<PAGE>
As filed with the Securities and Exchange Commission on November 20, 1996
Registration No. 333-_________
- --------------------------------------------------------------------------------
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
NORTH AMERICAN TECHNOLOGIES GROUP, INC.
-------------------------------------------------------
(Exact name of Registrant as specified in its charter)
DELAWARE 33-0041789
---------------------------------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
4710 BELLAIRE BOULEVARD, SUITE 301
BELLAIRE, TEXAS 77401
-----------------------------------------------------
(Address of principal executive offices) (Zip Code)
CONSULTING AGREEMENT DATED JULY 24, 1996
BY AND BETWEEN HAZLET INVESTORS, INC. AND
NORTH AMERICAN TECHNOLOGIES GROUP, INC.;
STOCK OPTION AGREEMENTS BETWEEN
NORTH AMERICAN TECHNOLOGIES GROUP, INC. AND
CERTAIN OF ITS OFFICERS AND EMPLOYEES
---------------------------------------
(Full title of the plans)
TIM B. TARRILLION, CHIEF EXECUTIVE OFFICER
NORTH AMERICAN TECHNOLOGIES GROUP, INC.
4710 BELLAIRE BOULEVARD, SUITE 301
BELLAIRE, TEXAS 77401
----------------------------------------
(Name and address of agent for service)
(713) 662-2699
---------------------------------------------------------------
(Telephone number, including area code, of agent for service)
<PAGE>
If the only securities being registered on this form are being offered pursuant
to dividend or reinvestment plans,
please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
- --------------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE (1)
================================================================================
<TABLE>
<CAPTION>
Proposed
Maximum Proposed
Amount Offering Maximum Amount of
to be Price Per Aggregate Registration
Title of Securities to be Registered Registered Share (1) Offering Price Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock issuable in 25,000 $0.66 $16,406.25 $ 4.97
lieu of cash
compensation under
Consulting Agreement
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock issuable upon 50,000 $1.00 $ 50,000 $ 15.15
exercise of options under
Consulting Agreement
------------------------------------------------------------------------------------------
50,000 $1.25 $ 62,500 $ 18.94
------------------------------------------------------------------------------------------
50,000 $1.50 $ 75,000 $ 22.73
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock issuable upon 300,000 $1.00 $ 300,000 $ 90.90
exercise of options
granted by the
Registration to certain
of its officers and
employees.
------------------------------------------------------------------------------------------
700,000 $1.25 $ 875,000 $ 265.15
------------------------------------------------------------------------------------------
2,350,000 $2.50 $5,875,000 $1,780.30
- ------------------------------------------------------------------------------------------------------------------------------------
Total $2,198.14
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Calculated in accordance with Rule 457(h)(1).
<PAGE>
PART II
INFORMATION REQUIRED IN THE
REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Registrant incorporates the following documents by reference in this
Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995, filed with the Securities and Exchange Common (the
"Commission") on April 14, 1996.
(b) The Registrant's Quarterly Report on Form 10-QSB for the period ended
March 31, 1996, filed with the Commission on May 14, 1996.
(c) The Registrant's Quarterly Report on Form 10-QSB for the period ended
June 30, 1996, filed with the Commission on August 13, 1996.
(d) The Registrant's Quarterly Report on Form 10-QSB for the period ended
September 30, 1996, filed with the Commission on November 12, 1996.
(e) The Registrant's Proxy Statement for its 1996 Annual Meeting of
Stockholders, filed with the Commission on May 22, 1996.
(f) All other documents filed by Registrant subsequent to the date of this
Registration Statement under Section 13(a), 13(c), 14 and 15(d) of the
Securities Exchange Act of 1934, prior to the filing of a post-effective
amendment to this Registration Statement which deregisters the securities
covered hereunder which remain unsold.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article IX of the Restated Certificate of Incorporation states that
directors of the Registrant shall not be liable for monetary damages for breach
of fiduciary duty "to the full extent permitted by the General Corporation Law
of Delaware as the same exists or may hereafter be amended." The Registrant is
also empowered by Section 102(b) of the Delaware General Corporation Law to
include a provision in the Certificate of Incorporation which would limit a
director's liability to the registrant or its stockholders for monetary damages
for breaches of fiduciary duty as a director. Article VIII of the Restated
Certificate of Incorporation provides such a limitation. As Delaware law now
exists, directors will remain liable for damages for (i) breach of their duty of
loyalty to the Registrant and its stockholders; (ii) their failure to act in
good faith; (iii) their intentional misconduct or knowing violation of law; (iv)
improper dividend payments, stock repurchases or redemptions; and (v) any
transaction from which the director derived an improper personal benefit.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
5 Opinion and Consent of Buchanan Ingersoll Professional Corporation.
10.1 Consulting Agreement dated July 24, 1996 by and between Hazlet
Investors, Inc. and North American Technologies Group, Inc.
10.2 Form of Employee Stock Option Agreement.
23.1 Consent of Buchanan Ingersoll Professional Corporation (included in
Exhibit 5)
23.2 Consent of BDO Seidman, LLP, Independent Certified Public Accountants
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represents a fundamental change in the information set forth in this
Registration Statement; and
<PAGE>
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement.
(2) That, for the purpose of determining any liability under the Act, each
such post-effective amendment shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
offered at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Act, each
filing of the Company's annual report pursuant to Section 13(a) or Section 15(d)
of the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Act, may
be permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission that such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel that matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on November 20, 1996.
NORTH AMERICAN TECHNOLOGIES GROUP,
INC.
By:/s/ Tim B. Tarrillion
------------------------------------------
Tim B. Tarrillion
Chief Executive Officer and Director
By:/s/ Judith Knight Shields
------------------------------------------
Judith Knight Shields
Senior Vice President-Finance,
Chief Financial Officer and Treasurer
Principal Accounting Officer
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ Tim B. Tarrillion Chief Executive Officer, November 20, 1996
------------------------- President and Director
Tim B. Tarrillion
/s/ Donovan W. Boyd Senior Vice President, November 20, 1996
------------------------- Chief Operating Officer
Donovan W. Boyd and Director
/s/ David M. Daniels Executive Vice President, November 20, 1996
------------------------- Secretary and Director
David M. Daniels
/s/ William T. Aldrich Director November 20, 1996
-------------------------
William T. Aldrich
/s/ Douglas C. Williamson Director November 20, 1996
-------------------------
Douglas C. Williamson
/s/ Mark E. Leyerle Director November 20, 1996
-------------------------
Mark E. Leyerle
/s/ Robert H Chaney Director November 20, 1996
-------------------------
Robert H. Chaney
/s/ Edwin H. Knight Director November 20, 1996
-------------------------
Edwin H. Knight
/s/ Christopher W. Roser Director November 20, 1996
-------------------------
Christopher W. Roser
<PAGE>
EXHIBIT INDEX
5 Opinion and Consent of Buchanan Ingersoll Professional Corporation.
10.1 Consulting Agreement dated July 24, 1996 by and between Hazlet
Investors, Inc. and North American Technologies Group, Inc.
10.2 Form of Employee Stock Option Agreement.
23.1 Consent of Buchanan Ingersoll Professional Corporation (included in
Exhibit 5)
23.2 Consent of BDO Seidman, LLP, Independent Certified Public Accountants
<PAGE>
EXHIBIT 5
OPINION AND CONSENT OF BUCHANAN INGERSOLL PROFESSIONAL
CORPORATION
November 21, 1996
North American Technologies Group, Inc.
4710 Bellaire Boulevard
Suite 301
Bellaire, Texas 77401
RE: NORTH AMERICAN TECHNOLOGIES GROUP, INC.'S
REGISTRATION STATEMENT ON FORM S-8
----------------------------------------------
Gentlemen:
We have participated in the preparation of the Registration Statement on
Form S-8 (the "Registration Statement") to be filed with the Securities and
Exchange Commission by North American Technologies Group, Inc. (the "Company")
for the purpose of registering under the Securities Act of 1933 shares of common
stock of the Company, $.001 par value, which may be issued by the Company as
consideration under a Consulting Agreement dated July 24, 1996 by and between
Hazlet Investors, Inc. and the Company (the "Consulting Agreement") and pursuant
to certain stock option agreements listed on Exhibit A to this letter (the
"Option Agreements"). As counsel to the Company, we have examined such
corporate records, certificates and other documents as we consider to relevant
and necessary to express the opinion hereinafter set forth.
On the basis of the foregoing and of our consideration of such other legal
and factual matters that we have deemed appropriate, we are of the opinion that
the common stock of the Company covered by the Registration Statement has been
duly authorized and, when the options granted under the Consulting Agreement and
the Option Agreements are exercised, will be legally issued, fully paid and non-
assessable, assuming that the applicable option exercise price (as set forth in
the Consulting Agreement and the Option Agreements) is paid with respect to each
share of common stock prior to issuance and full compliance with the Consulting
Agreement and the Option Agreements is otherwise made.
<PAGE>
This opinion is being delivered to you in compliance with Item 601(b)(5)(i)
of Regulation S-B of the Securities and Exchange Commission. This firm consents
to the filing of this opinion as an exhibit to the Registration Statement.
BUCHANAN INGERSOLL
PROFESSIONAL CORPORATION
By:/s/ Joseph P. Galda
--------------------
Joseph P. Galda
<PAGE>
EXHIBIT "A"
STOCK OPTION AGREEMENTS
1. Agreement by and between North American Technologies Group, Inc. and Tim B.
Tarrillion dated February 7, 1995.
2. Agreement by and between North American Technologies Group, Inc. and Tim B.
Tarrillion dated December 1, 1995.
3. Agreement by and between North American Technologies Group, Inc. and
Donovan Boyd dated February 23, 1995.
4. Agreement by and between North American Technologies Group, Inc. and
Donovan Boyd dated December 1, 1995.
5. Agreement by and between North American Technologies Group, inc. and David
M. Daniels dated October 3, 1994.
6. Agreement by and between North American Technologies Group, Inc. and David
M. Daniels dated February 7, 1995.
7. Agreement by and between North American Technologies Group, Inc. and Judith
Knight Shields dated February 23, 1995.
8. Agreement by and between North American Technologies Group, Inc. and Judith
Knight Shields dated December 1, 1995.
9. Agreement by and between North American Technologies Group, Inc. and Ronald
E. Borah dated February 7, 1995.
10. Agreement by and between North American Technologies Group, Inc. and
Michael W. Bonem dated February 7, 1995.
11. Agreement by and between North American Technologies Group, Inc. and Mark
D. Clark dated March 10, 1995.
12. Agreement by and between North American Technologies Group, Inc. and Robert
D. Jones III dated March 10, 1995.
<PAGE>
13. Agreement by and between North American Technologies Group, Inc. and John
W. Parrott dated July 28, 1995.
14. Agreement by and between North American Technologies Group, Inc. and Connie
Draehn dated December 1, 1995.
15. Agreement by and between North American Technologies Group, Inc. and Joseph
S. Wilwerding dated December 19, 1995.
16. Agreement by and between North American Technologies Group, Inc. and
William T. Aldrich dated December 29, 1995.
17. Agreement by and between North American Technologies Group, Inc. and Henry
W. Sullivan dated December 29, 1995.
18. Agreement by and between North American Technologies Group, Inc. and Terry
Nolan Tyler dated January 1, 1996.
19. Agreement by and between North American Technologies Group, Inc. and Jack
R. Madore, Jr. dated September 1, 1996.
20. Agreement by and between North American Technologies Group, Inc. and David
J. Weaver dated September 1, 1996.
<PAGE>
EXHIBIT 10.1
C O N F I D E N T I A L
July 24, 1996
Ed Meyer, Jr. VIA FAX: 908-332-0101
Hazlet Investors, Inc.
P. O. Box 37
248 Highway 79
Wickatunk, New Jersey 07765-0037
Dear Mr Meyer:
North American Technologies Group, Inc. (NATK) would like to enter into an
agreement with Hazlet Investors, Inc. to assist NATK in increasing investor
awareness via your Hazlet Investment Newsletter and other services you may
provide on a consulting basis. However, the intent of this relationship is to
improve the long term performance of NATK stock that will benefit all the
shareholders and not just create some short-lived effect for the company or a
small group of shareholders. As such, we want to structure the agreement as
follows:
. For a minimum period of twelve months beginning July 24, 1996, Hazlet agrees
to provide NATK with consulting services regarding the best methods for
disseminating information concerning the company to the worldwide investment
community. This will include drafting articles and disseminating them through
your newsletter, the Internet, and other Wall Street publications.
. NATK agrees to pay Hazlet an initial fee of $15,000 to cover initial out-of
pocket expenses incurred by Hazlet to initiate this coverage and investor
information service, including the cost of the proposed article in Investors'
Business Daily.
. NATK further agrees to provide Hazlet with 15,000 shares of NATK common stock
by September 6, 1996, or as soon as NATK can provide you with freely-traded
stock. In addition, NATK will issue Hazlet another 10,000 shares of NATK
common stock on January 24, 1997, if Hazlet has provided the consulting
services as promised. Evidence of such performance will include articles in
the Hazlet Newsletter, articles in independent financial publications
generated by Hazlet initiatives, information on NATK available on Hazlet's
website, Hazlet sponsored broker meetings and teleconferences with company
management, and an increased trading volume of NATK on an average basis over
the six-month period. To document the desired performance, Hazlet must
provide NATK, to my and David Daniels' attention, a monthly report specifying
the previous month's activities and results.
. NATK will also grant Hazlet 50,000 options to purchase NATK common stock at
$1.00 that can be exercised starting October 1, 1996; 50,000 options at $1.25
that can be exercised starting January 1, 1997; and 50,000 options at $1.50
that can be exercised starting April 1, 1997. Exercise of these options will
be dependent on Hazlet providing and documenting the
<PAGE>
services as promised. All these options will expire if not exercised before
September 1, 1997.
. Issuance of shares and options will require approval of NATK's Board of
Directors. I should be able to obtain such approval at our regularly
scheduled Board meeting on August 13, 1996. Subsequently, NATK will file an
S-8 registration with the SEC to assure that shares you receive under this
agreement will be free trading shares. The company will provide this
registration on a "best efforts basis" but expects that it will be completed
no later than September 6, 1996.
. Hazlet further agrees to allow NATK the opportunity to review all information
sent out concerning the company. All information sent out on the company will
be disseminated fairly, equitably, and legally, and in full compliance with
all SEC and NASDAQ rules and guidelines. Hazlet further agrees that it will
use its "best efforts" to assure that Hazlet and its associates do not trade
on any non-public information concerning the company or its stock prior to
the full public dissemination of such information.
If you agree to these terms and conditions please sign in the space provided
below and return to me by fax as soon as possible. We would like you to get
started as soon as possible. We will send you the initial check by courier as
soon as we receive your signed copy. If you have any questions, please feel
free to call me at any time.
Sincerely,
/s/ Tim B. Tarrillion
Tim B. Tarrillion
President, CEO
Agreed to:
By: /s/ Edward Meyer Jr.
Name: Edward Meyer Jr.
Company: Hazlet Investors Inc.
Date: July 24, 1996
<PAGE>
C O N F I D E N T I A L
July 25, 1996
Ed Meyer, Jr. VIA FAX: 908-332-0101
Hazlet Investors, Inc.
P. O. Box 37
248 Highway 79
Wickatunk, New Jersey 07765-0037
Dear Mr Meyer:
After having our corporate counsel review our Letter Agreement on July 24, 1996,
(the "Agreement"), we need to agree to certain items as an addendum to the
Agreement. As such, NATK and Hazlet Investors, Inc. ("Hazlet") further agree to
the following:
. Hazlet represents and warrants to NATK that the services to be rendered by
Hazlet under the Agreement will not be rendered in connection with the offer
or sale of securities of NATK as part of a capital raising transaction.
Hazlet covenants that it will not engage in any activity that could cause the
services to be rendered by it under the Agreement to be deemed to be "in
connection with the offer or sale of securities of NATK as part of a capital
raising transaction." Hazlet understands that NATK and its counsel will rely
on these representations, warranties, and covenants made herein in connection
with filing a Registration Statement on Form S-8 with respect to the shares
of NATK Common Stock to be issued in lieu of compensation and upon exercise
of options (the "Securities"), which Securities may be issued to Hazlet as
consideration for the services rendered under the Agreement.
. Both NATK and Hazlet can terminate the agreement "for cause" with thirty days
notice if either party fails to perform their obligations under the
Agreement. However, NATK agrees it will not terminate the agreement prior to
the payment of the $15,000 fee and the issuance of the initial 15,000 shares
of NATK Common stock as provided for in the Agreement. Unless renewed by
mutual consent of the parties, the Agreement will automatically terminate on
September 1, 1997, if it has not been terminated prior to that date as
provided above.
. To protect both parties to the Agreement, NATK must give written consent for
all statements, releases, articles, etc., made, written or issued by Hazlet
on behalf of NATK in the performance of Hazlet's services under the
Agreement. To comply with this provision, Hazlet must obtain written approval
(via Fax or other means of transmission) for all statements, etc., prior to
their issuance, from Tim Tarrillion, Judy Shields, or David Daniels of NATK.
<PAGE>
Please sign in the space provided below and return to me by fax as soon as
possible. If you have any questions, please feel free to call me at any time.
Sincerely,
/s/ Tim B. Tarrillion
Tim B. Tarrillion
President, CEO
Agreed to:
By: /s/ Edward Meyer Jr.
Name: Edward Meyer Jr.
Company: Hazlet Investors Inc.
Date: July 26, 1996
<PAGE>
EXHIBIT 10.2
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT ("Agreement"), dated as of __________ _____, is
by and between NORTH AMERICAN TECHNOLOGIES GROUP, INC., a Delaware corporation
(the "Company"), and ______________________ ("Employee").
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which
are hereby acknowledged, the Company and the Employee hereby agree as follows:
1. GRANT OF OPTION; VESTING SCHEDULE.
(a) Grant of Option. The Company hereby grants to Employee an option the
("Option") to purchase, subject to the terms and conditions hereof, from the
____________ (____________) shares (the "Option Shares") of Common Stock, par
value $0.001 per share, of the Company (the "Common Stock") beginning on the
Commencement Date (as defined below) and ending at 5:00 p.m. Eastern Standard
Time, on ___________, 2005 (the "Termination Date"), at an exercise price equal
to $2.50 per share of Common Stock. As used herein, the term "Commencement
Date" shall mean the date first set out above. The number of Option Shares and
the exercise price per share shall be subject to adjustment from time to time
upon the occurrence of certain events as set forth below. The shares of Common
Stock or any other shares or other units of stock or other securities or
property, or any combination thereof then receivable upon exercise of the
Option, as adjusted from time to time, are sometimes referred to hereinafter as
"Exercise Shares." The exercise price per share as from time to time in effect
is referred to hereinafter as the "Exercise Price."
The Option is not an "incentive stock option" as described in Section 422A of
the Internal Revenue Code of 1986, as amended.
(b) Vesting Schedule. Following the Commencement Date, the Option shall
vest and be exerciseable (unless earlier terminated as provided herein) on
_________ 1 in the years set forth below and in the amounts set forth below:
NUMBER OF
SHARES
__________ 1
1997 _______
1998 _______
1999 _______
2000 _______
Total _______
1
<PAGE>
; provided, however, that (i) the Option to acquire such shares shall vest on
the date set forth above only in the event that Employee is in the employ of the
Company or any of its subsidiaries in any capacity on such date and (ii) the
Option to acquire any Exercise Shares, if not earlier terminated by the terms of
this Agreement, shall terminate on the 5th annual anniversary date of the date
on which the Option to acquire such Exercise Shares vested as provided in this
clause (b). The period beginning on the Commencement Date and ending on the
Termination Date is sometimes referred to herein as the Option Period. If
Employee is not in the employ of the Company or any of its subsidiaries in any
capacity on any of the various vesting dates set forth above, regardless of the
reason therefore, then the Option with respect to such year shall not vest.
2. EXERCISE OF OPTION. The Option may be exercised, so long as it is then
valid and outstanding, from time to time in whole (as to Option Shares then
exercisable) or in part, and if in part, on as many occasions during the Option
Period as Employee shall desire, subject to the terms and provisions of this
Agreement. The Option may be exercised upon delivery on any business day to the
Company at its address set forth below (or such other office of the Company, if
any, as shall theretofore have been designated by the Company by written notice
to the Employee) of the following:
(a) a completed and executed Notice of Option Exercise in the form set
forth in Appendix A hereto and made a part hereof; and
(b) payment of the full Exercise Price for the number of Exercise Shares
set forth in the Notice of Option Exercise, in lawful money of the United States
of America, by certified check or cashier's check made payable to the order of
the Company (or with the consent of the Company, the purchase price therefor may
be paid in whole or in part by the delivery to the Company of certificates
representing shares of Common Stock held by Employee, duly endorsed for transfer
or accompanied by blank stock, each of which shares shall be valued at a price
equal to its then Current Market Value, as defined below).
In the event that Employee is no longer in the employ of the Company or any of
its subsidiaries in any capacity, Employee shall be entitled to exercise this
Option, according to the terms and conditions set forth herein, to purchase only
that number of Option Shares in which Employee has become vested prior to the
termination of such employment.
3. ISSUANCE OF EXERCISE SHARES; DELIVERY OF STOCK CERTIFICATE. The
Company shall, within ten (10) business days (or as soon thereafter as is
practicable) of the exercise of this Option, issue in the name of and cause to
be delivered to the Employee (or such other person or persons, if any, as the
Employee shall have designated in the Notice of Option Exercise) one or more
certificates representing the Exercise Shares to which the Employee (or such
other person or persons) shall be entitled upon such exercise under the terms
hereof. Such certificate or certificates shall be deemed to have been issued
and the Employee (or such other person or persons so designated) shall be deemed
to have
2
<PAGE>
become the record holder of the Exercise Shares as of the date of the due
exercise of this Option.
4. EXERCISE SHARES FULLY PAID AND NON-ASSESSABLE. The Company agrees and
covenants that all Exercise Shares issuable upon the due exercise of the Option
will, upon issuance of a certificate therefor in accordance with the terms
hereof, be duly authorized, validly issued, fully paid and non-assessable and
free and clear of all taxes (other than taxes which, pursuant to this Agreement,
the Company shall not be obligated to pay) or liens, charges, and security
interests created by the Company with respect to the issuance thereof.
5. RESERVATION OF EXERCISE SHARES. At the time of or before taking any
action which would cause an adjustment pursuant to this Agreement increasing the
number of shares of capital stock constituting the Exercise Shares, the Company
will take any corporate action which may be necessary in order that the Company
have remaining, after such adjustment, a number of shares of such capital stock
unissued and unreserved for other purposes sufficient to permit the exercise of
all the then vested Options under this Agreement of like tenor immediately after
such adjustment. The Company will also from time to time take action to
increase the authorized amount of its capital stock constituting the Exercise
Shares if at any time the number of shares of capital stock authorized but
remaining unissued and unreserved for other purposes shall be insufficient to
permit the exercise of the Options under this Agreement then vested. The
Company may but shall not be limited to reserve and keep available, out of the
aggregate of its authorized but unissued shares of capital stock, for the
purpose of enabling it to satisfy any obligation to issue Exercise Shares upon
exercise of Options, through the Termination Date, the number of Exercise Shares
deliverable upon the full exercise of this Option. At the time of or before
taking any action which would cause (pursuant to the provisions of this Section
5) an adjustment resulting in a reduction of the Exercise Price below the then
par value (if any) of the Exercise Shares issuable upon exercise of the Options,
the Company will take any corporate action which may be necessary in order to
assure that the par value per share of the Exercise Shares is at all times equal
to or less than the Exercise Price per share and so that the Company may validly
and legally issue fully paid and non-assessable Exercise Shares at the Exercise
Price, as so adjusted. The Company will also from time to time take similar
action if at any time the Exercise Price is below the then par value of the
Exercise Shares.
6. FRACTIONAL SHARES. The Company shall not be required to issue
fractional shares of capital stock upon the exercise of this Option or to
deliver stock certificates which evidence fractional shares of capital stock.
In the event that any fraction of an Exercise Share would, except for the
provisions of this Section 6, be issuable upon the exercise of this Option, the
Company shall pay to the Employee an amount in cash equal to such fraction
multiplied by the Current Market Value (as defined herein) of the Exercise
Share. For purposes of this subparagraph, the "Current Market Value" shall
mean, and be determined, as follows:
3
<PAGE>
(a) if the type of securities representing the Exercise Shares are traded
in the over-the-counter market and not on any national securities exchange and
not in the NASDAQ Reporting System, the average of the mean between the last bid
and asked prices per share, as reported by the National Quotation Bureau, Inc.,
or another generally accepted reporting service, for the last business day prior
to the date on which this Option is exercised, or if not so reported, the
average of the closing bid and asked prices for an Exercise Share as furnished
to the Company by any member of the National Association of Securities Dealers,
Inc., selected by the Company for that purpose;
(b) if the type of securities representing the Exercise Shares are listed
or traded on a national securities exchange or in the NASDAQ National Market
System, the closing price on the principal national securities exchange on which
they are so listed or traded or in the NASDAQ National Market System, as the
case may be, on the last business day prior to the date of the exercise of this
Option. The closing price referred to in this clause (b) shall be the last
reported sales price or, in case no such reported sale takes place on such day,
the average of the reported closing bid and asked prices, in either case, on the
national securities exchange on which the Exercise Shares are then listed or in
the NASDAQ Reporting System; or
(c) if no such closing price or closing bid and asked prices are
available, as determined in any reasonable manner as may be prescribed by the
Board of Directors of the Company.
7. PAYMENT OF TAXES. The Company will pay all documentary stamp taxes, if
any, attributable to the issuance of Exercise Shares upon the exercise of this
Option; provided, however, that the Company shall not be required to pay any tax
or taxes which may be payable in respect of any transfer involved in the issue
of any certificates representing the Exercise Shares in a name other than that
of the Employee, and the Company shall not be required to issue or deliver such
certificates unless or until the person or persons requesting the issuance
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.
8. RIGHTS OF EMPLOYEE. The Employee shall not, by virtue of anything
contained in this Agreement or otherwise, be entitled to any right whatsoever,
either in law or equity, of a stockholder of the Company, including without
limitation, the right to receive dividends or to vote or to consent or to
receive notice as a shareholder in respect of the meetings of shareholders or
the election of directors of the Company or any other matter, with respect to
any Exercise Shares prior to the acquisition of such Exercise Shares on the
exercise of this Option as provided in this Agreement .
9. ADJUSTMENT OF EXERCISE SHARES AND EXERCISE PRICE. The Exercise Price
and the number and kind of Exercise Shares purchasable upon the exercise of this
Option shall be subject to adjustment from time to time upon the happening of
certain events as provided in this Section 9. The Exercise Price in effect at
any time and the number and
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kind of securities purchasable upon exercise of this Option also shall be
subject to adjustment as hereinafter provided.
(a) In the case the Company shall (i) pay a dividend or make a
distribution on its shares of Common Stock in shares of Common Stock, (ii)
subdivide or classify its outstanding Common Stock into a greater number of
shares or (iii) combine or reclassify its outstanding Common Stock into a
smaller number of shares, the Exercise Price in effect at the time of the record
date for such dividend or distribution or of the effective date of such
subdivision, classification, combination or reclassification shall be
proportionally adjusted so that the Employee, upon any exercise of this Option
immediately thereafter shall be entitled to receive the aggregate number and
kind of shares which, if this Option had been exercised by such Employee
immediately prior to such date, he would have owned upon such exercise and been
entitled to receive upon such dividend, subdivision, classification, combination
or reclassification. For example, if the Company declares a 2 for 1 stock
dividend or stock split and the Exercise Price immediately prior to such event
was $5.00 per share, the adjusted Exercise Price immediately after such event
would be $2.50 per share, and as a result, the number of Option Shares would
double. Such adjustment shall be made successively whenever any event listed
above shall occur.
(b) In case the Company shall hereafter issue rights or warrants to all
holders of its Common Stock entitling them to subscribe for or purchase shares
of Common Stock (or securities convertible into Common Stock) at a price (or
having a conversion price per share) less than the current market price of the
Common Stock (as defined in the subsection (d) below) on the record date
mentioned below, the Exercise Price shall be adjusted so that the same shall
equal the price determined by multiplying the Exercise Price in effect
immediately prior to the date of such issuance by a fraction, the numerator of
which shall be the sum of the number of shares of Common Stock outstanding on
the record date mentioned below and the number of additional shares of Common
Stock which the aggregate offering price of the total number of shares of Common
Stock so offered (or the aggregate conversion price of the convertible
securities so offered) would purchase at such current market price per share of
the Common Stock, and the denominator of which shall be the sum of the number of
shares of Common Stock outstanding on such record date and the number of
additional shares of Common Stock offered for subscription or purchase (or into
which the convertible securities so offered are convertible). Such adjustment
shall be made successively whenever such rights or warrants are issued and shall
become effective immediately after the record date for the determination of
shareholders entitled to receive such rights or warrants; and to the extent that
shares of Common Stock are not delivered (or securities convertible into Common
Stock are not delivered) after the expiration of such rights or warrants the
Exercise Price shall be readjusted to the Exercise Price which would then be in
effect had the adjustments made upon the issuance of such rights or warrants
been made upon the basis of delivery of only the number of shares of Common
Stock (or securities convertible into Common Stock) actually delivered.
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(c) Whenever the Exercise Price payable upon exercise of this Option is
adjusted pursuant to the provisions of (a) or (b) above, the number of Exercise
Shares purchasable upon exercise of this Option shall simultaneously be adjusted
by multiplying the number of Exercise Shares initially issuable upon exercise of
this Option by the Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
(d) For the purpose of any computation under the subsection above, the
current market price per share of Common Stock at any date shall be deemed to be
the average of the daily closing prices for 30 consecutive business days before
such date. The closing price for each day shall be the last sale price (regular
way) or, in case no such reported sale takes place on such day, the average of
the last reported bid and lowest reported asked prices as reported by NASDAQ, or
other similar organization if NASDAQ is no longer reporting such information, or
if not so available, the fair market price as determined by the Board of
Directors.
(e) No adjustment in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least one cent ($0.01) in
such price; provided, however, that any adjustments which by reason of the
provisions of this sentence are not required to be made shall be carried forward
and taken into account in any subsequent adjustment required to be made
hereunder. All calculations under this Section 9 shall be made to the nearest
cent or to the nearest one-hundredth of a share, as the case may be. Anything
in this section to the contrary notwithstanding, the Company shall be entitled,
but shall not be required, to make such changes in the Exercise Price, in
addition to those required by this Section 9 as it, in its sole discretion,
shall determine to be advisable in order that any dividend or distribution in
shares of Common Stock, subdivision, classification, reclassification or
combination of Common Stock, issuance of warrants or options or other rights to
acquire Common Stock or distribution of evidences of indebtedness or other
assets (excluding cash dividends) referred to hereinabove in this Section 9
hereafter made by the Company to the holders of its Common Stock shall not
result in any tax to the holders of its Common Stock or securities convertible
into Common Stock.
(f) Whenever the Exercise Price is adjusted, as herein provided, the
Company shall promptly cause a notice setting forth the adjusted Exercise Price
and adjusted number of Shares issuable upon exercise of this Option to be mailed
to the Employee, at the address set forth in this Agreement for notice, and
shall cause a certified copy thereof to be mailed to its transfer agent, if any.
The Company may retain a firm of independent certified public accountants
selected by the Board of Directors (who may be the regular accountants employed
by the Company) to make any computation required by this Section 9, and a
certificate signed by such firm shall be conclusive evidence of the correctness
of such adjustment.
(g) In the event that at any time, as a result of an adjustment made
pursuant to this Section 9, the Employee thereafter shall become entitled to
receive any Exercise Shares of
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the Company other than Common Stock, thereafter the number of such other shares
so receivable upon exercise of this Option shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Common Stock contained in this Section 9.
10. RESTRICTIONS ON EXERCISE AND TRANSFERABILITY. This Option, and the
rights of Employee under this Agreement, shall be exerciseable only by the
Employee or, upon his death or disability, by his estate or any duly appointed
guardian, executor, administrator, trustee or other legal representative(s), and
shall not be transferred or assigned to any other party other than Employee's
estate upon his death.
11. RESTRICTIVE LEGENDS. So long as an exemption therefrom is then
available, the Company shall not be required by the terms of this Agreement to
register, under the Securities Act of 1933, as amended (the "Act"), or under
applicable state securities laws (together with the Act, the "Securities Laws"),
any of the Exercise Shares issued or to be issued upon the exercise of the
Option. In addition, in the event that any such Exercise Shares are not so
registered, Employee consents to the placement on the certificate or
certificates representing such Exercise Shares a legend or legends to the effect
that, among other things, neither such certificate or certificates nor the
Exercise Shares evidenced thereby have been registered under any Securities Laws
and that no sale, transfer or other disposition thereof or any interest therein
may be made or shall be recognized unless in the satisfactory written opinion of
counsel for, or satisfactory to, the Company, such transaction would not violate
or required registration under such Securities Laws. The Company may also place
on such certificate or certificates any other legend it deems necessary or
desirable in order to conform to any of the Securities Laws.
12. CERTAIN REGISTRATION RIGHTS. If at any time prior to the Termination
Date the Company registers under the Act any shares of Common Stock to be issued
to an executive officer of the Company or any of its subsidiaries upon exercise
of an option (a "Management Option") to acquire such shares of Common Stock
granted in connection with such person's employment with the Company or any of
its subsidiaries as an executive officer, then the Company shall offer in
writing to Employee a corresponding right to receive shares of Common Stock that
are registered under the Act upon the exercise of any of Employee's then vested
and unexercised shares of Common Stock under this Agreement upon similar terms
and provisions as those offered to such other executive officer. In addition,
if at any time prior to the Termination Date the Company offers to register any
of such other executive officer's outstanding shares of Common Stock that were
issued to him upon exercise of a Management Option, then the Company shall offer
in writing to Employee at the same time a corresponding right to cause the
Company to register any of the Employee's then outstanding shares of Common
Stock that were issued to him upon exercise of the Option granted under this
Agreement. The rights granted in favor of Employee under this Section 12: (a)
shall be as equal in nature to the rights granted in favor of such other
executive officer as is reasonably practicable, (b) shall relate to a
proportionate number of Employee's shares of Common Stock as the Board of
Directors of the Company deems reasonable and (c) shall be subject to such other
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reasonable terms and conditions as the Board of Directors of the Company may
then impose.
13. NOTICES. All notices or other communications under or relating to
this Agreement shall be in writing and shall be deemed to have been given if
delivered by hand or mailed by certified mail, postage prepaid, return receipt
request, addressed as follows:
If to the Company:
North American Technologies Group, Inc.
4710 Bellaire Blvd., Suite 301
Bellaire, Texas 77401
Attn: Corporate Secretary
If to the Employee:
_________________________
c/o ______________________
______________________
______________________
Either of the Company or the Employee may from time to time change the address
to which notices to it are to be mailed hereunder by notice in accordance with
the provisions of this Section.
14. AMENDMENTS. This Agreement may be amended or supplement only by a
writing signed by both parties hereto.
15. SUCCESSORS AND ASSIGNS. Subject to the provisions of Section 10
hereof, this Agreement shall inure to the benefit of and be binding on the
respective successors, assigns and legal representatives of the Employee and the
Company.
16. SEVERABILITY. If for any reason any provision, paragraph or terms of
this Agreement is held to be invalid or unenforceable, all other valid
provisions herein shall remain in full force and effect and all terms,
provisions and Sections of this Agreement shall be deemed to be severable.
17. GOVERNING LAW. To the full extent controllable by stipulation of the
Company and Employee, this Agreement shall be interpreted and enforced under
Texas law.
18. HEADINGS. Headings used herein are included herein for convenience of
reference only and shall not affect the construction of this Agreement or
constitute a part of this Agreement for any other purpose.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed the day and year first set out above.
"Company" NORTH AMERICAN TECHNOLOGIES
GROUP, INC.
By:_______________________________________
Tim B. Tarrillion
President and Chief Executive Officer
"Employee" __________________________________________
[insert Employee's name]
__________________________________________
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APPENDIX A
NOTICE OF STOCK OPTION EXERCISE
Pursuant to that certain Stock Option Agreement, dated as of
______________, as amended to date (the "Agreement"), by and between North
American Technologies Group, Inc., a Delaware corporation (the "Company"), and
the undersigned, and subject to the vesting periods set forth therein, the
undersigned hereby irrevocably elects to exercise an option to acquire
________________ shares of ______________________, at an exercise price of $____
per share, or an aggregate purchase price of $__________. Enclosed herewith is
a certified check or cashier's check made payable to the order of the Company in
the amount of the aggregate purchase price set forth in the preceding sentence
[or, if, applicable: "; provided, however, that $________ of such purchase
price therefor is hereby paid by the delivery to the Company of ______ shares of
Common Stock represented by certificate no(s) ___________, duly endorsed for
transfer or accompanied by a blank stock power, all in accordance with the terms
and provisions of the Agreement"]. Each capitalized terms used herein, unless
otherwise defined, has the meaning given such term in the Agreement.
The undersigned hereby represents and agrees that the Exercise Shares
purchased pursuant hereto are being purchased for investment and not with a view
to the distribution or resale thereof, and that the undersigned understands that
said Exercise Shares have not been registered under the Securities Laws.
The undersigned requests that a certificate for the Exercise Shares be
issued in the name of:
______________________________________
______________________________________
______________________________________
[Please print name, address]
Address of Employee (if different from above):
_________________________________
_________________________________
_________________________________
Dated:__________________
Name of Employee: _________________________________
Employee's Signature: _________________________________
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EXHIBIT 23.2
Consent of Independent
Certified Public Accountant
North American Technologies Group, Inc.
Houston, Texas
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement (S-8) of our report dated
March 14, 1996, except for Notes 7(a), 8(a) and 20, which are as of April 8,
1996, relating to the consolidated financial statements of North American
Technologies Group, Inc. Appearing in the Company's Annual Report on form 10-K
for the year ended December 31, 1995.
/s/ BDO Seidmain, LLP
BDO Seidman, LLP
Houston, Texas
November 20, 1996
