Document:

REGISTRATION RIGHTS AGREEMENT

EXHIBIT 10.3

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made and entered into as of November __, 2007 by and among PRESTO FOOD & BEVERAGE, INC., a New York corporation (the “Company”), and the persons and entities who are signatories hereto (the “Holders”).

Background

The Holders have severally agreed to purchase from the Company, and the Company has agreed to sell to the Holders an aggregate of up to $1,500,000 principal amount Convertible Promissory Notes of the Company (collectively, the “Notes”) and Warrants to purchase an amount of shares of the Company’s voting common stock, par value $0.001 per share (the “Common Stock”) equal to fifty percent (50%) of the face amount of the Notes purchased by the Holders at an exercise price of $0.31 per share of common stock (collectively, the “Warrants”) on the terms and conditions set forth in certain Subscription Agreements (collectively, the “Subscription Agreements”) of even date herewith by and between the Company and each of the Holders, as amended from time to time (the “Offering”).  The Offering will expire on the earlier to occur of: (i) December __, 2007, or (ii) the sale of the entire Offering, provided, that the offering period may be extended in the Company’s sole discretion until March __, 2008 (the “Offering Period”).

The Holders have been informed that following the execution and delivery of the Subscription Agreements and the issuance of the Notes and Warrants, the Company shall prepare and file a registration statement with the result of becoming a public company pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and, soon thereafter, the Common Stock shall be listed or quoted for trading, as applicable, on one of the following markets or exchanges: the Nasdaq SmallCap Market, the American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market or the OTC Bulletin Board or reported in the “Pink Sheets”. 

The Holders of the Notes will receive shares of Common Stock upon conversion of the Notes and exercise of the Warrants in accordance with the terms thereof.  The Notes and Warrants provide that in certain circumstances such Notes and Warrants are convertible or exercisable, as the case may be, into shares of Common Stock (collectively, the “Conversion Shares”).  This Agreement provides that the Holders shall be granted certain registration rights with respect to the Conversion Shares upon the terms and subject to the conditions as hereinafter set forth.

The parties agree as follows:

1.

Certain Definitions.  As used herein, the following terms shall have the following respective meanings:

"Commission" shall mean the Securities and Exchange Commission or any other Federal agency at the time administering the Securities Act.

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"Registrable Securities" shall mean, collectively, the Conversion Shares and any share of Common Stock issued in respect thereof or otherwise acquired by a Holder subsequent to the date hereof.

"Securities Act" shall mean the Securities Act of 1933, as amended, or any similar Federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.

2.

Restrictive Legend.  The Conversion Shares and each certificate representing such Registrable Securities and, except as otherwise provided in Section 3 hereof, each certificate issued upon exchange or transfer of any such securities shall be stamped or otherwise imprinted with a legend substantially in the following form:

“THE SECURITIES WHICH ARE REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNTIL A REGISTRATION STATEMENT WITH RESPECT THERETO IS DECLARED EFFECTIVE UNDER SUCH ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE COMPANY THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT IS AVAILABLE.”

3.

Notice of Proposed Transfer.  Prior to any proposed transfer of any Registrable Securities (other than under the circumstances described in Section 4 hereto, the holder thereof shall give written notice to the Company of its intention to effect such transfer.  Each such notice shall describe the manner of the proposed transfer and, if requested by the Company, shall be accompanied by an opinion of counsel reasonably satisfactory to the Company to the effect that the proposed transfer may be effected without registration under the Securities Act, whereupon such holder shall be entitled to transfer such securities in accordance with the terms of its notice.  All Registrable Securities transferred as above provided shall bear the legend set forth in Section 2, except that such securities shall not bear such legend if (i) such transfer is in accordance with the provisions of Rule 144 (or any other rule permitting public sale without registration under the Securities Act) or (ii) the opinion of counsel referred to above is to the further effect that the transferee and any subsequent transferee (other than an affiliate of the Company) would be entitled to transfer such securities in a public sale without registration under the Securities Act.

4.

Mandatory Registration Rights.

(a)

No later than March 31, 2008, the Company will prepare and file with the SEC a registration statement on Form SB-2 (or, if Form SB-2 is not then available to the Company, on such form of registration statement that is then available to effect a registration of all Registrable Securities for the purpose of registering under the Securities Act all of the Registrable Shares for resale by, and for the account of, the Holders as selling stockholders thereunder (the “Registration Statement”).  The Registration Statement shall permit the Holders to offer and sell, on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, any or all of the Registrable Securities.  The Registration  Statement also shall cover, to the extent allowable 

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under the Securities Act and the rules promulgated thereunder (including Rule 415), any shares of Common Stock resulting  from stock splits, stock dividends or similar transactions with respect to the Registrable Securities.  

In the event that any registration pursuant to this Section 4 shall be, in whole or in part, an underwritten public offering of common stock, any request by holders pursuant to this Section 4 to register Registrable Securities shall specify that such Registrable Securities is to be included in the underwriting on the same terms and conditions as the shares of common stock otherwise being sold through underwriters under such registration.  The number of shares of Registrable Securities to be included in such an underwriting may be cut back (pro rata among the requesting holders) if and to the extent that the managing underwriter shall be of the opinion that such inclusion would adversely affect the marketing of the securities to be sold by the Company therein. 

Notwithstanding anything to the contrary contained in this Section 4, in the event that there is an underwritten offering of securities of the Company pursuant to a registration covering Registrable Securities and a selling holder of Registrable Securities does not elect to sell his, her or its Registrable Securities to the underwriters of the Company’s securities in connection with such offering, such holder shall refrain from selling such Registrable Securities not registered pursuant to this Section 4 during the period of distribution of the Company’s securities by such underwriters and the period in which the underwriting syndicate participates in the after market; provided, however, that such holder shall, in any event, be entitled to sell its Registrable Securities in connection with such registration commencing on the 180th day after the effective date of such registration statement.

5.

Piggyback Registration.  If the Company at any time proposes to register any of its securities under the Securities Act for sale to the public, whether for its own account or for the account of other security holders or both (other than a registration statement associated with the merger of the Company with a public company or similar transaction or in connection a registration statement for the initial public offering of the Company’s Common Stock or a registration on Form-S-4, Form S-8 or other limited purpose form), then in each instance, it will give written notice to all Holders of its intention so to do not less than thirty (30) days prior to the filing of such registration statement, provided, however, that for the purposes of this sentence, the Company shall treat the Holders in the same manner and in pari passu with all other holders of unregistered capital stock of the Company who (a) have registration rights with respect to such stock or (b) presently or at any time hereafter are officers, directors, or 5% shareholders of the Company, or any affiliate, successor, or assign thereof.  Upon the written request of any such Holders, given within 20 days after the date of any such notice, to register any of its Registrable Securities (which request shall state the intended method of disposition thereof), the Company will use its best efforts to cause the Registrable Securities as to which registration shall have been so requested to be included in the securities to be covered by the registration statement proposed to be filed by the Company all to the extent requisite to permit the sale or other disposition by the holders (in accordance with its written request) of such Registrable Securities so registered.  The Company may withdraw any such registration statement before it becomes effective or postpone the offering of securities contemplated by such registration statement without any obligation to the Holders.  

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In the event that any registration pursuant to this Section 5 shall be, in whole or in part, an underwritten public offering, any request by Holders pursuant to this Section 5 to register Registrable Securities shall specify that such Registrable Securities is to be included in the underwriting on the same terms and conditions as the shares of Common Stock otherwise being sold through underwriters under such registration.  The number of shares of Registrable Securities to be included in such an underwriting may be cut back (pro rata among the requesting Holders) if and to the extent that the managing underwriter shall be of the opinion that such inclusion would adversely affect the marketing of the securities to be sold by the Company therein. 

Notwithstanding anything to the contrary contained in this Section 5, in the event that there is an underwritten offering of securities of the Company pursuant to a registration covering Registrable Securities and a selling Holder does not elect to sell his, her or its Registrable Securities to the underwriters of the Company’s securities in connection with such offering, such holder shall refrain from selling such Registrable Securities not registered pursuant to this Section 5 during the period of distribution of the Company’s securities by such underwriters and the period in which the underwriting syndicate participates in the after market; provided, however, that such holder shall, in any event, be entitled to sell its Registrable Securities in connection with such registration commencing on the 180th day after the effective date of such registration statement.

6.

Related Obligations.

At such time as the Company is obligated to prepare and file the Registration Statement with the Commission pursuant to Section 4 or 5, the Company will effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof and, with respect thereto, the Company shall have the following obligations:

(a)

use all commercially reasonable efforts to cause such Registration Statement (which, in the case of an underwritten public offering shall be on Form SB-2 or other form of general applicability satisfactory to the managing underwriter selected as therein provided) relating to the Registrable Securities to become effective within ninety (90) calendar days after the filing of the Registration Statement and shall keep such Registration Statement effective until the earlier to occur of  the date on which (i) the Holder shall have sold all the Registrable Securities; or (ii) two years from the Closing Date as defined in the Subscription Agreement (the “Registration Period”).  The Company shall use all commercially reasonable efforts to respond to all Commission comments within seven (7) business days from receipt of such comments by the Company. The Company shall use all commercially reasonable efforts to cause the Registration Statement relating to the Registrable Securities to become effective no later than five (5) business days after notice from the Commission that the Registration Statement may be declared effective.  The Holder agrees to provide all information which it is required by law to provide to the Company, including the intended method of disposition of the Registrable Securities, and the Company’s obligations set forth above shall be conditioned on the receipt of such information;

(b)

prepare and file with the Commission such amendments (including post-effective amendments) and supplements to the Registration Statement and the prospectus used in 

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connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may be necessary to keep such Registration Statement effective during the Registration Period, and, during such period, comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities of the Company covered by such Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition by the Holder thereof as set forth in such Registration Statement.  The Company shall use commercially reasonable efforts to cause such amendment and/or new Registration Statement to become effective as soon as practicable following the filing thereof;

(c)

make available to the Holder whose Registrable Securities are included in any Registration Statement and its legal counsel without charge (i) promptly after the same is prepared and filed with the Commission at least one (1) copy of such Registration Statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits, the prospectus included in such Registration Statement (including each preliminary prospectus) and, with regards to such Registration Statement(s), any correspondence by or on behalf of the Company to the Commission or the staff of the Commission and any correspondence from the Commission or the staff of the Commission to the Company or its representatives; (ii) upon the effectiveness of any Registration Statement, the Company shall make available copies of the prospectus, via EDGAR, included in such Registration Statement and all amendments and supplements thereto; and (iii) such other documents, including copies of any preliminary or final prospectus, as the Holder may reasonably request from time to time in order to facilitate the disposition of the Registrable Securities;

(d)

use commercially reasonable efforts to (i) register and qualify the Registrable Securities covered by the Registration Statement under such other securities or “blue sky” laws of such states in the United States as the Holder reasonably requests; (ii) prepare and file in those jurisdictions, such amendments (including post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness thereof during the Registration Period; (iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(d), or (y) subject itself to general taxation in any such jurisdiction.  The Company shall promptly notify the Holder who holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension of the registration or qualification of any of the Registrable Securities for sale under the securities or “blue sky” laws of any jurisdiction in the United States or its receipt of actual notice of the initiation or threatening of any proceeding for such purpose;

(e)

at the request of the Holder, the Company's counsel shall furnish to the Holder an opinion letter confirming the effectiveness of the registration statement.  Such opinion letter shall be issued as of the date of the effectiveness of the registration statement and be in form suitable to the Holder;

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(f)

immediately notify each seller under such Registration Statement and each underwriter, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of the happening of any event as a result of which the prospectus contained in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein not misleading in the light of the circumstances then existing;

(g)

use its best efforts to furnish, at the request of any seller, on the date that Registrable Securities is delivered to the underwriters for sale pursuant to such registration: (i) an opinion dated such date of counsel representing the Company for the purposes of such registration, addressed to the underwriters in a form and substance as is customarily given to underwriters in an underwritten public offering, and (ii) a letter dated such date from the independent public accountants retained by the Company, addressed to the underwriters in a form and substance as is customarily given by independent public accountants to underwriters in an underwritten public offering; and

(h)

make available for inspection by any underwriter participating in any distribution pursuant to such registration statement, and any attorney, accountant or other agent retained by such underwriter, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company's officers, directors and employees to supply all information reasonably requested by any such underwriter, attorney, accountant or agent in connection with such registration statement.

For purposes of Sections 6(a) and (b) above, the period of distribution of Registrable Securities in a firm commitment underwritten public offering shall be deemed to extend until each underwriter has completed the distribution of all securities purchased by it, and the period of distribution of Registrable Securities in any other registration shall be deemed to extend as provided herein.

In connection with each registration hereunder, the selling holders of Registrable Securities will furnish to the Company in writing such information with respect to themselves and the proposed distribution by them as shall be necessary in order to assure compliance with Federal and applicable state securities laws or as the Company may reasonably request.

In connection with each registration pursuant to Section 4 or 5 hereof covering an underwritten public offering, the Company agrees to enter into a written agreement with the managing underwriter selected in the manner herein, in such form and containing such provisions as are customary in the securities business for such an arrangement.

7.

Expenses.  All expenses incurred by the Company in complying with Section 4 hereof, including, without limitation, all registration and filing fees, printing expenses, fees and disbursements of counsel and independent public accountants for the Company and the Holders, fees of the National Association of Securities Dealers, Inc., fees of transfer agents and registrars, but excluding any Selling Expenses, are herein called "Registration Expenses".  All underwriting discounts and selling commissions and transfer taxes applicable to the sale of Registrable Securities are herein called "Selling Expenses".

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The Company will pay all Registration Expenses in connection with each registration statement filed pursuant to Section 4 or 5 hereof.  All Selling Expenses incurred in connection with any sale of Registrable Securities by any participating seller shall be borne by such participating seller or by such persons other than the Company (except to the extent the Company shall be a seller) as they may agree.

8.

Indemnification. In the event of a registration of any of the Registrable Securities under the Securities Act pursuant to Section 4 hereof, the Company will indemnify and hold harmless each seller of such Registrable Securities thereunder and each underwriter of such Registrable Securities thereunder and each other person, if any, who controls such seller or underwriter within the meaning of the Securities Act, against any and all losses, claims, damages, expenses or liabilities, joint or several, to which such seller or underwriter or controlling person may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in any registration statement under which such Registrable Securities was registered under the Securities Act pursuant to Section 4, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereof, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each such seller, each such underwriter and each such controlling person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability, expense or action; provided, however, that the Company will not be liable in any such case if and to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with information furnished by such seller specifically for inclusion in such Registration Statement or Prospectus or such underwriter or such controlling person in writing specifically for use in such registration statement or prospectus.

In the event of a registration of any of the Registrable Securities under the Securities Act pursuant to Section 4 hereof, each seller of such Registrable Securities thereunder, severally and not jointly, will indemnify and hold harmless the Company and each person, if any, who controls the Company within the meaning of the Securities Act, each officer of the Company who signs the registration statement, each director of the Company, each underwriter and each person who controls any underwriter within the meaning of the Securities Act, against all losses, claims, damages, expenses or liabilities, joint or several, to which the Company or such officer or director or underwriter or controlling person may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages, expenses or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the registration statement under which such Registrable Securities was registered under the Securities Act pursuant to Section 4, any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereof, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Company and each such officer, director, underwriter and controlling person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action, and provided, however, that such seller will be liable 

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hereunder in any such case if and only to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with information pertaining to such seller, as such, furnished in writing to the Company by such seller specifically for use in such registration statement or prospectus; provided, further, however, that the liability of each seller hereunder shall be limited to the proportion of any such loss, claim, damage, liability or expense which is equal to the proportion that the public offering price of the shares sold by such seller under such registration statement bears to the total public offering price of all securities sold thereunder, but not to exceed the proceeds received by such seller from the sale of Registrable Securities covered by such registration statement.  

Promptly after receipt by an indemnified party hereunder of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party hereunder, notify the indemnifying party in writing thereof, but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party under this Section 8.  In case any such action shall be brought against any indemnified party and it shall notify the indemnifying party of the announcement thereof, the indemnifying party shall be entitled to participate in and, to the extent it shall wish, to assume and undertake the defense thereof with counsel reasonably satisfactory to such indemnified party, and, after notice from the indemnifying party to such indemnified party of its election to assume and undertake the defense thereof, the indemnifying party shall not be liable to such indemnified party under this Section 8 for any legal expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation and of liaison with counsel so selected; provided, however, that, if the defendants in any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may be reasonable defenses available to it which are different from or additional to those available to the indemnifying party or if the interests of the indemnified party reasonably may be deemed to conflict with the interests of the indemnifying party, the indemnified party shall have the right to select a separate counsel and to assume such legal defenses and otherwise to participate in the defense of such action, with the expenses and fees of such separate counsel and other expenses related to such participation to be reimbursed by the indemnifying party as incurred.

Notwithstanding the foregoing, any indemnified party shall have the right to retain its own counsel in any such action, but the fees and disbursements of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party shall have failed to retain counsel for the indemnified person as aforesaid or (ii) the indemnifying party and such indemnified party shall have mutually agreed to the retention of such counsel.  It is understood that the indemnifying party shall not, in connection with any action or related actions in the same jurisdiction, be liable for the fees and disbursements of more than one separate firm qualified in such jurisdiction to act as counsel for the indemnified party.  The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment.  If the indemnification provided for in the first two paragraphs of this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under such paragraphs in respect of any losses, claims, damages or liabilities or actions in respect thereof 

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referred to therein, then each indemnifying party shall in lieu of indemnifying such indemnified party contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or actions in such proportion as appropriate to reflect the relative fault of the Company, on the one hand, and the sellers of such Registrable Securities, on the other, in connection with the statement or omissions which resulted in such losses, claims, damages, liabilities or actions, as well as any other relevant equitable considerations including the failure to give any notice under the third paragraph of this Section 8. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company, on the one hand, or by the sellers of such Registrable Securities, on the other, and to the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

The Company and the sellers of Registrable Securities agree that it would not be just and equitable if contribution pursuant to this Section 8 were determined by pro rata allocation (even if all of the sellers of Registrable Securities were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph.  The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or action in respect thereof, referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.  Notwithstanding the provisions of this and the immediately preceding paragraph, the sellers of such Registrable Securities shall not be required to contribute any amount in excess of the amount, if any, by which the total price at which the Registrable Securities sold by each of them was offered to the public exceeds the amount of any damages which they would have otherwise been required to pay by reason of such untrue or alleged untrue statement of omission.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who is not guilty of such fraudulent misrepresentation.  The indemnification of underwriters provided for in this Section 8 shall be on such other terms and conditions as are at the time customary and reasonably required by such underwriters.  

9.

Rule 144 Reporting.  From and after the date hereof, the Company agrees with the holders of Registrable Securities as follows:

(a)

The Company shall make and keep public information available as those terms are understood and defined in Rule 144 under the Securities Act, at all times from and after 90 days following the effective date of the first registration of the Company under the Securities Act of an offering of its common stock to the general public.

(b)

The Company shall file with the Commission in a timely manner all reports and other documents as the Commission may prescribe under Section 13(a) or 15(d) of the Securities Exchange Ac of 1934, as amended (the “Exchange Act”) at any time after the Company has become subject to such reporting requirements of the Exchange Act.

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(c)

The Company shall furnish to such holder of Registrable Securities forthwith upon request (i) a written statement by the Company as to its compliance with the reporting requirements of Rule 144 (at any time from and after 90 days following the effective date of the first registration statement of the Company for an offering of its common stock to the general public), and of the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements), (ii) a copy of the most recent annual or quarterly report of the Company and (iii) such other reports and documents so filed as a holder may reasonably request to avail itself of any rule or regulation of the Commission allowing a holder of Registrable Securities to sell any such securities without registration.

10.

Miscellaneous.

(a)

The rights arising under Section 4 shall terminate on the fifth anniversary of this Agreement, or if earlier, when (i) the holder of the Registrable Securities is no longer an "affiliate" as used in Rule 144 and (ii) the holder of the Registrable Securities is permitted to sell all Registrable Securities then held by it pursuant to Rule 144(k).

(b)

All covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not.  Without limiting the generality of the foregoing, the registration rights conferred herein on the holders of Registrable Securities shall inure to the benefit of any and all subsequent permitted holders from time to time of the Registrable Securities for so long as the certificates representing the Registrable Securities shall be required to bear the legend specified in Section 2 hereof.

(c)

All notices, requests, consents and other communications hereunder shall be in writing and shall be mailed by generally recognized overnight courier, postage prepaid, to the holder of the Registrable Securities at its, his, or her address set forth in the records of the Company and to the Company at its principal place of business or, in any case, at such other address or addresses as shall have been furnished in writing to the Company (in the case of a holder of Registrable Securities) or to the holders of Registrable Securities (in the case of the Company).

If to the Company:

Presto Food & Beverage, Inc.

410 Park Avenue, 2nd Floor

New York, NY 10022

Attention: Fernando O. Leonzo

Facsimile No.: (212) 406-5370

With a copy to: 

Gersten Savage LLP

600 Lexington Avenue, 9th Floor

New York, New York 10022

Attention: Peter J. Gennuso, Esq.

Facsimile No.: (212) 980-5192

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Each Notice shall be deemed given and effective upon receipt (or refusal of receipt).

(d)

This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

(e)

EACH PARTY TO THIS AGREEMENT HEREBY IRREVOCABLY AGREES THAT ANY LEGAL ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK AND HEREBY EXPRESSLY SUBMITS TO THE PERSONAL JURISDICTION AND VENUE OF SUCH COURTS FOR THE PURPOSES THEREOF AND EXPRESSLY WAIVES ANY CLAIM OF IMPROPER VENUE AND ANY CLAIM THAT THE SUCH COURTS ARE AN INCONVENIENT FORUM.  EACH PARTY HEREBY IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO ITS ADDRESS SET FORTH IN THE SUBSCRIPTION AGREEMENTS EXECUTED HEREWITH, SUCH SERVICE TO BECOME EFFECTIVE 10 DAYS AFTER SUCH MAILING.

(f)

This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be modified or amended except in writing.

(g)

This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

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IN WITNESS WHEREOF, the parties hereto have executed this Registration Rights Agreement as of the date and year first written above.

			
	 
	THE COMPANY:

	  

	 

	 
	Presto Food & Beverage, Inc.

	  

	 
	 

	  

	 
	 

	                                                                  

	By:

	 

	 
	 
	Name:

	 
	 
	Title:

	 
	 
	 

	 
	 
	 

	 
	HOLDERS:

	 
	 
	 

	 
	 
	 

	 
	By:

	 

	 
	 
	Name:

	 
	 
	Title:United States Securities and Exchange Commission EDGAR Filing

EXHIBIT 10.4

NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS AND MAY ONLY BE ACQUIRED FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.  THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE OF THIS WARRANT, IF ANY, MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO SUCH SECURITIES UNDER THE ACT AND QUALIFICATION UNDER APPLICABLE STATE LAW WITHOUT AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION AND QUALIFICATION ARE NOT REQUIRED UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION.

November  __, 2007

PRESTO FOOD & BEVERAGE, INC.

Warrant for the Purchase of Shares of Common Stock

For value received, this warrant (the “Warrant”) is hereby issued by PRESTO FOOD & BEVERAGE, INC., a New York corporation (the “Company”), to ______________(the “Holder”).  Subject to the provisions of this Warrant, the Company hereby grants to the Holder the right to purchase from the Company the number of fully paid and non-assessable shares of the Company’s Common Stock obtained by dividing [$_________] by $0.31 (the “Exercise Price”).

The term “Common Stock” means the common stock, par value $0.001 per share, of the Company.  The number of shares of Common Stock to be received upon the exercise of this Warrant may be adjusted from time to time as hereinafter set forth.  The shares of Common Stock deliverable upon such exercise, and as adjusted from time to time, are hereinafter referred to as “Warrant Shares.”

The Holder agrees with the Company that this Warrant is issued, and all the rights hereunder shall be held, subject to all of the conditions, limitations and provisions set forth herein.

1.

Exercise of Warrant. Subject to the terms and conditions set forth herein, this Warrant may be exercised in whole or in part, pursuant to the procedures provided below, at any time on or before 5:00 p.m., New York time, on the day occurring three (3) years from the date hereof (the “Expiration Date”) or, if such day is a day on which banking institutions in New York are authorized by law to close, then on the next succeeding day that shall not be such a day. The Warrant shall only be exercisable on a cash basis.  To exercise this Warrant the Holder shall 

present and surrender this Warrant to the Company at its principal office, with the Warrant Exercise Form attached hereto duly executed by the Holder and accompanied by payment in cash, wire transfer or by check, payable to the order of the Company, of the aggregate Exercise Price for the total aggregate number of Warrant Shares for which this Warrant is exercised.  Upon receipt by the Company of this Warrant, together with the executed Warrant Exercise Form and payment of the Exercise Price for the Warrant Shares to be acquired, in proper form for exercise, and subject to the Holder’s compliance with all material requirements of this Warrant for the exercise hereof, the Company shall issue and deliver to the Holder one or more certificates representing such Warrant Shares and Holder shall be deemed to be the holder of record of such Warrant Shares; provided, however, that no exercise of this Warrant shall be effective, and the Company shall have no obligation to issue any such Warrant Shares to the Holder upon any attempted exercise of this Warrant, unless the Holder shall have first delivered to the Company, in form and substance reasonably satisfactory to the Company, appropriate representations so as to provide the Company reasonable assurances that the securities issuable upon exercise may be issued without violation of the registration requirements of the Securities Act and applicable state securities laws, including without limitation representations that the Holder is familiar with the Company and its business and financial condition and has had an opportunity to ask questions and receive documents relating thereto to his or her reasonable satisfaction.

2.

Reservation of Shares.  The Company will at all times reserve for issuance and delivery upon exercise of this Warrant all shares of Common Stock from time to time receivable upon exercise of this Warrant.  All such shares shall be duly authorized and, when issued upon such exercise, shall be validly issued, fully paid and non-assessable and free of all preemptive rights.

3.

Fractional Shares.  No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant, but the Company shall pay the Holder an amount equal to the fair market value of such fractional share of Common Stock in lieu of each fraction of a share otherwise called for upon any exercise of this Warrant; provided, however, that in the event that there is no fair market value of the Company’s Common Stock, any such amount to be paid to the Holder as a fractional share shall be determined by the Company’s Board of Directors.

4.

Redemption.  The Company may, at its option, redeem all but not less than all of the Warrant Shares held by a Holder from and after the first anniversary of the date hereof if the Company’s common stock has traded at a closing price of at least $.50 per share for twenty (20) consecutive trading days.  The redemption price shall be $.05 per Warrant Share, it being understood and agreed that the Company shall have no right to redeem this Warrant prior to exercise thereof by the Holder.

5.

Assignment or Loss of Warrant.  Subject to the transfer restrictions herein (including Section 9), upon surrender of this Warrant to the Company or at the office of its stock transfer agent, if any, with the Assignment Form annexed hereto duly executed and funds sufficient to pay any transfer tax, the Company shall, without charge, execute and deliver a new Warrant in the name of the assignee named in such instrument of assignment and this Warrant 

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shall promptly be canceled.  Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction, or mutilation of this Warrant, and of reasonably satisfactory indemnification by the Holder, and upon surrender and cancellation of this Warrant, if mutilated, the Company shall execute and deliver a replacement Warrant of like tenor and date.

6.

Rights of the Holder.  Prior to exercise of the Warrant in accordance with the terms hereof, the Holder shall not, by virtue hereof, be entitled to any rights of a stockholder in the Company, either at law or in equity, and the rights of the Holder are limited to those expressed in this Warrant.

7.

Adjustments.

7.1

Adjustment for Recapitalization.  If the Company shall at any time after the date hereof subdivide its outstanding shares of Common Stock by recapitalization, reclassification, or split-up thereof, the number of shares of Common Stock subject to this Warrant immediately prior to such subdivision shall be proportionately increased, and if the Company shall at any time after the date hereof combine the outstanding shares of Common Stock by recapitalization, reclassification, or combination thereof, the number of shares of Common Stock subject to this Warrant immediately prior to such combination shall be proportionately decreased.  Any such adjustment and adjustment to the Exercise Price pursuant to this Section 7.1 shall be effective at the close of business on the effective date of such subdivision or combination.

Whenever the number of shares of Common Stock purchasable upon the exercise of this Warrant is adjusted, as provided in this Section 7.1, the Exercise Price shall be adjusted to the nearest cent by multiplying such Exercise Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares of Common Stock purchasable upon the exercise immediately prior to such adjustment, and (y) the denominator of which shall be the number of shares of Common Stock so purchasable immediately thereafter.

7.2

Adjustment for Reorganization, Consolidation, Merger.  In case of any reorganization of the Company after the date hereof or in case after such date the Company shall consolidate with or merge into another corporation or convey all or substantially all of its assets to another corporation, then, and in each such case, the Holder of this Warrant upon the exercise thereof as provided in Section 1 at any time after the consummation of such reorganization, consolidation, merger, or conveyance, shall be entitled to receive, in lieu of the securities and property receivable upon the exercise of this Warrant prior to such consummation, the securities or property to which such Holder would have been entitled upon such consummation if such Holder had exercised this Warrant immediately prior thereto; in each such case, the terms of this Warrant shall be applicable to the securities or property receivable upon the exercise of this Warrant after such consummation. 

7.3

Adjustment Due to Dilutive Issuance.  If, at any time when the Warrants are issued and outstanding, the Company issues or sells any shares of Common Stock or securities exercisable for or convertible into shares of Common Stock for no consideration or for a consideration per share (before deduction of reasonable expenses or commissions or underwriting discounts or allowances in connection therewith) less than the Exercise Price (a 

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“Dilutive Issuance”), then immediately upon the Dilutive Issuance, the Conversion Price will be reduced to the amount of the consideration  per share received by the Company in such Dilutive Issuance; provided, that only one adjustment will be made for each Dilutive Issuance.

7.4

Certificate as to Adjustments.  The adjustments provided in this Section 7.1 shall be interpreted and applied by the Company in such a fashion so as to reasonably preserve the applicability and benefits of this Warrant (but not to increase or diminish the benefits hereunder).  In each case of an adjustment in the number of shares of Common Stock receivable on the exercise of the Warrant, the Company at its expense will promptly compute such adjustment in accordance with the terms of the Warrant and prepare a certificate executed by two executive officers of the Company setting forth such adjustment and showing in detail the facts upon which such adjustment is based. The Company will forthwith mail a copy of each such certificate to each Holder. 

7.5

Notices of Record Date, Etc.  In the event that:

(a)

the Company authorizes the granting to any holder of Common Stock the right to subscribe for, purchase or otherwise acquire any shares of stock of any class or any other securities; or

(b)

the Company authorizes any capital reorganization of the Company, any reclassification of the capital stock of the Company, any consolidation or merger of the Company with or into another corporation, or any conveyance of all or substantially all of the assets of the Company to another corporation or entity; or 

(c)

the Company authorizes any voluntary or involuntary dissolution, liquidation, or winding up of the Company,

then, and in each such case, the Company shall mail or cause to be mailed to the holder of this Warrant at the time outstanding a notice specifying, as the case may be, (i) the date on which a record is to be taken for the purpose of such right, and stating the amount and character of such right, or (ii) the date on which such reorganization, reclassification, consolidation, merger, conveyance, dissolution, liquidation, or winding up is to take place, and the time, if any is to be fixed, as to which the holders of record of Common Stock shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, conveyance, dissolution, liquidation, or winding up.  Such notice shall be mailed at least twenty (20) days prior to the date therein specified.

7.6

No Impairment.  The Company will not, by any voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Section 7 and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Holder of this Warrant against impairment.

8.

Transfer to Comply with the Securities Act.  This Warrant and any Warrant Shares may not be sold, transferred, pledged, hypothecated or otherwise disposed of except as follows:  (a) to a person who, in the opinion of counsel to the Company, is a person to whom this 

4

Warrant or the Warrant Shares may legally be transferred without registration and without the delivery of a current prospectus under the Securities Act with respect thereto and then only against receipt of an agreement of such person to comply with the provisions of this Section 8 with respect to any resale or other disposition of such securities; or (b) to any person upon delivery of a prospectus then meeting the requirements of the Securities Act relating to such securities and the offering thereof for such sale or disposition, and thereafter to all successive assignees.

9.

Legend.  Unless the shares of Warrant Shares have been registered under the Securities Act, upon exercise of any of the Warrants and the issuance of any of the shares of Warrant Shares, all certificates representing shares shall bear on the face thereof substantially the following legend:

The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended, and may not be sold, offered for sale, assigned, transferred or otherwise disposed of, unless registered pursuant to the provisions of that Act or unless an opinion of counsel to the Corporation is obtained stating that such disposition is in compliance with an available exemption from such registration.

10.

Notices. All notices required hereunder shall be in writing and shall be deemed given when telegraphed, delivered personally or within two days after mailing when mailed by certified or registered mail, return receipt requested, to the Company or the Holder, as the case may be, for whom such notice is intended, if to the Holder, at the address of such party shown on the books of the Company, or if to the Company, at the address set forth on the signature page hereof, Attn: President, or at such other address of which the Company or the Holder has been advised by notice hereunder.

11.

Applicable Law.  The Warrant is issued under and shall for all purposes be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of laws provisions of such State.

12.

Registration Rights. The Holder shall have certain registration rights with respect to the registration of the Warrant Shares as provided in that certain Registration Rights Agreement by and between the Company and the parties thereto.

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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed on its behalf, in its corporate name, by its duly authorized officer, all as of the day and year first above written.

			
	 
	PRESTO FOOD & BEVERAGE, INC.

	 
	 
	 

	 
	 
	 

	                                                                           

	By:

	 

	 
	 
	Name: 

	 
	 
	Title:

WARRANT EXERCISE FORM

The undersigned hereby irrevocably elects to (i) exercise the within Warrant to purchase __________ shares of the Common Stock of PRESTO FOOD & BEVERAGE, INC., a New York corporation, pursuant to the provisions of Section 1 of the attached Warrant, and hereby makes payment of $__________ in payment therefore. The undersigned’s execution of this form constitutes the undersigned’s agreement to all the terms of the Warrant and to comply therewith.

		
	 
	 

	                                                      

	Signature

	 
	Print Name:

	  

	 

	  

	 

	 
	 

	 
	Signature, if jointly held

	 
	Print Name:

	 
	 

	  

	 

	  

	 

	 
	Date

ASSIGNMENT FORM

FOR VALUE RECEIVED_____________________________ (“Assignor”) hereby sells, assigns, and transfers unto _______________________________ (“Assignee”) all of Assignor’s right, title and interest in, to and under this Warrant issued by PRESTO FOOD & BEVERAGE, INC. dated ______________.

DATED: 

			
	 
	 
	ASSIGNOR:

	  

	 
	 

	  

	 
	 

	 
	 
	 

	 
	 
	Signature

	 
	 
	Print Name:

	  

	 
	 

	  

	 
	 

	 
	 
	 

	 
	 
	Signature, if jointly held

	 
	 
	Print Name:

	 
	 
	 

	 
	 
	 

	 
	 
	ASSIGNEE:

	 

	The undersigned agrees to all of the terms of the Warrant and to comply therewith.

	 
	 
	 

	 
	 
	 

	 
	 
	Signature

	 
	 
	Print Name:

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	Signature, if jointly held

	 
	 
	Print Name:

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