8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

Date of Report
(Date of earliest
event reported): October 28, 2005

Nutra Pharma Corp.

(Exact name of registrant as specified in charter)

California
(State or other
jurisdiction of
incorporation) 000-32141
(Commission
File Number) 91-2021600
(IRS Employer
Identification No.)

3473 High Ridge Road, Boynton Beach, Florida 33426
(Address of principal executive offices, including zip code)

(954) 509-0911
(Registrant’s telephone number, including area code)

1829 Corporate Drive, Boynton Beach, Florida 33426
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01.     Entry into a Material Definitive Agreement.

     On October 28, 2005 Nutra Pharma Corp. (the “Company”) entered into a one year agreement with Xinhua Financial Network Ltd. (“XFN”) where XFN will:

-

introduce the Company to potential strategic and operational partners, as well as suppliers, manufacturers, customers, and other relationships in The People’s Republic of China (“China”) and elsewhere in Asia; and

-

otherwise assist the Company with advancing the business objectives of the Company in China and elsewhere in Asia.

The Company and XFN shall agree to specific compensation arising out of any transaction with which XFN assists the Company.  In addition, the Company issued to XFN ten million (10,000,000) warrants for the right to purchase shares of the Company’s common stock at $.70 per share, a premium to the market price. The warrants expire September 30, 2010 and are redeemable by the Company for $1.00 if the market price for the Company’s common stock exceeds $1.00.  

     The above summaries of the terms of the retention of XFN are qualified in their entirety by reference to the exhibits attached to this Current Report on Form 8-K, which are incorporated by reference into this Item 1.01 in their entirety.

Item 3.02     Unregistered Sales of Equity Securities.

     The disclosure provided above in Item 1.01 is hereby incorporated by reference into this Item 3.02 with respect to the issuance on October 28, 2005 of a five year warrant to purchase 10,000,000 shares of common stock of the Company to XFN. The warrants were issued to an accredited investor in a private placement transaction exempt from registration under Section 4(2) of the Securities Act of 1933, as amended. The warrants are immediately exercisable as described above.

Item 9.01     Financial Statements and Exhibits

     (c) Exhibits

Exhibit
Number
10.1	Consulting Agreement, dated as of October 28, 2005, by and among Nutra Pharma Corp. and XFN
4.1	Xinhua Financial Network Warrant to purchase 10,000,000 shares of Company common stock

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this current report to be signed on its behalf by the undersigned hereunto duly authorized.

	NUTRA PHARMA CORP.
Date: November 3, 2005	/s/ Rik J. Deitsch
	Rik J. Deitsch
	President, Chief Executive Officer

NUTRA PHARMA CORP.

Exhibit Index to Current Report on Form 8-K

Exhibit
Number
10.1	Consulting Agreement, dated as of October 28, 2005, by and among Nutra Pharma Corp. and XFN
4.1	Warrant Xinhua Financial Network to purchase 10,000,000 shares of Company common stock

EX-10

Xinhua Financial Network  Ltd.
2003-5 Vicwood Plaza
199 Des Voeux Road Central
Hong Kong

October 28, 2005

Nutra Pharma Corp.

3473 High Ridge Road

Boynton Beach, Florida 33426

Gentlemen:

Reference is made to the Agreement, dated September 30, 2005, between Xinhua Financial Network Ltd. (“XFN”) and Nutra Pharma Corp. (the “Company”).  

Based upon the foregoing, we are pleased to set forth the terms of the retention of XFN by the Company.

1.

XFN will assist the Company as the Company’s non-exclusive consultant in connection with the following proposed activities:

(a)

introduce the Company to potential strategic and operational partners, as well as suppliers, manufacturers, customers, and other relationships in The People’s Republic of China (“China”) and elsewhere in Asia; and

(b)

otherwise assist the Company with advancing it’s the business objectives of the Company in China and elsewhere in Asia.  

2.

In connection with XFN’s activities on the Company’s behalf, XFN will familiarize itself with the business, operations, properties, financial condition, and prospects of the Company.  In connection with its role as the Company’s advisor, XFN would expect its services to include such additional advisory and related services as may be mutually agreed upon by XFN and the Company.  The retention by the Company of XFN as consultant and advisor as heretofore described shall be for a period beginning on the date of this letter until October 28, 2006 (the “Term”), subject to Paragraph 7 below.

3.

In connection with XFN’s activities on the Company’s behalf, the Company will cooperate with XFN and will furnish XFN with all information and data concerning the Company (the “Information”) which XFN deems appropriate and will request that the Company provide XFN with access to the Company’s officers, directors, employees, independent accountants, and legal counsel.  The Company further represents and warrants that any projections provided by it to XFN will have been prepared in good faith and will be based upon assumptions which, in light of the circumstances under which they are made, are reasonable.  The Company acknowledges and agrees that, in rendering its services hereunder, XFN will be using and relying on the Information without independent verification thereof by XFN or independent appraisal by XFN of any of the Company’s assets.  X FN does not assume responsibility for any information regarding the Company.  Any advice rendered by XFN pursuant to this Agreement may not be disclosed publicly, except to the Company, without our prior written consent.

4.

In consideration of its services pursuant to this Agreement, XFN shall be entitled to receive, and the Company agrees to pay XFN, such compensation as to which the parties shall agree in writing from time to time.  Notwithstanding the foregoing, the parties anticipate that such compensation will be on the revenue of a mutually agreeable allocation of revenue based upon, among other things, the nature of the transaction in question, the amount, difficulty, and nature of the services performed by XFN, and other consideration, including, without limitation, economic consideration.  The terms of any compensation that XFN and the Company agree upon shall be memorialized in writing and executed by an officer of each of XFN and the Company and attached to this letter and such terms shall be incorporated herein and made a part hereof.

5.

XFN shall be responsible for expenses incurred thereby in connection with its retention hereunder.

6.

the Company agrees to indemnify XFN in accordance with the indemnification provisions (the “Indemnification Provisions”) attached to this Agreement as Annex A, which Indemnification Provisions are incorporated herein and made a part hereof.

7.

This Agreement shall terminate at the expiry of the Term.  The parties agree to use good faith in negotiating to renew an agreement on terms substantially similar to the terms set out in this Agreement or any other terms that may be agreed between them prior to expiry of the Term.  During the Term either party hereto may terminate this Agreement at any time upon 30 days’ prior written notice, without liability or continuing obligation, except as set forth in the following sentence.  Neither termination of this Agreement nor completion of the assignment contemplated hereby shall affect: (i) any compensation earned by XFN up to the date of termination or completion, as the case may be, including the entirety of the consulting fees referenced in Paragraph 3 hereof; (ii) the reimbursement of expenses incurred by XFN up to the date of termination or completion, as the case may b e, (iii) the provisions of Paragraphs 3 through 7 of this Agreement and (iv) the Indemnification Provisions attached as Annex A hereto which are incorporated herein, all of which shall remain operative and in full force and effect.

8.

The validity and interpretation of this Agreement shall be governed by the law of the State of New York applicable to agreements made and to be fully performed therein. The Company irrevocably submits to the jurisdiction of any court of the State of New York or the United States District Court located in New York, New York, for the purpose of any suit, action, or other proceeding arising out of this Agreement, or any of the agreements or transactions contemplated hereby, which is brought by or against the Company and (i) hereby irrevocably agrees that all claims in respect of any such suit, action, or proceeding may be heard and determined in any such court and (ii) to the extent that the Company has acquired, or hereafter may acquire, any immunity from jurisdiction of any such court or from any legal process therein, the Company hereby waives, to the fullest extent permitted by law, such immu nity.  The Company hereby waives, and agrees not to assert in any such suit, action, or proceeding, in each case, to the fullest extent permitted by applicable law, any claim that (a) the Company is not personally subject to the jurisdiction of any such court, (b) the Company is immune from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution, or otherwise) with respect to the Company’s property or (c) any such suit, action, or proceeding is brought in an inconvenient forum.

9.

The benefits of this Agreement shall inure to the respective successors and assigns of the parties hereto and of the indemnified parties hereunder and their successors and assigns and representatives, and the obligations and liabilities assumed in this Agreement by the parties hereto shall be binding upon their respective successors and assigns.

10.

For the convenience of the parties hereto, any number of counterparts of this Agreement may be executed by the parties hereto.  Each such counterpart shall be, and shall be deemed to be, an original instrument, but all such counterparts taken together shall constitute one and the same Agreement.  This Agreement may not be modified or amended except in writing signed by the parties hereto.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

October 28, 2005

Page

If the foregoing correctly sets forth our Agreement, please sign the enclosed copy of this letter in the space provided and return it to us.

Very truly yours,

XINHUA FINANCIAL NETWORK LTD.

By:  /s/ Gordon Lau

      Name:  Gordon Lau

      Title:  CFO

Confirmed and Agreed to as of

this 28^th day of October 2005

NUTRA PHARMA CORP.

By:  Rik J Deitsch

      Name: Rik J Deitsch

      Title:  President / CEO

October 28, 2005

Page

Annex A

October 28, 2005

Page

INDEMNIFICATION PROVISIONS

Nutra Pharma Corp. (“the Company”), agrees to indemnify and hold harmless Xinhua Financial Network Ltd. (“XFN”) against any and all losses, claims, damages, obligations, penalties, judgments, awards, liabilities, costs, expenses, and disbursements (and any and all actions, suits, proceedings, and investigations in respect thereof and any and all legal and other costs, expenses, and disbursements in giving testimony or furnishing documents in response to a subpoena or otherwise), including, without limitation the costs, expenses, and disbursements, as and when incurred, of investigating, preparing, or defending any such action, suit, proceeding, or investigation (whether or not in connection with litigation in which XFN is a party), directly or indirectly, caused by, relating to, based upon, arising out of, or in connection with XFN’s acting for the Compan y, including, without limitation, any act or omission by XFN in connection with its acceptance of or the performance or non-performance of its obligations under the letter agreement dated October 28, 2005, between XFN and the Company, as it may be amended from time to time (the “Agreement”); provided, however, such indemnity agreement shall not apply to any portion of any such loss, claim, damage, obligation, penalty, judgment, award, liability, cost, expense, or disbursement to the extent it is found in a final judgment by a court of competent jurisdiction (not subject to further appeal) to have resulted primarily and directly from the willful misconduct of XFN. The Company also agrees that XFN shall not have any liability (whether direct or indirect, in contract or tort or otherwise) to the Company for or in connection with the engagement of XFN, except to the extent that any such liability is found in a final judgment by a court of competent jurisdiction (not subject to furt her appeal) to have resulted primarily and directly from XFN’s willful misconduct.

These Indemnification Provisions shall be in addition to any liability which the Company may otherwise have to XFN or the persons indemnified below in this sentence and shall extend to the following: XFN, its affiliated entities, directors, officers, employees, legal counsel, agents, and controlling persons (within the meaning of the federal securities laws).  All references to XFN in these Indemnification Provisions shall be understood to include any and all of the foregoing.

If any action, suit, proceeding, or investigation is commenced, as to which XFN proposes to demand indemnification, it shall notify the Company with reasonable promptness; provided, however, that any failure by XFN to notify the Company shall not relieve the Company from its obligations hereunder.  XFN shall have the right to retain counsel of its own choice to represent it, and the Company shall pay the fees, expenses, and disbursements of such counsel; and such counsel shall, to extent consistent with its professional responsibilities, cooperate with the Company and any counsel designated by the Company.  The Company shall be liable for any settlement of any claim against XFN made with the Company’s written consent, which consent shall not be unreasonably withheld.  The Company shall not, without the prior written consent of XFN, settle or compromise any cla im, or permit a default or consent to the entry of any judgment in respect thereof, unless such settlement, compromise, or consent includes, as an unconditional term thereof, the giving by the claimant to XFN of an unconditional release from all liability in respect of such claim.

In order to provide for just and equitable contribution, if a claim for indemnification pursuant to these Indemnification Provisions is made, but it is found in a final judgment by a court of competent jurisdiction (not subject to further appeal) that such indemnification may not be enforced in such case, even though the express provisions hereof provide for indemnification in such case, then the Company, on the one hand, and XFN, on the other hand, shall contribute to the losses, claims, damages, obligations, penalties, judgments, awards, liabilities, costs, expenses, and disbursements to which the indemnified persons may be subject in accordance with the relative benefits received by the Company, on the one hand, and XFN, on the other hand, and also the relative fault of the Company, on the one hand, and XFN on the other hand, in connection with the statements, acts, or omissions which resul ted in such losses, claims, damages, obligations, penalties, judgments, awards, liabilities, costs, expenses, or disbursements and the relevant equitable considerations shall also be considered.  No person found liable for a fraudulent misrepresentation shall be entitled to contribution from any person who is not also found liable for such fraudulent misrepresentation.  Notwithstanding the foregoing, XFN shall not be obligated to contribute any amount hereunder that exceeds the amount of fees previously received by XFN pursuant to the Agreement.

Neither termination nor completion of the engagement of XFN referred to above shall affect these Indemnification Provisions which shall then remain operative and in full force and effect.

EX-4

NEITHER THE SECURITIES REPRESENTED HEREBY, NOR THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF, HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, PLEDGED, ASSIGNED, OR OTHERWISE DISPOSED OF UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF THIS WARRANT OR SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT THIS WARRANT OR SUCH SECURITIES, AS APPLICABLE, MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED, OR OTHERWISE DISPOSED OF IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS.

THE TRANSFER OF THIS WARRANT IS RESTRICTED AS DESCRIBED HEREIN.

NUTRA PHARMA CORP.

Warrants for the Purchase

of

10,000,000 Shares of Common Stock

No. 1001

September 30, 2005

THIS CERTIFIES that, for consideration, the receipt and sufficiency of which are hereby acknowledged, and other value received, XINHUA FINANCIAL NETWORK LTD. (the “Holder”) is entitled to purchase from NUTRA PHARMA CORP., a California corporation (the “Company”), upon the terms and conditions set forth herein, at any time or from time to time on or after September 30, 2005 until, subject to Section 14 hereof, 5:00 P.M. New York City local time on the fifth anniversary of the Initial Exercise Date (the “Exercise Period”), up to an aggregate of 10,000,000 shares of common stock (the “Common Stock”), of the Company.  This Warrant is initially exercisable at $0.70 per share; provided, however, that upon the occurrence of any of the events specified in Section 5 hereof, the rights granted by this Warrant, including the exercise price and the number of shares of Common Stock to be received upon such exercise, shall be adjusted as therein specified.  The term “Exercise Price” shall mean, depending on the context, the initial exercise price (as set forth above) or the adjusted exercise price per share.  

This Warrant is the warrant or one of the warrants (collectively, including any warrant issued upon the exercise or transfer of any such warrants in whole or in part, the “Warrants”) issued pursuant to the Letter Agreement, dated as of September 30, 2005, between the Company and the Holder.  As used herein, the term “this Warrant” shall mean and include this Warrant and any Warrant or Warrants hereafter issued as a consequence of the exercise or transfer of this Warrant in whole or in part.  Each share of Common Stock issuable upon the exercise hereof shall be hereinafter referred to as a “Warrant Share”.

1.

This Warrant may be exercised during the Exercise Period, either in whole or in part, by the surrender of this Warrant (with the election at the end hereof duly executed) to the Company at its office at, 3473 High Ridge Road, Boynton Beach, Florida 33426, or at such other place as is designated in writing by the Company, together with a certified or bank cashier's check payable to the order of the Company in an amount equal to the product of the Exercise Price and the number of Shares for which this Warrant is being exercised.

2.

Upon each exercise of the Holder’s rights to purchase Warrant Shares, the Holder shall be deemed to be the holder of record of the Shares, notwithstanding that the transfer books of the Company shall then be closed or certificates representing the Warrant Shares with respect to which this Warrant was exercised shall not then have been actually delivered to the Holder.  As soon as practicable after each such exercise of this Warrant, the Company shall issue and deliver to the Holder a certificate or certificates representing the Warrant Shares issuable upon such exercise, registered in the name of the Holder or its designee.  If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant for cancellation, execute and deliver a Warrant evidencing the right of the Holder to purchase the balance of the aggregate number of Warrant Shares purchasab le hereunder as to which this Warrant has not been exercised or assigned.

3.

Any Warrants issued upon the transfer or exercise in part of this Warrant shall be numbered and shall be registered in a warrant register (the “Warrant Register”) as they are issued. The Company shall be entitled to treat the registered holder of any Warrant on the Warrant Register 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, and shall not be liable for any registration of transfer of Warrants which are registered or to be registered in the name of a fiduciary or the nominee of a fiduciary unless made with the actual knowledge that a fiduciary or nominee is committing a breach of trust in requesting such registration or transfer, or with the knowledge of such facts that its participation therein amounts to bad faith.  This Warrant shall be t ransferable on the books of the Company only upon delivery thereof duly endorsed by the Holder or by his duly authorized attorney or representative, or accompanied by proper evidence of succession, assignment, or authority to transfer.  In all cases of transfer by an attorney, executor, administrator, guardian, or other legal representative, duly authenticated evidence of his, her, or its authority shall be produced.  Upon any registration of transfer, the Company shall deliver a new Warrant or Warrants to the person entitled thereto.  This Warrant may be exchanged, at the option of the Holder thereof, for another Warrant, or other Warrants of different denominations, of like tenor and representing in the aggregate the right to purchase a like number of Warrant Shares (or portions thereof), upon surrender to the Company or its duly authorized agent.  Notwithstanding the foregoing, the Company shall have no obligation to cause Warrants to be transferred on its books to any person if, in th e opinion of counsel to the Company, such transfer does not comply with the provisions of the Securities Act and the rules and regulations thereunder.

4.

The Company shall at all times reserve and keep available out of its authorized, but unissued, Common Stock, solely for the purpose of providing for the exercise of the Warrants, such number of shares of Common Stock as shall, from time to time, be sufficient therefor.  The Company represents that all shares of Common Stock issuable upon exercise of this Warrant are duly authorized and, upon receipt by the Company of the full payment for such Warrant Shares, will be validly issued, fully paid, and nonassessable, without any personal liability attaching to the ownership thereof and will not be issued in violation of any preemptive or similar rights of stockholders.

5.

(a)

The Exercise Price for the Warrants in effect from time to time, and the number of shares of Common Stock issuable upon exercise of the Warrants, shall be subject to adjustment, as follows:

In the event that the Company shall at any time after the date hereof (A) declare a dividend on the outstanding Common Stock payable in shares of its capital stock, (B) subdivide the outstanding Common Stock, (C) combine the outstanding Common Stock into a smaller number of shares, or (D) issue any shares of its capital stock by reclassification of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), then, in each case, the Exercise Price per Warrant Share in effect at the time of the record date for the determination of stockholders entitled to receive such dividend or distribution or of the effective date of such subdivision, combination, or reclassification shall be adjusted so that it shall equal the price determined by multiplying such Exercise Price by a fraction, the numerator of which sha ll be the number of shares of Common Stock outstanding immediately prior to such action, and the denominator of which shall be the number of shares of Common Stock outstanding after giving effect to such action.  Such adjustment shall be made successively whenever any event listed above shall occur and shall become effective at the close of business on such record date or at the close of business on the date immediately preceding such effective date, as applicable.  Upon any such adjustment, the number of Warrant Shares issuable upon the exercise hereof shall be corresponding adjusted such that the aggregate Exercise Price hereunder immediately following such adjustment shall equal the aggregate exercise price immediately prior to such adjustment.

(b)

The Company shall not be required to issue fractions of shares of Common Stock or other capital stock of the Company upon the exercise of this Warrant.  If any fraction of a share of capital stock would be issuable on the exercise of this Warrant (or specified portions thereof), the Company shall purchase such fraction for an amount in cash equal to the same fraction of the Current Market Price (as hereinafter defined) of such share of Common Stock on the date of exercise of this Warrant.  As used herein, the term “Current Market Price” per share of Common Stock on any date shall be deemed to be the average of the daily closing prices for the 20 consecutive trading days immediately preceding the date in question.  The closing price for each day shall be the last reported sales price regular way or, in case no such reported sale takes place on such day, the closi ng bid price regular way, in either case on the principal national securities exchange  (including, for purposes hereof, the Nasdaq National Market) on which the Common Stock is listed or admitted to trading or, if the Common Stock is not listed or admitted to trading on any national securities exchange, the highest reported bid price for the Common Stock as furnished by the National Association of Securities Dealers, Inc. through the Nasdaq SmallCap Market or a similar organization if the Nasdaq SmallCap Market is no longer reporting such information.  If, on any such date, the Common Stock is not listed or admitted to trading on any national securities exchange and is not quoted on the Nasdaq SmallCap Market or any similar organization, the Current Market Price shall be deemed to be the fair value of a share of Common Stock on such date, as determined in good faith by the Board of Directors of the Company, absent manifest error.

(c)

All calculations under this Section 5 shall be made to the nearest cent or to the nearest one-hundredth of a share, as the case may be.

(d)

In any case in which this Section 5 shall require that an adjustment in the number of Warrant Shares be made effective as of a record date for a specified event, the Company may elect to defer, until the occurrence of such event, issuing to the Holder, if the Holder exercised this Warrant after such record date, the Warrant Shares, if any, issuable upon such exercise over and above the number of Warrant Shares issuable upon such exercise on the basis of the number of shares of Common Stock outstanding or in effect prior to such adjustment; provided, however, that the Company shall deliver to the Holder a due bill or other appropriate instrument evidencing the Holder's right to receive such additional shares of Common Stock upon the occurrence of the event requiring such adjustment.

(e)

Whenever there shall be an adjustment as provided in this Section 5, the Company shall within 15 days thereafter cause written notice thereof to be sent by registered or certified mail, postage prepaid, to the Holder, at its address as it shall appear in the Warrant Register, which notice shall be accompanied by an officer's certificate setting forth the number of Warrant Shares issuable and the Exercise Price thereof after such adjustment and setting forth a brief statement of the facts requiring such adjustment and the computation thereof, which officer's certificate shall be conclusive evidence of the correctness of any such adjustment absent manifest error.

(f)

No adjustment in the Exercise Price per Warrant Share shall be required if such adjustment is less than $.01; provided, however, that any adjustments which by reason of this Section 5 are not required to be made shall be carried forward and taken into account in any subsequent adjustment.

6.

(a)

In case of any capital reorganization, other than in the cases referred to in Section 5(a) hereof, or the consolidation or merger of the Company with or into another corporation (other than a merger or consolidation in which the Company is the continuing corporation and which does not result in any reclassification of the outstanding shares of Common Stock or the conversion of such outstanding shares of Common Stock into shares of other stock or other securities or property), or in the case of any sale, lease, or conveyance to another corporation of the property and assets of any nature of the Company as an entirety or substantially as an entirety (such actions being hereinafter collectively referred to as “Reorganizations”), there shall thereafter be deliverable upon exercise of this Warrant (in lieu of the number of Warrant Shares theretofore deliverable) the number of shar es of stock or other securities or property to which a holder of the respective number of Warrant Shares which would otherwise have been deliverable upon the exercise of this Warrant would have been entitled upon such Reorganization if this Warrant had been exercised in full immediately prior to such Reorganization.  In case of any Reorganization, appropriate adjustments, as determined in good faith by the Board of Directors of the Company, shall be made in the application of the provisions herein set forth with respect to the rights and interests of the Holder so that the provisions set forth herein shall thereafter be applicable, as nearly as possible, in relation to any shares or other property thereafter deliverable upon exercise of this Warrant.  Any such adjustment shall be made by, and set forth in, a supplemental agreement between the Company, or any successor thereto, and the Holder, with respect to this Warrant, and shall for all purposes hereof conclusively be deemed to be an appropriate adjustment.  The Company shall not effect any such Reorganization unless, upon or prior to the consummation thereof, the successor corporation, or, if the Company shall be the surviving corporation in any such Reorganization and is not the issuer of the shares of stock or other securities or property to be delivered to holders of shares of the Common Stock outstanding at the effective time thereof, then such issuer, shall assume by written instrument the obligation to deliver to the Holder such shares of stock, securities, cash, or other property as such holder shall be entitled to purchase in accordance with the foregoing provisions.  In the event of sale, lease, or conveyance or other transfer of all or substantially all of the assets of the Company as part of a plan for liquidation of the Company, all rights to exercise this Warrant shall terminate 30 days after the Company gives written notice to the Holder and each registered holder of a Warrant that such sale or conveyance or other transfer has been consummated.

(b)

In case of any reclassification or change of the shares of Common Stock issuable upon exercise of this Warrant (other than a change in par value or from a specified par value to no par value, or as a result of a subdivision or combination, but including any change in the shares into two or more classes or series of shares), or in case of any consolidation or merger of another corporation into the Company in which the Company is the continuing corporation and in which there is a reclassification or change (including a change to the right to receive cash or other property) of the shares of Common Stock (other than a change in par value, or from no par value to a specified par value, or as a result of a subdivision or combination, but including any change in the shares into two or more classes or series of shares), the Holder or holders of this Warrant shall have the right thereafter to receive u pon exercise of this Warrant solely the kind and amount of shares of stock and other securities, property, cash, or any combination thereof  receivable upon such reclassification, change, consolidation, or merger by a holder of the number of Warrant Shares for which this Warrant might have been exercised immediately prior to such reclassification, change, consolidation, or merger. Thereafter, appropriate provision shall be made for adjustments which shall be as nearly equivalent as practicable to the adjustments in Section 5.

(c)

The above provisions of this Section 6 shall similarly apply to successive  reclassifications and changes of shares of Common Stock and to successive consolidations, mergers, sales, leases, or conveyances.

7.

In case at any time the Company shall propose:

(a)

to pay any dividend or make any distribution on shares of Common Stock in shares of Common Stock or make any other distribution (other than regularly scheduled cash dividends which are not in a greater amount per share than the most recent such cash dividend) to all holders of Common Stock; or

(b)

to issue any rights, warrants, or other securities to all holders of Common Stock entitling them to purchase any additional shares of Common Stock or any other rights, warrants, or other securities; or

(c)

to effect any reclassification or change of outstanding shares of Common Stock or any consolidation, merger, sale, lease, or conveyance of property, as described in Section 6; or

(d)

to effect any liquidation, dissolution, or winding-up of the Company; or

(e)

to take any other action which would cause an adjustment to the Exercise Price per Warrant Share;

then, and in any one or more of such cases, the Company shall give written notice thereof by registered or certified mail, postage prepaid, to the Holder at the Holder's address as it shall appear in the Warrant Register, mailed at least 15 days prior to (i) the date as of which the holders of record of shares of Common Stock to be entitled to receive any such dividend, distribution, rights, warrants, or other securities are to be determined, (ii) the date on which any such reclassification, change of outstanding shares of Common Stock, consolidation, merger, sale, lease, conveyance of property, liquidation, dissolution, or winding-up is expected to become effective and the date as of which it is expected that holders of record of shares of Common Stock shall be entitled to exchange their shares for securities or other property, if any, deliverable upon such reclassification, change of outstanding shares, conso lidation, merger, sale, lease, conveyance of property, liquidation, dissolution, or winding-up, or (iii) the date of such action which would require an adjustment to the Exercise Price per Warrant Share.

8.

The issuance of any shares or other securities upon the exercise of this Warrant and the delivery of cer­tificates or other instruments representing such shares or other securities shall be made without charge to the Holder for any tax or other charge in respect of such issuance.  The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of any certificate in a name other than that of the Holder, and the Company shall not be required to issue or deliver any such certificate unless and until the person or persons requesting the issue thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

9.

The Warrant Shares issued on exercise of the Warrants shall be subject to a stop transfer order and the certificate or certificates representing the Warrant Shares shall bear the following legend:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, PLEDGED, ASSIGNED, OR OTHERWISE DISPOSED OF UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF THIS WARRANT OR SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT THIS WARRANT OR SUCH SECURITIES, AS APPLICABLE, MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED, OR OTHERWISE DISPOSED OF IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS.

10.  

Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction, or mutilation of any Warrant (and upon surrender of any Warrant if mutilated), and upon receipt by the Company of reasonably satisfactory indemnification, the Company shall execute and deliver to the Holder thereof a new Warrant of like date, tenor, and denomination.

11.  

The Holder of any Warrant shall not have, solely on account of such status, any rights of a stockholder of the Company, either at law or in equity, or to any notice of meetings of stockholders or of any other proceedings of the Company, except as provided in this Warrant.

12.

All notices under this Agreement must be in writing and addressed, if to the Company, to its manager.  Any notice or other communication in connection with this Agreement shall be deemed to have been given (i) if personally delivered to a party, when so delivered, (ii) (A) if by certified mail, three business days after mailing or (B) if by Federal Express or other recognized next day carrier timely posted for next business day delivery, the next business day following such timely posting, to the address of such party set forth in the preamble to this Agreement (or to such other address as the party shall have furnished in writing in accordance with the provisions of this Section 14), or (iii) if by facsimile, once transmitted (provided that the appropriate answer back or telephonic confirmation is received), if to the Company at 3473 High Ridge Road, Boynton Beach, Florida 33426, and if to the Holder, at Xinhua Finance Limited, 2003-5 Vicwood Plaza, 199 Des Voeux Road, Central Hong Kong, Attention: corporate secretary.   Either party may change the address or facsimile number to which notices or other communications hereunder are to be delivered by giving the other party notice in the manner set forth.  

13.  

This Warrant shall be construed in accordance with the laws of the State of New York applicable to contracts made and performed within such State, without regard to principles of conflicts of law.  The Holder and the Company irrevocably consent to the jurisdiction of the courts of the State of New York or the United States District Court for the Southern District of the State of New York, in connection with any action or proceeding arising out of, or relating to, this Warrant, any document or instrument delivered pursuant to, in connection with, or simultaneously with, this Warrant, or a breach of this Warrant or any such document or instrument. In any such action or proceeding, the Holder or the Company, as applicable, waives personal service of any summons, complaint, or other process and agrees that service thereof may be made in accordance with Section 14 hereof.  Within 30 days after such service, or such other time as may be mutually agreed upon in writing by the attorneys for the parties to such action or proceeding, the Company shall appear or answer such summons, complaint, or other process.  Should the Company fail to appear or answer within such 30-day period or such extended period, as the case may be, the Company shall be deemed in default and judgment may be entered against the Company for the amount as demanded in any summons, complaint, or other process so served.

14.

The Company may, at its option, upon 30 days prior written notice (the “Redemption Notice”) to the Holder, call for the redemption of the outstanding Warrants at a call price per Warrant of $0.001, provided that the Current Market Price per share of Common Stock, as determined pursuant to Section 5(b) hereof on any day within 10 days prior to the date of such Redemption Notice, shall be at least $1.00. In the event that the Company shall exercise such right to redeem the Warrants, such Warrants shall remain exercisable until the close of business on the date fixed for such redemption as set forth in the Redemption Notice.  If any Warrant called for redemption is not exercised at or prior to such time, such Warrant shall cease to be exercisable and the holder thereof shall be entitled only to the redemption price therefor.

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IN WITNESS WHEREOF, the Company has executed this Warrant as of the date first above written.

Dated: September 30, 2005

                        NUTRA PHARMA CORP.

By: /s/ Rik J Deitsch

       Name: Rik J Deitsch

       Title:  President / CEO

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 FORM OF ASSIGNMENT

(To be executed by the registered holder if such holder desires to transfer the attached Warrant.)

FOR VALUE RECEIVED, ______________________ hereby sells, assigns, and transfers unto _________________ a Warrant to purchase __________ shares of Common Stock of Nutra Pharma Corp.  and does hereby irrevocably constitute and appoint ___________________ (the “Company”), each with full authority to act without the others, attorney to transfer such Warrant  on the books of the Company, with full power of substitution.

Dated: _________________

Signature_______________________

NOTICE

The signature on the foregoing Assignment must correspond to the name as written upon the face of this Warrant in every particular, without alteration or enlargement or any change whatsoever.

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ELECTION TO EXERCISE

To:

NUTRA PHARMA CORP.

The undersigned hereby exercises its rights to purchase ___________ shares of Common Stock  (the “Common Stock”), of Nutra Pharma Corp. (the “Company”), covered by the within Warrant.  The undersigned hereby elects to exercise such rights by tendering herewith payment herewith in the amount of $____________ in accordance with the terms thereof, and requests that certificates for the securities constituting such shares of Common Stock be issued in the name of, and delivered to:

(Print Name, Address, and Social Security

or Tax Identification Number)

and, if such number of shares of Common Stock shall not constitute all such shares of Common Stock covered by the within Warrant, that a new Warrant for the balance of the shares of Common Stock covered by the within Warrant shall be registered in the name of, and delivered to, the undersigned at the address stated below.

Dated: __________________

Name________________________

(Print)

Address:

    ________________________

(Signature)  

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