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&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;Visualant, Inc. (the &amp;#147;Company&amp;#148; or &amp;#147;Visualant&amp;#148;)
was incorporated under the laws of the State of Nevada on October 8, 1998 with authorized common stock of 500,000,000 shares at
$0.001 par value. On September 13, 2002, 50,000,000 shares of preferred stock with a par value of $0.001 were authorized by the
shareholders.&amp;#160;&amp;#160;There are no preferred shares issued and the terms have not been determined. The Company&amp;#146;s executive
offices are located in Seattle, Washington.&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;&amp;#160;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;The Company has invented a way to shine light at a material
(solid surface, liquid, or gas) and measure the amount of light that is reflected back. The pattern of this reflected light is
compared to other patterns the Company has captured and this allows the Company to identify, detect, or diagnose materials that
cannot be identified by the human eye. The Company refers to this pattern of reflected light as a ChromaID&amp;#153;. The Company
designs ChromaID Scanner devices made with electronic, optical, and software parts to produce and capture the light.&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;&amp;#160;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;The Company&amp;#146;s first product, the ChromaID F12 Lab Kit,
scans and identifies solid surfaces. The Company is marketing this product to customers who are considering licensing the technology.
Target markets include, but are not limited to, commercial paint manufacturers, pharmaceutical equipment manufacturers, process
control companies, currency paper and ink manufacturers, security card, reader, and scanner manufacturers, food processing, and
electronic gaming.&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;&amp;#160;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;Through our wholly owned subsidiary, TransTech Systems, Inc.,&amp;#160;based
in Aurora, Oregon, the Company provides value added security and authentication solutions to corporate and government security
and law enforcement markets throughout the United States.&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;&amp;#160;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;On June 10, 2013, the Company entered into a Purchase Agreement,
Warrants, Registration Rights Agreement and Voting Agreement with Special Situations and forty other accredited investors pursuant
to which we issued 52,300,000 shares of common stock at $0.10 per share for a total of $5,230,000, which amount includes the conversion
of $500,000 in outstanding debt of the Company owed to one of its officers.&amp;#160;&amp;#160;As part of the transaction which closed
on June 14, 2013, the Company issued to the investors (i) five year Series A Warrants to purchase a total of 52,300,000 shares
of common stock at $0.15 per share; and (ii) five year Series B Warrants to purchase a total of 52,300,000 shares of common stock
at $0.20 per share. The transaction was entered into to strengthen our balance sheet, complete the purchase of our TransTech subsidiary,
and provide working capital to support the rapid movement of our ChromaID technology into the marketplace.&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;&amp;#160;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;The Company has a Joint Development Agreement through December
31, 2013 with Sumitomo Precision Products Co., Ltd., which focuses on the commercialization of the ChromaID&amp;#153; technology as
well as a License Agreement providing SPP with an exclusive license of the ChromaID&amp;#153; technology in identified Asian territories.
SPP is publicly traded in Japan and has operations in Japan, United States, China, United Kingdom, Canada and other parts of the
world.&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"&gt;&amp;#160;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0"&gt;To date, the Company been issued five patents by the United
States Office of Patents and Trademarks.&amp;#160;&amp;#160;See page&amp;#160;9 for more detailed information regarding the Company's patents
and business.&lt;/p&gt;

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