Exhibit 10.4

 

Form of Warrants

 

The warrants (the “Warrants”) referred to in the Payment Section of this
Agreement, and described more thoroughly in this Annex, shall be formally drawn
up into executable contracts by the Client’s counsel. The Client does hereby
agree to cover all related expenses, save for any that the Warrant Holders may
choose to incur from their own attorneys to review and/or provide
recommendations regarding the Warrants.

 

As of the Effective Date of this Agreement the Client does not have enough
issued Common Stock (the “Shares”) from its Authorized Shares and requires one
or more corporate actions to meet the terms and conditions of the Warrants. As
such, the Signatory of this Agreement does hereby guarantee that, should the
Client not be in a position, for any reason, to make full delivery of its
Shares, according to the terms and conditions specified in the Warrants, that
the Signatory will make such Shares available from his/her own (personal)
holdings, or the holdings of any affiliated organizations, trusts, entities, and
the like that he/she controls.

 

It is understood and agreed that the Client owes EGS the Warrants described
herein, and is committed to provide such Warrants, as of the Effective Date.

 

The following Basic Business Terms and Conditions are not exhaustive and are
subject to modification upon mutual agreement of the Signatories of this
Agreement.

 

Article II. Basic Business Terms and Conditions

 

1.Purchase of Shares. Subject to the terms and conditions hereinafter set forth,
the holder of this Warrant is entitled, upon surrender of this Warrant at the
principal office of the Client (or at such other place as the Client shall
notify the holder hereof in writing), to purchase from the Client up to 25,000
fully paid and nonassessable shares of the Shares at an exercise price of $0.10
per Share (such price, as adjusted from time to time, is herein referred to as
the “Exercise Price”).

 

2.Exercise Period. This Warrant shall be exercisable, in whole or in part, on or
after 9:00 am Eastern Time, January 1st, 2020, and until 5:00pm Eastern Time,
December 29th, 2023 (the “Exercise Period”).

 

3.Method of Exercise. While this Warrant remains outstanding and exercisable in
accordance with the terms and condition herein, the holder may exercise from
time to time, in whole or in part, the purchase rights evidenced hereby. Such
exercise shall be effected by:

 

3.1.the surrender of the Warrant, together with a notice of exercise to the
Secretary of the Client at its principal offices; and

 

3.2.the payment to the Client of an amount equal to the aggregate Exercise Price
for the number of Shares being purchased.

 

4.Certificates for Shares; Amendments of Warrants. Upon the exercise of the
purchase rights evidenced by this Warrant, one or more certificates for the
number of Shares so purchased shall be issued as soon as practicable thereafter,
and in any event within thirty (30) days of the delivery of the subscription
notice. Upon partial exercise, the Client shall promptly issue an amended
Warrant representing the remaining number of Shares purchasable thereunder. All
other terms and conditions of such amended Warrant shall be identical to those
contained herein. The above notwithstanding, the Shares may be delivered
electronically, and held in Street Name, in accordance with industry and
regulatory norms.

 

5.Issuance of Shares. The Client covenants that (i) the Shares, when issued
pursuant to the exercise of this Warrant, will be duly and validly issued, fully
paid and nonassessable and free from all taxes, liens, and charges with respect
to the issuance thereof, (ii) during the Exercise Period the Client will reserve
from its authorized and unissued Common Stock sufficient Shares in order to
perform its obligations under this warrant.

 

6.Adjustment of Exercise Price and Number of Shares. The number of and kind of
securities purchasable upon exercise of this Warrant and the Exercise Price
shall be subject to adjustment from time to time as follows:

 

6.1.Subdivisions, Combinations and Other Issuances. If the Client shall at any
time before the expiration of this Warrant subdivide the Shares, by split-up or
otherwise, or combine its Shares, or issue additional shares of its Shares as a
dividend, the number of Shares issuable on the exercise of this Warrant shall
forthwith be proportionately increased in the case of a subdivision or stock
dividend, or proportionately decreased in the case of a combination. Appropriate
adjustments shall also be made to the purchase price payable per share, but the
aggregate purchase price payable for the total number of Shares purchasable
under this Warrant (as adjusted) shall remain the same. Any adjustment under
this Section shall become effective at the close of business on the date the
subdivision or combination becomes effective, or as of the record date of such
dividend, or in the event that no record date is fixed, upon the making of such
dividend.

 

6.2.Reclassification, Reorganization and Consolidation. In case of any
reclassification, capital reorganization, or change in the capital stock
(including because of a change of control) of the Client (other than as a result
of a subdivision, combination, or stock dividend provided for in Section 6.1
above), then the Client shall make appropriate provision so that the holder of
this Warrant shall have the right at any time before the expiration of this
Warrant to purchase, at a total price equal to that payable upon the exercise of
this Warrant, the kind and amount of shares of stock and other securities and
property receivable in connection with such reclassification, reorganization, or
change by a holder of the same number of Shares as were purchasable by the
holder of this Warrant immediately before such reclassification, reorganization,
or change. In any such case appropriate provisions shall be made with respect to
the rights and interest of the holder of this Warrant so that the provisions
hereof shall thereafter be applicable with respect to any shares of stock or
other securities and property deliverable upon exercise hereof, and appropriate
adjustments shall be made to the purchase price per share payable hereunder,
provided the aggregate purchase price shall remain the same.

 

   

 

 

6.3.Notice of Adjustment. When any adjustment is required to be made in the
number or kind of shares purchasable upon exercise of the Warrant, or in the
Exercise Price, the Client shall promptly notify the holder of such event and of
the number of Shares or other securities or property thereafter purchasable upon
exercise of this Warrant.

 

7.No Fractional Shares or Scrip. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of this Warrant, but in lieu
of such fractional shares the Client shall make a cash payment therefor on the
basis of the Exercise Price then in effect.

 

8.Representations of the Client. The Client represents that all corporate
actions on the part of the Client, its officers, directors and stockholders
necessary for the sale and issuance of this Warrant have been taken.

 

9.Representations and Warranties by the Holder(s). The Holder(s) represents and
warrants to the Client as follows:

 

9.1.The Holder(s) has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of the purchase of
this Warrant and the Shares purchasable pursuant to the terms of this Warrant
and of protecting its interests in connection therewith.

 

9.2.The Holder(s) is able to bear the economic risk of the purchase of the
Shares pursuant to the terms of this Warrant.

 

10.Warrants Transferable. Subject to compliance with the terms and conditions of
this Section, this Warrant and all rights hereunder are transferable, without
charge to the holder hereof (except for transfer taxes), upon surrender of this
Warrant properly endorsed or accompanied by written instructions of transfer.
With respect to any offer, sale or other disposition of this Warrant or any
Shares acquired pursuant to the exercise of this Warrant before registration of
such Warrant or Shares.

 

11.Rights of Shareholders. No Holder of this Warrant shall be entitled, as a
Warrant Holder, to vote or receive dividends or be deemed the holder of the
Shares or any other securities of the Client which may at any time be issuable
on the exercise hereof for any purpose, nor shall anything contained herein be
construed to confer upon the holder of this Warrant, as such, any of the rights
of a stockholder of the Client or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action (whether upon any
recapitalization, issuance of stock, reclassification of stock, change of par
value, consolidation, merger, conveyance, or otherwise) or to receive notice of
meetings, or to receive dividends or subscription rights or otherwise until the
Warrant shall have been exercised and the Shares purchasable upon the exercise
hereof shall have become deliverable, as provided herein.

 

12.Governing Law. This Warrant and all actions arising out of or in connection
with this Agreement shall be governed by and construed in accordance with the
laws of New York, without regard to the conflicts of law provisions of New York
or of any other state.

 

13.Rights and Obligations Survive Exercise of Warrant. Unless otherwise provided
herein, the rights and obligations of the Client, of the holder of this Warrant
and of the holder of the Shares issued upon exercise of this Warrant, shall
survive the exercise of this Warrant.