ex4-1.htm


    

      
        

      


      EXHIBIT
        C

      


      FORM
        OF
        WARRANT

      


      THE
        SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
        SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
        LAWS.  THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE
        OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
        REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933,
        AS
        AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL IN
        A FORM
        REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER
        SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE
        144
        UNDER SAID ACT.  NOTWITHSTANDING THE FOREGOING, THIS WARRANT MAY BE
        PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT.

      


      DERYCZ
        SCIENTIFIC, INC.

      


      


      


      Warrant
        To Purchase Common Stock

      


      Warrant
        No.:
        ______                                                                                                                                                                                                                              
Number of Shares: _________

      


      Date
        of
        Issuance:

      


      Derycz
        Scientific, Inc., a Nevada corporation (the “Company”), hereby
        certifies that, for good and valuable consideration, the receipt and sufficiency
        of which are hereby acknowledged, _________________________ (“Holder”), the
        registered holder hereof or its permitted assigns, is entitled, subject to
        the
        terms set forth below, to purchase from the Company upon surrender of this
        Warrant, at any time or times on or after the date hereof, but not after
        11:59
        P.M. Pacific Time on the Expiration Date (as defined herein) __________
        (_,_____,____) fully paid and nonassessable shares of Common Stock (as defined
        herein) of the Company (the “Warrant Shares”) at
        the exercise price per share provided in Section 1(a) below or as subsequently
        adjusted.

      


      Section
        1.  This Warrant
        is
        the common stock purchase warrant (the “Warrant”) issued
        pursuant to the Private Placement Memorandum dated December 4, 2006 and the
        Subscription Agreement (“Subscription
        Agreement”) between the Company and the Holder.

      


      (a)           
        Definitions.  The
        following words and terms as used in this Warrant shall have the following
        meanings:

      


      


      (ii)           
        “Business Day”
        means any day other than Saturday, Sunday or other day on which commercial
        banks
        in the City of Los Angeles are authorized or required by law to remain
        closed.


      
        
          
          

        

        
          
            

          

        

        
          
          

        

      


      


      (iii)           
        “Closing Bid
        Price” means the closing bid price of Common Stock as quoted on the
        Principal Market (as reported by Bloomberg Financial Markets (“Bloomberg”) through
        its “Volume at Price” function).

      


      (iv)           
        “Common Stock”
        means (i) the Company’s common stock, par value $0.001 per share, and (ii) any
        capital stock into which such Common Stock shall have been changed or any
        capital stock resulting from a reclassification of such Common
        Stock.

      


      


      (vi)           
        “Expiration
        Date” means _____, 20__ or, if such date falls on a Saturday, Sunday or
        other day on which banks are required or authorized to be closed in the City
        of
        Los Angeles or the State of California or on which trading does not take
        place
        on the Principal Exchange or automated quotation system on which the Common
        Stock is traded (a “Holiday”), the
        next
        date that is not a Holiday.

      


      (vii)           
        “Issuance Date”
        means the date hereof.

       (x)           
        “Person”
means
        an individual, a limited liability company, a partnership, a joint venture,
        a
        corporation, a trust, an unincorporated organization and a government or
        any
        department or agency thereof.

      (xi)           
        “Principal
        Market” means the New York Stock Exchange, the American Stock Exchange,
        the Nasdaq National Market, the Nasdaq SmallCap Market, whichever is at the
        time
        the principal trading exchange or market for such security, or the
        over-the-counter market on the electronic bulletin board for such security
        as
        reported by Bloomberg or, if no bid or sale information is reported for such
        security by Bloomberg, then the average of the bid prices of each of the
        market
        makers for such security as reported in the “pink sheets” by the National
        Quotation Bureau, Inc.


      
        
          
          

        

        
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      (xii)           
        “Securities
        Act” means the Securities Act of 1933, as amended.

      


      (xiii)           
        “Warrant”
means
        this Warrant and all Warrants issued in exchange, transfer or replacement
        thereof.

      


      (xiv)           
        “Warrant Exercise
        Price” shall be $1.25 or as subsequently
        adjusted as provided in Section 8 hereof.

      


      (xv)           
        “Warrant
        Shares” means the shares of Common Stock issuable at any time upon
        exercise of this Warrant.

      


      (b)           
        Other Definitional Provisions.

      


      (i)           
        Except as otherwise specified herein, all references herein (A) to the Company
        shall be deemed to include the Company’s successors and (B) to any applicable
        law defined or referred to herein shall be deemed references to such applicable
        law as the same may have been or may be amended or supplemented from time
        to
        time.

      


      (ii)           
        When used in this Warrant, the words “herein”, “hereof”,
        and “hereunder”
        and words of similar import,
        shall refer to this Warrant as a whole and not to any provision of this Warrant,
        and the words “Section”, “Schedule”,
        and “Exhibit”
shall refer
        to Sections of, and Schedules and Exhibits to, this Warrant unless otherwise
        specified.

      


      (iii)           
        Whenever the context so requires, the neuter gender includes the masculine
        or
        feminine, and the singular number includes the plural, and vice
        versa.

      


      Section
        2.                      
Exercise
        of
        Warrant.

      


      (a)           
        Subject to the terms and conditions hereof, this Warrant may be exercised
        by the
        holder hereof then registered on the books of the Company, pro rata as
        hereinafter provided, at any time on any Business Day on or after the opening
        of
        business on such Business Day, commencing with the first day after the date
        hereof, and prior to 11:59 P.M. Pacific Time on the Expiration Date

      


      (i)           
        by delivery of a written notice, in the form of the subscription notice attached
        as Exhibit A
        hereto (the “Exercise
        Notice”), of such holder’s election to exercise this Warrant, which
        notice shall specify the number of Warrant Shares to be purchased, payment
        to
        the Company of an amount equal to the Warrant Exercise Price(s) applicable
        to
        the Warrant Shares being purchased, multiplied by the number of


      
        
          
          

        

        
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      Warrant
        Shares (at the applicable Warrant Exercise Price) as to which this Warrant
        is
        being exercised (plus any applicable issue or transfer taxes) (the “Aggregate Exercise
        Price”) in cash or wire transfer of immediately available funds and the
        surrender of this Warrant (or an indemnification undertaking with respect
        to
        this Warrant in the case of its loss, theft or destruction) to a common carrier
        for overnight delivery to the Company as soon as practicable following such
        date
        (“Cash Basis”)
        or (ii) on a “cashless” basis if, at the time of exercise, the Warrant Shares
        have not been subject to an effective registration statement for a 45
        consecutive day period, by delivering an Exercise Notice and in lieu of making
        payment of the Aggregate Exercise Price in cash or wire transfer, elect instead
        to receive upon such exercise the “Net Number” of shares of Common Stock
        determined according to the following formula (the “Cashless
        Exercise”):

      


      Net
        Number = (A x B) - (A
        x C)

                                            B

      


      For
        purposes of the foregoing formula:

      


      A
        = the
        total number of Warrant Shares with respect to which this Warrant is then
        being
        exercised.

      


      B
        = the
        Closing Bid Price of the Common Stock on the date of exercise of the
        Warrant.

      


      C
        = the
        Warrant Exercise Price then in effect for the applicable Warrant Shares at
        the
        time of such exercise.

      


      In
        the
        event of any exercise of the rights represented by this Warrant in compliance
        with this Section 2, the Company shall on or before the fifth (5th) Business
        Day
        following the date of receipt of the Exercise Notice, the Aggregate Exercise
        Price and this Warrant (or an indemnification undertaking with respect to
        this
        Warrant in the case of its loss, theft or destruction) and the receipt of
        the
        representations of the holder specified in Section 6 hereof, if requested
        by the
        Company (the “Exercise
        Delivery Documents”), and if the Common Stock is DTC eligible, credit
        such aggregate number of shares of Common Stock to which the holder shall
        be
        entitled to the holder’s or its designee’s balance account with The Depository
        Trust Company; provided, however, if the holder who submitted the Exercise
        Notice requested physical delivery of any or all of the Warrant Shares, or,
        if
        the Common Stock is not DTC eligible  then the Company shall, on or
        before the fifth (5th)
        Business Day following receipt of the Exercise Delivery Documents, issue
        and
        surrender to a common carrier for overnight delivery to the address specified
        in
        the Exercise Notice, a certificate, registered in the name of the holder,
        for


      
        
          
          

        

        
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      the
        number of shares of Common Stock to which the holder shall be entitled pursuant
        to such request.  Upon delivery of the Exercise Notice and Aggregate
        Exercise Price referred to in clause (i) or (ii) above the holder of this
        Warrant shall be deemed for all corporate purposes to have become the holder
        of
        record of the Warrant Shares with respect to which this Warrant has been
        exercised.  In the case of a dispute as to the determination of the
        Warrant Exercise Price, the Closing Bid Price or the arithmetic calculation
        of
        the Warrant Shares, the Company shall promptly issue to the holder the number
        of
        Warrant Shares that is not disputed and shall submit the disputed determinations
        or arithmetic calculations to the holder via facsimile within one (1) Business
        Day of receipt of the holder’s Exercise Notice.

      


      (b)           
        If the holder and the Company are unable to agree upon the determination
        of the
        Warrant Exercise Price or arithmetic calculation of the Warrant Shares within
        one (1) day of such disputed determination or arithmetic calculation being
        submitted to the holder, then the Company shall immediately submit via facsimile
        (i) the disputed determination of the Warrant Exercise Price or the Closing
        Bid
        Price to an independent, reputable investment banking firm or (ii) the disputed
        arithmetic calculation of the Warrant Shares to its independent, outside
        accountant. The Company shall cause the investment banking firm or the
        accountant, as the case may be, to perform the determinations or calculations
        and notify the Company and the holder of the results no later than forty-eight
        (48) hours from the time it receives the disputed determinations or
        calculations. Such investment banking firm’s or accountant’s determination or
        calculation, as the case may be, shall be deemed conclusive absent manifest
        error.

      


      (c)           
        Unless the rights represented by this Warrant shall have expired or shall
        have
        been fully exercised, the Company shall, as soon as practicable and in no
        event
        later than five (5) Business Days after any


      
        
          
          

        

        
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      exercise
        and at its own expense, issue a new Warrant identical in all respects to
        this
        Warrant exercised except it shall represent rights to purchase the number
        of
        Warrant Shares purchasable immediately prior to such exercise under this
        Warrant
        exercised, less the number of Warrant Shares with respect to which such Warrant
        is exercised.

      


      (d)           
        No fractional Warrant Shares are to be issued upon any pro rata exercise
        of this
        Warrant, but rather the number of Warrant Shares issued upon such exercise
        of
        this Warrant shall be rounded up or down to the nearest whole
        number.

      


      


      


      Section
        3.                      
Covenants
        as to Common
        Stock.  The Company hereby covenants and agrees as
        follows:

      


      (a)           
        This Warrant is, and any Warrants issued in substitution for or replacement
        of
        this Warrant will upon issuance be, duly authorized and validly
        issued.

      


      (b)           
        All Warrant Shares which may be issued upon the exercise of the rights
        represented by this Warrant will, upon issuance, be validly issued, fully
        paid
        and nonassessable and free from all taxes, liens and charges with respect
        to the
        issue thereof.

      


      (c)           
        During the period within which the rights represented by this Warrant may
        be
        exercised, the Company will at all times have authorized and reserved at
        least
        one hundred percent (100%) of the number of shares of Common Stock needed
        to
        provide for the exercise of the rights then represented by this Warrant and
        the
        par value of said shares will at all times be less than or equal to the
        applicable Warrant Exercise Price. If at any time the Company does not have
        a
        sufficient number of shares of Common Stock authorized and available, then
        the
        Company shall call and hold a special meeting of its stockholders within
        sixty
        (60) days of that time for the sole purpose of increasing the number of
        authorized shares of Common Stock.

      


      (d)           
        If at any time after the date hereof the Company shall file a registration
        statement, the Company shall include the Warrant Shares issuable to the holder,
        pursuant to the terms of this Warrant and shall maintain, so long as any
        other
        shares of Common Stock shall be so listed, such listing of all Warrant Shares
        from time to time issuable upon the exercise of this Warrant; and the Company
        shall so list on each national securities exchange or automated quotation
        system, as the case may be, and shall maintain such listing of, any other
        shares
        of capital stock of the Company issuable upon the exercise of this Warrant
        if
        and so long as any shares of the same class shall be listed on such national
        securities exchange or automated quotation system, provided, however, that
        the
        Warrant Shares may be removed from registration as required pursuant to the
        order of cutback for a Rule 415 comment as stated in the Private Placement
        Memorandum dated December 4, 2006.

      


      (e)           
        The Company will not, by amendment of its Articles of Incorporation or through
        any reorganization, transfer of assets, consolidation, merger, dissolution,
        issue or sale of securities, or any other voluntary action, avoid or seek
        to
        avoid the observance or performance of any of the terms to be observed or
        performed by it hereunder, but will at all times in good faith assist in
        the
        carrying out of all the provisions of this Warrant and in the taking of all
        such
        action as may reasonably be requested by the holder of this Warrant in order
        to
        protect the exercise privilege of the holder of this Warrant against dilution
        or
        other impairment, consistent with the tenor and purpose of this Warrant.
        The
        Company will not increase the par value of any shares of Common Stock receivable
        upon the exercise of this Warrant above the Warrant Exercise Price then in
        effect, and will take all such actions as may be necessary or appropriate
        in
        order that the Company may validly and legally issue fully paid and
        nonassessable shares of Common Stock upon the exercise of this
        Warrant.

      


      (f)           
        This Warrant will be binding upon any entity succeeding to the Company by
        merger, consolidation or acquisition of all or substantially all of the
        Company’s assets.

      


      
        
          
          

        

        
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      Section
        4.                      
Taxes.  The
        Company shall pay any and all transfer or documentary taxes, except any
        applicable withholding taxes, which may be payable with respect to the issuance
        and delivery of Warrant Shares upon exercise of this Warrant.

      


      Section
        5.                      
Warrant
        Holder Not
        Deemed a Stockholder.  Except as otherwise specifically
        provided herein, no holder, as such, of this Warrant shall be entitled to
        vote
        or receive dividends or be deemed the holder of shares of capital stock of
        the
        Company for any purpose, nor shall anything contained in this Warrant be
        construed to confer upon the holder hereof, as such, any of the rights of
        a
        stockholder of the Company or any right to vote, give or withhold consent
        to any
        corporate action (whether ay reorganization, issue of stock, reclassification
        of
        stock, consolidation, merger, conveyance or otherwise), receive notice of
        meetings, receive dividends or subscription rights, or otherwise, prior to
        the
        issuance to the holder of this Warrant of the Warrant Shares which he or
        she is
        then entitled to receive upon the due exercise of this Warrant.  In
        addition, nothing contained in this Warrant shall be construed as imposing
        any
        liabilities on such holder to purchase any securities (upon exercise of this
        Warrant or otherwise) or as a stockholder of the Company, whether such
        liabilities are asserted by the Company or by creditors of the
        Company.  Notwithstanding this Section 5, the Company will provide the
        holder of this Warrant with copies of the same notices and other information
        given to the stockholders of the Company generally, contemporaneously with
        the
        giving thereof to the stockholders.

      


      Section
        6.                      
Representations
        of
        Holder.  The holder of this Warrant, by the acceptance hereof,
        represents that it is acquiring this Warrant and the Warrant Shares for its
        own
        account for investment only and not with a view towards, or for resale in
        connection with, the public sale or distribution of this Warrant or the Warrant
        Shares, except pursuant to sales registered or exempted under the Securities
        Act; provided, however, that by making the representations herein, the holder
        does not agree to hold this Warrant or any of the Warrant Shares for any
        minimum
        or other specific term and reserves the right to dispose of this Warrant
        and the
        Warrant Shares at any time in accordance with or pursuant to a registration
        statement or an exemption under the Securities Act.

      


      Section
        7.                      
Ownership
        and
        Transfer.  The Company shall maintain at its principal
        executive offices (or such other office or agency of the Company as it may
        designate by notice to the holder hereof), a register for this Warrant, in
        which
        the Company shall record the name and address of the person in whose name
        this
        Warrant has been issued, as well as the name and address of each
        transferee.  The Company may treat the person in whose name any
        Warrant is registered on the register as the owner and holder thereof for
        all
        purposes, notwithstanding any notice to the contrary, but in all events
        recognizing any transfers made in accordance with the terms of this
        Warrant.

      


      Section
        8.                      
Adjustment
        of Warrant
        Exercise Price and Number of Shares.  The Warrant Exercise
        Price and the number of shares of Common Stock issuable upon exercise of
        this
        Warrant shall be adjusted from time to time as follows:

      


      (a)           
        Adjustment of
        Warrant
        Exercise Price upon Subdivision or Combination of Common
        Stock.  If the Company at any time after the date of issuance
        of this Warrant subdivides (by any stock split, stock dividend, recapitalization
        or otherwise) one or more classes of its outstanding shares of Common Stock
        into
        a greater number of shares, any Warrant Exercise Price in effect immediately
        prior to such subdivision will be proportionately reduced and the number
        of
        shares of Common Stock obtainable upon exercise of this Warrant will be
        proportionately increased.  If the Company at any time after the date
        of issuance of this Warrant combines (by combination, reverse stock split
        or
        otherwise) one or more classes of its outstanding shares of Common Stock
        into a
        smaller number of shares, any Warrant Exercise Price in effect immediately
        prior
        to such combination will be proportionately increased and the number of Warrant
        Shares issuable upon exercise of this Warrant will be proportionately
        decreased.  Any adjustment under this Section 8(a) shall become
        effective at the close of business on the date the subdivision or combination
        becomes effective.

      


      
        
          
          

        

        
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       (b)           
        Notices.

      


      (i)           
        Immediately upon any adjustment of the Warrant Exercise Price, the Company
        will
        give written notice thereof to the holder of this Warrant, setting forth
        in
        reasonable detail, and certifying, the calculation of such
        adjustment.

      


      (ii)           
        The Company will give written notice to the holder of this Warrant at least
        ten
        (10) days prior to the date on which the Company closes its books or takes
        a
        record (A) with respect to any dividend or distribution upon the Common Stock,
        (B) with respect to any pro rata subscription offer to holders of Common
        Stock
        or (C) for determining rights to vote with respect to any Organic Change
        (as
        defined below), dissolution or liquidation, provided that such information
        shall
        be made known to the public prior to or in conjunction with such notice being
        provided to such holder.

      


      (iii)           
        The Company will also give written notice to the holder of this Warrant at
        least
        ten (10) days prior to the date on which any Organic Change, dissolution
        or
        liquidation will take place, provided that such information shall be made
        known
        to the public prior to or in conjunction with such notice being provided
        to such
        holder.

      


      Section
        9.                                
Purchase
        Rights;
        Reorganization, Reclassification, Consolidation, Merger or
        Sale.

      


      (a)           
        In addition to any adjustments pursuant to Section 8 above, if at any time
        the
        Company grants, issues or sells any options, convertible securities or rights
        to
        purchase stock, warrants, securities or other property pro rata to the record
        holders of any class of Common Stock (the “Purchase Rights”),
        then the holder of this Warrant will be entitled to acquire, upon the terms
        applicable to such Purchase Rights, the aggregate Purchase Rights which such
        holder could have acquired if such holder had held the number of shares of
        Common Stock acquirable upon complete exercise of this Warrant immediately
        before the date on which a record is taken for the grant, issuance or sale
        of
        such Purchase Rights, or, if no such record is taken, the date as of which
        the
        record holders of Common Stock are to be determined for the grant, issue
        or sale
        of such Purchase Rights.

      


      (b)           
        Any recapitalization, reorganization, reclassification, consolidation, merger,
        sale of all or substantially all of the Company’s assets to another Person or
        other transaction in each case which is effected in such a way that holders
        of
        Common Stock are entitled to receive (either directly or upon subsequent
        liquidation) stock, securities or assets with respect to or in exchange for
        Common Stock is referred to herein as an “Organic
        Change.”  Prior to the consummation of any (i) sale of all or
        substantially all of the Company’s assets to an acquiring Person or (ii) any
        other Organic Change following which the Company is not a surviving entity,
        the
        Company will secure from the Person purchasing such assets or the successor
        resulting from such Organic Change (in each case, the “Acquiring Entity”) a
        written agreement (in form and substance satisfactory to the holders of Warrants
        representing at least two-thirds of the Warrant Shares issuable upon exercise
        of
        the Warrants then outstanding) to deliver to each holder of Warrants in exchange
        for such Warrants, a security of the Acquiring Entity evidenced by a written
        instrument substantially similar in form and substance to this Warrant and
        satisfactory to the holders of the Warrants (including an adjusted warrant
        exercise price equal to the value for the Common Stock reflected by the terms
        of
        such consolidation, merger or sale, and exercisable for a corresponding number
        of shares of Common Stock acquirable and receivable upon exercise of the
        Warrants without regard to any limitations on exercise, if the value so
        reflected is less than any Applicable Warrant Exercise Price immediately
        prior
        to such consolidation, merger or sale).  Prior to the consummation of
        any other Organic Change, the Company shall make appropriate provision (in
        form
        and substance satisfactory to the holders of Warrants representing a
        majority of the
        Warrant Shares issuable upon exercise of the Warrants then outstanding) to
        insure that each of the holders of the Warrants will thereafter have the
        right
        to acquire and receive in lieu of or in addition to (as the case may be)
        the
        Warrant Shares immediately theretofore issuable and receivable upon the exercise
        of such holder’s Warrants (without regard to any limitations on exercise), such
        shares of stock, securities or assets that would have been issued or payable
        in
        such Organic Change with respect to or in exchange for the number of Warrant
        Shares which would have been issuable and receivable upon the exercise of
        such
        holder’s Warrant as of the date of such Organic Change (without taking into
        account any limitations or restrictions on the exercisability of this
        Warrant).  This Section 9 shall not apply to acquisitions of other
        businesses by the Company.

      


      Section
        10.                                
Lost,
        Stolen,
        Mutilated or Destroyed Warrant.  If this Warrant is lost,
        stolen, mutilated or destroyed, the Company shall promptly, on receipt of
        an
        indemnification undertaking (or, in the case of a mutilated Warrant, the
        Warrant), issue a new Warrant of like denomination and tenor as this Warrant
        so
        lost, stolen, mutilated or destroyed.

      


      
        
          
          

        

        
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      Section
        11.                                
Notice.  Any
        notices, consents, waivers or other communications required or permitted
        to be
        given under the terms of this Warrant must be in writing and will be deemed
        to
        have been delivered:  (i) upon receipt, when delivered personally;
        (ii) upon receipt, when sent by facsimile (provided confirmation of receipt
        is
        received by the sending party transmission is mechanically or electronically
        generated and kept on file by the sending party); or (iii) one Business Day
        after deposit with a nationally recognized overnight delivery service, in
        each
        case properly addressed to the party to receive the same.  The
        addresses and facsimile numbers for such communications shall be:

       

      
        	
                If
                  to the Placement Agent:

              	
                T.R.
                  Winston & Company

              
	 	
                1999
                  Avenue of the Stars, Suite 2530

              
	 	
                Los
                  Angeles, California 90067

              
	 	
                Attention:                      
                  Tyler Runnels

              
	 	
                Telephone:                                
                  (310) 229-2139

              
	 	
                Facsimile:                      
                  (310) 201-2712

              
	 	 
	
                With
                  copy to:

              	
                Raul
                  Silvestre, Esq.

              
	 	 
	 	 
	 	 
	 	 
	 	 
	
                If
                  to the Company, to:

              	
                
                

                Derycz
                  Scientific, Inc.

              
	 	
                10990
                  Wilshire Boulevard, Suite 1410

              
	 	
                Los
                  Angeles, CA  90024

              
	 	
                Attention:  Peter
                  Derycz

              


      


      
        
          
          

        

        
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                With
                  a copy to:

              	
                Richardson
                  & Patel, LLP

              
	 	 
	 	 
	 	 
	 	 
	 	 


      

      


      If
        to a
        holder of this Warrant, to it at the address and facsimile number set forth
        on
Exhibit C
        hereto, with copies to such holder’s representatives as set forth on Exhibit C, or at
        such
        other address and facsimile as shall be delivered to the Company upon the
        issuance or transfer of this Warrant.  Each party shall provide five
        days’ prior written notice to the other party of any change in address or
        facsimile number.  Written confirmation of receipt (A) given by the
        recipient of such notice, consent, facsimile, waiver or other communication,
        (or
        (B) provided by a nationally recognized overnight delivery service shall
        be
        rebuttable evidence of personal service, receipt by facsimile or receipt
        from a
        nationally recognized overnight delivery service in accordance with clause
        (i),
        (ii) or (iii) above, respectively.

      


      Section
        12.                                
Date.  The
        date of this Warrant is set forth on page 1 hereof.  This Warrant, in
        all events, shall be wholly void and of no effect after the close of business
        on
        the Expiration Date[, except that notwithstanding any other provisions hereof,
        the provisions of Section 8(b) shall continue in full force and effect after
        such date as to any Warrant Shares or other securities issued upon the exercise
        of this Warrant] is this necessary?.

       

      Section
        13.                                
Amendment
        and
        Waiver.  Except as otherwise provided herein, the provisions of
        the Warrants may be amended and the Company may take any action herein
        prohibited, or omit to perform any act herein required to be performed by
        it,
        only if the Company has obtained the written consent of the holders of Warrants
        representing at least two-thirds of the Warrant Shares issuable upon exercise
        of
        the Warrants then outstanding; provided that, except for Section 8(a), no
        such
        action may increase the Warrant Exercise Price or decrease the number of
        shares
        or class of stock obtainable upon exercise of any Warrant without the written
        consent of the holder of such Warrant.

      


      


      Section
        14.                                
Descriptive
        Headings;
        Governing Law.  The descriptive headings of the several
        sections and paragraphs of this Warrant are inserted for convenience only
        and do
        not constitute a part of this Warrant.  The corporate laws of the
        State of Nevada shall govern all issues concerning the relative rights of
        the
        Company and its stockholders.  All other questions concerning the
        construction, validity, enforcement and


      
        
          
          

        

        
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      interpretation
        of this Warrant shall be governed by the internal laws of the State of
        California, without giving effect to any choice of law or conflict of law
        provision or rule (whether of the State of California or any other
        jurisdictions) that would cause the application of the laws of any jurisdictions
        other than the State of California.  Each party hereby irrevocably
        submits to the exclusive jurisdiction of the state and federal courts sitting
        in
        the City of Los Angeles, for the adjudication of any dispute hereunder or
        in
        connection herewith or therewith, or with any transaction contemplated hereby
        or
        discussed herein, and hereby irrevocably waives, and agrees not to assert
        in any
        suit, action or proceeding, any claim that it is not personally subject to
        the
        jurisdiction of any such court, that such suit, action or proceeding is brought
        in an inconvenient forum or that the venue of such suit, action or proceeding
        is
        improper.  Each party hereby irrevocably waives personal service of
        process and consents to process being served in any such suit, action or
        proceeding by mailing a copy thereof to such party at the address for such
        notices to it under this Warrant and agrees that such service shall constitute
        good and sufficient service of process and notice thereof.  Nothing
        contained herein shall be deemed to limit in any way any right to serve process
        in any manner permitted by law.

      


      Section
        15.                                
Waiver
        of Jury
        Trial.  AS A
        MATERIAL INDUCEMENT FOR EACH PARTY HERETO TO ENTER INTO THIS WARRANT, THE
        PARTIES HERETO HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
        RELATED IN ANY WAY TO THIS WARRANT AND/OR ANY AND ALL OF THE OTHER DOCUMENTS
        ASSOCIATED WITH THIS TRANSACTION.

      


      Section
        16.                                
Company’s
        Right to
        Redeem Warrant.  Once the shares that would be issued upon
        exercise of this Warrant are subject to an effective registration statement,
        then this Warrant may be redeemed by the Company, upon ten (10) days prior
        written notice (“Notice Period”) by the Company, at a redemption price of $0.01
        per warrant share (the “Redemption Price”), so long as the following conditions
        are met:

      


      
        	
                 

              	
                (a)

              	
                The
                  Company’s Closing Bid Price for the shares must have been in excess of
                  $2.00 per share 

              


      


      
        
          
          

        

        
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                for
                  at least 10 of the 25 consecutive trading days preceding the notice
                  of
                  demand for exercise; 

              


      

      
        	
                 

              	
                (b)
                  

              


      

      


      The
        registration statement covering the resale of the Warrant Shares shall have
        remained effective during the entire Notice Period.

      
        	
                 

              	
                (c)
                  

              


      

      Upon
        notice to the Holder hereof, and only if the conditions have been met then
        the
        Holder will have ten (10) days in which to exercise the Warrants being redeemed
        or accept the Redemption Price.

      


      


      


      


      


      IN
        WITNESS WHEREOF, the
        Company has caused this Warrant to be signed as of the date first set forth
        above.

      


      
        	 	
                
                

                DERYCZ
                  SCIENTIFIC, INC.

              
	 	 
	 	
                
                

                By:
                  ___________________________

              
	 	
                
                

                      Name:
                  Peter Derycz

              
	 	
                
                

                      Title:   President
                  and Chief Executive Officer

                
                

              


      

      



      
        
          
          

        

        
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      EXHIBIT
        A TO
        WARRANT

      EXERCISE
        NOTICE

      


      TO
        BE EXECUTED

      BY
        THE REGISTERED HOLDER TO EXERCISE THIS WARRANT

      DERYCZ
        SCIENTIFIC, INC.

      


      The
        undersigned holder hereby exercises the right to purchase ______________
        of the
        shares of Common Stock (“Warrant Shares”) of
        Derycz Scientific, Inc. (the “Company”), evidenced
        by the attached Warrant (the “Warrant”).  Capitalized
        terms used herein and not otherwise defined shall have the respective meanings
        set forth in the Warrant.

      


      Specify
        Method of exercise by check mark:

      


      1.
        ___                      
Cash Exercise

      


       (a)           
        Payment of Warrant
        Exercise Price. The holder shall pay the Aggregate Exercise Price of
        $______________ to the Company in accordance with the terms of the
        Warrant.

      


      (b)           
        Delivery of Warrant
        Shares.  The Company shall deliver to the holder _________
Warrant
        Shares in accordance with the terms of the Warrant.

      


      2.
        ___                      
Cashless Exercise

      


       (a)           
        Payment of Warrant
        Exercise Price.  In lieu of making payment of the Aggregate
        Exercise Price, the holder elects to receive upon such exercise the Net Number
        of shares of Common Stock determined in accordance with the terms of the
        Warrant.

      


                            
        (b)            Delivery of Warrant
        Shares.  The Company shall deliver to the holder _________
Warrant
        Shares in accordance with the terms of the Warrant.

      


      Date:
        _______________ __, ______

      


      Name
        of
        Registered Holder

      


      By:

      Name:

      Title:


      
        
          
            


             

            


          

          
          

        

        
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      EXHIBIT
        B TO
        WARRANT

      FORM
        OF WARRANT
        POWER

      


      FOR
        VALUE RECEIVED, the
        undersigned does hereby assign and transfer to ________________, Federal
        Identification No. __________, a warrant to purchase ____________ shares
        of the
        capital stock of Derycz Scientific, Inc. represented by warrant certificate
        no.
        _____, standing in the name of the undersigned on the books of said
        corporation.  The undersigned does hereby irrevocably constitute and
        appoint ______________, attorney to transfer the warrants of said corporation,
        with full power of substitution in the premises.

      


      
        	
                
                

                Dated:

              	 
	 	 
	 	
                
                

                By:

              
	 	
                
                

                Name:

              
	 	
                
                

                Title:

              
	 	 


      

      


      



      
        
          
            


             

            


          

          
          

        

        
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            14
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      EXHIBIT
        C TO
        WARRANT

      


      HOLDER’S
        ADDRESS