Document:

Custodial and Security Agreement

 Exhibit 10.4 
  
 CUSTODIAL AND SECURITY AGREEMENT 
  
 THIS CUSTODIAL AND SECURITY AGREEMENT (this “Agreement”) is made as of July 7, 2005, by and among North
American Technologies Group, Inc., a Delaware corporation with an address at 14315 West Hardy Road, Houston, TX 77060 (the “Company”), the purchasers signatory hereto (each individually, a “Purchaser,” and
collectively, the “Purchasers”), and Feldman Weinstein LLP, , as custodial agent for and for the benefit of the Purchasers, with an address at 420 Lexington Avenue, Suite 2620, New York, New York 10170 (the
“Custodian”). Capitalized terms used but not defined herein shall have the meanings set forth in the Securities Purchase Agreement referred to in the first recital. 
  
 W I T N E S S E
T H: 
  
 WHEREAS, the Company and each
Purchaser has entered into the Securities Purchase Agreement of even date herewith (the “Purchase Agreement”), pursuant to which the Purchasers are purchasing the Company’s 7% Convertible Debentures due one year after their
date of issuance (collectively, the “Debentures”) and Warrants; and 
  
 WHEREAS, in order to induce the Purchasers to enter into the Purchase Agreement and to purchase the Debentures, and as a condition precedent thereto, the Company has agreed to secure the payment and performance
of its obligations under the Purchase Agreement, the Debentures, this Agreement and the other Transaction Documents by granting to the Purchasers a first priority security interest in certain of the cash proceeds from the sale of the Debentures; and

  
 WHEREAS, the Company and the Purchasers have requested
that the Custodian hold $3,000,000 of the gross cash proceeds from the sale of the Debentures for the benefit of the Purchasers, as secured parties, in accordance with the terms hereof; 
  
 NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter contained, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
  
 1. Closing. 
  
 (a) Upon the Custodian’s receipt from the Purchasers of, in the aggregate, $5,000,000 into its escrow account (the “Escrow
Account”), together with each Purchaser’s executed counterparts of this Agreement, the Purchase Agreement and the Registration Rights Agreement, the Custodian shall telephonically advise the Company, or the Company’s designated
attorney or agent, of its receipt of such funds and such documents. 

 (b) Wire transfers to the Custodian shall be made as follows: 
  
 STERLING NATIONAL BANK 
 622 3RD AVENUE 
 NEW YORK, NY 10017

 ACCOUNT NAME: FELDMAN WEINSTEIN LLP 
 ABA ROUTING NO: 026007773 
 ACCT NO: 0814180101 
 REMARK: NAKEC/[FUND NAME] 
  
 (c) The Company, upon receipt of the telephonic notice described in Section 1(a) above, shall deliver to the Custodian the certificates representing the Debentures and the Warrants to be issued to each Purchaser at
the Closing together with: 
  
 (i) a counterpart
of the Registration Rights Agreement, as amended and restated, duly executed by the Company; 
  
 (ii) a counterpart of the Purchase Agreement, duly executed by the Company; and 
  
 (iii) a counterpart of this Agreement, duly executed by the
Company. 
  
 (d) In the event that the foregoing
items have not been delivered to the Custodian by the Company within five (5) Trading Days after the Custodian has received all of the Subscription Amounts (net of any permitted deductions pursuant to the Purchase Agreement), then each Purchaser
shall have an independent and separate right to demand and receive the return of its Subscription Amount. 
  
 (e) Once the Custodian receives all of the items required to be delivered hereunder, it shall wire the gross proceeds raised pursuant to
the Purchase Agreement per the written instructions of the Company less the balance of $3,000,000 (the “Secured Proceeds”) which shall be initially transferred into a separate non-interest bearing custodian deposit account of the
Custodian (the “Custodial Account”). Thereafter, the Custodial Account shall be maintained by the Custodian in accordance with the terms of this Agreement and may be invested, if possible, in an interest-bearing government
securities or commercial money market fund made available by the Custodian’s bank or as otherwise directed in a writing executed by the Company. The Custodian, by its execution and delivery of this Agreement, hereby agrees to accept receipt of
the Secured Proceeds and to hold such proceeds for the benefit of the Purchasers, as secured parties. 
  
 (f) After transferring the Secured Proceeds into the Custodial Account, the Custodian shall then arrange to have originals or counterpart
originals of the Purchase Agreement, the Warrants, the Debentures, the Registration Rights Agreement, and this Agreement delivered to the appropriate parties. 
  
 (g) The Custodian shall hold the Secured Proceeds in the Custodial Account, for the benefit of each
Purchaser, and not release such proceeds except as provided herein. 
  

 2 

 2. Release of Secured Proceeds. 
  
 (a) Release Upon Voluntary Conversion of Debentures. Each Purchaser shall be deemed to have funded to
the Company an amount (such Purchaser’s “Pro Rata Amount”) equal to the amount distributed by the Custodian to the Company hereunder multiplied by a fraction, the numerator of which is the amount of Debentures such Purchaser
has agreed to purchase pursuant to the Securities Purchase Agreement and the denominator of which is the aggregate amount of Debentures all Purchasers have agreed to purchase pursuant to the Securities Purchase Agreement. Upon the conversion by a
Purchaser of all or part of the principal amount of the Debenture(s) held by such Purchaser in excess of Purchaser’s Pro Rata Amount (the “Converted Principal Amount”), such Purchaser and the Company shall promptly thereafter
execute a joint certificate to the Custodian certifying that such Converted Principal Amount has been converted by the Purchaser (a “Conversion Certificate”, such release upon Conversion shall be a “Conversion
Release” and such date of a Conversion Release shall be the “Conversion Release Date”). Promptly after its receipt of a Conversion Certificate, the Custodian shall release out of the Secured Proceeds to the account
specified in the written instructions of the Company, an amount equal to the Converted Principal Amount. 
  
 (b) Release on Funding Dates. Three (3) days prior to any proposed Funding Date (as defined in the Purchase Agreement), the Company
shall deliver to the Custodian a certificate of the Company including a request for funds not to exceed the monthly funding caps set forth on Exhibit D to the Purchase Agreement. The amount of the monthly funding caps shall be increased, each
month, by the aggregate amount the funding caps in previous months exceeded the amount actually funded in such months. Such certificate shall include a resolution of a committee of disinterested directors requesting the funds and shall provide in
reasonable detail the information set forth on Exhibit E to the Purchase Agreement. After receipt of such request from the Company, the Custodian shall be obligated (in the absence of a veto exercised by Purchasers holding at least 66 2/3% of the principal value of the Debentures) to provide the requested funds to the Company out of the Secured
Proceeds (not to exceed $3,000,000 in the aggregate) on the Funding Date which shall be no later than three (3) Business Days after the receipt by the Custodian of the Company’s request for additional proceeds. No requests for funding may be
made after June 30, 2006. If at any time the Company has not requested funds from the Escrow Account for more than forty-five (45) days or at any time after a Funding Date in May 2006, any Purchaser may deliver notice to the Company, the Purchasers
and the Custodial Agent requesting the return of all funds held in the Escrow Account to the Purchasers according to their respective pro rata share of the funds in the Escrow Account (a “Return Request”). The return of the funds
held in the Escrow Account to the Purchasers shall be deemed a repayment of such amount under the Debentures and shall be applied to reduce amounts due and owing to the Purchasers as follows: first, to the payment of fees and expenses including
liquidated damages; second, to interest payable in cash; and third, to the outstanding principal. In the event the Company requires funds in excess of the amount set forth on Exhibit D, the Custodian shall be permitted, in the absence of a
veto exercised by Purchasers holding 66 2/3% of the principal value of the Debentures, to provide the Company
such funds not to exceed $500,000 in the aggregate. Upon fulfillment of the foregoing conditions, the Custodian shall release, to the account of the Company that portion of the Secured Proceeds specified in the Company’s request for funds. If
less than all of the Secured Proceeds are released, the remaining amount, for purposes of calculating each Purchaser’s rights hereunder, shall be re-allocated according to such Purchaser’s pro rata portion. 
  

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	 	(c)	Release Upon an Event of Default. 

  
 (i) If, on the Maturity Date of the Debentures (as defined in the Debenture), any Debentures shall remain unpaid, then upon receipt by the Custodian of a
written notice from a Purchaser holding such Debentures certifying that such Debentures remain unpaid, the Custodian shall release to such Purchaser its pro rata portion of the Secured Proceeds remaining in the Custodial Account relating to such
Purchaser (but not more than the amount due under such Debentures then held by such Purchaser and amounts due under the Purchase Agreement to such Purchaser), and such Secured Proceeds shall be applied to reduce amounts due and owing to such
Purchaser with respect to the Debentures and the Purchase Agreement as follows: first, to the payment of fees and expenses including liquidated damages; second, to interest payable in cash with respect to the Debentures; and third, to the
outstanding principal under the Debentures. 
  
 (ii) At any time
after the occurrence of an Event of Default, any Purchaser may, at its option, deliver a certificate to the Custodian and the Company specifying the nature of the Event of Default. If, within ten days after its receipt of such certificate, the
Custodian shall not have received written notice from the Company that it disputes the occurrence of such Event of Default, then the Custodian shall release to such Purchaser such Purchaser’s pro rata portion of the Secured Proceeds remaining
in the Custodial Account. In the event that the Company does deliver a timely notice to the Custodian and the Purchaser that it disputes such determination, then such dispute shall be resolved between the Company and the Purchaser by arbitration
conducted as follows: the arbitration shall be conducted in New York, New York, before an arbitration panel of three arbitrators, one of whom shall be selected by the Purchaser, one of whom shall be selected by the Company, with the remaining
arbitrator to be agreed upon by the first two. The arbitration shall be conducted in accordance with the commercial arbitration rules of the American Arbitration Association then in effect. Any arbitration decision or award shall be final and
conclusive as to the parties to this Agreement and their successors and assigns; judgment upon such decision or award may be entered in any competent court. In the event that the arbitration shall be decided in favor of the applicable Purchaser,
then upon delivery of a written copy of such decision by the Purchaser to the Custodian, the Custodian shall promptly release the Purchaser’s pro rata portion of the remaining Secured Proceeds to the Purchaser. 
  

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 3. Security Agreement. 
  
 (a) Grant. The Company hereby unconditionally and irrevocably grants to the Purchasers, to secure the
payment and performance in full when due of all of the Obligations (as said term is defined below), a continuing first priority security interest in, and so pledges and assigns to the Purchasers all of, the Secured Proceeds and any interest that
accrues thereon (“Collateral”). “Obligations” means all present and future indebtedness, obligations, covenants, duties and liabilities of any kind or nature of the Company to the Purchasers (or any of them) under this
Agreement, the Debentures and the other Transaction Documents, in each case whether now or hereafter existing, voluntary or involuntary, direct or indirect, absolute or contingent, liquidated or unliquidated, whether or not jointly owed with others.
Without limiting the generality of the foregoing, this Agreement secures the payment of all amounts that constitute part of the Obligations and would be owed by the Company to the Purchasers under the Transaction Documents but for the fact that they
are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving the Company or any of the Company’s Subsidiaries. 
  
 (b) Further Assurances. The Company agrees that at any time and from time to time, at the expense of
the Company, the Company shall promptly execute and deliver all further instruments, documents and/or control agreements and take all further action, that may be necessary or desirable, or that the Purchasers may reasonably request, in order to
perfect and protect any security interest granted or purported to be granted hereby or to enable any Purchaser to exercise and enforce its rights and remedies hereunder with respect to any of the Collateral. 
  
 (c) Rights and Remedies. At any time after the
occurrence of an Event of Default, and without any other notice to or demand upon the Company, the Purchasers shall have, in any jurisdiction in which enforcement hereof is sought, in addition to all other rights and remedies, the rights and
remedies of a secured party under the Uniform Commercial Code in effect from time to time in the State of New York (the “UCC”) and any additional rights and remedies which may be provided to a secured party in any applicable
jurisdiction. 
  
 (d) Power of Attorney.
The Company hereby irrevocably constitutes and appoints the Purchasers, and each of them, and any officer, partner, member or agent thereof, with full power of substitution, as its true and lawful attorneys-in-fact with full irrevocable power and
authority in the name, place and stead of the Company or in their own names, for the purpose of carrying out the terms of this Agreement, to take any and all appropriate action and to execute any and all documents and instruments that may be
necessary or useful to accomplish the purposes of this Agreement and, without limiting the generality of the foregoing, hereby gives said attorneys the power and right, on behalf of the Company, without notice to or assent by the Company, at any
time after the occurrence of an Event of Default, to sell, transfer, pledge, make any agreement with respect to or otherwise dispose of or deal with any of the Collateral in such manner as is consistent with the UCC and as fully and completely as
though the Purchasers were the absolute owners thereof for all purposes, and to do, at the Company’s expense, at any time or from time to time, all acts and things which the Purchasers deem necessary or useful to protect, preserve or realize
upon the Collateral and the security interest of the Purchasers therein, in order to effect the intent of this Agreement, all at least as fully and effectively as the Company might do. 
  

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 (e) Intentionally Omitted. 
  
 (f) Marshalling. All rights and remedies of the Purchasers hereunder and in respect of the Collateral
and other assurances of payment shall be cumulative and in addition to all other rights and remedies, however existing or arising. To the extent that it lawfully may, the Company hereby agrees that it will not invoke any law relating to the
marshalling of assets which might cause a delay in or impede the enforcement of the rights and remedies of the Purchasers under this Agreement, the Debentures, the other Transaction Documents or under any other instrument creating or evidencing any
of the Obligations or under which any of the Obligations is outstanding or by which any of the Obligations is secured or payment thereof is otherwise assured, and to the extent that it lawfully may, the Company hereby irrevocably waives the benefits
of all such law. 
  
 (g) No Waiver, etc.
The Purchasers shall not be deemed to have waived any of their rights or remedies in respect of the Obligations or the Collateral unless such waiver shall be in writing and signed by the Purchasers. No delay or omission on the part of the Purchasers
in exercising any right or remedy shall operate as a waiver of such right or remedy or any other right or remedy. A waiver on any one occasion shall not be construed as a bar to or waiver of any right or remedy on any future occasion. All rights and
remedies of the Purchasers with respect to the Obligations or the Collateral, whether evidenced hereby or by any other document or instrument, shall be cumulative and may be exercised singularly, alternatively, successively or concurrently at such
time or at such times as the Purchasers deem expedient. 
  
 (h) Certain Defined Terms. Terms used in this Section 3 but not otherwise defined in this Agreement that are defined in the UCC (as such term is hereinafter defined) shall have the respective meanings given
such terms therein; provided, however, that if a term is defined in Article 9 of the UCC differently than in another Article of the UCC, then such term shall have the meaning specified in Article 9. “UCC” means the
Uniform Commercial Code in effect from time to time in the State of New York. 
  
 4. Conditions to Custodian’s Duties. The acceptance by the Custodian of its duties as such under this Agreement is subject to the following terms and conditions, which all of the parties to this Agreement
hereby agree shall govern and control with respect to the rights, duties, liabilities and immunities of the Custodian: 
  
 (a) The Custodian is not a party to, nor is it bound by, any other agreement by which the other parties hereto may be bound (whether or
not it has knowledge of such), other than as expressly herein set forth. 
  
 (b) The Custodian shall be protected in acting upon any written notice, request, waiver, consent, receipt or other document which the Custodian, in good faith, believes to be genuine and what it purports to be. No
waiver or any breach of any covenant or provision herein contained shall be deemed a waiver of any preceding or 
  

 6 

 succeeding breach thereof, or of any other covenant or provision herein contained. No extension of time
for performance of any obligation or act shall be deemed an extension of the time for performance of any other obligation or act. If the Custodian reasonably requires other or further instruments in connection with this Agreement or obligations in
respect hereto, the necessary parties hereto shall join in furnishing such instruments. 
  
 (c) The Custodian shall be indemnified and held harmless by the Company and the Purchasers, jointly and severally, from and against any
and all loss, expense, fees (including attorneys’ fees) and damages that may be incurred by the Custodian as a result of its agreeing to act in such capacity and its performance of this Agreement. The Custodian shall not be obligated to any
party for any error in judgment or for any act done or steps taken or omitted by it in good faith, or for any mistake of fact or law, or for anything which it may do or refrain from doing in connection therewith, except as a result of its own gross
negligence or willful misconduct. This indemnity includes the costs of enforcing the indemnification (including attorneys’ fees). 
  
 (d) The Custodian may consult with or retain legal counsel in connection with any dispute or question as to the construction of any of the
provisions hereof or with regard to its duties and shall be held harmless and protected by the Company and the Purchasers in acting in good faith in accordance with the instructions of such counsel. Such counsel’s fees and expenses shall be
paid as set forth in Section 4(f) hereof. The Custodian may represent itself at its usual rates. 
  
 (e) The Custodian shall not be responsible or liable for the default or misconduct of its agents, attorneys or employees, if they are
selected with reasonable care. 
  
 (f) The
Company will pay the Custodian’s fees (at the Custodian’s customary hourly rate for legal services) and out-of-pocket disbursements for time spent in performing its duties under this Agreement, and if any of Custodian’s invoices are
not paid in full within 30 days, the Custodian is directed to pay itself directly from the Custodial Account; provided that if fees are taken directly from the Custodial Account by the Custodian, the Purchasers shall have no claim against the
Custodian for such funds but shall have a claim against the Company for reimbursement. The Company shall promptly replenish any funds that are disbursed to the Custodian from the Custodial Account. 
  
 (g) The Custodian shall have no obligation to seek to
maximize the rate of interest on the Secured Proceeds, and shall be without liability to any person in respect thereof. 
  
 (h) No modification of this Agreement shall, without the consent of the Custodian and all other parties hereto, modify the provisions of
this Agreement relating to the duties, obligations or rights of the Custodian. This Agreement is the final expression of, and contains the entire agreement between, the parties with respect to the subject matter hereof and supersedes all prior
understandings with respect thereto. 
  

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 5. Conflict with Respect to Collateral. 
  
 (a) In the event that the Custodian at any time receives or
becomes aware of conflicting demands or claims with respect to the Collateral, this Agreement or its duties hereunder, the Custodian shall have the right to discontinue and refrain from any and all activities on its part under this Agreement or in
connection herewith until such conflict is resolved to its satisfaction. 
  
 (b) The Custodian shall have the further right to commence or defend any action or proceedings for the determination of such conflict. The Company and the Purchasers jointly and severally agree to pay all costs,
damages, judgments and expenses, including reasonable attorneys’ fees, suffered or incurred by the Custodian in connection with or arising out of this Agreement and the transactions described herein in the event of bona fide conflicting claims
or demands, including, but without limiting the generality of the foregoing, a suit in interpleader brought by the Custodian. In the event that the Custodian files a suit in interpleader, it shall thereupon be fully released and discharged from all
further obligations to perform any and all duties or obligations imposed upon it by this Agreement (except it may not release the Collateral except as designated by the court). 
  
 6. Acknowledgement. All parties hereto agree that the Custodian is counsel for Midsummer Capital, LLC
(“Midsummer”) and shall be entitled to represent Midsummer with respect to the Purchase Agreement and the transactions contemplated thereunder; and the Company and each other Purchaser hereby waives any right or claim to object to
such legal representation by Custodian of Midsummer in connection with this transaction. 
  
 7. Resignation of Custodian. The Custodian may at any time resign hereunder by giving written notice of its resignation to the Company and the Purchasers, at least ten (10) days prior to the date specified for
such resignation to take effect, and upon the effective date of such resignation, all property then held by the Custodian hereunder shall be delivered by it to such Person as may be designated by the Company and the Purchasers, in writing, whereupon
all the Custodian’s obligations hereunder shall cease and terminate. If no such Person shall have been designated by such date, all obligations of the Custodian hereunder shall, nevertheless, cease and terminate. The Custodian’s sole
responsibility thereafter shall be to keep safely all property then held by it and to deliver the same to a Person designated by the parties hereto or in accordance with the directions of a final order or judgment of a court of competent
jurisdiction, or to file a suit in interpleader as provided in Section 5 above. 
  
 8. Interest on Secured Proceeds. The Custodian shall have no obligation to any party to maintain any level of interest on the Secured Proceeds. In the absence of an Event of Default, all accrued interest, if
any, shall be payable to the Company or its assignees at the direction of the Company when actual paid. 
  
 9. Successors and Assigns. The Purchasers may assign their rights hereunder in connection with the transfer of Debentures. The Company may
not assign its rights under this Agreement. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, administrators, successors and permitted assigns. 
  

 8 

 10. Governing Law; Jurisdiction. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, AND THE PARTIES AGREE AND CONSENT TO THE EXCLUSIVE JURISDICTION OF THE FEDERAL AND STATE COURTS LOCATED IN NEW YORK COUNTY, NEW YORK IN ANY ACTION OR PROCEEDING HEREUNDER, AND TO SERVICE OF PROCESS BY
CERTIFIED MAIL, RETURN RECEIPT REQUESTED (WHICH SHALL CONSTITUTE “PERSONAL SERVICE”). THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT. 
  
 11.
Amendment. No provision of this Agreement may be amended or waived without the prior written consent of the Company and all the Purchasers; provided, however, that any provision relating to the duties, obligations and
rights of the Custodian shall in addition require the approval of the Custodian, as provided in Section 4 above. 
  
 12. Notices. All notices or other communications between the parties contemplated under, or relating to, this Agreement shall be in writing, shall
be signed by each person giving such notice or communication, and shall be delivered by hand, reputable overnight courier or by certified mail, return receipt requested, to the parties at their respective addresses set forth in the Securities
Purchase Agreement or to such other address as to which the sending party has received written notice in accordance with this Section 12. 
  
 ******************* 
  

 9 

 IN WITNESS WHEREOF, the parties hereto have duly executed this Custodial Agreement as of the day and year first above
written. 
  

			
	NORTH AMERICAN TECHNOLOGIES GROUP,
INC.
		
	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 
	
	CUSTODIAN:
	
	FELDMAN WEINSTEIN LLP
		
	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 

  
 [PURCHASERS’
SIGNATURE PAGES TO FOLLOW] 

	
	Name of Investing Entity: Sponsor Investments, LLC
	 By: Herakles Investments, Inc., Managing Member

	 Signature of Authorized Signatory of Investing Entity:
                                        
                                        
                        

	 Name of Authorized Signatory:
                                        
                                        
        

	 Title of Authorized Signatory:
                                        
                                        
          

	
	Name of Investing Entity: Toibb Investment LLC
	 By: Toibb Management LLC, Manager

	 Signature of Authorized Signatory of Investing Entity:
                                        
                                        
                    

	 Name of Authorized Signatory: Harris Toibb

	 Title of Authorized Signatory: Manager

	
	Name of Investing Entity: Michael Toibb
	
	 Signature of Authorized Signatory of Investing Entity:
                                        
                                        
                    

	 Name of Authorized Signatory: Michael Toibb

	 Title of Authorized Signatory:

	
	Name of Investing Entity: Scott M. and Cheryl L. Hergott Living Trust
	
	 Signature of Authorized Signatory of Investing Entity:
                                        
                                        
                  

	 Name of Authorized Signatory:

	 Title of Authorized Signatory:

	
	Name of Investing Entity: Crestview Capital Master, LLC
	
	 Signature of Authorized Signatory of Investing Entity:
                                        
                                        
                  

	 Name of Authorized Signatory: Daniel Warsh

	 Title of Authorized Signatory:

	
	Name of Investing Entity: Midsummer Investment Ltd.
	
	 Signature of Authorized Signatory of Investing Entity:
                                        
                                        
                

	 Name of Authorized Signatory: Michel A. Amsalem

	 Title of Authorized Signatory:

	
	Name of Investing Entity: Islandia, LP
	
	 Signature of Authorized Signatory of Investing Entity:
                                        
                                        
                

	 Name of Authorized Signatory:

	 Title of Authorized Signatory:Limited Waiver and First Amendment

 Exhibit 10.5 
  
 LIMITED WAIVER AND FIRST AMENDMENT 
 TO CONSTRUCTION LOAN AGREEMENT 
  
 This LIMITED WAIVER AND FIRST AMENDMENT TO CONSTRUCTION LOAN AGREEMENT (this “Agreement”), dated as of July 7, 2005, is entered into by and among the following parties: 
  
 (a) TIETEK LLC, a Delaware limited liability company (the
“Borrower”); 
  
 (b) NORTH
AMERICAN TECHNOLOGIES GROUP, INC., a Delaware corporation (the “Company”), and TIETEK TECHNOLOGIES, INC., a Texas corporation (“TTT”) (the Company and TTT shall be collectively referred to as the “Borrower
Affiliates” and the Borrower Affiliates and the Borrower shall be collectively referred to as the “Borrower Group”); and 
  
 (c) OPUS 5949 LLC (formerly known as Tie Investors, LLC), a Texas limited liability company (the “Lender” and, together
with the Borrower Group, the “Parties”). 
  
 RECITALS 
  
 A. The Borrower, the Borrower
Affiliates, and the Lender entered into that certain Construction Loan Agreement, dated as of February 5, 2004, as amended by (1) that certain Release, dated February 22, 2005, by and among the Parties and (2) that certain Letter Agreement, dated
April 6, 2005, by and among the Parties (as so amended, the “Loan Agreement”), pursuant to which the Lender agreed to make available to the Borrower Group certain financial accommodations. 
  
 B. An Event of Default occurred under the Loan Agreement by reason of the
Borrower’s failure to make the required principal and interest payment due to the Lender on April 1, 2005 (the “Payment Default”); 
  
 C. On April 6, 2005, the Borrower, the Borrower Affiliates and Lender entered into a forbearance letter agreement (the “Initial Forbearance
Letter”), whereby the Parties agreed, among other things, that the Lender would take no action under the Loan Agreement, or any other documents related to or arising out of the Loan Agreement (collectively, the “Loan
Documents”), for a period beginning on the date of such forbearance letter agreement and ending on May 1, 2005 (such period, the “Initial Forbearance Period”). 
  
 D. On April 29, 2005, the Borrower, the Borrower Affiliates and Lender entered into a forbearance extension letter agreement
(the “Extension Agreement”), whereby the Parties agreed, among other things, that the Initial Forbearance Period and the terms of the Initial Forbearance Letter would be extended through May 9, 2005. 
  
 E. Effective as of May 9, 2005, the Borrower, the Borrower Affiliates and
Lender entered into that certain Forbearance Agreement, dated as of May 9, 2005 (the “Forbearance Agreement”), whereby the Parties agreed, among other things: (1) the Initial Forbearance Period 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
 TO CONSTRUCTION LOAN AGREEMENT - Page 1 

 was further extended through January 1, 2006; (2) the interest payments otherwise due and payable by Borrower under the
Loan Agreement and/or the other Loan Documents on April 1, 2005, July 1, 2005, and October 1, 2005, would be deferred until January 1, 2006; (3) the Borrower and the Borrower Affiliates would comply with certain additional covenants and conditions
for the benefit of Lender, including, but not limited to, seeking additional third-party financing and sale of the Borrower. 
  
 F. The Borrower and the Borrower Affiliates acknowledge and agree that one or more Defaults or Events of Default have occurred and are continuing, or may
occur, by reason of the Borrower’s failure to comply with its covenants contained in the Forbearance Agreement, including the Borrower’s covenant to select an investment banker to facilitate obtaining replacement financing and provide such
investment banker’s suggested plans for obtaining such financing (together with the Payment Default, the “Specified Events of Default”). 
  

G. The Specified Events of Default exist and remain uncured as of this date. 
  
 H. Pursuant to the terms of the Forbearance Agreement, the obligations evidenced by the Loan Documents due to the Lender
have been accruing interest at the default rate of interest for the period commencing May 9, 2005 and continuing to the date hereof, as provided in that certain Promissory Note, dated February 5, 2004, in the stated principal amount of $14,000,000,
made by the Borrower and the Borrower Affiliates, jointly and severally, payable to the order of the Lender (the “Prior Note”). 
  
 I. The Borrower and the Borrower Affiliates acknowledge and agree that as a result of the Specified Events of Default described above, the Lender has the
right to exercise its rights and remedies under the Loan Agreement, the Prior Note and the other Loan Documents. 
  
 J. The Borrower and the Borrower Affiliates have requested that, subject to the terms, conditions, covenants and limitations contained in this Agreement,
the Lender: (1) grant a limited waiver of the Specified Events of Default; (2) terminate the Initial Forbearance Letter, the Extension Agreement and the Forbearance Agreement in all respects; and (3) amend certain terms and conditions of the Loan
Agreement, the Prior Note and certain other Loan Documents as set forth herein to, among other things, permit the Borrower to obtain additional financing as contemplated by the Forbearance Agreement that will be subordinate to the Loan (as defined
in the Loan Agreement, as amended hereby) on the terms set forth below. 
  
 K. The Borrower and the Borrower Affiliates acknowledge and agree that, given the Borrower’s financial situation, the Borrower and the Borrower Affiliates have agreed to effect a restructuring of the Borrower’s indebtedness.

  
 L. The Lender has agreed to the actions described in
Paragraph J preceding, in each instance upon and subject to the terms, conditions, covenants and limitations contained in this Agreement. 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
 TO CONSTRUCTION LOAN AGREEMENT - Page 2 

 ACKNOWLEDGMENTS: 
  
 (a) The Borrower and the Borrower Affiliates hereby acknowledge and agree to the accuracy of all Recitals included in this
Agreement. 
  
 (b) The Borrower and the Borrower Affiliates
acknowledge and agree that all amounts advanced to, or for the benefit of, the Borrower, including, but not limited to, the Loan prior to the date hereof are, and shall continue to be, obligations under the Loan Documents (the
“Obligations”) and subject to all the terms and conditions in the Loan Agreement and the other Loan Documents, in each instance as amended and modified by this Agreement. 
  
 (c) The Borrower and the Borrower Affiliates acknowledge and agree that (i) as of July 7, 2005, the outstanding principal
and accrued but unpaid amount of the Obligations is $15,022,115.68, of which $14,000,000.00 is the amount of outstanding principal of the Prior Note, $599,958.33 is the amount of accrued but unpaid interest thereon, $407,944.45 is the outstanding
principal amount of the April Note, as defined below, and $14,212.90 is the amount of accrued by unpaid interest thereon; and (ii) the Obligations are enforceable against the Borrower without offset, reduction, or counterclaim. 
  
 AGREEMENTS 
  
 NOW, THEREFORE, in consideration of the premises herein contained and other
good and valuable consideration, the sufficiency of which is hereby acknowledged, the Parties hereto, intending to be legally bound, agree to the above Recitals, Acknowledgments and as follows: 
  
 1. DEFINITIONS. All capitalized terms used but not otherwise defined
in this Agreement shall have the meanings ascribed to them in the Loan Agreement. 
  
 2. LIMITED WAIVER. Subject to the terms and conditions set forth in this Agreement and the Borrower’s and the Borrower Affiliates’ acknowledgments and agreements set forth above, and expressly
conditioned upon the absence of any additional Events of Default, other than the Specified Events of Default, and satisfaction and fulfillment of each of the conditions precedent set forth in Section 4 below and each of the conditions
subsequent set forth in Section 5 below, the Lender hereby waives the Specified Events of Default. The waiver agreed to herein (i) is strictly limited to the Specified Events of Default, and except as expressly set forth in this Agreement,
all the other terms, provisions and conditions of the Loan Agreement and the other Loan Documents shall remain in full force and effect, in each instance as amended hereby, (ii) shall not extend nor be deemed to extend to any other Default or Event
of Default that may now exist or hereafter arise under the Loan Agreement or any of the other Loan Documents, (iii) shall not impair, restrict or limit any right or remedy of the Lender with respect to any other Default or Event of Default that may
now exist or hereafter arise under the Loan Agreement or any of the other Loan Documents, and (iv) shall not constitute any course of dealing or other basis for altering any obligation of any member of the Borrower Group or any right, privilege or
remedy of the Lender under the Loan Agreement or any of the other Loan Documents. No failure on the part of any Lender to provide a notice hereunder or otherwise exercise, and no delay in providing any notice or otherwise exercising, any right,
power, remedy or privilege under this Agreement, shall 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
 TO CONSTRUCTION LOAN AGREEMENT - Page 3 

 operate as a waiver thereof, nor shall any single or partial exercise of any right, power, remedy or privilege under this
Agreement preclude any other or further exercise thereof or the exercise of any other right, power, remedy or privilege. 
  
 3. AMENDMENTS TO LOAN DOCUMENTS. 
  
 3.1 The following definitions in Section 1.1 of the Loan Agreement are hereby amended and restated in their entirety to read as follows:

  
 “Loan” Any and all of (i) a
loan advanced in multiple disbursements as set forth herein as evidenced by the Note, (ii) interest thereon, whether paid in kind or otherwise, and (iii) any and all other debts, obligations and liabilities of every kind and character of the
Borrower now or hereafter existing in favor of the Lender under this Agreement or any of the other Loan Documents in each case, secured by a first lien on the Assets and a Deed of Trust Mortgage and Security Agreement on the Premises.”

  
 “Loan Documents” This
Agreement, the First Amendment, the Note, the Deed of Trust, the Security Agreement, the Patent Security Agreement, the Intercreditor Agreement, the Voting Agreement, the Non-Compete Agreement, the NATK Royalty Agreement, the TieTek Royalty
Agreement, the Membership Pledge Interest Agreements, the Solvency Certificates, and any other documents to be executed by Borrower or any of their respective shareholders pertaining to the Loan, and as the same may be amended from time to time.

  
 “Note” collectively, (i)
that certain Amended and Restated Promissory Note, dated as of July 7, 2005, in the stated principal amount of $14,000,000, made by the Borrower Group, jointly and severally, payable to the order of the Lender, (ii) any other promissory notes
evidencing any portion of the Loan, including any instruments amended and restated by the instrument referred to in clause (i) immediately preceding, and (iii) any promissory notes or other agreement evidencing any renewals, extensions, increases,
amendments, modifications, restatements or payment-in-kind in respect of any of the foregoing.” 
  
 3.2 The following definitions are hereby inserted in Section 1.1 of the Loan Agreement in the appropriate alphabetical order to read in their
entirety as follows: 
  
 “Debentures” the 7% Convertible Debentures of the Company in the original principal amount of $5,000,000, issued pursuant that certain Securities Purchase Agreement dated as of July 7, 2005. 
  
 3.3 New Sections 6.1(l), (m), and (n) are hereby added
to the Loan Agreement to read in their entirety as follows: 
  
 “(l) Amendments to Debentures. Company shall amend, restate, renew, increase, extend or otherwise modify the Debentures or any instrument executed or agreement entered into in connection therewith,
orally or in writing, or allow any such amendment, restatement, renewal, increase, extension or modification to occur, without the prior written consent of the Lender.” 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
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 “(m) Defaults Under Debentures. Company shall be in default under or
otherwise in breach or violation of the terms and conditions of the Debentures.” 
  
 “(n) Subordination. Company shall make any payment of all or any portion of the Debentures in violation Section 6 of
the Debentures or voluntarily prepay all or any portion of the Debentures without the prior written consent of the Lender; provided, however, that nothing herein shall prohibit the Company from issuing shares of Company Common Stock to the holders
of the Debentures in payment of interest due thereunder or upon conversion thereof.” 
  
 3.4 All references to the “Loan Agreement” or the “Construction Agreement” or other similar terms intended to refer to the Loan Agreement in each of the Loan Documents and in any other documents or
agreements by, between or among any of the Borrower Group and their respective affiliates, and or for the benefit of the Lender will from and after the date hereof refer to the Loan Agreement, as amended hereby, and all obligations of the Borrower
Group under the Loan Agreement, as amended hereby, shall be secured by and be entitled to the benefits of said Loan Documents and such other documents and agreements. All Loan Documents heretofore executed by all or any of the Borrower Group shall
remain in full force and effect to secure the Loan (as defined in the Loan Agreement), and such Loan Documents, as amended hereby, are hereby ratified and affirmed. 
  
 4. CONDITIONS PRECEDENT TO EFFECTIVENESS. The effectiveness of this Agreement is subject to the fulfillment of each
of the following terms and conditions to the satisfaction of Lender in its sole discretion at or before 2:00 p.m. (Dallas time) July 7, 2005. 
  
 4.1. The Lender shall have received fully executed copies of the Securities Purchase Agreement among the Company and certain purchasers of Debentures
issued pursuant to the Securities Purchase Agreement, in form and substance satisfactory to Lender. 
  
 4.2. The Lender shall have received a legal opinion of the Borrower’s counsel in form and substance satisfactory to the Lender as to such matters as
Lender may request with respect to each member of the Borrower Group, this Agreement, the Loan Agreement, the other Loan Documents and each agreement and instrument delivered in connection with, or contemplated by, this Agreement. 
  
 4.3. The Lender shall have received evidence satisfactory to the Lender that
each Purchaser (as defined in the Securities Purchase Agreement) funded the Escrow Account (as defined in the Securities Purchase Agreement). 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
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 4.4. The Lender shall have received each of the following fully executed (other than by Lender)
documents, in each instance in form acceptable to Lender: 
  

	 	(a)	an amended and restated promissory note in form of attached hereto as Exhibit A (the “Amended and Restated Note”), amending and restating the Prior Note; and

  

	 	(b)	an amendment in the form attached hereto as Exhibit B (the “Deed of Trust Amendment”) amending that certain Deed of Trust, Security Agreement, Assignment of
Rents and Fixture Filing, dated as of February 5, 2004, made by the Borrower, to Heather Kreager, Trustee, for the benefit of the Lender, filed of record February 23, 2004, in the office of the County Clerk of Harrison County, State of Texas, in
Book OR, Volume 2794, Page 220, as Document No. 4002281, and that certain Assignment of Leases and Rents, dated as of February 5, 2004, made by the Borrower to the Lender, filed of record February 23, 2004, in the office of the County Clerk of
Harrison County, State of Texas, in Book OR, Volume 2794, Page 262, as Document No. 4002282. 

  

	 	(c)	an Amended and Restated Registration Rights Agreement, in the form attached hereto as Exhibit C (the “Registration Rights Agreement”), executed by the
Company and providing for the registration of all shares of Company Common Stock issuable to the Lender pursuant to the Amended and Restated Note. 

  

4.5 The Lender shall have received in satisfaction of that certain Promissory Note, dated April 1, 2005, in the original principal amount of
$407,944.45, made by the Borrower Group (the “April Note”), jointly and severally, payable to the order of the Lender (evidencing interest paid in kind in accordance with the terms of the Prior Note), shares of the Company’s
common stock, par value $.001 per share (the “Company Common Stock”) in an amount determined by dividing the total principal and interest then due and payable under such note by the average NATK Share Value (as defined in the Amended and
Restated Note) for the twenty consecutive trading days ending upon the date prior to the effective date of this Agreement rounded up to the nearest whole share of Company Common Stock. 
  
 4.6 The Lender shall have received in satisfaction of the interest accruing on the April Note or the Prior Note, in each
case since April 1, 2005, shares of Company Common Stock in an amount determined by dividing the total interest (including default interest) due and payable as of the effective date of this Agreement under such note by the average NATK Share Value
for the twenty consecutive trading days ending upon the date prior to the effective date of this Agreement rounded up to the nearest whole share of Company Common Stock. 
  
 4.7 The Lender shall have received a written opinion of counsel to the Company acceptable to the Lender, in a form
satisfactory to the Lender, to the effect that, at the time of issuance and delivery of shares of Company Common Stock pursuant to Sections 4.5 and 4.6 of this Agreement, regarding the representations set forth in Section 7.2(g) of
this Agreement. 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
 TO CONSTRUCTION LOAN AGREEMENT - Page 6 

 5. CONDITIONS SUBSEQUENT TO EFFECTIVENESS; ADDITIONAL COVENANTS AND OBLIGATIONS OF THE BORROWER AND
THE BORROWER AFFILIATES. The continued effectiveness of this Agreement is subject to the satisfaction of the following conditions subsequent, unless specifically waived in writing by the Lender: 
  
 5.1 Beginning on July 7, 2005, the Borrower shall provide to the Lender
summary weekly production reports and monthly the same or substantially the same information that Borrower and the Borrower Affiliates provide to the members of its Board of Directors and to its management including without limitation, specific
performance reports or measurements, financial plans and budgets, and any other information reasonably requested by Lender, and shall be discussed in a weekly conference call with the Lender’s representatives or agents. 
  
 6. ADDITIONAL AGREEMENTS. 
  
 6.1. Default Interest. The Borrower and Borrower Affiliates agree and
acknowledge that from and after May 9, 2005, the Obligations have accrued interest at the default rate of interest provided in the Prior Note, and the Obligations will continue to accrue interest at the default rate of interest as provided in
Amended and Restated Note until the issue date of the Debentures, at which point the Obligations will accrue interest at the Applicable Rate as set forth in the Amended and Restated Note. 
  
 6.2. Audits and Field Exams. Until all of the Obligations owing to the Lender have been indefeasibly paid in full,
the Lender, and its agents, appraisers, and advisors shall have the right of full access to, and may visit, the Borrower’s and the Borrower Affiliates’ business, upon reasonable notice, to (i) inspect the collateral of the Lender; (ii)
visit and conduct field exams of the Borrower’s and the Borrower Affiliates’ business, (iii) take copies and extracts from the Borrower’s and the Borrower Affiliates’ books and records and inspect the Borrower’s and the
Borrower Affiliates’ facility, (iv) conduct on-site monitoring thereof, and (v) obtain information requested by the Lender as to such matters relating to the Borrower’s and the Borrower Affiliates’ business operations. The
Borrower’s and the Borrower Affiliates’ officers and employees shall fully cooperate with such efforts by the Lender, and its agents and advisors. 
  
 6.3. Consent to Relief. In the event of any breach of the Loan Documents, Conditions Precedent, the Conditions Subsequent or the Additional
Agreements set forth in this Agreement, then, to the extent that the Lender establishes before a court of appropriate jurisdiction that any of the foregoing has occurred, the Borrower and the Borrower Affiliates consent to injunctive relief,
including, but not limited to, the appointment of a receiver for the benefit of the Lender, in order to enforce the terms of this Agreement and the Loan Documents and to effect the remedies sought herein and under applicable law. 
  
 6.4. Cooperation of Borrower Affiliates. To the extent that compliance
with any of the Conditions Precedent, Conditions Subsequent and Additional Agreements requires action or cooperation by the Borrower Affiliates, each of the Borrower Affiliates agree to 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
 TO CONSTRUCTION LOAN AGREEMENT - Page 7 

 provide such cooperation and take such action, including, but not limited to, providing to the Lender complete access to
the Borrower’s and the Borrower’s Affiliates’ books, records, and facilities to confirm or supplement any information provided to Lender. 
  
 6.5. Meeting with Management. The Borrower and the Borrower Affiliates agree to cause their respective management and boards of directors to, upon
Lender’s request, attend informational meetings with the Lender to discuss and review the Borrower’s and the Borrower Affiliates’ business affairs and plans, provided, however, that absent an Event of Default, such
meetings shall be limited to once per calendar month, provided, further, that in the event that Lender has questions or concerns regarding the status of the Borrower or any of the Borrower Affiliates, in addition to the meetings
described above, the Lender may request a telephonic meeting with such management or boards of directors, or other representatives of the Borrower or any of the Borrower Affiliates, which meeting shall occur within 48 hours of such request.

  
 6.6 Representations and Warranties of the Lender. The
Lender hereby represents and warrants to the Borrower Group as follows: 
  
 (a) Own Account. The Lender understands that the shares of Company Common Stock issuable to it hereunder and pursuant to the Amended and Restated Note (the “Securities”) are “restricted
securities” and have not been registered under the Securities Act of 1933 (the “Securities Act”) or any applicable state securities law and is acquiring the Securities as principal for its own account and not with a view to or for
distributing or reselling such Securities or any part thereof in violation of the Securities Act or any applicable state securities law, has no present intention of distributing any of such Securities in violation of the Securities Act or any
applicable state securities law and has no arrangement or understanding with any other persons regarding the distribution of such Securities (this representation and warranty not limiting the Lender’s right to sell the Securities pursuant to a
registration statement meeting the requirements set forth in the Registration Rights Agreement and covering the resale of the Securities by the Lender as provided for in the Registration Rights Agreement (the “Registration Statement”) or
otherwise in compliance with applicable federal and state securities laws) in violation of the Securities Act or any applicable state securities law. The Lender is acquiring the Securities hereunder in the ordinary course of its business. The Lender
does not have any agreement or understanding, directly or indirectly, with any Person to distribute any of the Securities. 
  
 (b) Status. At the time the Lender was offered the Securities, it was, and at the date hereof it is either: (i) an “accredited
investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer” as defined in Rule 144A(a) under the Securities Act. 
  
 (c) Experience of the Lender. The Lender, either alone
or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
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 prospective investment in the Securities, and has so evaluated the merits and risks of such investment.
The Lender is able to bear the economic risk of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment. 
  

(d) General Solicitation. The Lender is not purchasing the Securities as a result of any advertisement, article, notice or other
communication regarding the Securities published in any newspaper, magazine or similar media or broadcast over television or radio or presented at any seminar or any other general solicitation or general advertisement. 
  
 6.7 Transfer Restrictions. 
  
 (a) The Securities may only be disposed of in compliance
with applicable state and federal securities laws. In connection with any transfer of Securities other than pursuant to an effective registration statement or Rule 144, to the Company or to an affiliate of the Lender or in connection with a pledge
as contemplated in Section 5.1(b), the Company may require the transferor thereof to provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be
reasonably satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Securities under the Securities Act. As a condition of transfer, any such transferee shall agree in writing to be bound by the
terms of this Agreement and shall have the rights of the Lender under this Agreement and the Registration Rights Agreement. 
  
 (b) The Lender agree to the imprinting, so long as is required by this Section 6.7(b), of a legend on any of the Securities in the
following form: 
  
 THESE SECURITIES HAVE NOT
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON
EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES. 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
 TO CONSTRUCTION LOAN AGREEMENT - Page 9 

 The Company acknowledges and agrees that the Lender may from time to time pledge pursuant
to a bona fide margin agreement with a registered broker-dealer or grant a security interest in some or all of the Securities to a financial institution that is an “accredited investor” as defined in Rule 501(a) under the Securities Act
and who agrees to be bound by the provisions of this Agreement and the Registration Rights Agreement and, if required under the terms of such arrangement, the Lender may transfer pledged or secured Securities to the pledgees or secured parties. Such
a pledge or transfer would not be subject to approval of the Company and no legal opinion of legal counsel of the pledgee, secured party or pledgor shall be required in connection therewith. Further, no notice shall be required of such pledge. At
the Lender’s expense, the Company will execute and deliver such reasonable documentation as a pledgee or secured party of Securities may reasonably request in connection with a pledge or transfer of the Securities, including, if the Securities
are subject to registration pursuant to the Registration Rights Agreement, the preparation and filing of any required prospectus supplement under Rule 424(b)(3) under the Securities Act or other applicable provision of the Securities Act to
appropriately amend the list of Selling Stockholders thereunder. 
  
 6.8 Event of Default. If at any time the Borrower or any member of the Borrower Group contests the validity of the Forbearance Agreement or the Loan Agreement (each as amended), this Agreement, or the Amended and Restated Promissory
Note, such event shall constitute an Event of Default under the Loan Agreement, the Prior Note and the Amended and Restated Promissory Note. 
  
 7. RATIFICATIONS, REPRESENTATIONS AND WARRANTIES. 
  
 7.1. The terms and provisions set forth in this Agreement shall supersede all inconsistent terms and provisions set forth in the Loan Agreement and,
except as expressly set forth in this Agreement, the terms and provisions of the Loan Agreement and each of the other Loan Documents are ratified and confirmed and shall continue in full force and effect. The Parties hereto agree that the Loan
Agreement shall continue to be legal, valid, binding and enforceable in accordance with its terms. 
  
 7.2. The Borrower and the Borrower Affiliates hereby represent and warrant to the Lender as follows: 
  
 (a) the execution, delivery and performance of this
Agreement and any and all other agreements executed and/or delivered in connection herewith or therewith have been authorized by all requisite action on the part of the Borrower and the Borrower Affiliates and will not violate (i) the Limited
Liability Company Agreement of the Borrower; (ii) the articles of incorporation or bylaws of either of the Borrower Affiliates; or (iii) the operating agreement of any managing member of the Borrower. 
  
 (b) the representations and warranties contained in this
Agreement, the Loan Agreement and the Loan Documents are true and correct in all material respects on and as of the date hereof as though made on and as of such date, except to the extent that breaches thereof are temporarily waived during the
Forbearance Period by this Agreement; 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
 TO CONSTRUCTION LOAN AGREEMENT - Page 10 

 (c) no Default or Event of Default under the Loan Agreement or the Loan Documents have
occurred or are continuing, other than the Specified Events of Default (as expressly disclosed), unless such Default or Event of Default has been specifically waived in writing by the Lender; 
  
 (d) the consummation of the transactions contemplated hereby
will not (i) violate any provision of the organizational documents or governing instruments of the Borrower or either of the Borrower Affiliates, (ii) violate any judgment, order, ruling, injunction, decree or award of any court, administrative
agency or governmental body against, or binding upon, the Borrower or either of the Borrower Affiliates, or (iii) constitute a violation by the Borrower or the Borrower Affiliates of any law or regulation of any jurisdiction applicable to the
Borrower or the Borrower Affiliates; 
  
 (e) this
Agreement was reviewed by the Borrower and the Borrower Affiliates, who acknowledge and agree that the Borrower and the Borrower Affiliates (i) understand fully the terms of this Agreement and the consequences of the issuance hereof, (ii) have been
afforded an opportunity to have this Agreement reviewed by, and to discuss this Agreement with, such attorneys and other persons as the Borrower or the Borrower Affiliates may wish, and (iii) have entered into this Agreement of their own free will
and accord and without threat or duress; 
  
 (f)
this Agreement and all information furnished to the Lender are made and furnished in good faith, for value and valuable consideration; and this Agreement has not been made or induced by any fraud, duress or undue influence exercised by the Lender,
or any other person; and 
  
 (g) with regard to
the issuance and delivery of shares of Company Common Stock to the Lender pursuant to Sections 4.5 and 4.6: (i) the issuance and delivery of such shares to the Lender does not require registration under the Securities Act; (ii) the issuance and
delivery of such shares to the Lender complies with all applicable state securities and blue sky laws; (iii) upon delivery to the Lender, such shares will be validly issued, fully paid and nonassessable; (iv) upon delivery to the Lender, such shares
will be free of any liens, claims and encumbrances; (v) all corporate action on the part of the Company, its directors, officers and shareholders necessary for the authorization, issuance and delivery of such shares has been taken; and (vi) except
as disclosed to the Lender, the issuance of such shares will not cause an adjustment to any conversion rates applicable to any preferred stock, options, warrants or other convertible securities of the Company or rights to acquire such securities of
the Company. 
  
 8. MISCELLANEOUS. 
  
 8.1. Misrepresentation. The Borrower shall indemnify and hold the
Lender harmless from and against any losses, damages, costs and expenses (including attorneys’ fees) 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
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 incurred by the Lender as a direct or indirect result of (i) breach of any representation or warranty contained in this
Agreement, or (ii) any breach or default under any of the covenants or agreements contained in this Agreement. 
  
 8.2. Covenants and Agreements. The Borrower and the Borrower Affiliates hereby agree and acknowledge that the Borrower is truly indebted to the
Lender for the Obligations (without offset, counterclaim, or reduction) pursuant to the terms of the Loan Agreement and the Loan Documents and hereby agree to observe, comply with and perform all of the obligations, terms, and conditions under or in
connection with the Loan Agreement and the Loan Documents. 
  
 8.3. Ratification of Liens and Security Interests. The Borrower and the Borrower Affiliates hereby acknowledge and agree that the liens and security interests granted pursuant to or otherwise in connection with the Loan Agreement and
the Loan Documents are valid and subsisting liens and security interests and are superior to all liens and security interests other than those exceptions approved by the Lender in writing and as otherwise permitted under the Loan Agreement or the
Loan Documents. 
  
 8.4. No Waiver. The Borrower and the
Borrower Affiliates agree that nothing contained in this Agreement shall affect or impair the validity or priority of the liens and security interests under the Loan Agreement or the Loan Documents. The Lender further reserves all of its rights and
remedies under the Loan Agreement and the Loan Documents, except as expressly modified herein. 
  
 8.5. Survival of Representations and Warranties. Except as provided otherwise in this Agreement, all representations and warranties made in the Loan Agreement or any of the Loan Documents including, without
limitation, any document furnished in connection with this Agreement, shall survive the execution and delivery of this Agreement, and no investigation by the Lender or any subsequent event shall affect the representations and warranties or the right
of the Lender to rely upon them. 
  
 8.6. Expenses of the
Lender. The Borrower agrees to pay on demand all costs and expenses incurred by the Lender in connection with the preparation, negotiation and execution of this Agreement and any other agreements executed pursuant hereto, including, without
limitation, the reasonable costs and fees of the Lender’s legal counsel. 
  
 8.7. Severability. Any provision of this Agreement held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Agreement, and the effect thereof
shall be confined to the provision so held to be invalid or unenforceable. 
  
 8.8. Headings. The headings of the sections and subsections of this Agreement are inserted for convenience only and do not constitute a part of this Agreement. 
  
 8.9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of this Agreement by 
  

 LIMITED WAIVER AND FIRST AMENDMENT 
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 facsimile shall have the same force and effect as the delivery of an original executed counterpart of this Agreement. Any
party delivering an executed counterpart of this Agreement by facsimile shall also deliver an original executed counterpart, but the failure to do so shall not affect the validity, enforceability or binding effect of this Agreement. 
  
 8.10. No Commitment. The Borrower and the Borrower Affiliates agree
the Lender has made no commitment or other agreement regarding the Loan Agreement or the Loan Documents, except as expressly set forth in this Agreement. The Borrower and the Borrower Affiliates warrant and represent that neither the Borrower nor
the Borrower Affiliates will rely on any commitment or other agreement on the part of the Lender unless such commitment or agreement is in writing and signed by the Lender. 
  
 8.11. Survival. All representations, warranties, covenants and agreements of the Parties made in this Agreement shall
survive the execution and delivery hereof, until such time as all of the obligations of the Parties hereto shall have lapsed in accordance with their respective terms or shall have been discharged in full. 
  
 8.12. Time of Essence. The Parties to this Agreement have agreed
specifically with regard to the times for performance set forth in this Agreement. Further, the Parties to this Agreement acknowledge that the agreements with regard to the times for performance are material to this Agreement. Therefore, the Parties
agree and acknowledge that time is of the essence to this Agreement. 
  
 8.13. Law Governing. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN SUBSTANTIALLY NEGOTIATED AND MADE IN THE STATE OF TEXAS AND SHALL BE INTERPRETED AND THE RIGHTS OF THE PARTIES DETERMINED IN ACCORDANCE WITH THE LAWS OF THE UNITED
STATES APPLICABLE THERETO AND THE INTERNAL LAWS OF THE STATE OF TEXAS APPLICABLE TO AN AGREEMENT EXECUTED, DELIVERED AND PERFORMED THEREIN, WITHOUT GIVING EFFECT TO THE CHOICE-OF-LAW RULES THEREOF OR ANY OTHER PRINCIPLE THAT COULD REQUIRE THE
APPLICATION OF THE SUBSTANTIVE LAW OF ANY OTHER JURISDICTION. 
  
 8.14. Consent to Jurisdiction. EACH PARTY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF ANY TEXAS OR FEDERAL COURT SITTING IN DALLAS, TEXAS, FOR THE PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF THIS
AGREEMENT, THE LOAN DOCUMENTS, THE FORBEARANCE AGREEMENT, THE PRIOR NOTE OR THE NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY. THE PARTIES HEREBY AGREE AND CONSENT THAT, IN ADDITION TO ANY METHODS OF SERVICE OF PROCESS PROVIDED FOR UNDER
APPLICABLE LAW, ALL SERVICE OF PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY TEXAS OF FEDERAL COURT SITTING IN DALLAS, TEXAS MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, AND SERVICE SHALL BE COMPLETE FIVE (5) DAYS
AFTER THE SAME SHALL 
  

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 HAVE BEEN SO MAILED. EACH PARTY IRREVOCABLY WAIVES ANY OBJECTION TO THE LAYING OF VENUE OF ANY ACTION, SUIT OR
PROCEEDING ARISING OUT OF THIS AGREEMENT, THE LOAN DOCUMENTS, THE FORBEARANCE AGREEMENT, THE PRIOR NOTE OR THE NOTE OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY IN ANY TEXAS OR FEDERAL COURT SITTING IN DALLAS, TEXAS AND FURTHER IRREVOCABLY
WAIVE AND AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION, SUIT OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. 
  
 8.15 Waiver; Modification. NO PROVISION OF THIS AGREEMENT MAY BE WAIVED, CHANGED OR MODIFIED, OR THE DISCHARGE
THEREOF ACKNOWLEDGED, ORALLY, BUT ONLY BY AN AGREEMENT IN WRITING SIGNED BY THE PARTY AGAINST WHOM THE ENFORCEMENT OF ANY WAIVER, CHANGE, MODIFICATION OR DISCHARGE IS SOUGHT. NO DELAY ON THE PART OF THE LENDER IN EXERCISING ANY RIGHT, POWER OR
PRIVILEGE HEREUNDER, SHALL OPERATE AS A WAIVER THEREOF, NOR SHALL ANY WAIVER OF ANY RIGHT, POWER OR PRIVILEGE HEREUNDER OPERATE AS A WAIVER OF ANY OTHER RIGHT, POWER OR PRIVILEGE HEREUNDER, NOR SHALL ANY SINGLE OR PARTIAL EXERCISE OF ANY RIGHT,
POWER OR PRIVILEGE HEREUNDER PRECLUDE ANY OTHER OR FURTHER EXERCISE THEREOF, OR THE EXERCISE OF ANY OTHER RIGHT, POWER OR PRIVILEGE HEREUNDER. ALL RIGHTS AND REMEDIES HEREIN PROVIDED ARE CUMULATIVE AND ARE NOT EXCLUSIVE OF ANY RIGHTS OR REMEDIES
WHICH THE PARTIES HERETO MAY OTHERWISE HAVE AT LAW OR IN EQUITY. 
  
 8.16. Waiver of Jury Trial. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE BORROWER AND THE BORROWER AFFILIATES HEREBY IRREVOCABLY AND EXPRESSLY WAIVE ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF THE LENDER IN THE NEGOTIATION, ADMINISTRATION OR ENFORCEMENT THEREOF.

  
 8.17. Final Agreement. THIS AGREEMENT AND THE
LOAN DOCUMENTS REPRESENT THE ENTIRE EXPRESSION OF THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF ON THE DATE THIS AGREEMENT IS EXECUTED. NEITHER THIS AGREEMENT NOR THE LOAN DOCUMENTS MAY BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. 
  
 8.18. Release. EACH OF THE BORROWER AND THE BORROWER AFFILIATES HEREBY ACKNOWLEDGES THAT AS OF THE DATE HEREOF IT 
  

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 HAS NO DEFENSE, COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE WHATSOEVER THAT CAN BE
ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART OF THE LIABILITY OF THE BORROWER TO REPAY THE OBLIGATIONS OR TO SEEK AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM THE LENDER OR ITS RESPECTIVE AFFILIATES, PARTNERS, PARTICIPANTS, AGENTS,
ATTORNEYS, OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, SUCCESSORS, ASSIGNS, AND PREDECESSORS, AND EACH OF THE BORROWER AND THE BORROWER AFFILIATES HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES THE LENDER AND ITS AFFILIATES,
PARTICIPANTS, PREDECESSORS, PARTNERS, AGENTS, OFFICERS, DIRECTORS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED
OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AGREEMENT IS EXECUTED, IN EACH CASE WHICH EITHER THE BORROWER OR ANY OF THE BORROWER
AFFILIATES MAY NOW OR HEREAFTER HAVE AGAINST THE LENDER, AND ITS RESPECTIVE AFFILIATES, PARTNERS, PARTICIPANTS, AGENTS, OFFICERS, DIRECTORS, EMPLOYEES, ATTORNEYS, SUCCESSORS, ASSIGNS, AND PREDECESSORS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH
CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING FROM THE OBLIGATIONS, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE LOAN AGREEMENT OR THE LOAN DOCUMENTS, AND NEGOTIATION FOR AND EXECUTION OF THIS
AGREEMENT. THE BORROWER AND THE BORROWER AFFILIATES HEREBY COVENANT AND AGREE NEVER TO INSTITUTE ANY ACTION OR SUIT AT LAW OR IN EQUITY, NOR INSTITUTE, PROSECUTE, OR IN ANY WAY AID IN THE INSTITUTION OR PROSECUTION OF ANY CLAIM, ACTION OR CAUSE OF
ACTION, RIGHTS TO RECOVER DEBTS OR DEMANDS OF ANY NATURE AGAINST THE LENDER, AND ITS RESPECTIVE AFFILIATES, PARTICIPANTS, AGENTS, ATTORNEYS, PARTNERS, OFFICERS, DIRECTORS, EMPLOYEES, SUCCESSORS, ASSIGNS, AND PREDECESSORS ARISING OUT OF OR RELATED TO
THE LENDER’S ACTIONS, OMISSIONS, STATEMENT, REQUESTS OR DEMANDS ORIGINATING ON OR PRIOR TO THE DATE HEREOF IN ADMINISTERING, ENFORCING, MONITORING, COLLECTION OR ATTEMPTING TO COLLECT THE INDEBTEDNESS OF THE BORROWER TO THE LENDER, WHICH
INDEBTEDNESS WAS EVIDENCED BY THE LOAN AGREEMENT AND THE LOAN DOCUMENTS. 
  
 8.19. Agreement Binding on the Borrower and the Borrower Affiliates. The Borrower and the Borrower Affiliates agree that this Agreement will be binding on the Borrower and the Borrower Affiliates and their
respective successors and assigns; provided, no obligation or right hereunder shall be assignable by the Borrower or any of the Borrower Affiliates (whether voluntarily, involuntarily or by operation of law) without the prior written consent of the
Lender. 
  

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 8.20. Termination of Prior Agreements. Upon the effectiveness of this Agreement, each of the
Forbearance Letter Agreement, the Extension Agreement and the Forbearance Agreement shall be terminated for all purposes. 
  

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 IN WITNESS WHEREOF, the Borrower, the Borrower Affiliates, and the Lender have caused this Agreement to
be executed and delivered as of the date first written. 
  

			
	BORROWER:
	
	TIETEK LLC, a Delaware limited liability company
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	 BORROWER AFFILIATES:

	
	NORTH AMERICAN TECHNOLOGIES GROUP, INC.,
	 a Delaware corporation

		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	TIETEK TECHNOLOGIES, INC., a Texas corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	 LENDER:

	
	OPUS 5949 LLC (fka Tie Investors LLC), a Texas limited liability company)
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

  

 LIMITED WAIVER AND FIRST AMENDMENT 
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