Exhibit 4.1
NEITHER THESE WARRANTS NOR THE COMMON STOCK ISSUABLE UPON EXERCISE OF THESE
WARRANTS HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE SOLD, PLEDGED OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH
SECURITIES UNDER THE ACT OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS
AVAILABLE.
7,500,000 Warrants June 20, 2005
APPLIED DNA SCIENCES, INC.
WARRANTS
Applied DNA Sciences, Inc., a Nevada corporation ("APDN"), certifies that,
for value received, Trilogy Capital Partners, Inc. ("Trilogy"), or registered
assigns (the "Holder"), is the owner of Seven Million Five Hundred Thousand
(7,500,000) Warrants of APDN (the "Warrants"). Each Warrant entitles the Holder
to purchase from APDN at any time prior to the Expiration Date (as defined
below) one share of the common stock of APDN (the "Common Stock") for $0.55 per
share (the "Exercise Price"), on the terms and conditions hereinafter provided.
The Exercise Price and the number of shares of Common Stock purchasable upon
exercise of each Warrant are subject to adjustment as provided in this
Certificate.
1. Vesting; Expiration Date; Exercise
1.1 Vesting. The Warrants shall vest and become exercisable as of the date
of this Certificate.
1.2 Expiration Date. The Warrants shall expire on June 19, 2008 (the
"Expiration Date").
1.3 Manner of Exercise. The Warrants are exercisable by delivery to APDN of
the following (the "Exercise Documents"): (a) this Certificate (b) a written
notice of election to exercise the Warrants; and (c) payment of the Exercise
Price in cash, by check or by "net" exercise as contemplated by Section 1.4 of
this Certificate. Within three business days following receipt of the foregoing,
APDN shall execute and deliver to the Holder: (a) a certificate or certificates
representing the aggregate number of shares of Common Stock purchased by the
Holder, and (b) if less than all of the Warrants evidenced by this Certificate
are exercised, a new certificate evidencing the Warrants not so exercised.
1.4 Net Exercise. In lieu of the payment methods set forth in Section 1.3
above, the Holder may elect to exchange all or some of the Warrant for the
number of shares of Common Stock computed using the following formula:
X = Y (A-B)
-------
A
Where X = the number of shares of Common Stock to be issued to Holder.
Y = the number of shares of Common Stock purchasable under the
Warrants being exchanged (as adjusted to the date of such
calculation).
A = the Market Price on the date of receipt by APDN of the exercise
documents.
B = the Exercise Price of the Warrants being exchanged (as adjusted in
accordance with the terms of Section 2 hereof).
The "Market Price" on any trading day shall be deemed to be the last
reported sale price of the Common Stock on such day, or, in the case no
such reported sales take place on such day, the last reported sale price on
the preceding trading day on which there was a last reported sales price,
as officially reported by the principal securities exchange in which the
shares of Common Stock are listed or admitted to trading or by the Nasdaq
Stock Market, or if the Common Stock is not listed or admitted to trading
on any national securities exchange or the Nasdaq Stock Market, the last
sale price, or if there is no last sale price, the closing bid price, as
furnished by the National Association of Securities Dealers, Inc. (such as
through the OTC Bulletin Board) or a similar organization or if Nasdaq is
no longer reporting such information. If the Market Price cannot be
determined pursuant to the sentence above, the Market Price shall be
determined in good faith (using customary valuation methods) by the Board
of Directors of APDN based on the information best available to it,
including recent arms-length sales of Common Stock to unaffiliated persons.
The Company acknowledges and agrees that for purposes of sales by the
Holder of Warrant Shares under Rule 144 under the Securities Act of 1933, as
amended, the holding period for Warrant Shares received in a "net exercise"
commences upon the date the Warrants were issued.
1.5 Warrant Exercise Limitation. Notwithstanding any other provision of
this Agreement, if as of the date of exercise APDN has a class of securities
registered under Section 12 of the Securities Exchange Act of 1934, as amended,
Holder may not exercise Warrants under this Section 1 to the extent that
immediately following such exercise Holder would beneficially own 5% or more of
the outstanding Common Stock of APDN. For this purpose, a representation of the
Holder that following such exercise it would not beneficially own 5% or more of
the outstanding Common Stock of APDN shall be conclusive and binding upon APDN.
2. Adjustments of Exercise Price and Number and Kind of Conversion Shares
2.1 In the event that APDN shall at any time hereafter (a) pay a dividend
in Common Stock or securities convertible into Common Stock; (b) subdivide or
split its outstanding Common Stock; (c) combine its outstanding Common Stock
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into a smaller number of shares; then the number of shares to be issued
immediately after the occurrence of any such event shall be adjusted so that the
Holder thereafter may receive the number of shares of Common Stock it would have
owned immediately following such action if it had exercised the Warrants
immediately prior to such action and the Exercise Price shall be adjusted to
reflect such proportionate increases or decreases in the number of shares.
2.2 In case of any reclassification of the outstanding shares of Common
Stock (other than a change covered by Section 2.1 hereof or a change which
solely affects the par value of such shares) or in the case of any merger or
consolidation or merger in which APDN is not the continuing corporation and
which results in any reclassification or capital reorganization of the
outstanding shares), the Holder shall have the right thereafter (until the
Expiration Date) to receive upon the exercise hereof, for the same aggregate
Exercise Price payable hereunder immediately prior to such event, the kind and
amount of shares of stock or other securities or property receivable upon such
reclassification, capital reorganization, merger or consolidation, by a Holder
of the number of shares of Common Stock obtainable upon the exercise of the
Warrants immediately prior to such event; and if any reclassification also
results in a change in shares covered by Section 2.1, then such adjustment shall
be made pursuant to both this Section 2.2 and Section 2.1 (without duplication).
The provisions of this Section 2.2 shall similarly apply to successive
reclassifications, capital reorganizations and mergers or consolidations, sales
or other transfers.
3. Reservation of Shares. APDN shall at all times reserve and keep available out
of its authorized but unissued shares of Common Stock, such number of shares of
Common Stock as shall from time to time be issuable upon exercise of the
Warrants. If at any time the number of authorized but unissued shares of Common
Stock shall not be sufficient to permit the exercise of the Warrants, APDN shall
promptly seek such corporate action as may be necessary to increase its
authorized but unissued shares of Common Stock to such number of shares as shall
be sufficient for such purpose.
4. Certificate as to Adjustments. In each case of any adjustment in the Exercise
Price, or number or type of shares issuable upon exercise of these Warrants, the
Chief Financial Officer of APDN shall compute such adjustment in accordance with
the terms of these Warrants and prepare a certificate setting forth such
adjustment and showing in detail the facts upon which such adjustment is based,
including a statement of the adjusted Exercise Price. APDN shall promptly send
(by facsimile and by either first class mail, postage prepaid or overnight
delivery) a copy of each such certificate to the Holder.
5. Loss or Mutilation. Upon receipt of evidence reasonably satisfactory to APDN
of the ownership of and the loss, theft, destruction or mutilation of this
Certificate, and of indemnity reasonably satisfactory to it, and (in the case of
mutilation) upon surrender and cancellation of these Warrants, APDN will execute
and deliver in lieu thereof a new Certificate of like tenor as the lost, stolen,
destroyed or mutilated Certificate.
6. Representations and Warranties of APDN. APDN hereby represents and warrants
to Holder that:
6.1 Due Authorization. All corporate action on the part of APDN, its
officers, directors and shareholders necessary for (a) the authorization,
execution and delivery of, and the performance of all obligations of APDN under,
these Warrants, and (b) the authorization, issuance, reservation for issuance
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and delivery of all of the Common Stock issuable upon exercise of these
Warrants, has been duly taken. These Warrants constitute a valid and binding
obligation of APDN enforceable in accordance with their terms, subject, as to
enforcement of remedies, to applicable bankruptcy, insolvency, moratorium,
reorganization and similar laws affecting creditors' rights generally and to
general equitable principles.
6.2 Organization. APDN is a corporation duly organized, validly existing
and in good standing under the laws of the State referenced in the first
paragraph of this Certificate and has all requisite corporate power to own,
lease and operate its property and to carry on its business as now being
conducted and as currently proposed to be conducted.
6.3 Valid Issuance of Stock. Any shares of Common Stock issued upon
exercise of these Warrants will be duly and validly issued, fully paid and
non-assessable.
6.4 Governmental Consents. All consents, approvals, orders, authorizations
or registrations, qualifications, declarations or filings with any federal or
state governmental authority on the part of APDN required in connection with the
consummation of the transactions contemplated herein have been obtained.
7. Representations and Warranties of Trilogy. Trilogy hereby represents and
warrants to APDN that:
7.1 Trilogy is acquiring the Warrants for its own account, for investment
purposes only.
7.2 Trilogy understands that an investment in the Warrants involves a high
degree of risk, and Trilogy has the financial ability to bear the economic risk
of this investment in the Warrants, including a complete loss of such
investment. Trilogy has adequate means for providing for its current financial
needs and has no need for liquidity with respect to this investment.
7.3 Trilogy has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of an investment
in the Warrants and in protecting its own interest in connection with this
transaction.
7.4 Trilogy understands that the Warrants have not been registered under
the Securities Act of 1933, as amended (the "Securities Act") or under any state
securities laws. Trilogy is familiar with the provisions of the Securities Act
and Rule 144 thereunder and understands that the restrictions on transfer on the
Warrants may result in Trilogy being required to hold the Warrants for an
indefinite period of time.
7.5 Trilogy agrees not to sell, transfer, assign, gift, create a security
interest in, or otherwise dispose of, with or without consideration
(collectively, "Transfer") any of the Warrants except pursuant to an effective
registration statement under the Securities Act or an exemption from
registration. As a further condition to any such Transfer, except in the event
that such Transfer is made pursuant to an effective registration statement under
the Securities Act, if in the reasonable opinion of counsel to APDN any Transfer
of the Warrants by the contemplated transferee thereof would not be exempt from
the registration and prospectus delivery requirements of the Securities Act,
APDN may require the contemplated transferee to furnish APDN with an investment
letter setting forth such information and agreements as may be reasonably
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requested by APDN to ensure compliance by such transferee with the Securities
Act.
8. Notices of Record Date
In the event:
8.1 APDN shall take a record of the holders of its Common Stock (or other
stock or securities at the time receivable upon the exercise of these Warrants),
for the purpose of entitling them to receive any dividend or other distribution,
or any right to subscribe for or purchase any shares of stock of any class or
any other securities or to receive any other right; or
8.2 of any consolidation or merger of APDN with or into another
corporation, any capital reorganization of APDN, any reclassification of the
capital stock of APDN, or any conveyance of all or substantially all of the
assets of APDN to another corporation in which holders of APDN's stock are to
receive stock, securities or property of another corporation; or
8.3 of any voluntary dissolution, liquidation or winding-up of APDN; or
8.4 of any redemption or conversion of all outstanding Common Stock;
then, and in each such case, APDN will mail or cause to be mailed to the Holder
a notice specifying, as the case may be, (a) the date on which a record is to be
taken for the purpose of such dividend, distribution or right, or (b) the date
on which such reorganization, reclassification, consolidation, merger,
conveyance, dissolution, liquidation, winding-up, redemption or conversion is to
take place, and the time, if any is to be fixed, as of which the holders of
record of Common Stock (or such stock or securities as at the time are
receivable upon the exercise of these Warrants), shall be entitled to exchange
their shares of Common Stock (or such other stock or securities), for securities
or other property deliverable upon such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation or winding-up. APDN
shall use all reasonable efforts to ensure such notice shall be delivered at
least 15 days prior to the date therein specified.
9. Registration Rights.
9.1 Definitions. For purposes of this Section 9, the following terms shall
have the meanings set forth below:
9.1.1 A "Blackout Event" means any of the following: (a) the possession by
APDN of material information that is not ripe for disclosure in a registration
statement or prospectus, as determined reasonably and in good faith by the Chief
Executive Officer or the Board of Directors of APDN or that disclosure of such
information in the Registration Statement or the prospectus constituting a part
thereof would be materially detrimental to the business and affairs of APDN; or
(b) any material engagement or activity by APDN which would, in the reasonable
and good faith determination of the Chief Executive Officer or the Board of
Directors of APDN, be materially adversely affected by disclosure in a
registration statement or prospectus at such time.
9.1.2 "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
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9.1.3 "Included Shares" shall mean any Registrable Shares included in a
Registration.
9.1.4 "Registrable Shares" shall mean the shares of Common Stock (or such
stock or securities as at the time are receivable upon the exercise of these
Warrants) issuable upon exercise of the Warrants and any other warrants and or
other securities issued to Trilogy in connection with performing investor
relations services for APDN, and shares or securities issued as a result of
stock split, stock dividend or reclassification of such shares.
9.1.5 "Registration" shall mean a registration of securities under the
Securities Act pursuant to Section 9.2 or 9.3 of this Agreement.
9.1.6 "Registration Period" with respect to any Registration Statement the
period commencing the effective date of the Registration Statement and ending
upon withdrawal or termination of the Registration Statement.
9.1.7 "Registration Statement" shall mean the registration statement, as
amended from time to time, filed with the SEC in connection with a Registration.
9.1.8 "SEC" shall mean the Securities and Exchange Commission.
9.2 Demand Registration. No later than the earlier to occur: (i) 15 days
following the effectiveness of the Company's current registration statement on
Form SB-2 (File No. 333-122848) and (ii) September 19, 2005, APDN shall prepare
and file with the SEC a Registration Statement for the purpose of registering
the sale of the Registrable Shares under the Securities Act, and shall use its
commercially reasonable efforts to cause the Registration Statement to become
effective within 60 days of the date of filing. Once effective, APDN shall
prepare and file with the SEC such amendments and supplements to the
Registration Statement and the prospectus forming a part thereof as may be
necessary to keep the Registration Statement effective until the earliest date
on which (a) all the Included Shares have been disposed of pursuant to the
Registration Statement, or (b) all of the Included Shares then held by Holder
may be sold under the provisions of Rule 144 without limitation as to volume,
whether pursuant to Rule 144(k) or otherwise.
9.3 Piggyback Registration. Unless the Registrable Shares are then included
in a Registration Statement or can be sold under the provisions of Rule 144
without limitation as to volume, whether pursuant to Rule 144(k) or otherwise,
if APDN shall determine to register any Common Stock under the Securities Act
for sale in connection with a public offering of Common Stock (other than
pursuant to an employee benefit plan or a merger, acquisition or similar
transaction), APDN will give written notice thereof to Holder and will include
in such Registration Statement any of the Registrable Shares which Holder may
request be included ("Included Shares") by a writing delivered to APDN within 15
days after the notice given by APDN to Holder; provided, however, that if the
offering is to be firmly underwritten, and the representative of the
underwriters of the offering refuse in writing to include in the offering all of
the shares of Common Stock requested by APDN and others, the shares to be
included shall be allocated first to APDN and any shareholder who initiated such
Registration and then among the others based on the respective number of shares
of Common Stock held by such persons. If APDN decides not to, and does not, file
a Registration Statement with respect to such Registration, or after filing
determines to withdraw the same before the effective date thereof, APDN will
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promptly so inform Holder, and APDN will not be obligated to complete the
registration of the Included Shares included therein.
9.4 Certain Covenants. In connection with any Registration:
9.4.1 APDN shall take all lawful action such that the Registration
Statement, any amendment thereto and the prospectus forming a part thereof does
not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they are made, not misleading. Upon
becoming aware of the occurrence of any event or the discovery of any facts
during the Registration Period that make any statement of a material fact made
in the Registration Statement or the related prospectus untrue in any material
respect or which material fact is omitted from the Registration Statement or
related prospectus that requires the making of any changes in the Registration
Statement or related prospectus so that it will not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading (taking into account any prior amendments or supplements), APDN shall
promptly notify Holder, and, subject to the provisions of Section 9.5, as soon
as reasonably practicable prepare (but, subject to Section 9.5, in no event more
than five business days in the case of a supplement or seven business days in
the case of a post-effective amendment) and file with the SEC a supplement or
post-effective amendment to the Registration Statement or the related prospectus
or file any other required document so that, as thereafter delivered to a
purchaser of Shares from Holder, such prospectus will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.
9.4.2 At least three business days prior to the filing with the SEC of
the Registration Statement (or any amendment thereto) or the prospectus forming
a part thereof (or any supplement thereto), APDN shall provide draft copies
thereof to Holder and shall consider incorporating into such documents such
comments as Holder (and its counsel) may propose to be incorporated therein.
Notwithstanding the foregoing, no prospectus supplement, the form of which has
previously been provided to Holder, need be delivered in draft form to Holder.
9.4.3 APDN shall promptly notify Holder upon the occurrence of any of
the following events in respect of the Registration Statement or the prospectus
forming a part thereof: (a) the receipt of any request for additional
information from the SEC or any other federal or state governmental authority,
the response to which would require any amendments or supplements to the
Registration Statement or related prospectus; (b) the issuance by the SEC or any
other federal or state governmental authority of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose; or (c) the receipt of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Shares for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose.
9.4.4 APDN shall furnish to Holder with respect to the Included Shares
registered under the Registration Statement (and to each underwriter, if any, of
such Shares) such number of copies of prospectuses and such other documents as
Holder may reasonably request, in order to facilitate the public sale or other
disposition of all or any of the Included Shares by Holder pursuant to the
Registration Statement.
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9.4.5 In connection with any registration pursuant to Section 9.2, APDN
shall file or cause to be filed such documents as are required to be filed by
APDN for normal Blue Sky clearance in states specified in writing by Holder;
provided, however, that APDN shall not be required to qualify to do business or
consent to service of process in any jurisdiction in which it is not now so
qualified or has not so consented.
9.4.6 APDN shall bear and pay all expenses incurred by it and Holder
(other than underwriting discounts, brokerage fees and commissions and fees and
expenses of more than one law firm) in connection with the registration of the
Shares pursuant to the Registration Statement.
9.4.7 APDN shall require each legal opinion and accountant's "cold
comfort" letter in connection with the Registration, if any, to be rendered to
Holder as well as APDN and/or its Board of Directors.
9.4.8 As a condition to including Registrable Shares in a Registration
Statement, Holder must provide to APDN such information regarding itself, the
Registrable Shares held by it and the intended method of distribution of such
Shares as shall be required to effect the registration of the Registrable Shares
and, if the offering is being underwritten, Holder must provide such powers of
attorney, indemnities and other documents as may be reasonably requested by the
managing underwriter.
9.4.9 Following the effectiveness of the Registration Statement, upon
receipt from APDN of a notice that the Registration Statement contains an untrue
statement of material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances under which they were made, Holder will immediately
discontinue disposition of Included Shares pursuant to the Registration
Statement until APDN notifies Holder that it may resume sales of Included Shares
and, if necessary, provides to Holder copies of the supplemental or amended
prospectus.
9.5 Blackout Event. APDN shall not be obligated to file a post-effective
amendment or supplement to the Registration Statement or the prospectus
constituting a part thereof during the continuance of a Blackout Event;
provided, however, that no Blackout Event may be deemed to exist for more than
60 days. Without the express written consent of Holder, if required to permit
the continued sale of Shares by Holder, a post-effective amendment or supplement
to Registration Statement or the prospectus constituting a part thereof must be
filed no later than the 61st day following commencement of a Blackout Event.
9.6 Rule 144. With a view to making available to Holder the benefits of
Rule 144, APDN agrees, until such time as Holder can sell all remaining
Registrable Shares under the provisions Rule 144(k), to:
9.6.1.1 comply with the provisions of paragraph (c)(1) of Rule 144; and
9.6.1.2 file with the SEC in a timely manner all reports and other
documents required to be filed by APDN pursuant to Section 13 or 15(d) under the
Exchange Act; and, if at any time it is not required to file such reports but in
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the past had been required to or did file such reports, it will, upon the
request of a Purchaser, make available other information as required by, and so
long as necessary to permit sales of its Shares pursuant to, Rule 144.
9.7 APDN Indemnification. APDN agrees to indemnify and hold harmless
Holder, and its officers, directors and agents (including broker or underwriter
selling Included Shares for Holder), and each person, if any, who controls
Holder within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act from and against any and all losses, claims, damages and
liabilities caused by (a) any violation or alleged violation by APDN of the
Securities Act, Exchange Act, any state securities laws or any rule or
regulation promulgated under the Securities Act, Exchange Act or any state
securities laws, (b) any untrue statement or alleged untrue statement of a
material fact contained in any registration statement or prospectus relating to
the Included Shares (as amended or supplemented if APDN shall have furnished any
amendments or supplements thereto) or any preliminary prospectus, or (c) caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading in
light of the circumstances under which they were made, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
furnished in writing to APDN by Holder or on Holder's behalf expressly for use
therein.
9.8 Holder Indemnification. Holder agrees to indemnify and hold harmless
APDN, its officers, directors and agents and each person, if any, who controls
APDN within the meaning of either Section 15 of the Securities Act or Section 20
of the Exchange Act to the same extent as the foregoing indemnity from APDN to
Holder, but only with respect to information furnished in writing by Holder or
on Holder's behalf expressly for use in any registration statement or prospectus
relating to the Registrable Shares, or any amendment or supplement thereto, or
any preliminary prospectus.
9.9 Indemnification Procedures. In case any proceeding (including any
governmental investigation) shall be instituted involving any person in respect
of which indemnity may be sought pursuant to this Section 9, such person (an
"Indemnified Party") shall promptly notify the person against whom such
indemnity may be sought (the "Indemnifying Party") in writing and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to such Indemnified Party, and shall assume the
payment of all fees and expenses; provided that the failure of any Indemnified
Party so to notify the Indemnifying Party shall not relieve the Indemnifying
Party of its obligations hereunder except to the extent (and only to the extent
that) that the Indemnifying Party is materially prejudiced by such failure to
notify. In any such proceeding, any Indemnified Party shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Party unless (a) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of such counsel or
(b) in the reasonable judgment of such Indemnified Party representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the Indemnifying Party
shall not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Indemnified Parties (including in the case of Holder, all of its
officers, directors and controlling persons) and that all such fees and expenses
shall be reimbursed as they are incurred. In the case of any such separate firm
for the Indemnified Parties, the Indemnified Parties shall designate such firm
in writing to the Indemnifying Party. The Indemnifying Party shall not be liable
for any settlement of any proceeding effected without its written consent (which
consent shall not be unreasonably withheld or delayed), but if settled with such
consent, or if there be a final judgment for the plaintiff, the Indemnifying
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Party shall indemnify and hold harmless such Indemnified Parties from and
against any loss or liability (to the extent stated above) by reason of such
settlement or judgment. No Indemnifying Party shall, without the prior written
consent of the Indemnified Party, effect any settlement of any pending or
threatened proceeding in respect of which any Indemnified Party is or could have
been a party and indemnity could have been sought hereunder by such Indemnified
Party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability arising out of such proceeding.
9.10 Contribution. To the extent any indemnification by an Indemnifying
Party is prohibited or limited by law, the Indemnifying Party agrees to make the
maximum contribution with respect to any amounts for which, he, she or it would
otherwise be liable under this Section 9 to the fullest extent permitted by law;
provided, however, that (a) no contribution shall be made under circumstances
where a party would not have been liable for indemnification under this Section
9 and (b) no seller of Registrable Securities guilty of fraudulent
misrepresentation (within the meaning used in the Securities Act) shall be
entitled to contribution from any party who was not guilty of such fraudulent
misrepresentation.
10. Nontransferability. Trilogy may not sell or transfer any Warrants to any
person other than a director, officer, employee, manager or affiliate of Trilogy
(or a person controlled by one or more directors, officers, employees, managers
or affiliates of Trilogy) or to a person or entity that assists Trilogy in
providing services to APDN pursuant to the Letter of Engagement dated June 20,
2005 as the same may be amended from time to time, without the consent of APDN.
11. Severability. If any term, provision, covenant or restriction of these
Warrants is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of these Warrants shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
12. Notices. All notices, requests, consents and other communications required
hereunder shall be in writing and shall be effective when delivered or, if
delivered by registered or certified mail, postage prepaid, return receipt
requested, shall be effective on the third day following deposit in United
States mail: to the Holder, at Trilogy Capital Partners, Inc., 11726 San Vicente
Boulevard, Suite 235, Los Angeles, CA 90049; and if addressed to APDN, at
Applied DNA Sciences, Inc., 9229 W. Sunset Boulevard, Suite 830, Los Angeles, CA
90069, or such other address as Holder or APDN may designate in writing.
13. No Rights as Shareholder. The Holder shall have no rights as a shareholder
of APDN with respect to the shares issuable upon exercise of the Warrants until
the receipt by APDN of all of the Exercise Documents.
Applied DNA Sciences, Inc.
By: /S/ Peter Brocklesby
----------------------------
Peter Brocklesby, President