As filed with the Securities and Exchange Commission on _______________,
1996,
Registration No. 33-______________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________
FORM S-8
Registration Statement
Under
The Securities Act of 1933, as amended.
_____________
U. S. TECHNOLOGIES INC.
(Exact name of registrant as specified in charter)
Delaware 73-1284747
(State of other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification
Number)
1402 Industrial Blvd.
Lockhart, Texas 78644
(512) 376-1049
(Address and telephone number of registrant's principal executive offices
and place of business)
William Meehan
President and Chief Executive Officer
Lockhart, Texas 78644
(512) 376-1049
(Name, address and telephone of agent for service)
Copies of all communications, including all communications sent to the
agent for service, should be sent to:
Jack D. Bryant
7404 Napier Trail
Austin, Texas 78729
(512) 219-7232
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the Registration Statement becomes
effective.
If the only securities being registered on this Form are being
offered pursuant to dividends or interest reinvestment plans, check the
following line:______
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 line:
x
CALCULATION OF REGISTRATION FEE
Title of each class Amount Proposed Propose
d Amount of
of securities to to be maximum aggregate Registra
tion
be registered registered offering price (1) offer
ing price(1) fee(1)
Common Shares, $0.02
par value per share,
issuable upon exercise
of stock options by
Selling Shareholders800,000* $0.165 $132,000.00 $250.00
Totals 800,000 $0.165 $132,000.00 $250.00
____________________________________________________________
_________________
[1] Based upon the mean between the closing bid and ask
prices for the Common Shares on November 8, 1996, in
accordance with Rule 457(c).
2
PROSPECTUS
U. S. TECHNOLOGIES INC.
800,000 Common Shares,
$0.02 per value per share
All of the $0.02 par value common shares (the "Common
Shares") of U. S. Technologies Inc. (the "Company") are
issuable upon exercise of stock options ("Options") to be
issued by the Company to its officers, directors, employees
and/or consultants. The Options will be issued to such
individuals and/or entities pursuant to written benefit
plans maintained by the Company. The Company will not
receive any proceeds from the sale of the Common Shares sold
by Shareholders, although the Company will receive the
exercise price payable upon any exercise of the options.
A total of 800,000 Common Shares registered hereunder
are issuable upon exercise of stock options issued by the
Company under its Nonqualifying Stock Option Plan (the
"Plan") to employees, directors, and/or other persons
associated with the Company whose services have benefitted
the Company. An aggregate of 800,000 Common Shares underlie
the options, none of which are presently outstanding, but
will be for a period of ten (10) years from the date of
grant. Options must be issued within ten (10) years from
April 30, 1996. The exercise price will be determined by
the Board of Directors of the Company.
The Company's Common Shares are listed with the
National Association of Securities Dealer, Inc. (NASD) and
traded on the OTC Bulletin Board. On November 8, 1996, the
last reported sales price for the Common Shares as reported
on the OTC Bulletin Board was $0.15 and $0.18 asked.
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF
RISK, IMMEDIATE SUBSTANTIAL DILUTION, LIMITED OPERATIONS,
OPERATING LOSSES, AND CONTINUING NEED FOR WORKING CAPITAL.
See "Risk Factors."
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is November 12, 1996.
3
As of the date of this Prospectus, none of the common Shares
underlying the Options described herein have been issued.
The Company anticipates that upon exercise of the
Options, of which there is no assurance, sales by the
holders thereof may be effected from time to time, by or for
the accounts of the Selling Shareholders, on the OTC
Bulletin Board Automated Quotation System ("OTCBB") or in
the over-the-counter market, in negotiated transactions, or
otherwise. Sales will be made through broker/dealers acting
as agents for the Selling Shareholders or to broker/dealers
who may purchase the Common Shares as principals and
thereafter sell the shares from time to time on the OTC
Bulletin Board, in the over-the-counter market, in
negotiated transactions, or otherwise. Sales will be made
either at market prices prevailing at the times of the sales
or at negotiated prices. See "Plan of Distribution."
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the year
ended December 31, 1995 (herein collectively, the "Form 10-
K"); and, the Company's Form 8-A Registration Statement
filed with the Commission on June 11, 1987 (File No. 0-
15960) filed under the Securities Exchange Act of 1934, are
hereby incorporated in this Prospectus by reference, and all
documents subsequently filed by the Company pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934, prior to the termination of the offering
described herein, shall be deemed to be incorporated in this
Prospectus and to be a part hereof from the date of the
filing of such documents. Any statement contained in a
document incorporation by reference herein shall be deemed
to be modified or superseded for all purposes to the extent
that a statement contained in this Prospectus or in any
other subsequently filed document which is also incorporated
herein by reference modifies or replaces such statement.
The Company will provide without charge to each person to
whom this Prospectus is delivered, on written or oral
request of such person, a copy (without exhibits) of any or
all documents incorporation by reference in this Prospectus.
Requests for such copies should be directed to William
Meehan, President, U.S. Technologies Inc., (1) if by
telephone to (512) 376-1049, or (ii) if by mail to P.O. Box
697, Lockhart, Texas 78644.
4
THE COMPANY
General Development of Business
U. S. Technologies Inc. (the "Company") was
incorporated on September 9, 1986, in the State of Delaware
as CareAmerica Inc. From time to time the term "Company" as
used herein refers to U.S. Technologies Inc. by itself or to
collectively refer to U. S. Technologies Inc. and some or
all of its subsidiaries, past and present. The Company was
formed to furnish in-home medical care services. On April
14, 1987, the Company completed a public offering of 660,000
units, each unit consisting of one share of Common Stock and
one Redeemable Warrant, each separately transferable
immediately upon issuance. The foregoing reflects a 1 for 5
reverse split of the Registrant's Common Stock, Warrants and
Options which took place on February 8, 1993, and assumes no
additional shares issued in respect of any fractional shares
which may have resulted from the reverse split.
In 1987 the Company changed business direction from the
medical industry to electronics. On September 1, 1988, the
Company moved its corporate headquarters from Kansas City,
Missouri, to Austin, Texas. The Company's decision to move
its headquarters to Austin, Texas, was made in order to more
effectively monitor the day-to-day activities of its
Subsidiaries. The management of the Company felt that
maintaining offices in Kansas City, Missouri, when its
operating Subsidiaries were in Austin, Texas, was an
unnecessary expense for the Company.
On July 14, 1989, the shareholders of the Company
approved a proposal to change the name of the Corporation
from CareAmerica Inc. to U.S. Technologies Inc. On July 14,
1989, the Company filed a Certificate of Amendment of
Certificate of Incorporation with the Secretary of State of
Delaware causing the name of the corporation to be changed
to U.S. Technologies Inc. Effective with the start of
business July 17, 1989, the Company's Common Stock traded on
the over-the-counter market and listed on the National
Association of Securities Dealers Automated Quotations
(NASDAQ) System. The trading symbol was changed to USXX.
Prior to June, 1994, the Company owned three (3)
additional subsidiaries which had been in operation for
several years: American Microelectronics Inc. ("AMI"),
Republic Technology Corporation ("Republic"), and U.S.
MicroLabs Inc. ("MicroLabs"). AMI was in the electronics
contract manufacturing business. Republic was in the
business of designing and marketing personal computers.
MicroLabs had been inactive for several years, but had at
one time been in the business of developing and marketing
software. AMI was the largest secured creditor of Republic.
The Company was the largest secured creditor of AMI. In
5
June, 1994, AMI foreclosed on its security interest in
Republic and accepted an assignment of all of Republic's
assets (all of which were covered by AMI's security
agreement) in satisfaction of Republic's debts to AMI.
Subsequent thereto the Company foreclosed on its security
interest in AMI and accepted an assignment of AMI's assets
(that were covered by the Company's security agreement) in
satisfaction of AMI's debts to the company. The Company
made a capital contribution of the foreclosed assets to the
newly formed company, Lockhart Technologies, Inc., "LTI" in
exchange for all of the capital stock of that company.
After the foreclosures, the Company sold all of its interest
in AMI, Republic, and MicroLabs for a total consideration of
$1,758.
The Company presently has two wholly owned
subsidiaries: Lockhart Technologies, Inc., a Texas
corporation ("LTI") and Newdat, Inc., an Arizona corporation
("Newdat"). Newdat owns an eighty percent (80%) interest in
SensonCorp Liesmited, an Arizona corporation ("Senson").
The Company acquired Newdat on January 23, 1995, in exchange
for 7,053,728 shares of the Company's common stock.
6
LTI was incorporated on June 29, 1994. LTI was
capitalized by the Company by the contribution of certain
assets, tangible and intangible, which the Company received
through its foreclosure of AMI. The assets were valued at
$1,764,580. LTI operates an electronics contract
manufacturing facility located inside a minimum security
prison facility located in Lockhart, Texas. LTI has an
Industry Work Program Agreement (the "IWPA"), which includes
a lease agreement, with Wackenhut Corrections Corporation,
The Texas Department of Criminal Justice, Division of
Pardons, and Paroles and the City of Lockhart, Texas. The
IWPA and Lease were assigned to LTI by American
Microelectronics Inc., a corporation formerly owned by the
Company. Wackenhut Corrections Corporation has not yet
formally ratified the assignment of the IWPA from American
Microelectronics Inc. to LTI, but has continued full
cooperation with LTI over the past 28 months. The Industry
Work Program Agreement provides and encourages LTI to
recruit and hire qualified employees from the 500 male
residents presently in this facility. Prospective resident
employees are provided vocational and educational training
by Wackenhut and the Texas Department of Criminal Justice,
Division of Pardons and Paroles tailored to the Company's
specifications. The Company is required to pay resident
employees at a rate prevailing in the area for similar work,
but at no time less the Federal Minimum Wage rate. The
lease agreement provides for approximately 27,800 square
feet of manufacturing and office space through January 31,
1997 and provides for automatic three year extensions unless
notification is given by either party at least six months
prior to the expiration of each term. LTI has been notified
by Wackenhut that it wishes to review the terms of the
second three year lease in the near future. The Company
does not anticipate any material changes in the terms of the
renewal option. The lease provides for annual rental rates
of $1 per year for the primary term and the first automatic
three year extension.
On September 5, 1996, the Company was notified by
NASDAQ that effective September 6, 1996, the Company's
securities would be deleted from the Nasdaq Small Cap Market
because the Nasdaq Listing Qualifications Panel lacked
confidence in the Company's short term plan to maintain
compliance with the listing requirements. The Company's
securities are presently trading on the OTC Bulletin Board
under the same trading symbol "USXX".
Principal Products, Services and Revenue Sources
The Company furnishes direction, administrative and
consulting services to its Subsidiaries, and raises funds as
appropriate for their operation and expansion.
7
LTI offers contract manufacturing services for
electronic circuit boards. LTI does not manufacture the
actual circuit boards; LTI purchases them from board
manufacturers. Electrical components placed on the boards
are furnished by LTI's customers in kit form or purchased
directly from electrical supply houses or parts
manufacturers. LTI places the components on the board,
solders the connections and, if requested, tests the
assembled board. LTI also performs electro-mechanical
assembly.
The electronic circuit board is the basic element for
manufacturing electronic circuitry today. Individual
electrical components such as resistors, capacitors and
solid state devices are mounted on the circuit board. Such
electrical components are "packaged" as "through-hole" or
"surface mount" devices. Through-hole components have wire
leads which are placed through holes on the board. The wire
leads are soldered to the board on the reverse side.
Surface mount components are smaller and have much shorter
leads or metallic ends which are soldered directly to small
metal pads on top of the board.
LTI's services may be used by any business that uses
electronic circuit boards. LTI presently assembles products
utilized in computers, computer peripherals, security and
communications systems, medical equipment and electronic
testing devices. LTI markets its services through two (2)
in-house salespeople and five manufacturing representative
sales people. It has increased the sales force by 350% over
the past six months and is attempting to expand its contract
manufacturing business by including larger runs and turnkey
operations.
Newdat, Inc. is an Arizona corporation which has
developed to market ready status a device for measuring (in
real time during production) the thickness of coatings on
wire, e.g., measuring the thickness of the zinc coating on
galvanized wire. This device has wide ranging alternative
applications. For example it can also be used to detect
flaws in wire and cable during production or while in use,
e.g., elevator or ski lift cables. Newdat is also
developing a high speed tape backup unit for computers,
utilizing a helical scan technology. Newdat also owns an
eighty percent (80%) interest in SensonCorp Limited "Senson"
which is presently marketing a line of environmentally
friendly chemical coatings developed by a major Australian
chemical company. Senson has exclusive rights to
manufacture and market these products in North America. The
coatings have a variety of applications, all with non toxic
anti-corrosion capability using vapor phase corrosion
inhibitors. Over the past half year, the Company's
management has consolidated much of Newdat's engineering
8
business in Lockhart as a control measure and cost saving
exercise.
The Company successfully concluded an agreement in the third
quarter of 1996 to acquire an 85% ownership interest in the
QuakeAlarm technology from Komen Holdings Pty., a new South
Wales Holding Company in exchange for 3,536,000 shares of
the Company's common stock. This technology, which has been
developed and prototyped, is a fully integrated early
warning earthquake alarm that can detect the first sign of
an imminent earthquake. The QuakeAlarm can alert the user
before humans begin to feel the earthquake by sensing the
quake's "P" (primary) wave, which precedes the "S" (shock)
waves which cause the damage. The purchase of the majority
ownership gives the Company exclusive manufacturing and
marketing right to the product worldwide. The Company plans
to commence production of the QuakeAlarm immediately and
market this product through several marketing
representatives worldwide.
Another potential business opportunity for LTI is a product
which it has developed on behalf of a customer. The product
is an energy saving device which has been developed for a
local company and is presently in field testing. The
product offers LTI the opportunity to undertake long
production run work which will enable combining the building
of circuit boards and coils with electro-mechanical
assembly.
LTI has entered into an exclusive three year agreement with
an Austin, Texas, original computer equipment manufacturer
"OEM" for the assembly, testing and shipping to end users a
new line of computers using the MAC operating system. The
OEM estimated that approximately 60,000 units will be
produced during the first year of the contract and
approximately 120,000 units during the second year.
Raw Materials
Some of the components and raw materials used by the
Company's subsidiaries are available from a limited number
of suppliers and/or are susceptible to non availability due
to periodic shortages. While component purchasing lead
times are improving due to greater competition. In some
instances there may be lead times of several months or
longer to obtain and sustain an adequate supply of
components. While parts are generally available, delays in
obtaining some parts could jeopardize orders and increase
the cost of operations for LTI and Newdat. LTI has
experienced prolonged or significant shortages in the past.
However, from time to time parts shortages may be expected
to cause temporary delays in production of some products.
Senson's raw materials include chemical stocks which are
generally available and management does not presently
9
anticipate any restrictions or delays in production due to
shortages in raw materials.
Patents, Trademarks, Licenses, Franchises and Concessions
The Company and LTI do not have any patents,
trademarks, licenses, franchises or concessions; however,
they may apply for some in the future. Because of the rapid
pace of technological change, the Company believes that
copyright, trademark and other legal protections are less
significant in its industry than such factors as innovative
skills, technological expertise and marketing abilities.
Newdat, Inc. holds U.S. and Canadian patents relating
to its wire measurement technology. These patents; covering
the same technology, reveal a new technology for measuring
the thickness of zinc and similar coatings on wire as well
as nondestructive electromagnetic testing of other
properties of wire. It is difficult to ascertain the value
of these patents. The novel parts of the device are its
ability to sense changes in external and internal
structures, including the on-line measurement of metallic
coating being applied to wire. The Company believes that
the rapid pace of change in high technology fields today
makes the ability to continuously innovate and develop new
technologies as important in some instances as the patents
themselves.
Senson's conformal coatings are widely protected by
patents, in particularly the "phased" emission of VPCI's
from the coatings.
Working Capital Practices
The Company's subsidiaries are discouraged from
carrying excess quantities of raw materials or purchased
parts because most of their products are produced to demand;
therefore, components and parts can usually be ordered as
needed. LTI has an agreement which allows one of its
suppliers to purchase materials from LTI's inventory when
they have needs for certain items. This procedure is to be
extended to other customers and known users of certain of
LTI's inventory. In a determined effort to limit inventory
holdings, LTI has introduced a heavy hand in its write-off
program and has made a allowance for obsolence in the amount
of $395,000 complemented with a determination to find buyers
for slow moving items. LTI offers selected customers a 2%
discount if bills are paid within ten days.
Dependence on Customers
LTI has broadened its customer base during 1995 and
1996 and is less dependent on key customers than previously.
However, it is now seeking longer production runs than in
10
the recent past and if it is successful, dependence on one
or more customers is inevitable. The loss of any one of
such customers would have a material adverse effect on LTI
and the Company. Management believes that this situation
will abate as LTI's customer base expands.
Backlog
At October 31, 1996, LTI's backlog (which represents
that portion of outstanding contracts not yet included in
revenue) was approximately $1,140,000. It is anticipated
that 100% of the backlog will be delivered before April 30,
1997.
At October 31, 1996, Newdat had no backlog as the wire
measurement devices have not passed through their Beta site
testing phases, and are therefore not offered for sale.
At October 31, 1996, Senson's had no backlog and at
this time Senson should be able to meet its marketing needs
as the Company manufactures in large batches.
Because LTI and Newdat receive price commitments from
their vendors, their costs normally do not increase relative
to backlog orders. Engineering changes in products by any
of LTI's customers or other events beyond the control of LTI
could result in the cancellation or suspension of some of
LTI's present backlog.
Competitive Conditions
LTI, Newdat and Senson are in competition with a large
number of firms. Most of their competitors are
substantially larger and have greater financial resources.
LTI's business is capital intensive, i.e., a significant
investment in equipment is necessary. The greater financial
resources of many of LTI's competitors gives those
competitors an advantage over LTI. Newdat and Senson have
products which face competition from other products. The
Company believes the products of Newdat and Senson have
features and qualities which give them a competitive
advantage. However, the existing control of the market
place by their competitors and the financial resources which
such competition can apply to their competitive marketing
efforts are significant negative factors against the ability
of Newdat and Senson to successfully complete in their
markets. Positive factors pertaining to LTI's competitive
position are the experience of LTI's new management team and
what LTI believes is its ability to address the growing need
for mixed technology circuit boards, i.e., circuit boards
containing both through-hole and surface mount components.
LTI has automated equipment for the assembly of circuit
boards using surface mount and through-hole components.
However, LTI's surface mount equipment is limited in
11
capacity. If LTI is able to sustain and increase its volume
of business, further investments in capital equipment will
be required. The Company will require additional debt
and/or lease financing to acquire additional equipment and
expanded receivables financing to fund any growth in sales.
Terms of possible lease agreements and/or the cost of
borrowed funds may be prohibitive.
Research and Development Activities
Newdat acquired products of which one had already been
developed. Newdat is limiting further research and
development to support the latest possible entry of its
proprietary products into market, and then the support and
enhancement of those products in the field.
Number of Persons Employed
As of October 31, 1996, the Company had two salaried
employees. Several employees of LTI devoted a significant
portion of their time to the affairs of the Company.
As of October 31, 1996, LTI had approximately 69
regular employees. LTI employees include residents from the
minimum security prison facility where the Company is
located.
As of October 31, 1996, Newdat had no employees.
As of October 31, 1996, Senson had 1 part time
employee.
None of the Company's employees are represented by a
union. The Company believes that its relationship with its
employees is good.
Regulation
The Company is subject to Food and Drug Administration
("FDA") regulations relating to medically related devices
which its subsidiary, LTI manufactures. These regulations
are generally applicable to companies producing medical
electronics. The products that are subject to FDA
regulation are not a significant portion of LTI's business.
All of the Company's subsidiaries are subject to OSHA.
USE OF PROCEEDS
The Company will not receive any of the proceeds from
the sale of the Common Shares by the Grantees of the
options. However, the Company may receive proceeds from
exercise of the Options, of which there is no assurance.
All net proceeds received by the Company from exercise of
12
the Options shall be added to working capital of the Company
and utilized for any valid corporate purpose. It is
presently anticipated that the proceeds may be utilized for
payment of outstanding accounts payable and general and
administrative expenses.
13
RISK FACTORS
The purchase of these securities involves a high degree
of risk. Prospective investors should carefully consider
the following factors, among others set forth in this
Prospectus, before making a decision to purchase the Common
Shares offered hereby.
1. Going Concern. The Company incurred significant
losses during the years ended December 31, 1995, 1994 and
1993 and had a working capital deficiency at December 31,
1993. The Company's auditors, Brown, Graham & Company P.C.,
have rendered a "going concern" opinion in its report. The
Company's consolidated financial statements have been
presented on the basis that the Company is a going concern
which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of
business. The Company's continued existence is dependent
upon its ability to resolve its liquidity problems, which it
plans to resolve principally from profitable operations,
accounts receivable based borrowing, long-term debt or
equity financing and the continued support and forbearance
of its vendors and creditors. (See Risk Factors - Future
Capital Needs and Possible Loss of Facilities)
2. NASDAQ Maintenance Requirements - the Common Stock
and Redeemable Warrants have been deleted from the Nasdaq
SmallCap Stock Market. The Company's Common Stock was
deleted effective September 6, 1996, because the Common
Stock was trading at $.125 per share, which was below the
required minimum bid price of $1.00 per share. Although,
the Company did meet the alternative minimum bid price test
requirement of $2,000,000 in capital and surplus and
$1,000,000 in market value of public float the Nasdaq
Listing Qualifications Panel was of the opinion that the
Company's plan to ensure long term compliance did not
convince them that the Company would be able to continue
meeting the minimum requirements. The company has requested
that the Review Committee of the Nasdaq Listing and Hearing
Review Committee review this decision and reverse this
decision. As of this date no determination has been made by
the review committee. The Common Stock is presently trading
on the OTC Bulletin Board.
Broker/Dealer Sales of the Company's Securities on the OTC
Bulletin Board are subject to Securities and Exchange
Commission Rules that impose additional sales practice
requirements on broker/dealers who sell such securities to
persons other than established customers and accredited
investors (generally institutions with assets in excess of
$5,000,000 or individuals with a net worth in excess of
$1,000,000 or an annual income exceeding $200,000 or
$300,000 jointly with their spouse). The Company's
Redeemable Warrants and Common Stock are subject to these
14
rules. For transactions covered by the Rules, the
broker/dealer must make a special suitability determination
for the purchaser, and receive the purchaser's written
agreement to the transaction prior to the sale, deliver a
notice to the customer of the hazards involved in investing
in such securities, and comply with additional regulations
which became operative on January 3, 1993. Consequently,
the Rule may affect the ability of broker/dealers to sell
the Company's securities and also may affect the ability of
purchasers in this offering to sell their shares in the
secondary market.
3. Operating Losses. The Company has accumulated a
deficit of $8,345,220 since its inception through the year
ending December 31, 1995. There is no assurance that the
Company will operate profitably in the future.
4. Absence of Dividends. No dividends have been
declared or paid by the Company on its Common Stock. The
Company intends to devote all available funds to the
operation of its business and, accordingly, does not intend
to pay any cash dividends in the foreseeable future.
5. Future Capital Needs. The circuit board contract
assembly business is capital intensive. LTI, the Company's
principal Subsidiary, has need for replacement of some of
its surface mount equipment to remain competitive with some
of its competition. LTI is presently seeking some of this
equipment and is also attempting to finance this equipment.
If LTI is unable to finance the equipment, such an event
could have a material adverse impact on the Company's future
operations and its ability to compete in the industry. If
LTI increases its volume of business, further investments in
capital equipment or replacement thereof and facilities
expansion may be required. There can be no assurance that
additional financing will be available on favorable terms.
6. Competition. The Company has competitors and
potential competitors, many of whom may have considerably
greater financial and other resources than the Company.
7. Product Development. The Company and LTI do not
have any patents, trademarks, licenses, franchises or
concessions; however, they may apply for some in the future.
Because of the rapid pace of technological change, the
Company believes that copyright, trademark and other legal
protections are less significant in its industry than such
factors as innovative skills, technological expertise and
marketing abilities.
Newdat, Inc. holds U.S. and Canadian patents relating
to its wire measurement technology. These patents; covering
the same technology, reveal a new technology for measuring
the thickness of zinc and similar coatings on wire as well
15
as nondestructive electromagnetic testing of other
properties of wire. It is difficult to ascertain the value
of these patents. The novel parts of the device are its
ability to sense changes in external and internal
structures, including the on-line measurement of metallic
coating being applied to wire. The Company believes that
the rapid pace of change in high technology fields today
makes the ability to continuously innovate and develop new
technologies as important in some instances as the patents
themselves.
Senson's conformal coatings are widely protected by
patents, in particularly the "phased" emission of VPCI's
from the coatings.
8. Possible Shortage of Working Capital to Market New
Product. Senson and Newdat have no working capital of their
own and will have to rely upon the Company or intercompany
loans from LTI to market its new product.
9. Product Protection. The Company and LTI do not
have any patents, trademarks, licenses, franchises or
concessions; however, they may apply for same in the future.
The Company believes that copyright, trademark and other
legal protections are less significant in its industry than
such factors as innovative skills, technological expertise
and marketing abilities.
Newdat, Inc. holds U.S. and Canadian patents relating
to its wire measurement technology. These patents; covering
the same technology, reveal a new technology for measuring
the thickness of zinc and similar coatings on wire as well
as nondestructive electromagnetic testing of other
properties of wire. It is difficult to ascertain the value
of these patents. The novel parts of the device are its
ability to sense changes in external and internal
structures, including the on-line measurement of metallic
coating being applied to wire. The Company believes that
the rapid pace of change in high technology fields today
makes the ability to continuously innovate and develop new
technologies as important in some instances as the patents
themselves.
Senson's conformal coatings are widely protected by
patents, in particularly the "phased" emission of VPCI's
from the coatings.
10. Backlog. At October 31, 1996, LTI's backlog
(which represents that portion of outstanding contracts not
yet included in revenue) was approximately $1,140,000. It
is anticipated that 100% of the backlog will be delivered
before April 30, 1997.
16
At October 31, 1996, Newdat had no backlog as the wire
measurement devices have not passed through their Beta site
testing phases, and are therefore not offered for sale.
At October 31, 1996, Senson's had no backlog and at
this time Senson should be able to meet its marketing needs
as the Company manufactures in large batches.
Because LTI and Newdat receive price commitments from
their vendors, their costs normally do not increase relative
to backlog orders. Engineering changes in products by any
of LTI's customers or other events beyond the control of LTI
could result in the cancellation or suspension of some of
LTI's present backlog.
11. Importance of Volume Production. The business of
the Company's principal Subsidiary, LTI, is the contract
assembly of surface mount, through-hole and mixed technology
circuit boards. That business is capital intensive,
requiring a substantial investment in automated equipment.
Hence, the Company has significant fixed costs. Because of
these fixed costs, the Company must have a significant
volume of work to cover manufacturing costs and to sustain
profitability. In this regard, production problems or
planning misjudgments could have a material adverse effect
on the Company.
12. Raw Materials. Some of the components and raw
materials used by LTI and Senson are available from only one
supplier and/or are subject to unavailability due to general
shortages. In some instances, there may be lead times of
several months or longer to obtain and sustain an adequate
supply of components. While parts are generally available,
delays in obtaining some parts can jeopardize orders and
increase the Company's cost of operations.
13. Reliance on a Few Customers. The Company's
principal Subsidiary, LTI, is largely dependent on a few
customers for a significant portion of its cash flow. The
loss of any one of these customers may have a material
adverse impact on the Company.
14. Dependence on Key Personnel. The success of the
Company depends, in part, on the continued availability of
the executive officers, senior staff members and key
technical employees of its Subsidiaries. The unavailability
of certain of these people, or the Company's inability to
attract and retain other key employees, could severely
affect the Company's ability to carry on its business.
There is no assurance that these officers or employees will
remain with the Company or that the Company will be able to
attract and retain other key employees.
17
15. Effect of Possible Bankruptcy, Reorganization or
Similar Proceeding. In the event of a bankruptcy,
reorganization or similar proceeding, the purchasers of the
shares offered pursuant to this Prospectus could lose their
entire investment, even if the Company were to survive.
16. Litigation Involving the Company. There is
litigation pending against the Company and some of its
subsidiaries.
17. Shares Eligible for Future Sale. As of the date
of this Prospectus, the Company has issued and outstanding
21,257,263 shares of Common Stock. 18,742,737 are authorized
but unissued at this time.
18. Shares Issuable Upon Exercise of Redeemable
Warrants. In connection with a public offering, the Company
issued and sold 660,000 Common Stock Purchase Warrants (the
"Redeemable Warrants") to purchase 660,000 shares of the
Company's Common Stock at $10.00 per share at any time until
5:00 p.m., Denver, Colorado, time on April 14, 1992, (the
"Warrant Expiration Date") unless extended by the Company.
(By action of the Board of Directors the expiration date of
the Redeemable Warrants was extended through December 31,
1996). The Redeemable Warrants expire after the Warrant
Expiration Date. The Redeemable Warrants are redeemable by
the Company upon 30 days notice at any time upon the payment
of a redemption premium of $0.005 per Redeemable Warrant
provided that, prior to such redemption, the shares of
Common Stock have traded in the public market for a period
of not less than twenty (20) consecutive trading days at a
closing bid price of not less than $12.50. Upon the
redemption of the Redeemable Warrants, if the holder does
not exercise the Redeemable Warrants, the Redeemable
Warrants will lose all value. There is no assurance that
the Company's Common Stock will ever trade at a level high
enough to cause the exercise of the Redeemable Warrants.
The exercise of the Redeemable Warrants will result in
additional shares of Common Stock being issued with a
resulting dilution in the interests of other shareholders
and could adversely affect the market price of the Common
Stock.
19. Possible Income Tax Consequences Upon Expiration
of Any Unexercised Warrants. The Internal Revenue Service
has taken a position that upon the expiration of warrants
which were not exercised, the issuer of the warrants should
realize taxable income in the year of expiration in an
amount equal to the consideration received upon issuance of
such warrants. If this position should prevail in the
courts, the Company may become liable for federal income
taxes on the amount of the proceeds realized from the sale
of the Redeemable Warrants which expire unexercised.
18
20. Possible loss of Facilities. LTI's operations are
located in a minimum security prison facility under a lease
agreement with Wackenhut Corrections Corporation, The Texas
Department of Criminal Justice, Division of Pardons and
Paroles and the City of Lockhart, Texas, to lease
approximately 27,800 square feet of manufacturing and office
space under an operating lease through January 31, 1997 and
provides for an automatic three year extension. LTI has
been notified by Wackenhut that they wish to renegotiate the
terms of the second renewal option period. These
negotiations will take place within the next thirty days.
The Company does not anticipate that the terms of the
contract will change materially. However, if the company
were not able to renegotiate reasonable terms or was forced
to vacate the current premises, this would have a material
adverse impact on the Company.
FOR ALL OF THE AFORESAID REASONS, AND OTHERS SET FORTH
HEREIN, THE PURCHASE OF THE SECURITIES OFFERED HEREBY
INVOLVE A HIGH DEGREE OF RISK. ANY PERSON CONSIDERING AN
INVESTMENT IN THE SECURITIES OFFERED HEREBY SHOULD BE AWARE
OF THESE AND OTHER FACTORS SET FORTH IN THIS PROSPECTUS.
THE SECURITIES SHOULD BE PURCHASED ONLY BY PERSONS WHO CAN
AFFORD TO ABSORB A TOTAL LOSS OF THEIR INVESTMENT IN THE
COMPANY AND HAVE NO NEED FOR A RETURN ON THEIR INVESTMENT.
PLAN OF DISTRIBUTION
Upon the exercise of any of the Options, sale of shares
may be effected from time to time in transactions (which may
include block transactions) in OTCBB, in over-the-counter
market, in negotiated transactions, through the writing of
options on the Common Shares, or a combination of such
methods of sale, at fixed prices which may be charged, at
market prices prevailing at the time of sale, or at
negotiated prices. Sales may be effected by selling Common
Shares directly to purchasers or to or through
broker/dealers which may act as agents or principals. Such
broker/dealers may receive compensation in the form of
discounts, concessions, or commissions from the sellers
and/or the purchasers of Common Shares for whom such
broker/dealers may act as agents or to whom they sell as
principal, or both. Sellers and any broker/dealer that act
in connection with the sale of Common Shares might be deemed
to be "underwriters" within the meaning of Section 2(11) of
the Act of any commission received by them and any profit on
the resale of the Common Shares as principal might be deemed
to be underwriting discounts and commissions under the Act.
Sellers of the Common Stock may agree to indemnify any
agent, dealer or broker/dealer that participates in
transactions involving sales of Common Shares against
certain liabilities, including liabilities arising under the
Act. The Company will indemnify certain other persons
19
against certain liabilities in connection with the offering
of the Common Shares, including liabilities arising under
the Act.
20
COMMISSION POSITION OF INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
Under Delaware Corporation Act and the Company's
Articles of Incorporation, as amended, the Company's
Officers and Directors may be indemnified against certain
liabilities which they may incur in their capacities as
such.
Section 145 of the General Corporation Law of Delaware
provides as follows:
(a) A corporation may indemnify any person who was or
is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation)
by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him
in connection with such action, suit or proceeding if he
acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct
was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or
upon a plea of nolo contendere or its equivalent, shall not,
of itself, create a presumption that the person did not act
in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that this
conduct was unlawful.
(b) A corporation may indemnify any person who was or
is a party or is threatened to be made party to any
threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor
by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses
(including attorney's fees) actually and reasonably incurred
by him in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best
interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue
21
or matter as to which such person shall have been adjudged
to be liable to the corporation unless and only to the
extent that the Court of Chancery or the court in which such
action or suit was brought shall determine upon application
that, despite the adjudication of liability but in lieu of
all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
(c) To the extent that a director, officer, employee or
agent of a corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding
referred to in subsections (a) and (b) of this section, or
in defense of any claim, issue or matter therein, he shall
be indemnified against expenses (including attorney's fees)
actually and reasonably incurred by him in connection
therewith.
(d) Any indemnification under subsection (a) and (b)
of this section (unless ordered by a court) shall be made by
the corporation only as authorized in the specific case upon
a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances
because he has met the applicable standard of conduct set
forth in subsections (a) and (b) of this section. Such
determination shall be made (1) by the board of directors by
a majority vote of a quorum consisting of directors who were
not parties to such action, suit or proceeding, or (2) if
such a quorum is not obtainable, or, even if obtainable a
quorum of disinterested directors so directs, by independent
legal counsel in a written opinion; or (3) by the
stockholders.
(e) Expenses incurred by an officer or director in
defending a civil or criminal action, suit or proceeding may
be paid by the corporation in advance of the final
disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such director or
officer to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the
corporation as authorized in this section. Such expenses
incurred by other employees and agents may be so paid upon
such terms and conditions, if any, as the board of directors
deems appropriate.
(f) The indemnification and advancement of expenses
provided by, or granted pursuant to, the other subsections
of this section shall not be deemed exclusive of any other
rights to which those seeking indemnification or advancement
of expenses may be entitled under any bylaw, agreement, vote
of stockholders or disinterested directors or otherwise,
both as to action in his official capacity and as to action
in another capacity while holding such office.
22
(g) A corporation shall have power to purchase and
maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise
against any liability asserted against him and incurred by
him in any such capacity, or arising out of his status as
such, whether or not the corporation would have the power to
indemnify him against such liability under this section.
(h) For purposes of this section, references to the
"corporation" shall include, in addition to the resulting
corporation, any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors,
officers, and employees or agents, so that any person who is
or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request
of such constituent corporation as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same
position under this section with respect to the resulting or
surviving corporation as he would have with respect to such
constituent corporation if its separate existence had
continued.
(i) For purposes of this section, references to "other
enterprises" shall include employee benefit plans;
references to "fines" shall include any excise taxes
assessed on a person with respect to any employee benefit
plan; and references to "serving at the request of the
corporation" shall include any service as a director,
officer, employee, or agent of the corporation which imposes
duties on, or involves services by, such director, officer,
employee or agent with respect to an employee benefit plan,
its participants or beneficiaries; and a person who acted in
good faith and in a manner he reasonably believed to be in
the interest of the participants and beneficiaries of an
employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interest of the corporation"
as referred to in this section.
(j) The indemnification and advancement of expenses
provided by, or granted pursuant to, this section shall,
unless otherwise provided when authorized or ratified,
continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of
the heirs, executors and administrators of such a person.
The Company's Articles of Incorporation and Bylaws
provide:
23
Article IV of the Bylaws
Section 1. Right to Indemnification
Each person who was or is made a party or is threatened
to be made a party to or is involved (including, without
limitation, as a witness) in any actual or threatened
action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that
he or she is or was a director or officer of the corporation
or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation
or of a partnership, joint venture, trust or other
enterprise, including service with respect to employee
benefit plans, whether the basis of such proceeding is
alleged action in an official capacity as a director,
officer, employee or agent or in any other capacity while
serving as a director, officer, employee or agent, shall be
indemnified and held harmless by the corporation to the full
extent authorized by the Delaware General Corporation Law,
as the same exists or may hereafter be amended (but, in the
case of any such amendment, only to the extent that such
amendment permits the corporation to provide broader
indemnification rights than said law permitted the
corporation to provide prior to such amendment), or by other
applicable law as then in effect, against all expense,
liability and loss (including attorney's fees judgments,
fines, ERISA, excise taxes or penalties and amounts to be
paid in settlement) actually and reasonably incurred or
suffered by such person in connection therewith and such
indemnification shall continue as to a person who has ceased
to be a director, officer, employee or agent and shall inure
to the benefit of his or her heirs, executors and
administrators; provided, however, that except as provided
in Section 2 of this Article with respect to proceedings
seeking to enforce rights to indemnification, the
corporation shall indemnify any such person seeking
indemnification in connection with a proceeding (or part
thereof) initiated by such person only if such proceeding
(or part thereof) was authorized by the Board of Directors
of the corporation. The right to indemnification conferred
in this Section 1 shall be a contract right and shall
include the right to be paid by the corporation the expenses
incurred in defending any such proceeding in advance of its
final disposition; provided, however, that, if the Delaware
General Corporation Law requires, the payment of such
expenses incurred by a director or officer in his or her
capacity as a director or officer (and not in any other
capacity in which service was or is rendered by such person
while a director or officer, including, without limitation,
service to an employee benefit plan) in advance of the final
disposition of a proceeding shall be made only upon delivery
to the corporation of an undertaking, by or on behalf of
such director or officer, to repay all amounts so advanced
24
if it shall ultimately be determined that such director or
officer is not entitled to be indemnified under this Section
1 or otherwise.
Section 2. Right of Claimant to Bring Suit.
If a claim under Section 1 of this Article is not paid
in full by the corporation within sixty days after a written
claim has been received by the corporation, except in the
case of a claim for expenses incurred in defending a
proceeding in advance of its final disposition, in which
case the applicable period shall be twenty days, the
claimant may at any time thereafter bring suit against the
corporation to recover the unpaid amount of the claim and,
to the extent successful in whole or in part, the claimant
shall be entitled to be paid also the expense of prosecuting
such claim. It shall be a defense to any such action (other
than an action brought to enforce a claim for expenses
incurred in defending any proceeding in advance of its final
disposition where the required undertaking, if any is
required, has been tendered to the corporation) that the
claimant has not met the standards of conduct which make it
permissible under the Delaware General Corporation Law of
the corporation to indemnify the claimant for the amount
claimed, but the burden of proving such defense shall be on
the corporation. Neither the failure of the corporation
(including its Board of Directors, independent legal counsel
or its stockholders) to have made a determination prior to
the commencement of such action that indemnification of the
claimant is proper in the circumstances because he or she
has met the applicable stand of conduct set forth in the
Delaware General Corporation Law nor an actual determination
by the corporation (including its Board of Directors,
independent legal counsel, or its stockholders) that the
claimant has not met such applicable standard of conduct
shall be a defense to the action or create a presumption
that the claimant has not met the applicable standard of
conduct.
Section 3. Nonexclusivity of Rights.
The right to indemnification and the payment of
expenses incurred in defending a proceeding in advance of
its final disposition conferred in this Section shall not be
exclusive of any other right which any person may have or
hereafter acquire under any statue, provision of the
Certificate of Incorporation, Bylaws, agreement, vote of
stockholders or disinterested directors or otherwise.
25
Section 4. Insurance, Contracts and Funding
The corporation may maintain insurance, at its expense,
to protect itself and any director, officer, employee or
agent of the corporation or another corporation,
partnership, joint venture, trust or other enterprise
against any expense, liability or loss, whether or not the
corporation would have the power to indemnify such person
against such expense, liability or loss under the Delaware
General Corporation Law. The corporation may enter into
contracts with any director or officer of the corporation
furtherance of the provisions of this Section and may create
a trust fund, grant a security interest or use other means
(including, without limitation, a letter of credit) to
ensure the payment of such amounts as may be necessary to
effect indemnification as provided in this Section.
Section 5. Indemnification of Employees and Agents of the
Corporation.
The corporation may, by action of its Board of
Directors from time to time, provide indemnification and pay
expenses in advance of the final disposition of a proceeding
to employees and agents of the corporation with the same
scope and effect as the provisions of this Section with
respect to the indemnification and advancement of expenses
of directors and officers of the corporation.
Article 11 of the Articles of Incorporation
To the full extent that the Delaware General
Corporation Law, as it exists on the date hereof or may
hereafter be amended, permits the limitation or elimination
of the liability of directors, a director of the corporation
shall not be liable to the corporation or its stockholders
for monetary damages for breach of fiduciary duty as a
director. Any amendment to or repeal of this Article 11
shall not adversely affect any right or protection of a
director of the corporation for or with respect to any acts
or omission of such director occurring prior to such
amendment or repeal.
26
Position of the Commission
Insofar as indemnification for liabilities arising
under the Act may be permitted Officers, Directors and
controlling persons of the Company pursuant to the forgoing
provisions or otherwise, the Company has been advised that
in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed
in the Securities Act of 1933, as amended (the "1933 Act)")
and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the
payment by the Company of expenses incurred or paid by a
Officer, Director or controlling person of the Company in
the successful defense of any action, suit or proceeding) is
asserted by such Officer, Director or controlling person in
connection with the securities being registered, the Company
will, unless in the opinion of its counsel the 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 1933 Act and will be governed by the final
adjudication of such issue.
OPINION OF COUNSEL
The validity of the Common Shares offered hereby has
been passed upon for the Company by Jack D. Bryant, Attorney
at Law, 7404 Napier Trail, Austin, Texas 78729.
EXPERTS
The consolidated financial statements and financial
statements schedules of U. S. Technologies Inc. as of
December 31, 1995 and 1994 and for each of the three years
in the period ended December 31, 1995 incorporated in this
Prospectus by reference to the Annual Report on Form 10-K,
have been so incorporated in reliance on the report of
Brown, Graham & Company, P.C. independent accountants, given
on the authority of that firm as experts in accounting and
auditing.
AVAILABLE INFORMATION
The Company is subject to the informational
requirements of the Securities Exchange Act of 1934 and in
accordance therewith files reports, proxy statements and
other information with the Securities and Exchange
Commission (the "Commission"). Information concerning the
Company can be inspected and copied at the offices of the
Commission, 450 Fifth Street, N.W., Washington D.C., 20549.
Copies of such material can be obtained from the Public
27
Reference Section of the Commission at Room 1024, 450 Fifth
Street, N.W., Washington D.C., 20549, at prescribed rates.
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO
MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY ANY SECURITIES OTHER THAN THE COMMON SHARES
OFFERED BY THIS PROSPECTUS. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY ANY COMMON SHARES IN ANY CIRCUMSTANCES IN WHICH SUCH
OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF
OR THAT THE INFORMATION CONTAINED BY REFERENCE HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
28
PART II.
Information Required in the Registration Statement.
Item 3. Incorporation of documents by reference.
Included in Prospectus.
Item 4. Description of Securities.
Not applicable.
Item 5. Interest of Named Experts and Counsel.
Included in Prospectus.
Item 6. Indemnification of Directors and Officers.
Included in Prospectus.
Item 7. Exemption from Registration.
Not applicable.
Item 8. Exhibits
(a) Exhibits
Exhibit No. Document.
5 * Opinion of Jack D. Bryant, 7404 Napier Trail,
Austin, Texas 78729, regarding the legality
of the securities registered under this
Registration Statement.
10.1 * 1996 Nonqualifying Stock Option Plan.
24.1 * Consent of counsel for the Company (set
forth in the opinion of counsel included as
Exhibit 5).
24.2 * Consent of Brown, Graham & Company P.C.,
independent public accountants for the
Company.
* Filed herewith.
29
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 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 Securities Act of 1933, 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 at that time shall be deemed to be the
initial bona fide offering thereof; and,
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.
The undersigned registrant hereby undertakes that, for
the purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's
annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 that is incorporated by
reference in the 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.
30
U. S. TECHNOLOGIES INC.
FORM S-8
EXHIBIT INDEX
Exhibit
No. Description Page
1.1 Articles of Incorporation of the Company
1.2 Bylaws of the Company
5 * Opinion of Jack D. Bryant, 7404 Napier Trail,
Austin, Texas 78729, regarding the legality of
the securities registered under this Registration
Statement. 22
10.1 * Nonqualifying Stock Option Plan 23
24.1 * Consent of counsel for the Company (set forth
34
in the opinion of counsel included as Exhibit 5
to this Registration Statement)
24.2 * Consent of Brown, Graham & Company P.C., Certified
Public 35
Accountants for the Company.
* Filed herewith.
Exhibits 1.1 and 1.2 were filed as exhibits to the
Company Registration Statement on Form S-1, SEC File No. 33-
47835 and SEC File No. 33-11720. Such exhibits are
incorporated herein by reference pursuant to Rule 12b-32.:
31
EXHIBIT 5
November 12, 1996
U. S. Technologies Inc.
1402 Industrial Blvd.
Lockhart, Texas 78644
RE: Registration Statement on
Form S-8 (S.E.C. File No.
33-_____________)
Covering Public Offering
of Common Shares of U. S.
Technologies, Inc.
Gentlemen:
I have acted as counsel for U. S. Technologies Inc., a
Delaware corporation (the "Company"), in connection with the
registration by the Company of an aggregate of 800,000
Common Shares, par value $0.02 per share, underlying options
issuable to any employee, director, general partner,
officer, or consultant or advisor of the Company (the
"Options"), all as more fully set forth in the Registration
Statement on Form S-8 to be filed by the Company.
In such capacity, I have examined, among other
documents, the Articles of Incorporation, as amended, Bylaws
and minutes of meetings of its Board of Directors and
shareholders, and the
1996 Qualifying Stock Option Plan of the Company.
Based upon the foregoing, and subject to such further
examinations as I have deemed relevant and necessary, I am
of the opinion that:
1. The Company is a corporation duly organized and
validly existing under the laws of the State of
Delaware.
2. The Options and underlying Common Shares have been
legally and validly authorized under the Articles
of Incorporation, as amended, of the Company, and
when issued and paid for upon exercise of the
Options, the Common Shares underlying the Options
will constitute duly and validly issued and
outstanding, fully paid and nonassessable Common
Shares of the Company.
32
Yours truly,
Jack D. Bryant
33
EXHIBIT 10.1
U. S. TECHNOLOGIES INC.
1996 NONQUALIFYING STOCK OPTION PLAN
ARTICLE I
Purpose of Plan
This 1996 NONQUALIFYING STOCK OPTION PLAN (the
"Plan") of U.S. TECHNOLOGIES INC. (the "Company") for persons
employed or associated with the Company, including without
limitation any employee, director, general partner, officer,
or consultant or advisor, is intended to advance the best
interests of the Company by providing additional incentive to
those persons who have a substantial responsibility for its
management, affairs, and growth by increasing their
proprietary interest in the success of the Company, thereby
encouraging them to maintain their relationships with the
Company. Further, the availability and offering of Stock
Options under the Plan supports and increases the Company's
ability to attract, engage and retain individuals of
exceptional talent upon whom, in large measure, the sustained
progress growth and profitability of the Company for the
shareholders depends.
ARTICLE II
Definitions
For Plan purposes, except where the context might
clearly indicate otherwise, the following terms shall have the
meanings set forth below:
"Board" shall mean the Board of Directors of the
Company.
"Code" shall mean the Internal Revenue Code of 1986,
as amended, and the rules and regulations promulgated
thereunder.
"Committee" shall mean the Compensation Committee,
or such other committee appointed by the Board, which shall be
designated by the Board to administer the Plan. The Company
shall be composed of two or more persons as from time to time
are appointed to serve by the Board and may be members of the
Board.
"Common Shares" shall mean the Company's Common
Shares $0.02 par value per share, or, in the event that the
outstanding Common Shares are hereafter changed into or
23
exchanged for different shares or securities of the Company,
such other shares or securities.
"Company" shall mean U.S. Technologies Inc., a
Delaware corporation, and any parent or subsidiary corporation
of U.S. Technologies Inc., as such terms are defined in
Section 425(e) and 425(f), respectively of the Code.
"Optionee" shall mean any person employed or
associated with the affairs of the Company who has been
granted one or more Stock Options under the Plan.
"Stock Option" or "NQSO" shall mean a stock option
granted pursuant to the terms of the Plan.
"Stock Option Agreement" shall mean the agreement
between the Company and the Optionee under which the Optionee
may purchase Common Shares hereunder.
ARTICLE III
Administration of the Plan
1. The Committee shall administer the plan and
accordingly, it shall have full power to grant Stock Options,
construe and interpret the Plan, establish rules and
regulations and perform all other acts, including the
delegation of administrative responsibilities, it believes
reasonable and proper.
2. The determination of those eligible to receive
Stock Options, and the amount, price, type and timing of each
Stock Option and the terms and conditions of the respective
stock option agreements shall rest in the sole discretion of
the Committee, subject to the provisions of the Plan.
3. The Committee may cancel any Stock Options
awarded under the Plan if an Optionee conducts himself in a
manner which the Committee determines to be inimical to the
best interest of the Company and its shareholders as set forth
more fully in paragraph 8 of Article X of the Plan.
4. The Board, or the Committee, may correct any
defect, supply any omission or reconcile any inconsistency in
the Plan or in any granted Stock Option, in the manner and to
the extent it shall deem necessary to carry it into effect.
5. Any decision made, or action taken, by the
Committee or the Board arising out or in connection with the
interpretation and administration of the Plan shall be final
and conclusive.
6. Meetings of the Committee shall be held at such
times and places as shall be determined by the Committee. A
24
majority of the members of the Committee shall constitute a
quorum for the transaction of business, and the vote of a
majority of those members present at any meeting shall decide
any question brought before that meeting. In addition, the
Company may take any action otherwise proper under the Plan by
the affirmative vote, taken without a meeting, of a majority
of its members.
7. No member of the Committee shall be liable for
any act or omission of any other member of the Committee or
for any act or omission on his own part, including, but not
limited to, the exercise of any power or discretion given to
him under the Plan except those resulting from his own gross
negligence or willful misconduct.
8. The Company, through its management, shall
supply full and timely information to the Committee on all
matters relating to the eligibility of Optionees, their duties
and performance, and current information on any Optionee's
death, retirement, disability or other termination of
association with the Company, and such other pertinent
information as the Committee may require. The Company shall
furnish the Committee with such clerical and other assistance
as is necessary in the performance of its duties hereunder.
ARTICLE IV
Shares Subject to the Plan
1. The total number of shares of the Company
available for grants of Stock Options under the Plan shall be
800,000 Common Shares, subject to adjustment as herein
provided, which shares may be either authorized but unissued
or reacquired Common Shares of the Company.
2. If a Stock Option or portion thereof shall
expire or terminate for any reason without having been
exercised in full, the unpurchased shares covered by such NQSO
shall be available for future grants of Stock Options.
ARTICLE V
Stock Option Terms and Conditions
1. Consistent with the Plan's purpose, Stock
Options may be granted to any person who is performing or who
has been engaged to perform services of special importance to
management in the operation, development and growth of the
Company.
2. Determination of the option price per share for
any stock option issues hereunder shall rest in the sole and
unfettered discretion of the Committee.
25
3. All Stock Options granted under the Plan shall
be evidenced by agreements which shall be subject to
applicable provisions of the Plan, and such other provisions
as the Committee may adopt, including the provisions set forth
in paragraphs 2 through 11 of this Article V.
4. All Stock Options granted hereunder must be
granted within ten years from the date this Plan is adopted.
5. No Stock Option granted hereunder shall be
executable after the expiration of ten years from the date
such NQSO is granted. The Committee, in its discretion, may
provide that an option shall be executable during such ten
year period or during any lesser period of time. The
Committee may establish installment exercise terms for a Stock
Option such that the NQSO becomes fully executable in a series
of cumulating portions. If an Optionee shall not, in any
given installment period, purchase all the Common Shares which
such Optionee is entitled to purchase within such installment
period, such Optionee's right to purchase any Common Shares
not purchased in such installment period shall continue until
the expiration or sooner termination of such NQSO. The
Committee may also accelerate the exercise of any NQSO.
6. A Stock Option, or portion thereof, shall be
exercised by deliver of (i) a written notice of exercise to
the Company specifying the number of Common Shares to be
purchased, and (ii) payment of the full price of such Common
Shares, as fully set forth in paragraph 7 of this Article V.
No NQSO or installment thereof shall be
reusable except with respect to whole shares, and fractional
share interests shall be disregarded. Not less than 100
Common Shares may be purchased at one time unless the number
purchased is the total number at the time available for
purchase under the NQSO. Until the Common Shares represented
by an exercised NQSO are issued to an Optionee, he shall have
none of the rights of a shareholder.
7. The exercise price of a Stock Option, or
portion thereof, may be paid:
A. In United States dollars, in cash or by
cashier's check, certified check, bank draft or money order,
payable to the order of the Company in an amount equal to the
option price; or,
B. At the discretion of the Committee,
through the delivery of fully paid and nonassessable Common
Shares, with an aggregate fair market value (determined as the
average of the highest and lowest reported sales prices on the
Common Shares as of the date of exercise of the NQSO, as
reported by such responsible reporting service as the
Committee may select, or if there were not transactions in the
26
Common Shares on such day, then the last preceding day on
which transactions took place), as of the date of the NQSO
exercise equal to the option price, provided such tendered
shares, or any derivative security resulting in the issuance
of Common Shares, have been owned by he Optionee for at least
30 days prior to such exercise; or,
C. By a combination of both A and B above.
The Committee shall determine acceptable
methods for tendering Common Shares as payment upon exercise
of a Stock Option and may impose such limitations and
prohibitions on the use of Common Shares to exercise an NQSO
as it deems appropriate.
8. With the Optionee's consent, the Committee may
cancel any Stock Option issued under this Plan and issue a new
NQSO to such Optionee.
9. Except by will, the laws of descent and
distribution, or with the written consent of the Committee, no
right or interest in any Stock Option granted under the Plan
shall be assignable or transferable, and no right or interest
of any Optionee shall be liable for, or subject to, any lien,
obligation or liability of the Optionee. Upon petition to,
and thereafter with the written consent of the Committee, an
Optionee may assign or transfer all or a portion of the
Optionee's rights and interest in any stock option granted
hereunder. Stock Options shall be executable during the
Optionee's lifetime only by the Optionee or assignees, or the
duly appointed legal representative of an incompetent
Optionee, including following an assignment consented to by
the Committee herein.
10. No NQSO shall be executable while there is
outstanding any other NQSO which was granted to the Optionee
before the grant of such option under the Plan or any other
plan which gives the right to the Optionee to purchase stock
in the Company or in a corporation which is a parent
corporation (as defined in Section 425(e) of the Code) of the
Company, or any predecessor corporation of any of such
corporations at the time of the grant. An NQSO shall be
treated as outstanding until it is either exercised in full or
expires by reason of lapse of time.
11. Any Optionee who disposes of Common Shares
acquired on the exercise of a NQSO by sale or exchange either
(i) within two years after the date of the grant of the NQSO
under which the stock was acquired, or (ii) within one year
after the acquisition of such Shares, shall notify the Company
of such disposition and of the amount realized upon such
disposition. The transfer of Common Shares may also be
restricted by applicable provisions of the Securities Act of
1933, as amended.
27
ARTICLE VI
Adjustments or Changes in Capitalization
1. In the event that the outstanding Common Shares
of the Company are hereafter changed into or exchanged for a
different number of kinds of shares or other securities of the
Company by reason of merger, consolidation, other
reorganization, recapitalization, reclassification,
combination of shares, stock split-up or stock dividend:
A. Prompt, proportionate, equitable, lawful
and adequate adjustment shall be made of the aggregate number
and kind of shares subject to Stock Options which may be
granted under the Plan, such that the Optionee shall have the
right to purchase such Common Shares as may be issued in
exchange for the Common Shares purchasable on exercise of the
NQSO had such merger, consolidation, other reorganization,
recapitalization, reclassification, combination of shares,
stock split-up or stock dividend not taken place;
B. Rights under unexercised Stock Options or
portions thereof granted prior to any such change, both as to
the number or kind of shares and the exercise price per share,
shall be adjusted appropriately, provided that such
adjustments shall be made without change in the total exercise
price applicable to the unexercised portion of such NQSO's but
by an adjustment in the price for each share covered by such
NQSO's; or,
C. Upon any dissolution or liquidation of the
Company or any merger or combination in which the Company is
not a surviving corporation, each outstanding Stock Option
granted hereunder shall terminate, but the Optionee shall have
the right, immediately prior to such dissolution, liquidation,
merger or combination, to exercise his NQSO in whole or in
part, to the extent that it shall not have been exercised,
without regard to any installment exercise provisions in such
NQSO.
2. The foregoing adjustment and the manner of
application of the foregoing provisions shall be determined
solely by the Committee, whose determination as to what
adjustments shall be made and the extent thereof, shall be
final, binding and conclusive. No fractional Shares shall be
issued under the Plan on account of any such adjustments.
ARTICLE VII
Merger, Consolidation or Tender Offer
1. If the Company shall be a party to a binding
agreement to any merger, consolidation or reorganization or
sale of substantially all the assets of the Company, each
outstanding Stock Option shall pertain and apply to the
28
securities and/or property which a shareholder of the number
of Common Shares of the Company subject to the NQSO would be
entitled to receive pursuant to such merger, consolidation or
reorganization or sale of assets.
2. In the event that:
A. Any person other than the Company shall
acquire more than 20% of the Common Shares of the Company
through a tender offer, exchange offer or otherwise;
B. A change in the "control" of the Company
occurs, as such term is defined in Rule 405 under the
Securities Act of 1933;
C. There shall be a sale of all or
substantially all of the assets of the Company;
any then outstanding Stock Option held by an Optionee, who is
deemed by the Committee to be a statutory officer ("insider")
for purposes of Section 16 of the Securities Exchange Act of
1934 shall be entitled to receive, subject to any action by
the Committee revoking such an entitlement as provided for
below, in lieu of exercise of such Stock Option, to the extent
that it is then executable, a cash payment in an amount equal
to the difference between the aggregate exercise price of such
NQSO, or portion thereof, and, (i) in the event of an offer or
similar event, the final offer price pre share paid for Common
Shares, or such lower price as the Committee may determine to
conform an option to preserve its Stock Option status, times
the number of Common Shares covered by the NQSO or portion
thereof, or (ii) in the case of an event covered by B or C
above, the aggregate fair market value of the Common Shares
covered by the Stock Option, as determined by the Committee at
such time.
3. Any payment which the Company is required to
make pursuant to paragraph 2 of this Article VII, shall be
made within 15 business days, following the event which
results in the Optionee's right to such payment. In the event
of a tender offer in which fewer than all the shares which are
validity tendered in compliance with such offer are purchased
or exchanged, then only that portion of the shares covered by
an NQSO as results from multiplying such shares by a fraction,
the numerator of which is the number of Common Shares acquired
purchase to the offer and the denominator of which is the
number of Common Shares tendered in compliance with such
offer, shall be used to determine the payment thereupon. To
the extent that all or any portion of a Stock Option shall be
affected by this provision, all or such portion of the NQSO
shall be terminated.
4. Notwithstanding paragraphs 1 and 3 of this
Article VII, the Company may, by unanimous vote and
29
resolution, unilaterally revoke the benefits of the above
provisions; provided, however, that such vote is taken no
later than ten business days following public announcement of
the intent of an offer of the change of control, whichever
occurs earlier.
ARTICLE VIII
Amendment and Termination of Plan
1. The Board may at any time, and from time to
time, suspend or terminate the Plan in whole or in part or
amend it from time to time in such respects as the Board may
deem appropriate and in the best interest of the Company.
2. No amendment, suspension or termination of this
Plan shall, without the Optionee's consent, alter or impair
any of the rights or obligations under any Stock Option
theretofore granted to him under the Plan.
3. The Board may amend the Plan, subject to the
limitations cited above, in such manner as it deems necessary
to permit the granting of Stock Options meeting the
requirements of future amendments or issued regulations, if
any, to the Code.
4. No NQSO may be granted during any suspension of
the Plan or after termination of the Plan.
ARTICLE IX
Government and Other Regulations
The obligation of the Company to issue, transfer and
deliver Common Shares for Stock Options exercised under the
Plan shall be subject to all applicable laws, regulations,
rules, orders and approval which shall then be in effect and
required by the relevant stock exchanges on which the Common
Shares are traded and by government entities as set forth
below or as the Committee in its sole discretion shall deem
necessary or advisable. Specifically, in connection with the
Securities Act of 1933, as amended, upon exercise of any Stock
Option, the Company shall not be required to issue Common
Shares unless the Committee has received evidence satisfactory
to it to the effect that the Optionee will not transfer such
shares except pursuant to a registration statement in effect
under such Act or unless an opinion of counsel satisfactory to
the Company has been received by the Company to the effect
that such registration is not required. Any determination in
this connection by the Committee shall be final, binding and
conclusive. The Company may, but shall in no event be
obligated to take any other affirmative action in order to
cause the exercise of a Stock Option or the issuance of Common
Shares purchase thereto to comply with any law or regulation
of any government authority.
30
ARTICLE X
Miscellaneous Provisions
1. No person shall have any claim or right to be
granted a Stock Option under the Plan, and the grant of an
NQSO under the Plan shall not be construed as giving an
Optionee the right to be retained by the Company.
Furthermore, the Company expressly reserves the right at any
time to terminate its relationship with an Optionee with or
without cause, free from any liability, or any claim under the
Plan, except as provided herein, in an option agreement, or in
any agreement between the Company and the Optionee.
2. Any expenses of administering this Plan shall
be borne by the Company.
3. The payment received from Optionee from the
exercise of Stock Options under the Plan shall be used for the
general corporate purposes of the Company.
4. The place of administration of the Plan shall
be in the State of Texas, and the validity, contraction,
interpretation, administration and effect of the Plan and its
rules and regulations, and rights relating to the Plan, shall
be determined solely in accordance with the laws of the State
of Delaware.
5. Without amending the Plan, grants may be made
to persons who are foreign nationals or employed outside the
United States, or both, on such terms and conditions,
consistent with the Plan's purpose, different from those
specified in the Plan as may, in the judgment of the
Committee, be necessary or desirable to create equitable
opportunities given differences in tax laws in other
countries.
6. In addition to such other rights of
indemnification as they may have as members of the Board or
Committee, the members of the Committee shall be indemnified
by the Company against all costs and expenses reasonably
incurred by them in connection with any action, suite or
proceeding to which they or any of them may be party by reason
of any action taken or failure to act under or in connection
with the Plan or any Stock Option granted thereunder, an
against all amount paid by them in settlement thereof
(provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in
satisfaction of a judgment in any such action, suit or
proceeding, except a judgment based upon a finding of bad
faith; provided that upon the institution of any such action,
suit or proceeding a Committee member shall in writing, give
the Company notice thereof and an opportunity, at its own
expense, to handle and defend the same before such Committee
member undertakes to handle and defend it on his own behalf.
31
7. Stock Options may be granted under this Plan
form time to time, in substitution for stock options held by
employees of other corporations who are about to become
employees of the Company as the result of a merger or
consolidation of the employing corporation with the Company or
the acquisition by the Company of the assets of the employing
corporation or the acquisition by the Company of stock of the
employing corporation as a result of which it become a
subsidiary of the Company. The terms and conditions of such
substitute stock options so granted my vary from the terms and
conditions set forth in this Plan to such extent as the Board
of Director of the Company at the time of grant may deem
appropriate to conform, in whole or in part, to the provisions
of the stock options in substitution for which they are
granted, but no such variations shall be such as to affect the
status of any such substitute stock options as a stock option
under Section 422A of the Code.
8. Notwithstanding anything to the contrary in the
Plan, if the Committee finds by a majority vote, after full
consideration of the facts presented on behalf of both the
Company the Optionee, that the Optionee has been engaged in
fraud, embezzlement, theft, commission of a felony or proven
dishonesty in the course of his association with the Company
or any subsidiary corporation which damaged the Company or any
subsidiary corporation, or for disclosing trade secrets of the
Company or any subsidiary corporation, the Optionee shall
forfeit all unexercised Stock Options and all exercised NQSO's
under which the Company has not yet delivered the certificates
and which have been earlier granted the Optionee by the
Committee. The decision of the Committee as to the case of an
Optionee's discharge and the damage done to the Company shall
be final. No decision of the Committee, however, shall affect
the finality of the discharge of such Optionee by the Company
or any subsidiary corporation in any manner. Further, if
Optionee voluntarily terminates employment with the Company,
the Optionee shall forfeit all unexercised stock options.
ARTICLE XI
Written Agreement
Each Stock Option granted hereunder shall be
embodied in a written Stock Option Agreement which shall be
subject to the terms and conditions prescribed above and shall
be signed by the Optionee and by the President or any Vice
President of the Company, for and in the name and on behalf of
the Company. Such Stock Option Agreement shall contain such
other provisions as the Committee, in its discretion shall
deem advisable.
ARTICLE XII
Effective Date
32
This Plan shall become unconditionally effective as
of the effective date of approval of the Plan by the Board of
Director of the Company. No Stock Option may be granted later
than ten (10) years from the effective date of the Plan;
provided, however, that the Plan and all outstanding Stock
Options shall remain in effect until such NQSO's have expired
or until such options are cancelled.
33
Number of Shares: Date of Grant:
NON QUALIFYING STOCK OPTION AGREEMENT
AGREEMENT made this _______ day of ________________,
19____, between (the "Optionee"), and U.S. TECHNOLOGIES INC.,
a Delaware corporation (the "Company").
1. Grant of Option. The Company, pursuant to the
provisions of the U.S. Technologies Inc. 1996 Nonqualifying
Stock Option Plan (the "1996 Plan"), set forth as Attachment A
hereto, hereby grants to the Optionee, subject to the terms
and conditions set froth or incorporated herein, an Option and
Purchase from the Company all or any part of an aggregate of
Common Shares, as such Common Shares are now constituted, at
the purchase price of $ per share. The provisions of the 1996
Plan governing the terms and conditions of the Option granted
hereby are incorporated in full herein by reference.
2. Exercise. The Option evidenced hereby shall be
executable in whole or in part (but only in multiples of 100
Shares unless such exercise is as to the remaining balance of
this Option) on or after and on or before, provided that the
cumulative number of Common Shares as to which this Option may
be exercised (except as provided in paragraph 1 of Article VI
of this 1996 Plan) shall not exceed the following amounts:
Cumulative Number Prior to
Date
of Shares (Not Inclusive of)
The Option evidenced hereby shall be executable by the deliver
to and receipt by the Company of (i) a written notice of
election to exercise, in the form set forth in Attachment B
hereto, specifying the number of shares to be purchased; (ii)
accompanied by payment of the full purchase price thereof in
case or certified check payable to the order of the Company,
or by fully-paid and nonassessable Common Shares of the
Company properly endorsed over to the Company, or by a
34
combination thereof; and, (iii) by return of this Stock Option
Agreement for endorsement of exercise by the Company on
Schedule I hereof. In the event fully paid and nonassessable
Common Shares are submitted as whole or partial payment for
Shares to be purchased hereunder, such Common Shares will be
valued at their Fair Market Value (as defined in the 1996
Plan) on the date such Shares are received by the Company and
applied to payment of the exercise price.
35
3. Transferability. The Option evidenced hereby
is NOT assignable or transferable by the Optionee other than
by the Optionee's will, by the laws of descent and
distribution, as provided in paragraph 9 of Article V of the
1996 Plan. The Option shall be executable only by the
Optionee during his lifetime.
U.S. TECHNOLOGIES INC.
BY:
President
ATTEST:
Secretary
Optionee hereby acknowledges receipt of a copy of
the 1996 Plan, attached hereto and accepts this Option subject
to each and every term and provision of such Plan. Optionee
hereby agrees to accept as binding, conclusive and final, all
decisions or interpretations of the Compensation Committee of
the Board of Directors administering the 1996 Plan on any
questions arising under such Plan. Optionee recognizes that
if Optionee's employment with the Company or any subsidiary
thereof shall be terminated with cause, or by the Optionee,
all of the Optionee's rights hereunder shall thereupon
terminate; and that, pursuant to paragraph 10 of Article V of
the 1996 Plan, this Option may not be exercised while there is
outstanding to Optionee any unexercised Stock Option, granted
to Optionee before the date of grant of this Option, to
purchase Common Shares of the Company or any parent or
subsidiary thereof.
Dated:
Optionee
Type or Print Name
Address
36
Social Security No.:
37
Attachment B
(Suggested form of letter to be used for notification of
election to exercise.)
Date
Secretary,
U.S. Technologies Inc.
1402 Industrial Blvd.
Lockhart, Texas 78644
Dear Sir:
In accordance with paragraph 2 of the Nonqualifying Stock
Option Agreement evidencing the Option granted to me on under
the U.S. Technologies Inc. 1996 Nonqualifying Stock Option
Plan, I hereby elect to exercise this Option to the extent of
Common Shares.
Enclosed are (i) Certificate(s) No.(s)
representing fully-paid Common Shares of U.S. Technologies
Inc. endorsed to the Company with signature guaranteed, and/or
a certified check payable to the order of U.S. Technologies
Inc. in the amount of $ as the balance of the purchase price
of $ for the Shares which I have elected to purchase and (ii)
the original Stock Option Agreement for endorsement by the
Company as to exercise on Schedule I thereof. I acknowledge
that the Common Shares (if any) submitted as part payment for
the exercise price due hereunder will be valued by the Company
at their Fair Market Value (as defined in the 1996 Plan) on
the date this Option exercise is effected by the Company. In
the event I hereafter sell any Common Shares issued pursuant
to this option exercise within one year from the date of
exercise or within two years after the date of grant of this
Option, I agree to notify the Company promptly of the amount
of taxable compensation realized by me by reason of such sale
for Federal income tax purposes.
When the certificate for Common Shares which I have
elected to purchase has been issued, please deliver it to me,
along with my endorsed Stock Option Agreement in the event
there remains an unexercised balance of Shares under the
Option, at the following address:
Signature of Optionee
38
Type or Print Name
Optionee Date of Grant
SCHEDULE I
Unexercised Is
suing
Shares Payment Shares Officer
Date Purchased Received Remaining In
itials
39
EXHIBIT
24.1
CONSENT OF COUNSEL
I HEREBY CONSENT to the inclusion of my name and references to
Jack D. Bryant, Attorney at Law, beneath the caption "Opinion of
Counsel" in the Prospectus forming a part of the Registration
Statement and to the filing of a copy of our opinion as Exhibit
No. 5 thereto.
Dated this 12th day of November, 1996.
Yours truly,
Jack D. Bryant
34
EXHIBIT 24.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration
statement of U.S. Technologies Inc. on Form S-8 of our report
dated April 14, 1996, on our audits of the consolidated financial
statements and financial statement schedules of U.S. Technologies
Inc. and Subsidiaries, as of December 31, 1995 and 1994, and for
the years ended December 31, 1995, 1994 and 1993, which report is
included in the Annual Report on Form 10-K. We also consent to
the reference to our firm under the caption "Experts."
BROWN, GRAHAM AND COMPANY P.C.
Georgetown, Texas
November 12, 1996
35
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
as amended, the Registrant certifies that it has reasonable
grounds to believe that it meets all the requirements for filing
on Form S-8 and has duly caused this Registration Statement or
Amendment thereto be signed on its behalf by the undersigned,
thereunto duly authorized, on the 12th day of November, 1996.
U.S. TECHNOLOGIES INC.
BY:s/ John V. Allen
John V. Allen
Chairman of the Board,
Pursuant to the requirements of the Securities Exchange Act
of 1933, as amended, this Registration Statement or Amendment
thereto has been signed by the following persons in the
capacities and on the dates indicates.
Signature Title Date
s/James Chen Director November 12, 1996
James Chen
s/William Meehan President, Director
November 12, 1996
William Meehan Acting Controller
Acting Principal Accounting Officer
36
