Document:

Exhibit
10.4

 

	
   

  	
  October 6, 2004

  

 

Ms. Margaret H. K. Yee and Mr. Y.
H. Gin

Munning Trading Co.

China Trade Center

838 Grant Ave., Suite 301

San Francisco, CA 94108

 

 

Dear Ms. Yee and Mr. Gin:

 

 

I am granting Munning Trading Co. exclusive
marketing rights from Mosaic (subject to performance outlined in previous
transmittal) for Nutriceutical Chews and other Mosaic Nutriceuticals Corp.
products for distribution to and within the countries of China, Taiwan, Hong
Kong and Macaw.

 

This exclusive will be for a three-year
period with the continual option to renew providing Mosaic is satisfied with
the marketing efforts We will require at least 50,000 units total monthly of
any combined product mix of Mosaic Nutriceuticals Corp.

 

I enjoyed speaking with you today and I look
forward to a successful relationship with your company.

 

 

	
   

  	
  Respectfully yours,

  
	
   

  	
   

  
	
   

  	
  /s/ Charles Townsend

  	
   

  
	
   

  	
  Charles Townsend

  
	
   

  	
  President

  
	
   

  	
  Mosaic Nutriceuticals
  Corp.

  

 

 

	
   

  	
  1502
  SAN ANTONE

  	
   

  
	
   

  	
  LEWISVILLE,
  TX 75077

  	
   

  
	
   

  	
  MOSAIC
  NUTRICEUTICALS CORP.Exhibit 10.5

 

INTERNATIONAL MARKETING AGREEMENT

 

THIS INTERNATIONAL
MARKETING AGREEMENT (hereinafter referred to as the “Agreement”), entered into
as of July 12, 2004 (hereinafter referred to as the “Effective Date”) by
and between the Mosaic Nutriceuticals Corporation, a corporation organized and
existing under the laws of the State of Nevada, United States of America,
having its offices at 1502 San Antone, Lewisville, TX 75077 (hereinafter
referred to as the “COMPANY”) and C & H Marketing, Inc. existing
under the laws of Nevada, having its offices at 2980 South Rainbow Blvd, Suite 220H
Las Vegas, NV89146 (hereinafter referred to as “Marketer”);

 

WITNESSETH

 

In consideration of the
mutual covenants contained herein, the parties hereto agree as follows: 

 

1.                   APPOINTMENT

 

The COMPANY hereby
appoints MARKETER and MARKETER hereby accepts appointment as the exclusive
authorized Marketer for the COMPANY Nothing in this Agreement shall be deemed
to constitute a prohibition on parallel imports into the Territory of Products
as a result of passive sales and COMPANY shall not be responsible for
transgression of MARKETERS rights hereunder by third parties. MARKETER agrees
that it will not engage in active marketing of the Products outside the
Territory.

 

NO
AGENCY RELATIONSHIP

 

MARKETER is at all
times an independent contractor and is not and shall not be deemed to be the
legal representative or agent of the COMPANY for any purpose whatsoever, and
MARKETER is not authorized to transact business, incur obligations (express or
implied), make any commitments or representations, or otherwise act in any
manner, in the name of or on behalf of the COMPANY. MARKETER shall transact
business in its own name and assume the entire responsibility for all action or
inaction taken by it as MARKETER for the Products.

 

2.                   CERTAIN
RESPONSIBILITIES OF MARKETER

 

(a)               MARKETER
shall use its best efforts to promote the sale of Products within the Territory.

 

(b)              MARKETER
will at all times conduct its business in a manner that will reflect favorably on
the COMPANY and the Products and will not engage in any deceptive, misleading, illegal
or unethical business practices.

 

(c)               MARKETER
agrees to convey to the COMPANY any information which may be of value to the
COMPANY that may come to the attention of MARKETER including, but not being
limited to, information concerning the Products, market conditions, competition,
customers and prospective customers.

 

1

 

(d)              MARKETER
agrees that it shall not, and shall take steps to ensure that none of its
principals, shareholders, directors, officers, employees, agents, subMarketers,
representatives and other persons working on its behalf in connection with this
Agreement shall, engage in any activity that would expose the COMPANY or any of
its Affiliates to a risk of fines or penalties under laws and regulations of
the Territory. “Affiliates” means any person or entity controlling, controlled
by or under common control with the COMPANY

 

(e)               MARKETER
represents and warrants that neither it nor any of its principals,
shareholders, directors, officers, employees, agents, subMarketers,
representatives and other persons working on its behalf in connection with this
Agreement is now acting or during the term hereof will act in an official
capacity for or on behalf of, or is now or during the term hereof will become
an officer or employee of, any public international organization or government
or of any department, agency, instrumentality or political subdivision thereof,
or an official of any political party or a candidate for political office (any
of the foregoing an “official”). MARKETER shall provide such information or
certifications as the COMPANY may require with respect to its compliance with
the requirements of this Subsection.

 

(f)                 Neither
MARKETER nor any of its principals,
shareholders, directors, officers, employees, agents, subMarketers,
representatives and other persons working on its behalf in connection with this
Agreement shall, in the name, on behalf or for the benefit of the COMPANY or
any of its Affiliates or in respect of the Products, offer, pay, give, promise
to pay or give, or authorize the payment or gift of money or anything of value
to any official, political party or employee of a customer or to any other
person at the request, suggestion or direction of any official, political party
or employee of a customer or while knowing that all or portion of such money or
thing of value will be offered, given or promised, directly or indirectly, to
any such person for the purpose of obtaining or retaining business or favorable
governmental action. MARKETER shall provide such information or certifications
as the COMPANY may require with respect to its compliance with the requirements
of this Subsection.

 

(g)              COMPANY
shall be responsible for the collection, remittance and payment of any and all
taxes, charges, levies, assessments and other fees of any kind imposed by
governmental or other authority in respect of the purchase, importation, sale
or other distribution of the Products.

 

(h)              Fees to
Marketer. COMPANY understands and hereby acknowledges that the services of
Marketer are indispensable to the consummation of a business relationship
between COMPANY and Retailer. In consideration of the foregoing and the other services
to be performed by Marketer hereunder, COMPANY agrees to pay to Marketer a 10%
fee on or before the 15th of each month based upon the net amount of
Product sales collected in the previous month, either directly or through one
or intermediaries, by COMPANY or any of its Affiliates to Retailer as follows:

 

2

 

It being
understood and agree by and between COMPANY and Marketer that COMPANY shall be
obligated to pay Marketer the aforementioned fee for any and all Products sold
at the current list price in effect (sold either directly or indirectly through
one or more intermediaries) by COMPANY or its Affiliates to Retailer regardless
of whether such Products were contemplated by the parties at the time of signing
of this Agreement.  The aforementioned
fee shall be payable to Marketer by cash or wire transfer within 30 days of the
date the Products are so sold to Retailer. A sale is not considered final until
Mosaic Nutracueticals Corp. has been paid and no fees are payable until funds
are collected. No fees are paid on uncollected sales and Marketer may assist
COMPANY in collection.

 

(i)                  No
later than fifteen (15) days after the end of each calendar month, COMPANY
shall provide to Marketer, and Company shall cause each of its Affiliates to
provide to Marketer, a written report, in form and substance reasonably
acceptable to Marketer, setting forth in detail a description of all Products
sold (either directly or indirectly through one or more intermediaries) by Company
or any of its Affiliates to Retailer during the previous calendar month,
including the type and quantity of such Products, the price charged the
Retailer for each such Product, any and all other information necessary to
accurately calculate the fees owed to Marketer. Within 15 days of the end of
each quarter company will issue options to marketer excisable over seven years
at the greater of the weighted average market stock price for the quarter or
the closing stock trade on the final day of trading in the quarter. The number
of options issued in a quarter will be 10,000 for each $100,000.00 in sales as
previously defined.

 

(j)                  For
the avoidance of doubt, the price at which Company sells Products to customers
shall be determined solely by COMPANY; provided however that the COMPANY might
communicate with MARKETER for recommended resale prices for Products.

 

(k)               MARKETER
shall not in any way alter the Products without the prior written authorization
of COMPANY, nor extend any warranty nor make any representations regarding the
Products other than those contained in Company’s then current written warranty.
Any warranty given by MARKETER with respect to Products that have been altered
without prior authorization or any such additional warranty or representation
shall be void.  Claims by MARKETER in
regard to any defect in or nonconformity of the Products shall be made pursuant
to claim procedures established by COMPANY.

 

3.                   CHANGES

 

(a)               Without
incurring any liability to MARKETER, the COMPANY, upon providing MARKETER
ninety (90) days prior written notice, may: (i) change the designs or
specifications of, or modify any Product, in which event, the COMPANY will
assist and cooperate with MARKETER in obtaining any necessary or required

 

 

registrations,
licenses or approvals; or (ii) discontinue the manufacture of, or sale for
use in the Territory, of any Product.

 

(b)              The
COMPANY shall provide MARKETER with written notice of any of the aforementioned
changes, but such written notice shall not
be a prerequisite to the effectiveness of the change.  In the event of any change in designs or
specifications, or any modifications of any Product, the COMPANY shall be under
no obligation to make such change(s) on any Product previously shipped.

 

4.                   ORDERING
TERMS

 

(a)               The
COMPANY reserves the right to change the prices of Products or the discounts or
promotional funds relating thereto at any time without the consent of MARKETER.

 

5.                   ISSUANCE
OF WARRANTS

 

Upon the execution
and delivery of this Agreement by the parties, the COMPANY will issue and
deliver to MARKETER warrants to purchase Common Stock of the Company (“Common
Stock”) on such terms and conditions as set forth in the Warrants (the “Warrants”),
a form of which is attached hereto as Exhibit A, but which shall,
in any event, conform to the following requirements.

 

(a)               the
Warrant shall be issued to and exercisable by MARKETER within the time allowed
for execution of this Agreement and shall permit MARKETER to purchase shares of
Common Stock, at an exercise price per share as described in Exhibit A; at an exercise
price of the greater of (i) the closing price the Common Stock on the last
day of the Quarter as reported by NASD or the (ii) the average closing
price for the Quarter as reported by NASD.

 

(a)               The
Company shall use its reasonable best efforts to file, no later than thirty (30) business days after MARKETER
exercises its Warrants, a registration statement on Form S-4 or other as
may be required under the Securities Act covering the shares of Common Stock
issuable pursuant to the Warrants.

 

6.                   WARRANTY
AND LIMITATION OF LIABILITY

 

(a)               The
COMPANY’S sole and exclusive warranty obligation with regard to any sale hereunder
is specified in the COMPANY’s General Terms and Conditions as set forth on Exhibit E,
attached hereto.

 

(b)              COMPANY
will replace, at its sole option and only obligation, any Products found to be
defective if notified within the warranty period.

 

(c)               COMPANY
shall use commercially reasonable efforts to replace defective Product within
ninety (90) days from receipt of the defective Product.

 

 

(d)              Product
which has been replaced by COMPANY during the warranty period is warranted only
for the remaining unexpired portion of the original warranty period.

 

(e)               COMPANY’s
replacement of defective Product within the warranty period shall be its
customers’ exclusive remedy with respect to defective Product and shall be the
limit of COMPANY’s liability with respect to defective Product.

 

(f)                 To
the extent permitted by applicable law, the foregoing warranty is exclusive and
in LIEU OF ALL OTHER EXPRESS AND IMPLIED WARRANTIES WHATSOEVER, INCLUDING BUT
NOT LIMITED TO IMPLIED WARRANTIES OF SATISFACTORY QUALITY, MERCHANTABILITY AND FITNESS
FOR PARTICULAR PURPOSE.

 

(g)              All
claims must be brought within one (1) year of shipment by COMPANY.

 

(h)              Nothing
herein is intended to exclude or limit COMPANY’s liability for death or
personal injury caused by its negligence.

 

7.                   CONFIDENTIALITY
OF PROPRIETARY INFORMATION

 

(a)               All
information relating to Proprietary Information (“Propriety Information” includes,
but is not being limited to, methods of manufacture, price lists or any other
information relating to the business affairs of the COMPANY not generally known
to the public) supplied by the COMPANY is solely for the use of MARKETER under
this Agreement and remains the property of the COMPANY.

 

(b)              In the
event of termination of this Agreement, MARKETER shall promptly return to the
COMPANY or its designee all such Proprietary Information (including all copies).

 

(c)               MARKETER
agrees: (i) not to use or permit the use of the COMPANY’s Proprietary
Information except in accordance with this Agreement; (ii) not to disclose
such Proprietary Information to others except to the extent such disclosure is
absolutely necessary to MARKETER’s operations under this Agreement and only
then if Marketer receives prior written authorization for such disclosure from Company and such disclosure is
subject to the same limitations on the recipient as on MARKETER; and (iii) not
to use, permit the use of, or disclose to others such Proprietary Information
after termination of this Agreement, except information which is in the public
domain through no fault of MARKETER.

 

(d)              Without
limiting the foregoing, MARKETER shall not, directly or indirectly, or assist
others to, duplicate or substantially copy any of the Products, in whole or in
part.

 

 

8.                   TRADEMARK
AND INTELLECTUAL PROPERTY RIGHTS

 

(a)               MARKETER
shall not use or publish any COMPANY trade name or trademark except in
association with the sale and service of the Products.  Any use of a COMPANY trade name or trademark
shall have the prior written approval of the COMPANY, and shall be discontinued
upon termination of this Agreement.

 

(b)              Nothing
herein shall abrogate or invalidate any other trademark or trade name agreements
which may be in effect between COMPANY and MARKETER.

 

(c)               MARKETER
agrees to promptly inform the COMPANY of any infringement or perceived
infringement of any COMPANY Intellectual Property (“Intellectual Property”
meaning any patent, copyright, registered design, unregistered design right,
trademark, trade name, logo, trade secret, know-how or other industrial or intellectual
property owned or used by COMPANY or any of its Affiliates, whether or not
registered, together with any current registrations or applications for any
registration of the foregoing rights, trademarks or trade names) that comes to
the attention of MARKETER.

 

(d)              MARKETER
acknowledges that Company’s rights to the Intellectual Property used on or in
relation to the Products and Company’s business and the goodwill connected
therewith are Company’s property. MARKETER agrees that it is only permitted to
use the Intellectual Property for the purposes of and during the term of this
Agreement and only as authorized by COMPANY hereunder or otherwise in writing;
other than to that extent, it has and will have no right to use or to allow others
to use the Intellectual Property or any part of it and it shall not seek to register
any Intellectual Property on behalf of COMPANY without Company’s express
written consent; it will not do or omit to do or authorize any third party to do
or to omit to do anything which could invalidate or be inconsistent with the Intellectual
Property; and it will make a statement in any advertising material and promotional
literature produced by or for it in connection with the Products as to the
ownership of any relevant Intellectual Property used or referred to therein.

 

(e)               MARKETER
agrees that it will not remove, alter or otherwise tamper with any trademarks,
trade names, logos, numbers or other means of identification on the Products or
the labeling, packaging or inserts therefore which come into Marketer’s
possession custody or control.

 

9.                   INDEMNIFICATION
FOR INFRINGEMENT

 

(a)               COMPANY
agrees that, upon notification by MARKETER pursuant to the provision governing
notice herein, COMPANY will promptly investigate and defend, at its own
expense, all claims, allegations, suits, actions or proceedings in which
MARKETER is made a defendant for any infringement, claimed infringement or
alleged inducement of infringement, or unauthorized or unlawful use of any
patent or trademark resulting from the sale, use or other disposition of any
Product purchased under this Agreement, in accordance with its terms and

 

 

conditions, except
to the extent that such claims involve trademarks, word marks or other material
provided by MARKETER.

 

(b)              COMPANY
shall have the right to settle any such suits, actions or proceedings on terms
and conditions of choice to COMPANY.

 

10.            PRODUCT COMPLAINTS AND/OR RECALLS

 

(a)               COMPANY
may notify MARKETER if it receives any complaints from its customers that have
the potential to impact Product received or sold by MARKETER and the health and
well being of customers.

 

(b)              MARKETER
agrees to promptly forward to COMPANY any and all information related to
customer complaints received on any of the Products supplied by COMPANY to
MARKETER under this Agreement.

 

(c)               COMPANY
agrees to inform MARKETER of any corrective actions deemed necessary as a
result of a complaint investigation, and MARKETER agrees to take whatever
actions are deemed necessary by COMPANY to remedy the situation.

 

(d)              MARKETER
agrees to cooperate with Company’s for field corrections or Product recalls.

 

(e)               MARKETER
undertakes, to the extent permitted or required by any applicable law, to
maintain appropriate up-to-date and accurate records to enable the immediate
recall of any of the Products. These records shall include records of deliveries
to customers (including details of Product identification numbers, delivery
date, name and address of customer, and telephone number and fax number if
available).  MARKETER shall, at Company’s
cost (unless caused in whole or in part by the act or omission of MARKETER or
its principals, shareholders, directors, officers, employees, agents,
subMarketers, representatives or other persons working on its behalf in
connection with this Agreement), give such assistance as COMPANY shall require
for the purpose of recalling as a matter of urgency any of the Products.

 

11.            NOTICES
AND REPORTS

 

(a)               MARKETER
agrees to notify the COMPANY at once of any changes in location, ownership,
nature of the business, key personnel or other significant circumstance, which
may affect performance under of this Agreement.

 

(b)              MARKETER
agrees to notify the COMPANY at once of any matter of importance coming to its
attention relating to the Products. 
MARKETER shall furnish to the COMPANY such reports as the COMPANY may
reasonably require relating to the Products.

 

 

(c)               Any
notice provided for herein shall be effective upon mailing, provided that it is
in writing, addressed to the
party to receive such notice at the address set forth herein, and sent postage
prepaid by registered or certified mail as follows:

 

If to the COMPANY:                            Mosaic
Nutriceuticals Corp.

 

1502 San Antone

Lewisville, TX 75077

U.S.A.

Attention: Charles
Townsend

 

If to MARKETER:                                          to
the address in the opening paragraph of this Agreement,

Attention:            

 

12.            TERMINATION

 

(a)               This
Agreement shall terminate upon the first to occur of any of the following:

 

(1)               The
expiration of 7 year(s) from the Effective Date (the “Term”). Notwithstanding
the aforementioned sentence, this Agreement shall automatically renew for up to
no more than four (4) consecutive one (1) year periods upon the first
four (4) annual expiration dates unless at least thirty (30) days advance
written notice of intent not to allow renewal of this Agreement is given by
either party to the other party. COMPANY and MARKETER must expressly agree in
writing, by formal amendment to this Agreement, to any extension of the term of
this Agreement beyond 11 years.

 

(2)     The expiration
of thirty (30) days from the date of provision by either party of a notice of
termination, without cause, upon the other party; or

 

(3)     The filing by or
against either party in any court of competent jurisdiction of a petition of
bankruptcy or insolvency, or for the appointment of a receiver or trustee, or
the making of an assignment for the benefit of creditors where permitted by
law, upon the written notice of termination by one party to the other; or

 

(4)     The
determination by the COMPANY that there has been significant change in the
ownership, the organization, or the key management of MARKETER, upon the
written notice of termination by the COMPANY to MARKETER; or

 

(5)     The breach of
this Agreement by either party hereto, upon the written notice of termination
by one party to the other (including by way of example and not limitation
MARKETER’S failure to agree to and/or meet any sales quota); or

 

(6)     MARKETER or any
employee, agent, representative or subMarketer thereof is found guilty of a
criminal act which, in the opinion of the COMPANY, may

 

 

adversely affect
the interests of the COMPANY, upon the written notice of termination by the
COMPANY to MARKETER.

 

(b)              In
addition to the foregoing, this Agreement may be terminated if the parties cannot
mutually agree to any adjustments in the price of the Products.

 

(c)               Furthermore,
in the event of a conflict between any laws or regulations applicable to the
COMPANY or its affiliates and laws or regulations of any other country applicable
to MARKETER that cannot be resolved without exposing one of the parties to a
risk of penalties or adverse action thereunder, the party so exposed shall have
the right to terminate this Agreement immediately.

 

(d)              In the
event of the termination, expiration or non-renewal of this Agreement, for any
or no reason, MARKETER shall no longer represent itself in any manner as a Marketer
of the Products.

 

(e)               In the
event this Agreement is terminated, expires or is not renewed for any or no reason,
neither party shall be liable to the other party for incidental or consequential
damages incurred by reason of such termination.

 

(f)                 Neither
party to this Agreement shall, by reason of expiration, non-renewal or
termination of this Agreement, be liable to the other party for any damages on
account of loss of expenditures or commissions or in connection with any
business or goodwill. The right of termination or non-renewal, as provided
herein, is absolute and the parties recognize that termination or non-renewal
of this Agreement may result in loss or damage to either party, but hereby
expressly agree that neither party shall be liable to the other by reason of
any loss or damage resulting from the termination or non-renewal of this
Agreement by the other whether for cause or without cause including, without
limitation, any loss of prospective profits, or any damage occasioned by loss
of goodwill or by reason of any expenditures, investments leases or commitments
made in anticipation of the continuance of this Agreement.

 

13.            AMENDMENTS

 

This Agreement
shall not be modified, amended or otherwise changed, except by written
amendment executed by, or on behalf of, each of the parties hereto.

 

14.            NON-WAIVER

 

No waiver by
either party of a breach of any provision of this Agreement shall be taken or
held to be a waiver by such party of any succeeding breach of such provision or
breach of any other provision of the Agreement.

 

15.            FORCE
MAJEURE

 

No liability of
COMPANY under this Agreement shall result from any delay in performance or
nonperformance when caused by circumstances reasonably beyond

 

 

the control and
without the fault or negligence of COMPANY, including but not limited to fire,
flood, war, insurrection, terrorism, travel or shipping restrictions,
governmental regulation, labor disputes, embargoes or other acts by any government, or shortage of, or inability
to obtain materials, equipment or transportation, insufficient labor or
utilities or other services, or any other cause, similar or dissimilar to the
foregoing, which is beyond the reasonable control of the COMPANY. In the event
of a shortage of Products, the COMPANY reserves the right to allocate its production
among its customers, including MARKETER, on such basis as the COMPANY deems
equitable or desirable.

 

16.            ENTIRE
AGREEMENT

 

This Agreement
constitutes the entire agreement between the parties and supercedes all prior
Marketer and/or Product sale agreements, oral or written, between the parties
with respect to the subject hereof.

 

17.            LAW
GOVERNING/DISPUTE RESOLUTION

 

Because the
parties hereto do business in different jurisdictions, and because they both
have contacts in Nevada, and because they wish to ensure that this Agreement is
construed in accordance with their intentions, they agree that this Agreement
shall be governed by and shall be construed and interpreted in accordance with
the laws of the State of Nevada, USA, without giving effect to the principles
of conflict of laws thereof and MARKETER and COMPANY hereby expressly submit to
and accept the exclusive personal and subject matter jurisdiction of the State
of Nevada, US.A. for purposes of the enforcement of the terms and conditions of
this Agreement.  The application of the
United Nations Convention on Contracts for the International Sale of Goods and
the United Nations Convention on the Limitation Period in the International
Sale of Goods to this Agreement are expressly excluded.  All disputes, controversies, or claims
arising out of or relating to this Agreement or any breach of this Agreement,
other than any action by COMPANY to seek injunctive relief, that cannot be
settled amicably by the parties must be finally and exclusively settled by
binding arbitration under the then prevailing Rules of the American
Arbitration Association by one arbitrator mutually agreed upon by the parties
or, if the parties cannot agree on one arbitrator, then by an arbitrator
appointed by the American Arbitration Association.  Such arbitration shall be held in the City of
Carson City, State of Nevada, USA or such other location as the parties may
mutually agree, and must be conducted in the English language. The parties
agree that judgment on any arbitration award may be entered in any court of
competent jurisdiction. In no event shall either of the parties be permitted to
arbitrate any dispute as a class with other parties.

 

18.            SEVERABILITY

 

If any provision
of this Agreement shall be held invalid or in contravention of any applicable
statute, regulation or law whatsoever, such provision shall be deemed separable
and not a part of this Agreement to the extent of such invalidity or

 

 

contravention, and
the remainder of this Agreement shall be enforceable in accordance with the
terms hereof.

 

19.            NON-ASSIGNABILITY

 

Performance under
this Agreement by, and payment due, MARKETER shall not be assignable without
the prior written consent of the COMPANY.

 

20.            LICENSES,
TAXES AND DUTIES

 

MARKETER shall be
responsible for compliance with all applicable laws, rules and
regulations, and obtaining any licenses to import the Products into the country
of destination and to pay all taxes, duties and tariffs required to import the
Products into such country, including, by way of example and not limitation,
investigating, and arranging compliance with, any product registration
requirements.

 

21.            ENGLISH
VERSION.

 

The version of
this Agreement written in the English language shall be the only authentic
version, regardless of whether a translation is made in any other language.

 

22.            CAPTIONS

 

It is understood
and agreed by and between the parties hereto that the descriptive caption
headings appearing at the beginning of each section of this Agreement are
inserted solely for purposes of convenience of reference and are in no event to
be construed as part of the Agreement.

 

23.            AUTHORITY TO CONTRACT

 

Each of COMPANY
and MARKETER warrant and declare that it has the right, power and authority and
has taken all action necessary to execute and deliver, and to exercise their
rights and perform their obligations under this Agreement.

 

24.            RIGHTS OF THIRD PARTIES

 

This Agreement
does not create any right enforceable by any person who is not a signatory
party, except that: the terms of this Agreement intended to benefit any
Affiliate of COMPANY may be enforced by such Affiliate; and this Agreement
shall be binding upon and inure to the benefit of permitted successors to or
permitted assignees of the rights of the parties to this Agreement.

 

IN WITNESS WHEREOF, each
of the parties hereto has caused this Agreement to be executed on its behalf by
its duly authorized representative or agent as of the day and year first above
written.

 

THIS AGREEMENT CONTAINS BINDING
ARBITRATION PROVISIONS

THAT MAY BE ENFORCED BY THE PARTIES.

 

 

 

	
  /s/ Charles Townsend

  	
   

  	
  Date 12 July - 04

  	
   

  
	
  MOSAIC NUTRICEUTICALS
  CORP.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Charles Townsend,
  President

  	
   

  	
   

  

 

 

	
  /s/ Sandra Hardman

  	
   

  	
  Date 13 July - 04

  	
   

  
	
  C & H
  Marketing, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Sandra Hardman,
  President

  	
   

  	
   

  

 

 

Warrant to Purchase

 

Shares of Common Stock

 

Of Mosaic Nutraceuticals CORPORATION

 

Void Seven [7] Years From Execution Date of This Warrant

 

THIS CERTIFIES THAT, for
value received, C & H Marketing, Incorporated, hereinafter HOLDER,
having its offices at 2980 South Rainbow Blvd, Suite 220H, Las Vegas, NV.,
89146 is entitled to subscribe for and purchase at the EXERCISE PRICE, defined
hereinafter, from MOSAIC NUTRACEITICALS, hereinafter the CORPORATION, a Nevada
CORPORATION with offices at 4100 Spring Valley, Suite 200, Dallas, Texas,
75244, corporate common stock as defined and determined below.

 

1.                                      DEFINITIONS

As used herein,
the following terms shall have the following respective meaning[s]:

 

COMMON
STOCK                                     shall
mean the CORPORATION’s Common Stock, par value $0.01 per share and any
securities into which such Common Stock or such other security[s] as may
hereafter be changed.

 

EXERCISE
PERIOD                                  shall
mean the period commencing with the date herein subscribed below and ending at
5:00 PM, CST, seven [7] years, unless sooner terminated as provided for below.

 

EXERCISE
PRICE                                            shall
be defined as the greater of the weighted average market stock price for the
preceding quarter, or, the closing stock value on the final day of trading of
the preceding quarter.

 

EXERCISE
SHARES                               shall
mean the total shares allowable under this agreement for exercise by the HOLDER.
 This total shall be determined using the
following formula

 

	
   

  	
  X

  	
     times
  10,000

  	
  = EXERCISE Shares

  
	
   

  	
  100,000

  	
   

  	
   

  

 

	
   

  	
  X = total sales [ in
  USD] attributable and confirmed by CORPORATION to have been completed by
  HOLDER and its affiliates.

  

 

2.                                      EXERCISE OF
WARRANT

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
  CORPORATION Initial

  

 

1

 

2.1                                 The
rights represented by this WARRANT may be exercised in whole or in part at any
time during the EXERCISE PERIOD, by delivery of the following to the CORPORATION
at its address set forth herein; or at such other address as CORPORATION by
designate by notice in writing to HOLDER.

 

a.                                       an
executed Notice of Exercise in the form attached hereto as Exhibit A;

b.                                      payment
of the EXERCISE PRICE in cash or bank check; and

c.                                       this
warrant.

 

2.2                                 Upon
the exercise of the rights represented by this Warrant, a certificate or certificates
for the EXERCISE SHARES so purchased, registered in the name of the HOLDER or
persons affiliated and designated by the HOLDER, shall be issued and delivered
to the HOLDER with fifteen [15] business, after the rights represented by this
Warrant shall have been so exercised and confirmed by CORPORATION. In the event
that this Warrant is exercised in part, the CORPORATION at its expense shall
execute and deliver a new Warrant of like tenor and terms exercisable for the number
of shares for which this Warrant may then be exercised.

 

2.3                                 The
person in whose name any certificate or certificates for EXERCISE SHARES are to
be issued upon exercise of this Warrant shall be deemed to have become the HOLDER
of record of shares on the date on which this Warrant was exercised and surrendered
and payment of and for the EXERCISE PRICE was made, irrespective of the date of
deliver of such certificate or certificates, except that, if the date of such surrender
and payment is a date when the stock transfer books of the CORPORATION are
closed, such person shall be deemed to have become the beneficial HOLDER of
such shares at the close of business of the next succeeding date on the stock
transfer books are open. The CORPORATION agrees to notify the HOLDER in writing
with ten [10] business days a determination of the dates the stock transfer
books are expected to be closed, but in no event shall such notice be sent
later than the tenth [10th] day prior to the first closure.

 

2.4                                 Unless
this Warrant has expired, a new Warrant representing the number of shares of
EXERCISE SHARES, if any, with respect to which this Warrant shall not previously
have been exercised shall be issued to the HOLDER with such time. All Warrants
issued on transfers or changes be date the date hereof and shall be identical with
this Warrant except as to the number of shares of EXERCISE SHARES issueable
pursuant hereto. The CORPORATION will, at the time of and at any time subsequent
to each exercise of this Warrant, if requested in writing by the HOLDER,
acknowledge its continuing obligation to afford to HOLDER all rights to which
such HOLDER shall continue to be entitled after such exercise in accordance
with the terms of this Warrant, provided that if any HOLDER shall fail to make
any such request, the failure shall not affect the continuing obligation of the
CORPORATION to afford such rights to the HOLDER.

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
  CORPORATION Initial

  

 

2

 

3.                                      COVENANTS OF THE
CORPORATION

 

CORPORATION agrees
and covenants as follows -

 

a.                                       Covenants
at to EXERCISE SHARES

The CORPORATION
covenants and agrees that all EXERCISE SHARES that may be issued upon the
exercise of the rights represented by this Warrant shall, upon issuance, be
validly issued and outstanding, fully paid and non-assessable and free from all
taxes liens and charges with respect to the issuance thereof.

 

b.                                      The
CORPORATION further covenants and agrees that the CORPORATIN will, at all
times, during the EXERCISE PERIOD, have authorized and reserved a sufficient
number of shares of its COMMON STOCK to provide for the full exercise of rights
as represented and authorized by this Warrant. If at any time during the
EXERCISE PERIOD the number of authorized but un-issued shares of COMMON SHARES
shall not be sufficient to permit exercise of this Warrant, the CORPORATION
will take such reasonable corporate actions as may, in the opinion of counsel,
be necessary to increase its authorized but un-issued shares of COMMON STOCK to
such numbers of shares as shall be sufficient for such purposes.

 

c.                                       If
the EXERCISE PRICE is at any time less than the par value of the EXERCISE SHARES,
the CORPORATION also covenants and agrees to cause to be taken such reasonable
steps and actions [whether by decreasing the par value of the EXERCISE SHARES,
the conversion of the EXERCISE SHARES from par value to no par value, or
otherwise] as will permit the exercise of the Warrant without any additional
payment by the HOLDER hereof [other than payment of the EXERCISE PRICE] and the
issuance of the EXERCISE SHARES, which EXERCISE SHARES upon such issuance, will
be fully paid and non-assessable.

 

d.                                      Except
and to the extent waived or consented to by the HOLDER, the CORPORAITON will
not, by amendment of its Articles of Incorporation or through any
reorganization, transfer of asset, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary actions, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the CORPORATION, but shall, at all times, in good faith assist in
the fulfillment of all provisions of this Warrant and in taking all such
necessary action as may be appropriate in order to protect the exercise rights
of the HOLDER against impairment.

 

Without limiting
the generality of the foregoing, the CORPORATION will

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
  CORPORATION Initial

  

 

3

 

i.                                          not
increase the par value or any shares of COMMON STOCK receivable upon the
exercise of this warrant above the amount payable therefore upon such exercise
immediately prior to increase in par value;

 

ii.             take all
such actions as may be necessary or appropriate in order that the CORPORATION
may validly and legally issue fully paid and non-assessable shares of COMMON
STOCK, free and clear of any liens, claims encumbrances and restrictions [other
than as provided for herein] upon the exercise of this warrant; and

 

iii.            use its
reasonable commercial efforts to obtain all such authorizations, exemptions or
consents from any public regulatory body having jurisdiction thereof as may be
necessary to enable the CORPORATION to perform its obligations under this
Warrant

 

e.                                       In
the event of any taking by the CORPORATION of a record of the holders of any COMMON
STOCK for the purpose of determining the holders thereof who are entitled to
receive any dividend [other than a cash dividend which is the same as cash
dividends paid previous quarters] or other distribution on shares of COMMON
STOCK, the CORPORATION shall notify the HOLDER, in accordance with Section 11
herein, at least ten [10] days prior to the date specified herein, of the date
on which any record is to be taken for the purpose of dividend or distribution.

 

4.                                      ADJUSTMENT OF
EXERCISE PRICE.

 

(a)                                  Adjustment
of Exercise Price and Number of Shares. The number and kind of securities
purchasable upon the exercise of a Warrant and the Exercise Price therefore
shall be subject to adjustment from time to time upon the occurrence of certain
events, as follows:

 

(i)                                     Adjustments
for Subdivisions of Common Stock.

 

If the number of
shares of Common Stock outstanding at any time is increased by a stock dividend
payable in shares of Common Stock or by a subdivision or split up of stock,
then concurrently with the effectiveness of such dividend, subdivision or split
up, (A) the Exercise Price then in effect shall be proportionately
decreased and (B) the number of shares of Common Stock issuable upon the
exercise of a Warrant shall be increased in proportion to such increase of
outstanding shares of Common Stock.

 

(ii)           Adjustments
for Combinations of Common Stock.

 

If the number of
shares of Common Stock outstanding at any time is decreased by a combination of
the outstanding shares of Common Stock, then concurrently with the
effectiveness of such combination, (A) the Exercise Price then in effect
shall be proportionately increased and (B) the

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
  CORPORATION Initial

  

 

4

 

number of shares
of Common Stock issuable upon the exercise of a Warrant shall be decreased in
proportion to such decrease in outstanding shares of Common Stock.

 

(iii)          Adjustments
for Stock Dividends and Other Distributions.

 

In the event the
CORPORATION at any time or from time to time makes or fixes a record date for
the determination of holders of Common Stock entitled to receive any
distribution (excluding any repurchases of securities by the CORPORATION not
made on a pro rata basis from all holders of any class of the CORPORATION
securities) payable in property or in securities of the CORPORATION other than
shares of Common Stock, then, in each such event, the Exercise Price in effect
immediately prior to the close of business on the record date fixed for the
determination of the holders entitled to receive such distribution, shall be
reduced to a price determined by multiplying such Exercise Price by a fraction (A) the
numerator of which shall be the Exercise Price in effect immediately prior to
the close of business on such record date minus the value on such record date
of such distribution (as determined in good faith by the Board of Directors of
the CORPORATION), applicable to one share of Common Stock; and (B) the
denominator of which shall be such Exercise Price in effect immediately prior
to the close of business on such record date.

 

(iv)          Adjustments
for Reclassification, Exchange and Substitution.

 

Except
as provided in Section 6 upon a Notice Event, if the Common Stock issuable
upon the exercise of a Warrant shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for above), then each Warrant shall thereafter
be exercisable for the remaining exercise period of the Warrant for the
purchase of, in lieu of the number of shares of Common Stock which the HOLDER
thereof would otherwise have been entitled to receive, a number of shares of
such other class or classes of stock equivalent to the number of shares of
Common Stock that would have been received by such HOLDER upon exercise of the
warrant immediately before that change. In addition, to the extent applicable
in any reorganization or re-capitalization, provision shall be made by the
CORPORATION with the successor or surviving entity, if not the CORPORATION, so
that the HOLDER of a Warrant shall thereafter be entitled to receive upon
exercise during the remaining exercise period of the Warrant owned by such
HOLDER the number of shares of stock or other securities or property of the
CORPORATION or otherwise, to which

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
  CORPORATION Initial

  

 

5

 

such HOLDER would
have been entitled on such reorganization or recapitalization had such HOLDER
exercised the Warrant in its entirety immediately prior to such change.

 

(v)                                 Notification.

 

Upon any
adjustment pursuant to this Section 4, the CORPORATION shall, within ten (10) days
thereafter, deliver written notice thereof to the HOLDERs, which notice shall
state the increased or decreased number of shares of Common Stock issuable upon
the exercise of the Warrants, the adjusted Exercise Price and/or the details of
any other adjustment pursuant to this Section 4, setting forth in
reasonable detail the method of calculation, and the facts upon which such
calculations are based.

 

5.                                      MERGER,
CONSOLIDATION, OR LIQUIDATION.

 

a.                                       If

 

(i)                                     the
CORPORATION consolidates with or merges into another entity and is not the
survivor, or sells or conveys substantially all of its property, and

 

(ii)           in
connection therewith, shares of stock, other securities, property, or cash
(collectively, “Merger Consideration”) are issuable or deliverable in exchange
for the CORPORATION’s capital stock, then the CORPORATION shall give each
HOLDER at least ten (10) days prior written notice of the consummation of
such transaction and

 

(iii)          the
CORPORATION shall make proper provision such that, the HOLDER of this Warrant,
upon the exercise hereof at any time after the consummation of such
transaction, shall be entitled to receive, at the Exercise Price then in
effect, in lieu of the Common Stock immediately prior to such transaction, the
Merger Consideration to which such HOLDER would have been entitled if such
Warrant had been exercised in full immediately prior to such transaction,
subject to adjustments subsequent to such transaction as nearly equivalent as
possible to the adjustments provided for in Section 4 above.

 

b.                                      If
the CORPORATION receives notice that a purchase, tender or exchange offer has
been made to the holders of more than 50% of the outstanding Common Stock (on
an as converted basis) the CORPORATION shall give each HOLDER reasonable notice
thereof, but in any event, the CORPORATION shall give each HOLDER at least ten (10) days
prior written notice of the consummation of such transaction.

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
  CORPORATION Initial

  

 

6

 

6.                                      NOTICE OF CERTAIN
EVENTS. In the event (a “Notice Event”):

 

a.                                       the
CORPORATION authorizes the issuance to any holders of any class of its capital
stock rights or warrants to subscribe for or purchase shares of its capital stock,
or any other subscription rights or warrants;

 

b.                                      the
CORPORATION authorizes the distribution to any holders of any class of its capital
stock evidences of indebtedness or assets;

 

c.                                       of
any capital reorganization or reclassification of the Warrant Shares or the CORPORATION’s
Common Stock, other than a subdivision or combination of the outstanding Common
Stock and other than a change in par value of the Common Stock;

 

d.                                      of
any liquidation, consolidation or merger to which the CORPORATION is a party
and for which approval of any of the CORPORATION’s stockholders is required,
other than a consolidation or merger in which the CORPORATION is the continuing
CORPORATION and that does not result in any reclassification or change of the
shares of Common Stock issuable upon the exercise of a Warrant;

 

e.                                       of
the conveyance or transfer of the CORPORATION’s properties and assets,
substantially as an entirety; or

 

f.                                         of
the CORPORATION’s voluntary or involuntary dissolution, liquidation or
winding-up; then, in each such instance, the CORPORATION shall cause to be
mailed by certified mail to each HOLDER, at least ten (10) days prior to
the applicable record or effective date for any event set forth above, a notice
stating the dates as of which (x) the holders of capital stock of record to be
entitled to receive any such rights, warrants or distributions or to be
entitled to vote on such Notice Event are to be determined, and (y) such Notice
Event is expected to become effective.

 

7.                                      FRACTIONAL
SHARES.

 

No fractional
shares of Common Stock will be issued in connection with any exercise
hereunder. In lieu of such fractional shares the CORPORATION shall make a cash
payment therefore based upon the Fair Market Value (as defined below) of the
Common Stock on the date of exercise. For the purposes of this Section 7
hereof “Fair Market Value” of a share of Common Stock as of a particular date
means:

 

a.                                       if
traded on an exchange or the over-the-counter market, quoted on the Nasdaq
National Market or reported by the National Quotation Bureau, then the most
recently reported closing or bid price,

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
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7

 

b.                                      if
conversion or exercise is simultaneous with an underwritten public offering registered
under the Securities Act of 1933, as amended, the public offering price (before
deducting commissions, discounts or expenses) per share sold in such offer, and

 

c.                                       otherwise,
the price, not less than book value, determined in good faith and in such
reasonable manner as prescribed by a majority of CORPORATION’s Directors who
are not CORPORATION officers or employees (the “Outside Directors”); provided,
however that (i) the CORPORATION shall notify the HOLDER of such price
within ten (10) days from the date of exercise; (ii) the HOLDER shall
have ten (10) days after receipt of such notice to dispute such price by
written notice to the CORPORATION; (iii) the HOLDER and the CORPORATION
shall thereafter mutually agree upon an appraiser to determine a Fair Market
Value binding upon the HOLDER and the CORPORATION; and (iv) the
CORPORATION and the HOLDER shall split equally the costs of such appraisal
unless the Fair Market Value determined thereby is 110% or more of that
determined by the Outside Directors, in which case the CORPORATION shall bear
the full costs of such appraisal.

 

8.                                      REGISTRATION
AND TRANSFER.

 

a.                                       Registration.

 

The CORPORATION
shall maintain a register for the registration of the transfer and exchange of
Warrants. The Warrants shall initially be registered in the name of the HOLDER.
The CORPORATION shall be entitled to treat the registered HOLDER of any Warrant
as the owner in fact thereof for all purposes and shall not be bound to
recognize any equitable or other claim to or interest in such Warrant on the
part of any other person or entity.

 

b.                                      Transfer
and Exchange of Warrants; Procedure.

 

Any Warrant shall
be transferable only upon surrender of the Warrant Certificate at the
CORPORATION’s office at the address set forth in the opening paragraph of this
Agreement, duly endorsed by its HOLDER or by such holders duly authorized
attorney or representative, accompanied by a duly executed Assignment Form provided
in the Warrant Certificate, together with payment of any taxes which may be
payable in connection with such transfer. Upon any registration of transfer,
the CORPORATION shall deliver a new Warrant Certificate to the person or entity
entitled thereto and the surrendered Warrant Certificate shall be canceled.
Warrant Certificates so canceled shall be delivered to the CORPORATION from
time to time upon the CORPORATION’s request.

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
  CORPORATION Initial

  

 

8

 

9.                                      EARLY
TERMINATION.

 

In the event of,
at any time during the Exercise Period, an initial public offering of
securities of the CORPORATION registered under the Securities Act or the sale
or other disposition of all or substantially all of the properties and assets
of the CORPORATION in its entirety to any other person, the CORPORATION shall
provide to the HOLDER at least 30 days advance written notice of such public
offering or such sale or other disposition of the CORPORATION’s properties and
assets. In the event of such sale (other than a public offering) or other
disposition of all or substantially all of the properties and assets of the
CORPORATION, if the value received by the CORPORATION, on a per share of Common
Stock basis, is greater than the Exercise Price (per share) then this Warrant
shall be deemed exercised in its entirety and the appropriate shares of Common
Stock issued entitling the HOLDER to receive its proportionate distribution as
a shareholder of the CORPORATION. If the value received by the CORPORATION, on
a per share of Common Stock basis, is less than the Exercise Price (per share)
then this Warrant shall terminate. In addition, this Warrant shall terminate in
the event of a public offering unless exercised within one (1) year after
the date such public offering is closed.

 

10.                               NO STOCKHOLDER RIGHTS.

 

This Warrant in
and of itself shall not entitle the HOLDER to any voting rights or other rights
as a stockholder of the CORPORATION.

 

11.                               NO TRANSFER OF WARRANT.

 

There may be no
transfers of this Warrant except as set forth in this Section 11. This
Warrant may be transferred on the books of the CORPORATION by the HOLDER in
person or by duly authorized attorney to one or more “accredited investors” or “qualified
institutional buyers” who satisfy the criteria set forth in item (3) of Exhibit A,
upon surrender of this Warrant at the principal office of the CORPORATION,
properly endorsed and upon payment of any necessary transfer tax or other
governmental charge imposed upon such transfer and delivery of the assignment
form set forth in Exhibit B. This Warrant is exchangeable at the principal
office of the CORPORATION for Warrants for the purchase of the same number of
shares of Exercise Shares, each new Warrant to represent the right to purchase
such number of shares of Exercise Shares as the HOLDER hereof shall designate
at the time of such exchange. Notwithstanding the HOLDER’s right to transfer
this Warrant, in whole or in part, the HOLDER agrees that at any time that it
wishes to sell or transfer any interest in this Warrant to any person or entity
other than to an “affiliate” (as defined in the Securities Act), it will give
written notice to the CORPORATION disclosing the identity of the proposed
purchaser or transferee, the number of Exercise Shares to which such purchaser
or transferee will be entitled to

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
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9

 

exercise, the
purchase or transfer price, and the scheduled closing time. The CORPORATION
shall have 20 days in which to notify the HOLDER in writing that it wishes to
purchase that portion of the Warrant being offered at the purchase or transfer
price per share, which purchase by the CORPORATION shall occur and be
consummated on the later of:

 

i.                                          the
scheduled closing time identified in the HOLDER’s written notice and

 

ii.             the 30th
day after written notice was first given by the HOLDER to the CORPORATION of
such proposed purchase or transfer. If no written notice by the CORPORATION of
its intent to purchase is received by the HOLDER within the 20-day period, the
HOLDER shall be free to proceed with its sale and transfer. All purchasers and
transferees (other than the CORPORATION) shall be entitled to the same rights
of the HOLDER hereunder and shall be subject to all the terms hereof, including
without limitation, Sections 4.1 and 10 hereof.

 

12.                               LOST, STOLEN, MUTILATED
OR DESTROYED WARRANT.

 

If this Warrant is
lost, stolen, mutilated or destroyed, the CORPORATION may, on such terms as it
may reasonably impose (which shall, in the case of a mutilated Warrant, include
the surrender thereof), issue a new Warrant of like denomination and tenor as
the Warrant so lost, stolen, mutilated or destroyed. Any such new Warrant shall
constitute an original contractual obligation of the CORPORATION, whether or
not the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any
time enforceable by anyone.

 

13.                               NOTICES.

 

All notices and
other communications required or permitted hereunder shall be in writing and
shall be deemed effectively given: (a) upon personal delivery to the party
to be notified, (b) when sent by confirmed facsimile if sent during normal
business hours of the recipient, if not, then on the next business day; (c) three
days after having been sent by registered or certified mail, return receipt
requested, postage prepaid; or (d) one day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written
verification of receipt. All communications shall be sent to the following
addresses or facsimile numbers: (a) if to the CORPORATION, to Mosaic
Nutraceuticals CORPORATION, Facsimile Number: 
(         )                    ,
and  (b)  if to the HOLDER, to the
address set forth below the HOLDER’s signature on the following page, or at
such other address or facsimile number as one party may furnish to the other in
writing.

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
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10

 

14.                               ACCEPTANCE.

 

Receipt of this
Warrant by the HOLDER shall constitute acceptance of and agreement to all of
the terms and conditions contained herein.

 

15.                               ASSIGNMENT.

 

This Warrant (and
any Exercise Shares) and the agreements set forth herein shall be binding on
all successors, assignees or transferees of the parties, and shall bind such
successor, assignee, and transferee to the performance, duties and obligations
to the same extent as the party from which it received its interest.

 

16.                               SURVIVAL.

 

The terms of
Sections 4 and 10 shall survive the termination or expiration of this Warrant.

 

17.                               GOVERNING LAW.

 

This Warrant and
all rights, obligations and liabilities hereunder shall be governed by the laws
of the State of Delaware.

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
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11

 

IN
WITNESS WHEREOF, the
CORPORATION has caused this Warrant to be executed by its duly authorized
officer effective as of                 200     .

 

 

	
   

  	
  MOSAIC NUTRACEUTICALS
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Charles
  Townsend, President

  

 

AGREED AND ACCEPTED:

 

	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Facsimile:

  	
   

  	
   

  
							

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
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12

 

EXHIBIT A

NOTICE OF EXERCISE

 

TO: MOSAIC NUTRACEUTICALS
CORPORATION

 

The undersigned
hereby elects to exercise            Warrants
represented by this Warrant Certificate to purchase               shares
of Common Stock (or other shares) issuable upon the exercise of such Warrants,
and tenders herewith payment of the purchase price of such shares in full.

 

Please issue a
certificate or certificates representing said shares of Common Stock (or other
shares) in the name of the undersigned or in such other name as is specified
below:

 

	
   

  	
   

  	
   

  
	
   

  	
  (Name)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Address)

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

 

	
   

  	
   

  
	
   

  	
  (Signature)

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

 

	
   

  	
   

  
	
  (Date)

  	
   

  

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
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13

 

EXHIBIT B

 

FOR VALUE RECEIVED,          hereby
sells, assigns and transfers unto                   
the within Warrant and all rights evidenced thereby and does irrevocably constitute
and appoint                      ,
attorney, to transfer the said Warrant on the books of the within named
CORPORATION.

 

	
  Dated:

  	
   

  	
   

  	
  Signature

  	
   

  
	
   

  	
   

  
	
   

  	
  Address

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

PARTIAL ASSIGNMENT

 

FOR VALUE RECEIVED,                       hereby
sells, assigns and transfers unto                   the
right to purchase                       shares
of Exercise Shares evidenced by the within Warrant together with all rights
therein, and does irrevocably constitute and appoint                      ,
attorney, to transfer that part of the said Warrant on the books of the within
named CORPORATION.

 

	
  Dated:

  	
   

  	
   

  	
  Signature

  	
   

  
	
   

  	
   

  
	
   

  	
  Address

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HOLDER Initial

  	
   

  	
   

  	
   

  	
  CORPORATION Initial

  

 

 

14

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