other   written   or  oral
         communications,  the provisions of this Agreement shall prevail and any
         such conflicting terms and conditions are hereby rejected.  APDNA shall
         use reasonable efforts to fill orders promptly, but shall not be liable
         for any  damages  (consequential  or  otherwise)  to UK Licensee or any
         third  party  for  failure  to fill  any  orders,  or for any  delay in
         delivery  or error  in  filling  any  orders.  APDNA  will use its best
         efforts to accept each Purchase Order issued by UK Licensee. APDNA will
         ship all  Product  within  the Lead  Time set forth  therein  unless UK
         Licensee's  Purchase Order specifically  states a delivery schedule for
         Product  different  from such lead time and such  delivery  schedule is
         accepted in writing by APDNA.

                                       11
<PAGE>

7.6      Purchase Orders issued by UK Licensee  shall,  to the extent  necessary
         for APDNA to fulfill the terms  thereof,  include:  (i)  description of
         Products  and Product  Materials,  (ii)  quantity  of  Products  and/or
         Product  Materials,  (iii)  price  per  unit of  Products  and  Product
         Materials (iv) total order price,  (v) Delivery Date, and (vi) delivery
         location.  Except as otherwise  explicitly  provided in this Agreement,
         any changes to or  rescheduling  of an accepted  Purchase Order must be
         mutually   agreed  and   incorporated   into  a  written  Change  Order
         referencing the original Purchase Order.

7.7      Within ten calendar days of its receipt of the Purchase Order, Licensor
         must send  written  notice to UK Licensee for  acceptance  of the order
         ("Confirmation");

7.8      All Products delivered to UK Licensee shall be FOB (Taipei,  Taiwan, or
         the United  States) or other place of shipment as  specified in writing
         by UK Licensee and agreed to by APDNA.  APDNA may ship  partial  orders
         provided that APDNA notifies UK Licensee and UK Licensee  agrees to the
         partial  order prior to shipment.  UK Licensee's  Purchase  Order shall
         specify the carrier or means of  transportation  or routing,  and APDNA
         will comply with UK Licensee's  instructions.  If UK Licensee  fails to
         provide  shipping  instructions,  APDNA shall select the best available
         carrier, on a commercially reasonable basis.

7.9      Any  modification  to a Purchase  Order  shall be made in writing by an
         authorized  representative  of UK Licensee ("Change Order") and sent to
         APDNA,  and such Change Order shall be subject to acceptance in writing
         by APDNA and shall not be binding until such acceptance.

8.      Non-competition and Non-solicitation

8.1      During the term of this  Agreement  APDNA shall not  solicit  Customers
         solely  developed  by  UK  Licensee  ("the  UK  customers  or  approved
         customers  outside  of the  Region.")  Upon  any  termination  of  this
         Agreement,  the above  restriction  shall  apply for a period of thirty
         days with the exception of customers  under contract to receive Product
         from APDNA.  APDNA shall be entitled to a detailed and exhaustive  list
         of all contact  information of any and all Customers  under contract to
         receive APDNA Products as well as  prospective  customers with which UK
         Licensee is  negotiating.  This list must be  delivered to APDNA within
         five Business Days of the date of termination of this Agreement.

8.2      Customers of the UK Licensee  are the sole  property of the UK Licensee
         and are not under any  restraints  or  conditions  implied by APDNA and
         will not be contacted or solicited by APDNA for a period of thirty days
         following any termination or dissolution of this agreement.

8.3      UK Licensee and APDNA shall not, without the prior written consent from
         the other party directly or indirectly  (including without  limitation,
         through  any  Affiliate  of either

                                       12
<PAGE>

         party),  (i)  solicit  or  request  any  person  who is at the  time an
         employee of or a consultant of the other party to leave the  employment
         of or  terminate  such  person's  relationship  with that party or (ii)
         employ,  hire, engage or be associated with, or endeavor to entice away
         from the respected party any such person.

8.4      UK  Licensee  or APDNA shall not,  directly  or  indirectly  (including
         without limitation,  through any Affiliate of either party) (i) solicit
         any  existing  customer  of either  party or any entity that shall have
         been a customer of that party at any time within  twelve (12) months of
         terminating  this agreement to cease doing business in whole or in part
         with that party (ii)  intentionally  attempt to limit or interfere with
         any business  agreement or relationship  existing  between either party
         and/or its  Affiliates  with any third party;  or (iii)  disparage  the
         business  reputation of the party (or its management  team) or take any
         actions that are harmful to the party's  goodwill  with its  customers,
         providers, vendors, employees, the media or the public.

9.     Confidentiality

9.1      UK  Licensee  shall not use or  divulge  or  communicate  to any person
         (other than those whose province it is to know the same or as permitted
         or contemplated  by this Agreement or with the written  approval of the
         other party or as may be required by law):

         (i)      any Confidential Information ; or

         (ii)     any of the terms of this Agreement

9.2      UK Licensee shall prevent the unauthorised publication or disclosure of
         any such  information,  materials  or  documents  and  ensure  that any
         person,  subject  to  the  written  approval  of  APDNA,  to  whom  the
         information,  materials or documents are  disclosed,  is aware that the
         same is  confidential  and is  covered  by a similar  duty to  maintain
         confidentiality.

9.3      UK Licensee  shall  ensure that its  employees  are aware of and comply
         with the  confidentiality  and non-disclosure  provisions  contained in
         this Section and shall indemnify APDNA against any loss or damage which
         APDNA may sustain or incur as a result of any breach of  confidence  by
         UK Licensee's employees.  APDNA also specifically has the right to seek
         injunctive relief as a remedy to a breach of Article 9.
10.       Reservation of Rights

10.1     APDNA reserves the right at any time:

                                       13
<PAGE>

                  ( i ) to make  modifications  or additions to the  Technology,
         Product Materials,  and Products in respect to any designs as APDNA may
         in its discretion  determine;  and such modifications or additions will
         be  automatically  granted to the UK Licensee and will be considered an
         improvement to the licensed product line;

                  (ii) to discontinue  selling Product Materials and Products if
         those products or parts  therefore are  discontinued or replaced except
         for those Products and Product Materials accepted to be delivered under
         a confirmed purchase order;

                  (iii)  to  require  UK  Licensee  to  obtain  advance  written
         approval from APDNA on all advertising  and promotional  material prior
         to any printing,  email  distribution or  publication.  The UK Licensee
         reserves  the right to cease using  APDNA  advertising  or  promotional
         material  in  respect  to the  Product  Materials  and  Products  if it
         considers  such  material  to be not in its best  interests  to use. UK
         Licensee must notify  APDNA,  in writing,  thirty days in advance,  and
         present APDNA with its alternative advertising or promotional material,
         and APDNA shall have final approval of such material; and

                  (iv) to require UK Licensee to obtain advance written approval
         from APDNA prior to Sub-Licensing any of its Territory.

11.      Legal Relationship

11.1     Nothing  herein shall contain any facts as to suggest that APDNA and UK
         Licensee are engaging in a joint  venture or  partnership.  UK Licensee
         shall  have no  authority  to bind  APDNA in any legal  obligation.  UK
         Licensee shall only contract with customers on its own behalf.

12.      Termination

         Notwithstanding  anything else contained herein,  this Agreement may be
         terminated as set forth

12.1     APDNA may  terminate  this  Agreement  if the UK  Licensee:  (a) sells,
         assigns,  attempts  to sell or assign,  or ceases to carry on, its main
         business  or the  business  related to this  Agreement  unless  parties
         mutually  agree  otherwise;  (b)  fails to meet any  Minimum  Guarantee
         target (not including the relevant  Minimum  Guarantee for New Products
         under  Section 1.3,  which shall be subject to Section 13.6) during the
         then current term of the Agreement;  or (c) fails to comply with any of
         its obligations under this Agreement;

                                       14
<PAGE>

12.2     Immediately by APDNA if the control of UK Licensee has been transferred
         without the prior written approval of APDNA which approval shall not be
         unreasonably denied;

12.3     Immediately  by either if the other party  becomes  insolvent or starts
         negotiations about  re-composition  with its creditors or a petition in
         bankruptcy is filed by or against it or it makes an assignment  for the
         benefit of its creditors with any proceeding not being dismissed within
         60 days thereafter;

12.4     By either  party  after  having  given 60 days notice in writing to the
         other party if the other party breach any of its  material  obligations
         under  this   Agreement  and  such  breach  is  not  cured  within  the
         above-mentioned period;

12.5     With regard to the license granted hereunder,  UK Licensee shall not be
         entitled to any compensation or reimbursement  for its Fee (whether for
         loss of distribution rights,  goodwill or otherwise) as a result of the
         termination of this Agreement in accordance with its terms. If, for any
         reason, the Agreement is terminated,  any outstanding royalties will be
         prorated and paid by UK Licensee within 90 days, upon collection.  (See
         Section 7, Indemnity).

12.6     Except as  otherwise  stated  herein,  in case APDNA has  ground(s)  to
         terminate  this  Agreement  because UK Licensee  had failed to meet any
         Minimum  Guarantee target (not including the relevant Minimum Guarantee
         for New Products under Section 1.3) during the then current term of the
         Agreement,  APDNA (in addition to asserting  any legal right and remedy
         at law or in equity)  shall have the right to terminate  the  Exclusive
         License  granted in this Agreement in which case such  Agreement  shall
         remain  effective  to the extent  that UK  Licensee  shall  remain as a
         non-exclusive  licensee  (the  right  to  so  remain  a  licensee  on a
         non-exclusive  basis being at the sole  discretion of APDNA),  with the
         same shipping  terms and conditions and the same price for Products for
         existing  Customers  as of the date of  termination,  but price for the
         Products may be increased by up to 10% for new Customer  orders only in
         year one.  Prices may be increased at the sole  discretion  of APDNA in
         years going  forward.  APDNA  agrees to act in good faith in making its
         products  competitively priced for the UK Licensee. All other terms and
         conditions  shall  be  subjected  to the  Parties'  agreement.  For the
         avoidance  of any  doubt,  such  right  to  remain  as a  non-exclusive
         licensee  shall not be available to UK Licensee in the event that APDNA
         terminates  this  Agreement  for any  other  reason  specified  in this
         Agreement.

                                       15
<PAGE>

12.7.    UK Licensee  shall have any time period  otherwise  set forth herein to
         remedy/cure  any  potential  breach  or  violation  of  terms  in  this
         Agreement from the date it receives written  notification by courier or
         US mail. APDNA hereby may grant, in its sole discretion, to UK Licensee
         a special  termination-option to convert its UK Licensee designation to
         that of a  non-exclusive  manufacturer  in the  event of a  non-curable
         breach.  As an alternative to forced  termination,  UK Licensee may, at
         its own  discretion,  exercise  this option prior to the  initiation of
         termination.  UK Licensee shall have this option available,  in lieu of
         termination  for any  reason  and at its sole  discretion,  to become a
         non-exclusive  manufacturer  of  APDNA  and/or  a UK  Licensee  for the
         Products and  Technology in the Territory on such terms and  conditions
         to be determined by the parties.

13.      Effect of Termination

         Upon the termination of this Agreement:

13.1     All rights and obligations of the parties hereunder shall automatically
         terminate  except for such rights of action as shall have accrued prior
         to  such   termination  and  any  obligation   which  expressly  or  by
         implication  are intended to come into or continue in force on or after
         such termination.

13.2     UK Licensee  shall,  at its own  expense,  return to APDNA or otherwise
         dispose  of as  APDNA  may  instruct,  all  technical  and  promotional
         materials and other documents and papers whatsoever sent to UK Licensee
         and relating to the Technology,  Product  Materials and Products or the
         business of APDNA (other than  correspondence  between the parties) and
         all  property  of  APDNA  in UK  Licensee's  possession  or  under  its
         control., unless UK Licensee is acting as a non-exclusive sub-licensee.

13.3     Any and all sub-licences  granted by UK Licensee must be turned over to
         APDNA. At its sole discretion,  APDNA may allow UK Licensee to maintain
         its sub-licenses, but decisions will be made on a case by case basis.

13.4     UK Licensee  will be entitled to any fees due and or  commissions  from
         existing  customers  for  sales  consummated  for a period on 12 months
         following the termination of this Agreement.

13.5     If, for any reason,  APDNA should lose its  exclusivity  with  Biowell,
         Biowell shall honor this Sub-License Agreement for the remainder of its
         term so long as Sub-Licensee meets its Minimum  Guarantees,  as defined
         herein, in its Territory.

14.      Exclusion of Liability

14.1     Except as set out in this Agreement or to the extent prohibited by law,
         all conditions, warranties and representations, expressed or implied by
         (i)  statute,  (ii) civil code or (iii)  otherwise,  in relation to any
         Technology, Product Materials and Products, are excluded by APDNA.

                                       16
<PAGE>

14.2     Except as  otherwise  provided  in this  Agreement,  APDNA shall not be
         liable to  UKLicensee,  whether  for  negligence,  breach of  contract,
         misrepresentation or otherwise, for:

              (a) loss or damage  incurred  by UK  Licensee as a result of third
              party claims (whether in relation to Intellectual  Property Rights
              or otherwise); or

              (b)  indirect or  consequential  damage  suffered by UK  Licensee,
              including, without limitation, loss of profits, goodwill, business
              opportunity or anticipated saving.

14.3     APDNA  shall  not  be  liable  for  any  loss,  damages,   expenses  or
         liabilities  arising from an  infringement  or claim of infringement of
         third party rights in the  Intellectual  Property Rights  subsisting in
         the Technology,  Product  Materials and Products  howsoever  arising in
         connection with this Agreement.

14.4     APDNA warrants that all Products and Product Materials sold by APDNA to
         UK Licensee under the terms of this  Agreement will be materially  free
         from defects in workmanship and materials and substantially  conform to
         the relevant  Specifications  under normal use and service for a period
         of 60 days after  delivery to the carrier for  shipment to UK Licensee.
         Within five  Business  Days of UK  Licensee's  receipt of the  relevant
         Product  Materials and Products,  UK Licensee shall notify APDNA if any
         Product  Materials or Products  contains a material defect in materials
         or  workmanship,  or  otherwise  fails  to  conform  materially  to the
         Specifications  during the warranty period. APDNA shall correct, at its
         own  expense,  any such  defect by  repairing  such  defective  Product
         Materials  and  Products or, at APDNA's  option,  by  delivering  to UK
         Licensee an equivalent  Product  Materials and Products  replacing such
         defective Product Materials and Products.  APDNA may inspect and verify
         such alleged  defect in the Territory and UK Licensee will need to ship
         the alleged  defective  items to the United States or Taiwan within two
         weeks of making such  claims.  If the product is found to be  defective
         APDNA will bear the costs of shipping.  Such remedies for any breach of
         warranty as listed in this Section 15.4 shall be the sole and exclusive
         remedies available to UK Licensee at law or in equity.

14.5     WARRANTY  EXCLUSIONS.  APDNA SHALL NOT BE LIABLE  UNDER ANY WARRANTY IF
         ITS TESTING AND  EXAMINATION  DISCLOSES  THAT THE ALLEGED DEFECT IN THE
         PRODUCT  OR  PRODUCT  MATERIAL  DOES  NOT  EXIST  OR WAS  CAUSED  BY UK
         LICENSEE'S OR ITS END USER'S MISUSE, NEGLECT,  IMPROPER INSTALLATION OR
         TESTING,  UNAUTHORIZED  ATTEMPTS  TO  REPAIR,  OR  BY  ACCIDENT,  FIRE,
         LIGHTNING  OR OTHER  HAZARD.  APDNA MAKES NO OTHER  WARRANTIES,  EITHER
         EXPRESS OR  IMPLIED,  INCLUDING  OF  MERCHANTABILITY  OR FITNESS  FOR A
         PARTICULAR PURPOSE, EXCEPT AS EXPRESSLY SET FORTH HEREIN.

                                       17
<PAGE>

14.6     APDNA will be liable for the product  manufactured by APDNA or Biowell.
         APDNA will cause such action to take place as necessary that will grant
         the  representative  the rights to handle product liability for clients
         in the  territory.  UK  Licensee's  customers are not required to go to
         licensor  directly  to  file a  claim  against  product  liability.  UK
         Licensee  will  handle the  liability  on behalf of the  licensor.  All
         expenses in this matter shall be paid by licensor or licensor's insure.

14.7     EXCEPT FOR THE EXPRESS  WARRANTIES  CREATED  UNDER THIS  AGREEMENT  AND
         EXCEPT AS SET FORTH  OTHERWISE  IN THIS  AGREEMENT,  IN NO EVENT  SHALL
         EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INCIDENTAL,  CONSEQUENTIAL,
         SPECIAL OR PUNITIVE  DAMAGES OF ANY KIND OR NATURE  ARISING OUT OF THIS
         AGREEMENT OR THE SALE OF PRODUCTS,  WHETHER SUCH  LIABILITY IS ASSERTED
         ON THE BASIS OF CONTRACT, TORT (INCLUDING THE POSSIBILITY OF NEGLIGENCE
         OR STRICT LIABILITY),  OR OTHERWISE,  EVEN IF THE PARTY HAS BEEN WARNED
         OF THE  POSSIBILITY OF ANY SUCH LOSS OR DAMAGE,  AND EVEN IF ANY OF THE
         LIMITED REMEDIES IN THIS AGREEMENT FAIL OF THEIR ESSENTIAL PURPOSE.

         In no event shall the aggregate  liability of APDNA in connection  with
         this Agreement,  or any other materials or services provided under this
         Agreement,  whether arising in contract,  tort or under any other legal
         theory (including, without limitation, negligence or strict liability),
         exceed the total value of the relevant Purchase Order.

14.8     UK Licensee  will not pass through to its retailers or customers or any
         other third party any warranties made by APDNA or Biowell hereunder and
         will  expressly  indicate to its retailers or customers  that they must
         look solely to UK Licensee in connection  with any  problems,  warranty
         claims or other matters concerning the Product. APDNA will only warrant
         what claims they have made publicly.

15.      Intellectual Property Rights

15.1     All Intellectual Property Rights, including without limitation patents,
         designs,  utility models,  copyrights trade or service marks, Know-How,
         trade secrets and other proprietary information,  in or relating to the
         Technology,  Product  Materials and Products and any other products and
         services  related  thereto are and shall remain the

                                       18
<PAGE>

         sole and  exclusive  property of APDNA and Biowell.  UK Licensee  shall
         have no right to obtain  or grant  any  licenses  with  respect  to the
         Technology,  Products, Product Materials, or any other related products
         or  services  or any of the  Intellectual  Property  Rights  therein or
         relating thereto, except as set forth herein.  Furthermore, UK Licensee
         may sub license its rights hereunder, with the prior written consent of
         APDNA.

15.2     UK Licensee  shall notify APDNA as soon as it receives any knowledge of
         any illegal or  unauthorized  use of any of the Technology and Products
         or any of the Intellectual  Property Rights therein or relating thereto
         and will  assist  APDNA  (at  APDNA's  expense)  in  taking  all  steps
         necessary to defend APDNA's rights therein.

15.3     UK Licensee shall not in any way: (a) modify,  disassemble,  decompile,
         or reverse engineer the Technology, Product Materials, and Products and
         any related products supplied hereunder; (b) transfer possession of any
         Technology,  Product  Materials,  and Products and any related products
         supplied  hereunder to another  party,  except as  expressly  permitted
         herein; or (c) use the Technology,  Product Materials, and Products and
         any  related  products  supplied  hereunder  in any way  not  expressly
         provided for this Agreement. There will be no implied licenses.

15.4     Subject  to the  express  prior  written  approval  of  APDNA,  Sub- UK
         Licensee  must use the  trademarks  and logos of both APDNA and Biowell
         for the sole purpose of marketing, reselling and promoting the Products
         in the Territory under, and during the term of, this Agreement.

15.5     The provisions of this section 16 will survive the  termination of this
         Agreement.

16.      General

16.1     UK Licensee  and APDNA hereby agree to bring any matter not resolved in
         good  faith   negotiations   before  an  arbitrator  in  the  State  of
         California. The Parties shall select an arbitrator from a list provided
         by the American Arbitration Association.

16.2     This Agreement may be executed in any number of  counterparts,  each of
         which  will be an  original  but all of which  together  will  form one
         agreement.  Delivery of an executed copy of this Agreement by facsimile
         transmission  will have the same  effect  as  delivery  of an  original
         signed counterpart.

16.3     The failure of either party hereto to insist upon the strict  adherence
         to any term of this  Agreement on any occasion  shall not be considered
         as a waiver of any right  hereunder

                                       19
<PAGE>

         nor shall it deprive  that party of the right to insist upon the strict
         adherence  to that term or any  other  term of this  Agreement  at some
         other time.

16.4     UK  Licensee,  and not  APDNA,  will be  responsible  for all taxes and
         expenses  incurred in UK Licensee's  business,  including UK Licensee's
         business  with  APDNA.  If UK  Licensee  is required by law to make any
         deduction or withholding from any payment due hereunder to APDNA, then,
         notwithstanding  anything in this agreement to the contrary,  the gross
         amount  payable by UK Licensee  to APDNA,  will be  increased  so that,
         after any such  deduction  or  withholding  for  taxes,  the net amount
         received  by APDNA will not be less than the amount  that it would have
         received had such deduction or withholding not been required.

16.5     UK Licensee agrees that all rights,  commitments,  grants,  privileges,
         fees, duties,  any value will be automatically  granted in whole to the
         New  International  Subsidiary  at such time as APDNA is ready to Float
         the  International  Subsidiary  on a  recognized  exchange  of  APDNA's
         choice.

         IN WITNESS WHEREOF,  the parties hereto have executed this Agreement in
two copies of which each has received one.

<TABLE>
<CAPTION>
         Applied DNA Sciences, Inc.     G.A. Corporate Finance, Ltd.       Biowell Technology Inc.
                                             (for and behalf of)

<S>                                     <C>                                <C>
         By: /s/ Larry Lee              By: /s/ Fredericck von Nidda       By: /s/ Jun-Jei Sheu

         Lawrence Lee                   Frederick von Nidda, Director      Jun-Jei Sheu

         Title: President &  CEO        Title: CEO                         Title: CEO

         Date:                          Date:                              Date:
</TABLE>

                                       20
<PAGE>

Exhibit 1

UK Licensee Territory Application

The Region or Territory:

United  Kingdom.  In order to be  considered  UK-based,  the entity's  corporate
office  and  headquarters  must  be in the UK  regardless  of  concentration  of
worldwide  sales.  APDNA shall be the sole authority for the resolution of cross
territorial disputes, in its sole discretion.

                                       21
<PAGE>

Exhibit 2

UK Minimum Guarantee Targets for

Initial Product Line

To maintain  the  Exclusive  License  granted in this  Agreement  by APDNA to UK
Licensee,  UK Licensee  agrees to meet all of the following UK Licensee  Minimum
Guarantee targets ("SL-MG-Target").

a)  During the first anniversary of this Agreement,  APDNA must receive at least
    US$50,000.00  (net of any taxes or fees of any kind)  from  Purchase  Orders
    placed for Products or Product Materials by UK Licensee.

b)  During the second anniversary of this Agreement. APDNA must receive at least
    US$150,000.00  (net of any taxes or fees of any kind) from  Purchase  Orders
    placed for  Products or Product  Materials  by UK  Licensee.  Alternatively,
    Licensee  may meet this  Minimum  Guarantee  for the  second  year by paying
    US$150,000 to APDNA.

c)  During the third  anniversary of this Agreement,  UK Licensee shall increase
    the Minimum Guarantee  amounting to US$300,000.00  (net of any taxes or fees
    of any kind) from Purchase  Orders placed for Products or Product  Materials
    by UK Licensee.

d)  During the fourth anniversary of this Agreement,  UK Licensee shall increase
    the third year MG Target by at least twenty per cent to a minimum  guarantee
    of $360,000.00

e)  During the fifth  anniversary of this Agreement,  UK Licensee shall increase
    the fourth year MG Target by at least twenty per cent to a minimum guarantee
    of $432,000.00.

f)  During the sixth anniversary of this Agreement,  APDNA must receive at least
    US$475,200  (net of any  taxes or fees of any  kind)  from  Purchase  Orders
    placed for Products or Product Materials by UK Licensee.

g)  During the seventh  anniversary  of this  Agreement.  APDNA must  receive at
    least  US$522,720.00  (net of any taxes or fees of any kind)  from  Purchase
    Orders placed for Products or Product Materials by UK Licensee.

h)  During the eighth anniversary of this Agreement,  UK Licensee shall increase
    the Minimum Guarantee  amounting to US$574,992.00  (net of any taxes or fees
    of any kind) from Purchase  Orders placed for Products or Product  Materials
    by UK Licensee

i)  During the ninth  anniversary of this Agreement,  UK Licensee shall increase
    the eighth year MG Target by at least twenty per cent to a minimum guarantee
    of $632,491.00

j)  During the tenth  anniversary of this Agreement,  UK Licensee shall increase
    the ninth yearn MG Target by at least twenty per cent to a minimum guarantee
    of $695,740.00.00.

                                       22
<PAGE>

k)  In the event that UK Licensee  complies  with all of the  Minimum  Guarantee
    targets described herein,  the Agreement shall be automatically  renewed for
    five calendar years  following the Initial Term ("Second  Term").  If the UK
    Licensee  continues  to  maintain  its markets and to abide by the terms and
    conditions of this  agreement  than the UK Licensee will remain at a minimum
    the non- exclusive distributor for APDNA`s products and all parties agree to
    make all  reasonable  efforts  to allow  the UK  Licensee  to  remain as the
    Exclusive UK Licensee in its territories for a period of 20 years.

                                       23
<PAGE>

Exhibit 3

Initial Product Line

(1)   BWACI-C001 Covert AC-Ink-I;

(2)   BWACI-I001 Instant AC-Ink-I;

(3)   BWACI-K001 Instant Ink Detection Kit

(4)   BWACC-C001-I AC-Chip

(5)   BWACC-R001-I AC-Chip Reader

(6)   BWACL-I001 Instant detection DNA Label

(7)   DNA/ACCESS ACCESS Security System

(8)   BWACC-M001 DNA  Anti-Counterfeiting  Identification Chip Module Set (Basic
      Model)

(9)   BWACC-M002  DNA   Anti-Counterfeiting   Identification   Chip  Module  Set
      (Security Model)

(10)  Applied DNA Textile Marker

                                       24
<PAGE>

Exhibit 4

Minimum Guarantee Targets for

New Products

(Not including Initial Product Line)

         a)       During the first eighteen month period,  APDNA must receive at
                  least  US$100,000.00  (net of any  taxes or fees of any  kind)
                  from Purchase Orders for each new product from UK Licensee.

         b)       During  the  second  year (the  twelve  months  following  the
                  eighteen   month   period)   APDNA   must   receive  at  least
                  US$150,000.00  (net of any  taxes  or fees of any  kind)  from
                  Purchase Orders for each new product from UK Licensee.

         c)       During the third year (the twelve months  following the second
                  year) APDNA must receive at least $300,000.00(net of any taxes
                  or fees of any kind) from Purchase Orders for each new product
                  from UK Licensee.

         d)       During the fourth year (the twelve months  following the third
                  year)  APDNA  must  receive at least  $360,000.00  (net of any
                  taxes or fees of any kind) from  Purchase  Orders for each new
                  product from UK Licensee.

         e)       During the fifth year (the twelve months  following the fourth
                  year) APDNA must receive at least  $432,000  (net of any taxes
                  or fees of any kind) from Purchase Orders for each new product
                  from UK Licensee.

   If the UK Licensee  achieves  these minimum  guarantees  the new product will
   fall under the terms and  conditions of the original APDNA and UK Sub-License
   Agreement.  If they fail to meet minimum  guarantees,  APDNA can exercise its
   right to sell this product directly into the UK market or to sub-license this
   product to a third party.

                                       25
<PAGE>

Exhibit 5

         Price for Products and Product Materials

(To be provided)

                                       26
<PAGE>

Exhibit 6

Representations and Warranties

(a)   UK Licensee, individually, has full power and authority to enter into this
      Sub-License  Agreement,  and this  Agreement  constitutes  its  valid  and
      legally  binding  obligation,  enforceable  in  accordance  with its terms
      except   (i)   as   limited   by   applicable   bankruptcy,    insolvency,
      reorganization,   moratorium,   and  other  laws  of  general  application
      affecting  enforcement of creditors'  rights generally and (ii) as limited
      by laws relating to the availability of specific  performance,  injunctive
      relief, or other equitable remedies.

(b)   UK Licensee and the Company  represent to the other  respective party that
      it has had an  opportunity  to ask questions and receive  answers from the
      Company  regarding  the  terms  and  conditions  of  the  offering  of the
      Securities and the business, properties, prospects and financial condition
      of the Company.

(c)   UK Licensee further represents to the other respective party that it is an
      UK  Licensee in  securities  of  companies  in the  development  stage and
      acknowledges  that it is able to fend for  itself,  can bear the  economic
      risk of its investment, and has such knowledge and experience in financial
      or business  matters that it is capable of evaluating the merits and risks
      of the investment in the Securities. UK Licensee is an accredited investor
      as such term is defined in Regulation D promulgated  under the  Securities
      Act of 1933.

                                       27
<PAGE>

Exhibit 7

 NEW PRODUCT LICENSE APPLICATION

Name of                         Date of         Collaborative Technology
New Product        Code         Application     Product (Yes or No)
-----------        ----         -----------     -------------------

         PRODUCT ADMITTED:   ___________

         PRODUCT DENIED:     ___________

         If Denied, state reason:

         ---------------------------------------------------------------------

         Date New Product Initial Exclusive Term: _________________

<TABLE>
<CAPTION>
                                               Applied DNA Sciences, Inc.         Biowell Technology Inc.

<S>                                            <C>                                <C>
         By:__________________________         By:__________________________      By:__________________________

         Name: _______________________         Name: Larry Lee                    Name: Jun-Jei Sheu

         Title:                                Title:  President                  Title: Chairman & CEO

         Date: ______, 200_                    Date:  ______, 200_                Date:  ______, 200_
</TABLE>

                                       28
<PAGE>

Exhibit 8
PROMISSORY NOTE

$2,975,000                                                         July 29, 2003

         FOR VALUE  RECEIVED,  G. A. Corporate  Finance Ltd., the undersigned UK
Licensee,  a business  entity located at 26 Eccleston  Square London,  SW1V 1NS,
England,  promises to pay to the order of Applied DNA Sciences, Inc., at 9255 W.
Sunset Blvd., Suite 805, Los Angeles, CA 90069 or such other place as the holder
may designate in writing to the  undersigned,  the principal sum of  $2,975,000,
together with interest thereon from date hereof until paid, at the interest rate
of 5% per annum as follows:  twenty (20) consecutive  quarterly  installments of
Principal and Interest in the amount equal to the lower of $185,937.50 or 35% of
Gross  Revenues for that quarter (see  breakdown  below) due on the final day of
the quarter ended,  commencing September 30, 2003 and ending June 30, 2008. If a
quarterly  payment is only  partially  paid,  the unpaid balance of that payment
will accrue to the following  quarterly payment due without penalty.  As long as
the  Minimum  Guarantees  are  met  (see  Exhibit  2 of  the  Exclusive  License
Agreement) the Promissory Note shall be extended without penalty, through 2013.

Quarterly payments shall be applied first to accrued interest and the balance to
principal.  Such payments are to be derived from 15% of UK Licensee's  quarterly
Gross Revenues  (including cash,  sub-license fees,  revenues from sales, etc.).
The combined  quarterly  payment AND the revenue  sharing  commitment  of 20% as
defined in paragraph  3.2(iii),  shall never exceed 35% of UK  Licensee's  Gross
Revenues.  It is  acknowledged  by the parties that there are no "cost of goods"
associates with sub-licensing.

All or any part of the  aforesaid  principal  sum may be prepaid at any time and
from  time to time  without  penalty.  Notwithstanding  the  foregoing,  no such
prepayment may be made prior to September 30, 2003.

This Promissory Note is assignable by the UK Licensee,  G. A. Corporate  Finance
Ltd., upon written consent and approval of Applied DNA Sciences, Inc.

In the event of termination by the parties,  the remaining  payments due on this
Promissory Note will be cease to be due,  however,  any existing  contracts with
customers  that  are  held  by UK  Licensee,  and  any  Gross  Revenues  derived
therefrom, shall be subject to paragraph 3.2(iii) revenue sharing as outlined in
the  Exclusive  Sub-License  Agreement.  In case suit or action is instituted to
collect  this  note,  or any  portion  hereof,  the maker  promises  to pay such
additional  sum, as the court may adjudge  reasonable,  attorneys'  fees in said
proceedings.  Frederick von Nidda, the authorized  signatory for G. A. Corporate
Finance Ltd., is hereby indemnified by Applied DNA Sciences,  Inc. and shall not
be held personally liable on this Promissory Note.

This note is made and executed  under,  and is in all respects  governed by, the
laws of the State of Nevada, in the United States of America.

                                G. A. Corporate Finance Ltd.

                                /s/  Frederick von Nidda

                                ------------------------------
                                Frederick von NiddaExhibit 10.1

                          SECURITIES PURCHASE AGREEMENT

         SECURITIES PURCHASE AGREEMENT dated as of September 15, 2003 (the
"AGREEMENT") is made and entered into by and among Skyride Associates, LLC, a
Delaware Limited Liability Company ("PURCHASER"), and the security and debt
holders of the Company listed on Schedule 1.1 hereto (collectively the "SELLERS"
and each individually a "SELLER").

                              W I T N E S S E T H:

         WHEREAS, the Sellers own shares of Series A convertible participating
preferred stock, par value $.001 per share (the "SERIES A PREFERRED STOCK") ,
and warrants to purchase shares of common stock, par value $.001 per share (the
"WARRANTS") of Skyline Multimedia Entertainment, Inc., a New York corporation
(the "COMPANY"), in the amounts set forth on Schedule 1.1 hereto; and

         WHEREAS, the Sellers are lenders under a Senior Credit Agreement dated
as of December 20, 1996 entered by and among the Company, certain of its
Subsidiaries (as defined below) and the Sellers (or their predecessors), as
amended (the "SENIOR CREDIT AGREEMENT") and hold senior promissory notes issued
pursuant to the Senior Credit Agreement (the rights of the Sellers with respect
to loans made under the Senior Credit Agreement (as evidenced by the Senior
Credit Agreement and senior promissory notes issued pursuant thereto) are known
as the "SENIOR PROMISSORY NOTES") and are lenders under a Senior Secured Credit
Agreement dated as of May 20, 1998 entered by and among the Company, certain of
its Subsidiaries (as defined below) and the Sellers (or their predecessors), as
amended (the "SENIOR SECURED CREDIT AGREEMENT") and hold senior secured demand
promissory notes issued pursuant to the Senior Secured Credit Agreement (the
rights of the Sellers with respect to loans made under the Senior Secured Credit
Agreement (as evidenced by the Senior Credit Agreement and senior secured demand
promissory notes issued pursuant thereto) are known as the "SENIOR SECURED
DEMAND NOTES");

         WHEREAS, the Senior Secured Demand Notes, the Series A Preferred Stock,
the Senior Promissory Notes listed on Schedule 1.1 hereto and the obligation of
the Company listed on Item 3 of Schedule 1.1(b) hereto are known as the
"SECURITIES"; and

         WHEREAS, the Sellers desire to sell to the Purchaser and the Purchaser
desires to purchase from the Sellers all of the Securities and Warrants owned
and held by the Sellers, on the terms and subject to the conditions set forth
herein;

         NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements herein contained, the parties hereto agree as follows:

1.       SALE AND PURCHASE OF SECURITIES

                                       1
<PAGE>

         1.1 SALE AND PURCHASE. Subject to the satisfaction of the terms and
conditions herein set forth, and in reliance upon the respective representations
and warranties of the parties set forth herein or in any document delivered
pursuant hereto, each of the Sellers severally and not jointly (on behalf of
itself and its Affiliates (as defined below)) hereby sells, assigns and
transfers to the Purchaser, free and clean of any liens, claims, charges,
security interests, restrictions or encumbrances of any kind ("LIENS"), and the
Purchaser hereby purchases from such Seller, at the Closing (as hereinafter
defined), all of the Securities, which Securities are set forth opposite each
such Seller's name on Schedule 1.1 hereto as well as the other rights referred
to in Section 1.2.

         1.2 ASSIGNMENT. Each Seller hereby assigns, transfers and sets over to
the Purchaser any and all of such Seller's claims, rights, causes of action,
title, and interest in, relating to, arising from, and that may be asserted in
connection with the obligations of the Company under such Seller's Securities
(in each case as set forth on Schedule 1.1 hereto), and, in the case of the
Series A Preferred Stock does hereby irrevocable constitute and appoint
_______________, as such Seller's attorney to transfer such shares of Series A
Preferred Stock on the books of the Company with full power of substitution in
the premises.

         Each Seller also hereby assigns, transfers and sets over to the
Purchaser any other securities (including the Warrants, common stock, options,
warrants or other similar rights to acquire securities of the Company or any
Subsidiary (as such term is defined in Section 2.3 of this Agreement)), and all
debts, obligations, claims or other rights of or against the Company or any
Subsidiary, owned and held by such Seller (or its Affiliates), including all of
such Seller's respective rights, title and interest in and to all instruments,
contracts, documents and agreements of any kind related to the Securities and
the Warrants.

         1.3 PURCHASE PRICE. The aggregate purchase price ("PURCHASE PRICE") for
(i) all of the Securities to be purchased by the Purchaser from the Sellers and
(ii) all other securities to be transferred by the Sellers to the Purchaser on
the Closing Date or thereafter (as described in Section 1.2), in each case
pursuant to this Agreement, shall be $6,000,000, with the amount to be paid to
each Seller set forth next to such Seller's name on Schedule 1.1 (each such
amount being referred to as a Seller's "SELLER PURCHASE PRICE").

         1.4 CLOSING. Subject to the provisions of this Agreement, the purchase
and sale of the Securities shall take place at the closing (the "CLOSING") at
the offices of Fischbein Badillo Wagner Harding on the date of this Agreement.
The date and time of such Closing are herein referred to as the "CLOSING DATE."
At the Closing, or in the case of (a), as soon thereafter as possible, (a) each
Seller shall deliver to the Purchaser the certificates or other documentation
representing the Securities owned and held by such Seller and (b) Purchaser
shall deliver to each Seller its Seller Purchase Price by certified check or
wire transfer of immediately available funds to an account designated by the
applicable Seller.

2.       REPRESENTATIONS AND WARRANTIES OF THE SELLERS

         Each of the Sellers, severally and not jointly, represents and warrants
(only with respect to itself and the Securities it owns) to the Purchaser as
follows:

                                       2
<PAGE>

         2.1 OWNERSHIP OF SECURITIES. Schedule 1.1 sets forth all of the
Securities held of record or beneficially owned by such Seller. Each Seller has
good and valid title to the Securities set forth opposite such Seller's name on
Schedule 1.1, free and clear of any Liens. Other than with respect to those
being transferred pursuant to this Agreement, no Seller is a party to any
option, warrant, right, contract, call, put or other agreement or commitment
providing for the disposition or acquisition of any security or any other
obligation of the Company or any Subsidiary. No Seller is a party to any voting
trust, proxy or other agreement or understanding with respect to the voting of
any capital stock of the Company. Upon consummation of the sale of the
Securities set forth opposite such Seller's name on Schedule 1.1 hereto, each
Seller will transfer to the Purchaser good and valid title to all of the
Securities owned by such Seller set forth opposite such Seller's name on
Schedule 1.1, free and clear of any and all Liens. The Sellers have not received
any payments from the Company in respect of the Securities.

         2.2 AUTHORIZATION; ENFORCEABILITY. Each Seller is duly organized and
validly existing and in good standing under the laws of its State of
incorporation. Each Seller has full right, capacity, power, and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereunder including, without limitation, the sale of the Securities
to the Purchaser. All requisite action of the part of each Seller for the
authorization, execution and delivery of this Agreement and the performance of
the obligations of Seller hereunder has been taken or will be taken prior to the
Closing. This Agreement constitutes a legal, valid and binding obligation of
each Seller, enforceable against such Seller in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
reorganization or similar laws in effect which affect the enforceability of
creditors' rights generally, or equitable principles.

         2.3 SECURITIES DOCUMENTS. Exhibits A, B and C are true and complete
copies of the only documents which have been located by each Seller evidencing
the Securities. The Securities have not been amended or modified since the date
issued. To the knowledge of each Seller, the Securities set forth opposite such
Seller's name on Schedule 1.1, constitute legal, valid and binding obligations
of the Company and the Subsidiaries. To the knowledge of each Seller, the
Securities set forth opposite such Seller's name on Schedule 1.1, are, as of the
date hereof, and will be after their transfer from such Seller to the Purchaser
as contemplated in the Agreement, enforceable against the Company and the
Subsidiaries, in accordance with their respective terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency, moratorium,
reorganization or similar laws in effect which affect the enforceability of
creditors' rights generally, or equitable principles. To the knowledge of each
Seller there is, as of the date hereof, and after giving effect to the transfer
of the Securities set forth opposite each Seller's name on Schedule 1.1 will be
no right of offset, defense, claim or objection in favor of the Company or any
Subsidiary arising out of or with respect to any of the obligations of the
Company or any Subsidiary with respect to any of the Securities. As used in this
Agreement, the term "SUBSIDIARY" means any corporation or other entity in which
the Company is entitled by virtue of its ownership of securities (or equivalent
interests) to elect a majority of the directors (or persons performing
equivalent functions).

         2.4 NO VIOLATION. Neither the execution and delivery of this Agreement
nor the consummation of the transactions contemplated hereunder will violate or
conflict with the organizational documents of any Seller or violate, conflict
with, or allow the termination of, constitute a default under, or cause the
acceleration or the maturity of, any debt or obligation pursuant to any
agreement or commitment to which any Seller is a party or by which it is bound,
or violate any law, judgment, decree, order, regulation or rule of any court or
governmental authority to which such Seller is subject.

                                       3
<PAGE>

         2.5 CONSENTS AND APPROVALS OF GOVERNMENTAL AUTHORITIES OR OTHERS. No
consent, approval or authorization of, or declaration, filing or registration
with, any person including any governmental or regulatory authority, is required
to be made or obtained by each Seller in connection with the execution, delivery
and performance of this Agreement or the consummation by such Seller of the
transactions contemplated hereunder.

3.       REPRESENTATIONS AND WARRANTIES OF PURCHASER.

         Purchaser represents and warrants to each of the Sellers as follows:

         3.1 ORGANIZATION. The Purchaser is a limited liability company duly
organized, validly existing and in good standing under the laws of Delaware.

         3.2 AUTHORIZATION. The Purchaser has full power and authority to
execute and deliver this Agreement and to perform its obligations hereunder. All
requisite action on the part of the Purchaser for the authorization, execution
and delivery of this Agreement and the performance of the obligations of the
Purchaser hereunder has been taken or will be taken prior to Closing. This
Agreement constitutes a legal, valid and binding obligation of Purchaser,
enforceable against Purchaser in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency, moratorium,
reorganization or similar laws in effect which affect the enforceability of
creditors' rights generally, or equitable principles.

         3.3 INVESTMENT INTENT. Buyer is acquiring the Securities for its own
account, for investment purposes only and not with a view to, or for sale or
resale in connection with, any public distribution thereof or with any present
intention of selling, distributing or otherwise disposing of the Securities.
Purchaser understands that the Securities are "restricted securities" under the
federal securities laws inasmuch as they are being acquired from Sellers in a
transaction not involving a public offering and that under such laws and
applicable regulations such Securities may only be resold without registration
under the Securities Act of 1933, as amended, in limited circumstances. The
Purchaser is sophisticated in financial matters and transactions of the nature
contemplated by this Agreement.

4.       CONDITIONS TO PURCHASER'S OBLIGATIONS TO CLOSE

         The obligations of the Purchaser to consummate the Closing is subject
to the fulfillment (or waiver in writing by the Purchaser), on or before the
Closing Date, of each of the following conditions:

         4.1      REPRESENTATIONS AND WARRANTIES; PERFORMANCE.

         (a) (i) The representations and warranties set forth in this Agreement
made by each of the Sellers shall be true and correct as of the Closing Date as
if made on the Closing Date and (ii) each of the Sellers shall have performed
all obligations and complied with all covenants and agreements required to be
performed or to be complied with by it under this Agreement in all material
respects on or prior to the Closing Date.

                                       4
<PAGE>

         4.2 CONSENTS. All governmental consents and all consents, approvals or
authorizations which Sellers actually know are necessary to consummate the
transactions contemplated by this Agreement shall have been obtained.

         4.3 ABSENCE OF LITIGATION. On the Closing Date, no law, regulation,
judgment, injunction, order or decree shall prohibit the consummation of the
transactions contemplated hereby. Without limiting the generality of the
foregoing, the sale of the Securities shall not be required to be registered
under the Securities Act of 1933, as amended.

         4.4      SUPPORTING DOCUMENTS.  On or before the Closing Date the
Purchaser shall have received copies of the following documents:

         (a) the Certificate of Incorporation of the Company certified as of a
recent date by the Secretary of State of the State of New York and the
Certificate of Incorporation or other organizational document of each Subsidiary
certified as of a recent date by the Secretary of State of the jurisdiction of
organization of each Subsidiary;

         (b) a certificate of the Secretary of State of the State of New York
dated as of a recent date as to the due incorporation and good standing of the
Company, the payment of all franchise taxes by the Company and listing all
documents of the Company on file with said Secretary of State and a good
standing certificate dated as of a recent date as to the due organization and
good standing, the payment of all franchise taxes and listing all of the
documents on file of each Subsidiary from the Secretary of State of the
jurisdiction of organization of such Subsidiary; and

         (c)      Evidence, satisfactory to the Purchaser that cash held by the
Company was $2,725,000 on May 19, 2003.

         4.5 DIRECTORS. The Purchaser shall have received written resignations
from each member of the Company's Board of Directors which were appointed by the
Sellers.

5.       COVENANTS OF THE SELLERS

         5.1 FURTHER ASSURANCES; POST CLOSING COOPERATION. At any time or from
time to time after the Closing, each Seller shall execute and deliver to the
Purchaser such documents, certificates and instruments as Purchaser may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement, including such documents, certificates and instruments to
cause the transfer of record and beneficial ownership of the Securities to the
Purchaser.

         5.2 DISTRIBUTIONS . In the event any Seller receives at any time any
property, cash, securities or other distribution from the Company on account of
or with respect to the Securities or other rights transferred to the Purchaser
under this Agreement, such Seller will promptly notify the Purchaser that it has
received such distribution and will promptly remit such distribution to the
Purchaser in the identical form in which it was received.

                                       5
<PAGE>

6.       CONDITIONS TO SELLERS' OBLIGATIONS TO CLOSING

         The obligation of each Seller to consummate the Closing is subject to
the fulfillment (or waiver in writing by such Seller), on or before the Closing
Date of each of the following conditions:

         6.1 REPRESENTATIONS AND WARRANTIES; PERFORMANCE. (a) The
representations and warranties set forth in this Agreement made by the Purchaser
shall be true and correct as of the Closing Date as if made on the Closing Date
and (b) the Purchaser shall have performed all obligations and complied with all
covenants and agreements required to be performed or to be complied with by it
under this Agreement in all material respects on or prior to the Closing Date.

         6.2 PRICE. The Purchaser shall have paid the Seller Purchaser Price to
each Seller in accordance with Section 1.3.

7.       INDEMNIFICATION.

         7.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The warranties and
representations set forth in Articles 2 and 3 shall survive the execution of
this Agreement and the Closing until the date that is eighteen months after the
Closing Date except (i) as to matters with respect to which a party shall have
given written notice of any claim within such period which shall not terminate
until such claim has been finally settled, decided or adjudicated. The covenants
and agreements contained in this Agreement to be performed following the Closing
shall survive the execution and delivery of this Agreement until the period of
applicable performance.

         7.2          INDEMNIFICATION.

         (a) Subject to the following provisions of this Article 7, commencing
on the Closing Date, each Seller severally and not jointly, shall defend,
indemnify and hold harmless, the Purchaser and any of its respective officers,
directors, employees, and Affiliates, from any and all Claims, which any of them
may incur or suffer as a result of or arising out of any breach of the
representations, warranties, covenants or agreements of such Seller set forth in
Article 2 of this Agreement and for which claim has been made during the
applicable periods hereunder; PROVIDED, that in no event shall any Seller be
obligated to indemnify the Purchaser for any amounts in excess of that Seller's
Seller Purchase Price as set forth on Schedule 1.1(a), (b) or (c) hereto, as the
case may be. As used in this Agreement, the term "AFFILIATE", as used with
reference to any person means any person controlling, controlled by or under
common control with such person. Control for purposes of this definition, means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a person, whether through ownership
of voting securities or by contract or otherwise.

         (b) Subject to the following provisions of this Article 7, commencing
on the Closing Date, Purchaser shall defend, indemnify and hold harmless each
Seller and any of their respective officers, directors, employees and Affiliates
from any and all Claims, which such Seller may incur or suffer as a result of or
arising out of any breach of the representations, warranties, covenants or
agreements of Purchaser set forth in this Agreement and for which claim has been
made during the applicable periods hereunder.

                                       6
<PAGE>

         7.3      INDEMNIFICATION PROCEDURE; ARBITRATION.

         (a) In the case of any claim asserted by a third party against a party
entitled to indemnification under this Agreement (the "INDEMNIFIED PARTY"),
written notice shall be given by the Indemnified Party to the party required to
provide indemnification (the "INDEMNIFYING PARTY") promptly after such
Indemnified Party has knowledge of any claim as to which indemnity may be
sought, and the Indemnifying Party (at the expense of such Indemnifying Party)
shall have the right to assume the defense of any claim or any litigation
resulting therefrom, PROVIDED, that (a) counsel for the Indemnifying Party who
shall conduct the defense of such claim or litigation shall be reasonably
satisfactory to the Indemnified Party, and the Indemnified Party may participate
in such defense at such Indemnified Party's expense, and (b) the failure of any
Indemnified Party to give written notice as provided herein shall not relieve
the Indemnifying Party of its indemnification obligation under this Agreement
except to the extent that such Indemnifying Party is materially prejudiced as a
result of such failure to give notice. In no event will the Indemnified Party
admit any liability with respect thereto or settle, compromise, pay or discharge
the same without the prior written consent of the Indemnifying Party, which
consent shall not be unreasonably withheld. Except with the prior written
consent of the Indemnified Party, no Indemnifying Party, in the defense of any
such claim or litigation, shall consent to entry of any judgment or enter into
any settlement that provides for injunctive or other nonmonetary relief
affecting the Indemnified Party or that does not include as an unconditional
term thereof the giving by each claimant or plaintiff to such Indemnified Party
of a release from all liability with respect to such claim or litigation. In the
event that the Indemnified Party shall have been advised by its counsel that the
Indemnified Party may have available to it one or more defenses or counterclaims
that are inconsistent with one or more of those that may be available to the
Indemnifying Party in respect of such claim or any litigation relating thereto,
the Indemnified Party shall have the right to employ counsel to represent it at
the sole cost (provided such costs are reasonable) of the Indemnifying Party,
such costs to be paid by the Indemnifying Party to the Indemnified Party during
the conduct of such defense, settlement, negotiations or litigation, PROVIDED,
that if the Indemnified Party does so employ counsel , the Indemnified Party
shall not settle such claim or litigation without the written consent of the
Indemnifying Party, such consent not to be unreasonably withheld. In the event
that the Indemnifying Party does not accept the defense of any matter as above
provided within thirty (30) business days of its receipt of written notice of
such claim by an Indemnified Party, the Indemnified Party shall have the right
to assume the defense of such claim subject to the provisions of this Article 7;
PROVIDED, for the avoidance of doubt, that the Indemnified Party shall not
settle or otherwise dispose of such claim without the prior written consent of
the Indemnifying Party, which consent shall not be unreasonably withheld. In any
event, each Seller and the Purchaser, as the case may be, shall cooperate in the
defense of any claim or litigation subject to this Article 7 and the records of
each shall be reasonably available to the other with respect to such defense.

                                       7
<PAGE>

         (b) If the Indemnified Party believes that a matter has occurred that
entitles it to indemnification under Article 7 (other than matters covered by
Section 7.3(a) above), the Indemnified Party shall give prompt written notice to
the Indemnifying Party describing such matter in reasonable detail, including
the nature and basis of the claim and reasonably sufficient, detailed
information of damages as then known ("INDEMNIFICATION CLAIM"). The Indemnified
Party shall be entitled to supplement its Indemnification Claim from time to
time thereafter by further written notices as they are established. The
Indemnifying Party shall send a written response to such Indemnification Claim
within thirty (30) business days after receipt of the Indemnification Claim
stating its acceptance or objection to the Indemnification Claim, and explaining
its position with respect thereto in reasonable detail. If such Indemnifying
Party does not respond within such thirty (30) business day period, it will be
deemed to have accepted the Indemnified Party's Indemnification Claim as
specified in the notice given by the Indemnified Party. If the Indemnifying
Party gives a timely objection notice, then the parties will use commercially
reasonable efforts to attempt to resolve the dispute. Upon the expiration of an
additional twenty (20) business day period from the date of the objection notice
or such longer period as to which the Indemnified and Indemnifying Parties may
agree, any such dispute shall be submitted to arbitration in New York County to
a member of the American Arbitration Association mutually appointed by the
Indemnified and Indemnifying Parties (or, in the event the Indemnified and
Indemnifying Parties cannot agree on a single such member, to a panel of three
members selected in accordance with the rules of such Association), who shall
promptly arbitrate such dispute in accordance with the rules of such Association
and report to the parties upon such disputed items, and such report shall be
final, binding and conclusive on the parties. Judgment upon the award by the
arbitrator(s) may be entered in any court having jurisdiction. All reasonable
fees and expenses of the arbitrators and costs of arbitration shall be paid as
determined by the arbitrators and to the extent not so determined, each party
shall pay its own expenses.

8.       CONFIDENTIAL INFORMATION

         In the event the transactions contemplated by this Agreement are not
consummated, each party hereto will hold all non-public confidential information
which it obtained from the other parties hereto in the course of negotiating
this Agreement, which it did not previously know or which was not previously in
the public domain, confidential; no party will directly or indirectly use such
information until the same shall become in the public domain (other than by
disclosure by a party hereto receiving such information for use pursuant
hereto), and each party will return to the applicable party all documents,
objects and records obtained from such other party pursuant hereto or derived
therefrom which are not in the public domain.

9.       MISCELLANEOUS.

         9.1 EXPENSES. Except as provided for herein, each of the parties hereto
shall bear all expenses incurred by it in connection with this Agreement and in
consummation of the transactions contemplated hereby and in preparation
therefor.

         9.2 NOTICES. All notices, demands, waivers, requests and other
communications required or permitted to be given under the provisions of this
Agreement shall be in writing and shall be deemed duly given three days after
mailing if mailed by registered mail, postage prepaid, return receipt requested,
or the day following mailing if by Federal Express or similar overnight delivery
service, or, when delivered if delivered personally, at the following addresses
pending the designation of another address by written notice in accordance with
the provisions hereof, or, in the case of notice by telecopier, upon receipt
thereof as confirmed by telephone:

                                        8
<PAGE>

If to Purchaser:

Skyride Associates, LLC
241 Fifth Avenue, Suite 302
New York, New York 10016
Attention:  Walter Threadgill

With a copy to:

Joseph L. Cannella, Esq.
Fischbein Badillo Wagner Harding
909 Third Avenue
New York, New York 11501

If to the Sellers:

To them at the addresses set forth on Schedule I hereto, with copies of such
notices to be provided as set forth on Schedule I hereto.

         9.3 ENTIRE AGREEMENT. This Agreement and the Disclosure Schedules
contain all the terms agreed upon between the parties with respect to the
subject matter hereof and supersede all prior agreements and understandings with
respect to the subject matter hereof, whether oral or written. This Agreement
may not be changed or modified, except by agreement in writing, signed by all of
the parties hereto.

         9.4 HEADINGS. The headings of the Sections of this Agreement are for
convenience of reference only and shall not be deemed to explain, limit or
amplify the provisions hereof.

         9.5 ASSIGNMENT; SUCCESSORS IN INTEREST. None of the Sellers, the
Company or Purchaser may transfer or assign its rights, duties or obligations
hereunder or any part hereof to any other person or entity without the prior
written consent of the other parties hereto, which consent shall not be
unreasonably withhed; provided that the Purchaser may assign all or any portion
of its rights and obligations under this Agreement to a direct or indirect
wholly owned subsidiary provided that the Purchaser shall continue to remain
obligated hereunder. Except as otherwise specifically provided herein, this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, legal representatives, personal representatives,
successors and assigns. The obligations of the Sellers under this Agreement are
several, not joint without preference or distinction between them.

                                        9
<PAGE>

         9.6 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which shall
be deemed but one and the same instrument.

         9.7 GOVERNING LAW. This Agreement shall be construed and interpreted in
accordance with and governed in all respects by the laws of the State of New
York applicable to contracts made and to be performed therein. Any dispute
arising hereunder shall be adjudicated exclusively in the Federal and State
Courts of the State of New York located in the County of New York, as to which
courts the parties waive any claim of inconvenient forum. Each of the parties
hereby waives, to the extent permitted by applicable law, trial by jury in any
litigation in any court with respect to, in connection with, or arising out of
this Agreement, or the validity, protection, interpretation, collection or
enforcement thereof.

         9.8 BROKERAGE. None of the Company, the Sellers or the Purchaser is a
party to any agreement with any finder, broker or other person, or in any way
obligated to any finder, broker or other person for any commission, fees or
expenses in connection with the origin, negotiation, execution or performance of
this Agreement, and each shall indemnify the others and hold them harmless
against and in respect of any claim for brokerage, finders fees, or other fees
or commissions relative to this Agreement.

         9.9 CONSTRUCTION. This Agreement is to be deemed to have been prepared
jointly by the parties hereto after arms-length negotiations, and any
uncertainty or ambiguity existing herein shall not be interpreted against any
party, but according to the application of the rules of interpretation of
contracts.

         9.10 NO THIRD PARTY BENEFICIARIES WITH THE EXCEPTION OF THE PARTIES TO
THIS AGREEMENT, THERE EXISTS NO RIGHT OF ANY PERSON TO CLAIM A BENEFICIAL
INTEREST IN THIS AGREEMENT OR ANY RIGHTS OCCURRING BY VIRTUE OF THIS AGREEMENT.

         9.11 NO OTHER REPRESENTATIONS OR WARRANTIES. Except as specifically and
expressly set forth in Article 2, (A) THE SELLERS MAKE NO REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, RELATING TO THE SECURITIES,
THE COMPANY OR THE SUBSIDIARIES, INCLUDING, WITHOUT LIMITATION, ANY
REPRESENTATION OR WARRANTY AS TO VALUE, MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE OR FOR ORDINARY PURPOSES, OR ANY OTHER MATTER, (B) THE
SELLERS MAKE NO, AND HEREBY DISCLAIM ANY, REPRESENTATION OR WARRANTY REGARDING
THE COMPANY AND THE SUBSIDIARIES AND (C) THE SECURITIES BEING TRANSFERRED TO
PURCHASER ARE CONVEYED ON AS "AS IS, WHERE IS" BASIS AS OF THE CLOSING, AND
PURCHASER SHALL RELY UPON ITS OWN EXAMINATION THEREOF. PURCHASER HAS NOT SOUGHT
OR RELIED UPON ANY REPRESENTATION, WARRANTIES OR STATEMENTS OF ANY KIND MADE BY
OR ON BEHALF OF THE SELLERS OR ANY DOCUMENT PROVIDED BY THE SELLERS EXCEPT AS
EXPRESSLY CONTAINED IN THIS AGREEMENT.

                                       10

<PAGE>

         9.12 SEVERABILITY. If any provision of this Agreement shall be declared
by any court of competent jurisdiction to be illegal, void of unenforceable, all
other provisions of this Agreement shall not be affected and shall remain in
full force and effect.

             THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.

                                       11

<PAGE>

         IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed in its name and on its behalf, all as of the day and year first
above written.

                               PURCHASER:

                               SKYRIDE ASSOCIATES, LLC

                               By: /S/
                                   ------------------------------------
                                   Name:  Walter Threadgill
                                   Title:  Manager

                               SELLERS:

                               US SMALL  BUSINESS  ADMINISTRATION,  AS
                               RECEIVER  FOR PROSPECT STREET NYC
                               DISCOVERY FUND, L.P.

                               By: /S/
                                   --------------------------------------------
                                   Name:  Gail G. Green
                                   Title: Chief, Account Resolution Branch, SBA

                               THE  BANK  OF  NEW  YORK  AS   TRUSTEE   FOR
                               THE   EMPLOYEES' RETIREMENT PLAN OF
                               KEYSPAN CORPORATION

                               By: /S/
                                   --------------------------------------------
                                   Name:  Michael T. Shayne
                                   Title:  Vice President

                                       12
<PAGE>

                               THE BANK OF NEW YORK AS TRUSTEE FOR
                               THE KEYSPAN CORPORATION NON-
                               BARGAINING HEALTH VEBA

                               By: /S/
                                  -------------------------------------------
                               Name:  Michael T. Shayne
                               Title:  Vice President

                               PROSPECT STREET NYC CO-INVESTMENT FUND, L.P.

                               By: /S/
                                  -------------------------------------------
                               Name:  John Barry
                               Title:

                                       13

<PAGE>

         Schedule 1.1(a) to Securities Purchase Agreement dated September 15,
         2003 (Prospect Street NYC Discovery Fund, L.P.)

"Seller Purchase Price": $1,551,600

"Securities"

1. Senior Promissory Note No. 1 dated December 20, 1996 in the principal amount
of $1,500,000.00.

2. Senior Secured Demand Note No. 2 dated May 20, 1998 in the principal amount
of $435,000.

3. Certificate representing 1,090,909 shares of Series A Convertible
Participating Preferred Stock, $.001 par value.

(This Schedule of "Securities" does not include any class of Common Stock or
warrants to purchase any class of Common Stock).

The Seller only possesses a copy of the document evidencing the Security listed
in Item 1 above and possesses originals of the documents evidencing the
Securities listed in Items 2 and 3 above.

Notices:

Gail Green, Esquire
Chief, Account Resolutions Branch
Office of Liquidation
U.S. Small Business Administration
409 Third Street, S.W.
Washington, D.C. 20416

                                       14
<PAGE>

         Schedule 1.1(b) to Securities Purchase Agreement dated September 15,
         2003 (Prospect Street NYC Co-Investment Fund, L.P.)

"Seller Purchase Price": $1,072,200

"Securities"

1. Senior Promissory Note No. 5 dated March 14, 1997 in the principal amount of
$450,000.

2. Senior Secured Demand Note No. PSNYC-1 dated April 1, 2000 in the principal
amount of $500,000 (issued pursuant to the Senior Secured Credit Agreement dated
as of May 20, 1998).

3. Additional loan in the principal amount of $500,000.

(This Schedule of "Securities" does not include any class of Common Stock or
warrants to purchase any class of Common Stock).

The Seller possesses (i) a copy of the document evidencing the Security listed
in Item 1 above, (ii) an original version of the document evidencing the
Security listed in Item 2 above and (iii) no documentation whatsoever evidencing
the Security listed in Item 3 above.

Notices:

John Barry
Prospect Street NYC Co-Investment Fund, L.P
10 East 40th Street
                                                  New York, N.Y. 10016

<PAGE>

         Schedule 1.1(c) to Securities Purchase Agreement dated September 15,
         2003 (Employees' Retirement Plan of Keyspan Corporation and Keyspan
         Corporation Non-Bargaining Health VEBA)

"Seller Purchase Price": $3,376,200

"Securities"

1. Senior Promissory Note No. 2 dated December 26, 1996 in the principal amount
of $1,000,000.

2. Senior Promissory Note No. 3 dated December 31, 1996 in the principal amount
of $500,000.

3. Senior Promissory Note No. 4 dated February 18, 1997 in the principal amount
of $500,000.

4. Senior Promissory Note No. 6 dated March 21, 1997 in the principal amount of
$500,000.

5. Senior Secured Demand Note No. 1 dated May 20, 1998 in the principal amount
of $500,000.

6. Senior Secured Demand Note in the principal amount of $1,350,000.

The Seller only possesses (i) copies of documents evidencing the Securities
listed in Item 1, Item 2 and Item 3; (ii) unsigned copies of documents filed by
the Company with the SEC evidencing the Securities listed in Item 4 and Item 5;
and (iii) a copy of the first amendment to the Senior Secured Credit Agreement,
as amended on May 29, 1998 (the "First Amendment"), which copy is unsigned by
the Borrowers (as defined in the Senior Secured Credit Agreement) evidencing the
Security listed in Item 6.

(This Schedule of "Securities" does not include any class of Common Stock or
warrants to purchase any class of Common Stock).

                                       16

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