EXHIBIT 99.22
CONVERSION AGREEMENT AND AMENDMENT
This Conversion Agreement and Amendment (the "Agreement") is made as of
March 7, 2007, among North American Technologies Group, Inc., a Delaware
corporation (the "Company"), and the holders of the 7% Convertible Debentures
due on July 1, 2008, as amended (the "Debentures"), of the Company (each
individually a "Holder" and collectively the "Holders"). Capitalized terms used
but not defined herein shall have the meanings given them in the Debenture.
1. Conversion. Each of the Holders hereby elects to convert the entire
amount of principal under the Debentures held by it into shares of Common Stock
of the Company according to the conditions of the Debentures and this Agreement.
The Conversion Date shall be the date on which the Company receives all of the
executed Promissory Notes from the respective Payees thereunder and executed
counterparts to this Agreement from the Holders of the Debentures, provided,
however, that if the Effective Date does not occur by March 30, 2007, this
Agreement will terminate and be of no further force or effect.
2. Waiver and Amendment. The requirement of Section 4(c) of the Debentures
that a Holder's ownership of the Common Stock not exceed the percentage set
forth therein is hereby waived and the Debentures are hereby amended to delete
that Section 4(c) in its entirety, and all references thereto in the Debentures.
3. Consideration. In consideration for the conversion by the Holders of the
Debentures on the Conversion Date, the Company will pay to the Holders on the
Conversion Date the number of shares of Common Stock equal to the quotient of
(i) the Interest Share Amount that would be due and owing to the Holders if the
Debentures were held through the Maturity Date divided by (ii) the Interest
Conversion Rate as of the Conversion Date. The Company will within ten Trading
Days of the Conversion Date, cause its transfer agent to deliver the Conversion
Shares in accordance with Section 4(d)(ii) of the Debentures.
4. Antidilution Adjustment. If the Company shall, in connection with its
proposed financing in the amount of no less than $11.6 million (the
"Financing"), sell or grant any option to purchase, or otherwise dispose of or
issue any Common Stock or Common Stock Equivalents entitling any Person to
acquire shares of Common Stock, at an effective price per share less than the
Conversion Price, as adjusted on the date of this Agreement (such lower price,
the "Base Price"), then, upon consummation of the Financing, the Company shall
issue to the Holders, pro rata, the number of shares of Common Stock equal to
the difference between (i) the number of shares of Common Stock received
pursuant to this Agreement and (ii) the number of shares of Common Stock to
which the Holders would have been entitled if the Conversion Price on the date
of this Agreement had been equal to the Base Price. The Company shall notify the
Holder in writing, no later than the Business Day following the issuance of any
Common Stock or Common Stock Equivalents subject to this provision, indicating
therein the applicable Base Price.
5. Prospectus Delivery. Each of the Holders agrees to comply with the
prospectus delivery requirements under the applicable securities laws in
connection with any transfer of the Conversion Shares.
6. Transfer Taxes. If any of the Conversion Shares are to be issued in the
name of a person other than the Holder thereof, that Holder will pay all
transfer taxes payable with respect thereto and will deliver such certificates
and opinions as reasonably requested by the Company in accordance therewith. No
fee will be charged to the Holder for any conversion, except for such transfer
taxes, if any
NORTH AMERICAN TECHNOLOGIES GROUP, INC.
By: /s/ Xxxx Xxxxxxx
----------------
Xxxx Xxxxxxx, Chief Executive Officer
AMOUNT OF DEBENTURES: HOLDERS:
$6,141,287.80 Sponsor Investments, LLC
By Herakles Investments, Inc., Managing Member
By:
--------------------------
Name:
------------------------
Title:
-----------------------
$1,831,995.10 Crestview Capital Master, LLC
By:
--------------------------
Name:
------------------------
Title:
-----------------------
$349,999.65 Enable Growth, L.P.
By:
--------------------------
Name:
------------------------
Title:
-----------------------
$49,999.95 Enable Opportunity Partners, L.P.
By:
--------------------------
Name:
------------------------
Title:
-----------------------
$594,318.30 Islandia, LP
By Xxxx Xxxx, Inc., General Partner
By:
--------------------------
Name:
------------------------
Title:
-----------------------
2
$1,492,399.20 Midsummer Investment
Ltd. By Midsummer Capital, LLC,
Investment Manager
By:
--------------------------
Name:
------------------------
Title:
-----------------------
$50,000.00 Xxxxx X. and Xxxxxx X. Xxxxxxx Living Trust
By:
--------------------------
--------------------------
Name:
------------------------
------------------------
Titles:
-----------------------
$50,000.00 -----------------------------
Xxxxxxx Xxxxx
$940,000.00 Toibb Investment, LLC
By Toibb Management LLC,
Manager
By:
--------------------------
Name:
------------------------
Title:
-----------------------
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