Applied DNA Sciences Inc (APDN)

[apdn1mill]

This TERM SHEET is subject to additional agreement between the PARTIES and, except as stated otherwise, it is not intended to be legally binding.

http://www.sec.gov/Archives/edgar/data/744452/000157104914003134/ex10-1.htm

1

General Outline

1.1
The cooperation shall comprise three phases:
Phase 0: Establishment of preliminary test and authentication methods with a minimum accuracy to determine ********.

Phase 1: Test method to be validated and specified. Joint development and scoping of a concept to prepare production at an industrial scale as further set out under section 1.3. The PARTIES shall enter into phase 2, if the conditions set out under section 1.4 are fulfilled.

Phase 2: Launching the product at industrial scale in ********.

1.2
During phase 0, ADNAS shall develop and establish a preliminary test method. The PARTIES will enter into phase 1 if the established test method ensures an accuracy to identify at least ********.

1.3
During phase 1, the PARTIES undertake and shall perform the following:

1.3.1
Preparation of a marketing concept
BOREALIS to analyze customer needs and value proposition for low cost marked polyolefin products in high value applications;

? ADNAS to support up to two customer visits to promote concept and to explore interest on request of BOREALIS;

? ADNAS and BOREALIS to develop Signature DNA marketing concept ******** in polyolefin products; and

? Joint development of business concepts considering marking and authentication business contribution.

1.3.2

Preparation of a production concept

? ADNAS to validate and specify test method established and developed in ********;

? ADNAS to deliver DNA markers ********;


? ADNAS to provide assessment on legal compliance (health and safety related requirements) for the use of DNA markers with bulk polyolefin products in relevant markets such as Europe and USA;

? BOREALIS to run pre-tests at two customers and ADNAS to provide marker volumes for the pre-tests in appropriate form;

? BOREALIS to provide list of documents required to enable use of DNA markers at industrial scale for BOREALIS’ products;

? ADNAS to provide documentation and legal statements that allow the use of DNA markers master batch in Europe;

? Joint development of initial logistics concept to handle markers in Europe and US;

? BOREALIS to develop and produce two marked compounds for corresponding customer sampling;

? BOREALIS to provide or produce marked lab scale samples for high value applications with different concentration of markers;

? BOREALIS to run performance tests of application typical properties;

? ********;

? ********;

? ADNAS to provide authentication of lab and customer trials (********);

? Joint assessment and documentation of benefits of DNA marker authentication ********; and

Confidential Treatment Requested

? BOREALIS to follow all ADNAS protocols for quality, secure storage and chain of custody of its DNA marker products.

1.4 In order to start with phase 2, the following conditions must be fulfilled:

? Marker formulation and documentation fulfills relevant industry standards for health and safety applicable ********;


? ********;

? ********;

? ********;

? ********;

? ********;

? ********;

? ********; and

? ********.