WARRANT PURCHASE AGREEMENT
January
31, 2008
Universal
Capital Management, Inc.
0000
Xxxxxx Xx., #00
Xxxxxxxxxx,
Xxxxxxxx 00000
Vystar
Corporation,
a
Georgia corporation (the "Company"),
hereby agrees with you as follows:
| 1. |
Concurrently
with the execution of this Warrant Purchase Agreement (the “Agreement”),
the Company is entering into with you a consulting agreement, of
even date
hereof. Pursuant to the terms of the consulting agreement, the Company
will deliver to you a Warrant (the "Warrant")
in the form of Exhibit
A
hereto, to purchase up to One Million (1,000,000) shares of the Company’s
common stock, par value $.0001 per share (the “Common
Stock”),
at a purchase price of ($0.01) per share, exercisable for a period
of up
to Sixty (60) months commencing on the date hereof. The right to
purchase
all One Million (1,000,000) shares shall vest
immediately.
|
| 2. |
The
Company covenants that all shares that may be issued upon the exercise
of
the Warrant, upon issuance, will be validly issued, fully paid and
non-assessable and free from all taxes, liens and charges with respect
to
the issuance thereof. The Company further covenants that during the
period
within which the Warrant may be exercised, the Company will at all
times
have authorized and reserved a sufficient number of shares of Common
Stock
to permit the exercise of the
Warrant.
|
| 3. |
This
Warrant is not transferable.
|
If
the
foregoing correctly sets forth our understanding, please sign
below.
| Very truly yours, | Accepted as of the |
| date written above: | |
| Vystar Corporation |
|
Xxxxxxx
X Xxxxx
|
Xxxxxx
X Xxxxxxx, Vice President
|
|
President
& Chief Operating Officer
|
Universal
Capital Management, Inc.
|
EXHIBIT
A
WARRANT
No. ___
NO
SALE,
TRANSFER, PLEDGE OR OTHER DISPOSITION OF THIS WARRANT OR THE SHARES PURCHASABLE
HEREUNDER SHALL BE MADE EXCEPT PURSUANT TO REGISTRATION UNDER THE SECURITIES
ACT
OF 1933, AS AMENDED, OR PURSUANT TO AN OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER THAT REGISTRATION IS NOT REQUIRED. TRANSFER OF THIS WARRANT IS ALSO
RESTRICTED BY A WARRANT PURCHASE AGREEMENT DATED February 28, 2008 A COPY OF
WHICH IS AVAILABLE FROM THE ISSUER.
WARRANT
TO PURCHASE COMMON STOCK
IN
VYSTAR CORPORATION
Exercisable
Commencing
January
31, 2008
Void
After
January
31, 2013
THIS
CERTIFIES
that,
for value received, Universal Capital Management, Inc. of 0000
Xxxxxx Xx., #00, Xxxxxxxxxx, Xxxxxxxx 00000,
is
entitled, subject to the terms and conditions set forth in this Warrant, to
purchase from Vystar Corporation (“Company"),
located at 0000 Xxxxxxxxx Xxxx., Xxxxxxxx 000, Xxxxx 000, Xxxxxx, XX 00000
One
Million (1,000,000) shares of the Company’s common stock, par value $.0001 per
share (the “Common
Stock”),
at a
purchase price of ($.01) per share, exercisable for a period of up to Sixty
(60)
months commencing on the date hereof, subject to adjustment as provided in
Section 5 below. This Warrant is issued pursuant to a Warrant Purchase Agreement
between Universal Capital Management, Inc. and the Company, dated January 31,
2008, and is subject to all the terms thereof, including the vesting schedules
set forth in Section 1 thereof, and the limitations on transferability set
forth
in Section 3 thereof.
1. This
Warrant may be exercised by the holder hereof, in whole or in part (but not
as
to a fractional share), by the presentation and surrender of this Warrant with
the form of Election to Purchase duly executed, at the principal office of
the
Company (or at such other address as the Company may designate by notice in
writing to the holder hereof at the address of such holder appearing on the
books of the Company), and upon payment to the Company of the purchase price
by
certified or bank cashier's check. The shares of Common Stock so purchased
shall
be deemed to be issued to the holder hereof as the record owner of such shares
of Common Stock as of the close of business on the date on which this Warrant
shall have been surrendered and payment made for such shares. Certificates
for
the shares of Common Stock so purchased shall be delivered or mailed to the
holder promptly after this Warrant has been exercised, and if applicable, a
new
Warrant identical in form representing the number of shares of Common Stock
with
respect to which this Warrant shall not then have been exercised shall also
be
issued to the holder hereof.
2. Nothing
contained herein shall be construed to confer upon the holder of this Warrant,
as such, any of the rights of a shareholder of the Company.
3. The
Company shall not issue certificates representing fractions of shares of Common
Stock upon the exercise of this Warrant, but shall make a cash payment for
any
fractional share based on the market price of the Common Stock on the date
of
exercise, which shall be the closing sale price on the principal exchange on
which the Common Stock is traded; or if not traded on any exchange, then the
representative closing bid price in the over-the-counter market; or if not
traded in the over-the-counter market, the fair market value as determined
by
the Company’s board of directors. All calculations under this Section 3 and
under Section 5 shall be made to the nearest cent or shares, as the case may
be.
4. Subject
to the limitations on transfer set forth in Section 3 of the Warrant Purchase
Agreement, this Warrant is exchangeable, upon its surrender by the holder at
the
office of the Company referred to in Section 1 above, for new warrants
(containing the same terms as this Warrant) each representing the right to
purchase such number of shares of Common Stock as shall be designated by such
holder at the time of such surrender (but not exceeding in the aggregate the
remaining number of shares of Common Stock which may be purchased hereunder).
Upon receipt of evidence satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant and upon delivery of a bond of
indemnity satisfactory to the Company (or, in the case of mutilation, upon
surrender of this Warrant), the Company will issue to the holder a replacement
warrant (containing the same terms as this Warrant). As used herein, "Warrant"
shall include all new warrants issued in exchange for or replacement of this
Warrant.
5. If
the
Company shall pay a dividend in shares of its Common Shares, subdivide
(forward-split) its outstanding shares of Common Stock, combine (reverse-split)
its outstanding shares of Common Stock, issue by reclassification of its shares
of Common Stock any shares or other securities of the Company, or distribute
to
holders of its Common Stock any securities of the Company or of another entity,
the number of shares of Common Stock or other securities the holder hereof
is
entitled to purchase pursuant to this Warrant immediately prior thereto shall
be
adjusted so that the holder shall be entitled to receive upon exercise the
number of shares of Common Stock or other securities which he or she would
have
owned or would have been entitled to receive after the happening of any of
the
events described above had this Warrant been exercised immediately prior to
the
happening of such event, and the exercise price per share shall be
correspondingly adjusted; provided, however, that no adjustment in the number
of
shares and/or the exercise price shall be required unless such adjustment would
require an increase or decrease of at least one percent (1%) in such number
and/or price; and provided further, however, that any adjustments which by
reason of this Section 5 are not required to be made shall be carried forward
and taken into account in any subsequent adjustment. An adjustment made pursuant
to this Section 5 shall become effective immediately after the record date
in
the case of the stock dividend or other distribution and shall become effective
immediately after the effective date in the case of a subdivision, combination
or reclassification. The holder of this Warrant shall be entitled to participate
in any subscription or other rights offering made to holders of Common Stock
had
he purchased the full number of shares as to which this Warrant remains
unexercised immediately prior to the record date for such rights offering.
If
the Company is consolidated or merged with or into another corporation or if
all
or substantially all of its assets are conveyed to another corporation this
Warrant shall thereafter be exercisable for the purchase of the kind and number
of shares of stock or other securities or property, if any, receivable upon
such
consolidation, merger or conveyance by a holder of the number of shares of
Common Stock of the Company which could have been purchased on the exercise
of
this Warrant immediately prior to such consolidation, merger or conveyance;
and,
in any such case, appropriate adjustment (as determined by the Board of
Directors) shall be made in the application of the provisions herein set forth
with respect to the rights and interests thereafter of the holder of this
Warrant to the end that the provisions set forth herein (including provisions
with respect to changes in and other adjustments of the number of shares of
Common Stock the holder of this Warrant is entitled to purchase) shall
thereafter be applicable, as nearly as possible, in relation to any shares
of
Common Stock or other securities or other property thereafter deliverable upon
the exercise of this Warrant. Upon any adjustment of the number of shares of
Common Stock or other securities the holder of this Warrant is entitled to
purchase, and of any change in exercise price per share, then in each such
case
the Company shall give written notice thereof to the then registered holder
of
this Warrant at the address of such holder as shown on the books of the Company,
which notice shall state such change and set forth in reasonable detail the
method of calculation and the facts upon which such calculation is
based.
6. If
at any
time:
| A. |
The
Company shall declare a dividend or other distribution on its Common
Stock
payable otherwise than in cash at the same rate as the immediately
preceding regular dividend or in Common Stock;
|
| B. |
The
Company shall authorize the granting to the holders of its Common
Stock of
rights to subscribe for or purchase any shares of capital stock of
any
class or of any other rights;
|
| C. |
There
shall be any plan or agreement of reorganization, or reclassification
of
the capital stock of the Company, or consolidation or merger of the
Company with, or sale of all or substantially all of its assets to,
another corporation; or
|
| D. |
There
shall be a voluntary or involuntary dissolution, liquidation or winding
up
of the Company; then the Company shall give to the registered holder
of
this Warrant at the address of such holder as shown on the books
of the
Company, at any time prior to the applicable record date or dates,
a
written notice summarizing such action or event and stating the record
date or dates for any such dividend or rights (or if a record is
not to be
taken, the date or dates as of which the holders of Common Stock
of record
to be entitled to such dividend or rights are to be determined),
the date
on which any such reorganization, reclassification, consolidation,
merger,
sale of assets, dissolution, liquidation or winding up is expected
to
become effective, and the date or dates as of which it is expected
the
holders of Common Stock of record shall be entitled to effect any
exchange
of their shares of Common Stock for securities of other property
deliverable upon any such reorganization, reclassification, consolidation,
merger, sale of assets, dissolution, liquidation or winding
up.
|
IN
WITNESS WHEREOF,
the
Company has caused this Warrant to be signed by its duly authorized officers
on
January 31, 2008.
| Attested: | VYSTAR CORPORATION |
| By:_______________________ | By: __________________________ |
| Xxxxxxx X Xxxxx, President & Chief Operating Officer |
