EXHIBIT 10.4






 


EXHIBIT
10.4


 


As
part of the incentive for signing this Agreement, the Company hereby grants the Executive
Team the following warrants (the “Warrants”), with the following primary terms
and conditions, plus such other terms and conditions as may be included in the Warrant, which shall be mutually acceptable.


 


a)Each
Warrant shall entitle the owner to purchase one share of common stock of the Company.
The warrants will contain price protection should shares be used for an acquisition
at a price lower than the conversion price in force. The anti dilution provision will not apply to financings done below
the strike price.


 


b)Executive
Team is hereby granted three Warrant Certificates as follows:


 


Certificate
#1 for 10,000,000 Warrants with a strike price of $.025 per share must be exercised
within one year of the date Executive Team begins collecting salaries from the Company,


 


Certificate
# 2 for 10,000,000 Warrants with a strike price of $.04 per share and a Term of 5 years from the vesting date,


 


Certificate
#3 for 10,000,000 Warrants with a strike price of $.055 per share and a Term of 5 years from the vesting date.


 


Certificate
#1 shall vest immediately upon signing this Agreement. Certificate #2 shall vest.


upon
execution of Certificate #1.


 


Certificate
#3 shall vest upon execution of Certificate #1.


 


All
Warrants may vest earlier per the “Early Vesting Criteria” contained herein. Executive Team shall be entitled to divide
each certificate into smaller unit sizes to reflect ownership interest consistent
with the Executive team allocation or individual estate planning activities. Individual
executives shall be permitted to change the names on such Warrants if he deems it desirable to do so.


 


c)All
Warrants shall vest earlier than the time criteria listed in b) above based upon the
following “Early Vesting Criteria”,


 


i)
All unvested Warrants shall automatically vest when the Company has revenue of $12,500,000
total for any two consecutive quarters and the Company records a pre-tax net profit for the two quarters.


 


ii)
All unvested Warrants shall vest when the Executive “exercises” the Warrant by converting the Warrant from a warrant
to a share of common stock as specified in the warrant document The Company shall cooperate with
Executive in exercising any Warrants when, Executive gives notice of intent to exercise.


 


iii)
A Change of Control


 




    	 



    	 



    

 


iv)
Termination of employment for any reason other than “for cause” or resignation.


 


d)The
Warrants and the underlying shares shall be registered in the first registration statement which the Company files, provided legal
counsel for the Company determines that said Warrants and shares can be legally
included.


 


e)Executive
compensation -Executive Team hereby agrees to waive any salary from the Company for
a period of 6 months from the date of this Agreement.


 


f)
Board of Directors - Immediately upon execution of this Agreement Messrs Silvey and Young
shall resign from the Company’s Board of Directors. They shall be replaced by dint Coldren
(new Chairman and CEO) and Alan Massara (new Director and President).


 


	Agreed:	 	 
	 	 	 
	/s/
    Mike Pruitt	 	Date
	Mike Pruitt	 	12-14-10
	 	 	 
	North American Energy
    Resources, Inc
	 
	/s/
    Clint Coldren	 	Date
	Clint Coldren	 	12/14/10
	 	 	 
	/s/
    Alan Massara	 	Date
	Alan Massara	 	12/14/10


 








    	2