Exhibit (d)
AGREEMENT
AGREEMENT (this "Agreement"), dated as of December 5, 1997, by and
among AMBI Inc., a corporation organized under the laws of the State of New York
(the "Company"), and the undersigned Initial Investors (together with
affiliates, the "Initial Investors").
WHEREAS:
In connection with that certain Securities Purchase Agreement, dated
as of May 8, 1997, by and among the Company and the Initial Investors (the
"Securities Purchase Agreement"), the Company issued and sold to the Initial
Investors certain units consisting of (i) one share of the Company's Series D
Convertible Preferred Stock, par value $.01 per share (the "Preferred Stock"),
convertible into common stock, par value $.005 per share of the Company (the
"Common Stock") and (ii) warrants (the "Warrants") to acquire shares of Common
Stock. The rights, preferences and privileges of the Preferred Stock are set
forth in the Certificate of Amendment of the Certificate of Incorporation by
AMBI Inc. ("Certificate of Amendment") attached as Exhibit A to the Securities
Purchase Agreement. The terms of the Warrants are set forth in the Stock
Purchase Warrant attached as Exhibit B to the Securities Purchase Agreement.
Capitalized terms used and not otherwise defined herein shall have the meaning
ascribed thereto in the Securities Purchase Agreement, the Certificate of
Amendment and the Stock Purchase Warrant.
The Company desires to induce the Initial Investors to agree not to
convert certain of their Preferred Stock for a period of six (6) months as
described herein.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Initial Investors hereby agree as follows:
Conversion of Preferred Stock; Adjustment in Conversion Price. The
Company and the Initial Investors agree that, effective as of the date of this
Agreement, the Initial Investors shall convert fifty (50%) percent of their
Preferred Stock into such number of fully paid and nonassessable shares of
Common Stock determined in accordance with the formula set forth in Article IV.A
of the Certificate of Amendment. The Company agrees that, for purposes of such
conversion, the Conversion Price shall be the amount obtained by multiplying
Seventy-Five (75%) Percent by the average of the Closing Bid Prices for the
Company's Common Stock for the five (5) consecutive trading days ending on the
trading day immediately preceding the date of this Agreement. The Initial
Investors and the Company agree to effect the conversion in accordance with the
procedures set forth in Article IV.B of the Certificate of Amendment.
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2. Restriction on Conversion of Remaining Preferred Stock. The Initial
Investors agree that, for a period of six (6) months following the date hereof
(the "Lock Up Period"), the Initial Investors shall not convert their remaining
shares of Preferred Stock ("Remaining Preferred Stock") without the prior
written consent of the Company, which consent may be withheld at the sole
discretion of the Company. Upon expiration of the Lock Up Period, the Initial
Investors shall be entitled, at any time or from time to time, at their
discretion, to convert the Remaining Preferred Stock into shares of Common Stock
in accordance with the terms of the Certificate of Amendment.
3. Adjustment in Fixed Conversion Price. The Fixed Conversion Price
applicable to the Remaining Preferred Stock shall be reset to equal $2.25.
4. Adjustment in Warrant Exercise Price. The Company hereby agrees to
reduce the Exercise Price of the Warrants to $2.25. Such reduction may be
evidenced by a future amendment to the Warrants.
5. Extension of the Maturity Date. The Company hereby agrees to extend
the Maturity Date for the mandatory conversion of the Remaining Preferred Stock
under Section IV.D of the Certificate of Amendment from May 8, 1999 to May 8,
2001.
6. Adjustment in Number of Notice Days Required for an Optional
Redemption. The Initial Investors and the Company hereby agree that the minimum
number of days required for prior written notice of an Optional Redemption
Notice pursuant to Section VIII.D of the Certificate of Amendment shall be
reduced from twenty (20) business days to ten (10) business days.
7. (a) Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.
(b) This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed in the State of New York. The Company and the Initial
Investors irrevocably consents to the jurisdiction of the United States federal
courts and the state courts located in the City of New York in the State of New
York in any suit or proceeding based on or arising under this Agreement and
irrevocably agrees that all claims in respect of such suit or proceeding may be
determined in such courts. The Company and the Initial Investors irrevocably
waives the defense of an inconvenient forum to the maintenance of such suit or
proceeding. Service of process mailed by first class mail shall be deemed in
every respect effective service of process upon the recipient in any such suit
or proceeding. Nothing herein shall affect the right of the Company or the
Initial Investor to serve process in any other manner permitted by law. The
Company and each Initial Investor agree that a final non-appealable judgment in
any such suit or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on such judgment or in any other lawful manner.
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(c) Except as expressly provided herein, all of the terms and
provisions of the Certificate of Designation shall continue in full force and
effect and nothing contained herein shall be deemed to constitute a waiver by
the Initial Investors of any of their rights under the Certificate of Amendment,
the Stock Purchase Warrant, the Securities Purchase Agreement, the Registration
Rights Agreement or any other agreement among the Company and the Initial
Investors.
(d) This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties hereto.
(e) This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same agreement. This Agreement, once executed by a party,
may be delivered to the other party hereto by facsimile transmission of a copy
of this Agreement bearing the signature of the party so delivering this
Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
AMBI INC.
By: /s/ Xxxxxxxx X. Xxxxx
Name: Xxxxxxxx X. Xxxxx
Title:
INITIAL INVESTORS:
C.C. INVESTMENTS, LDC OLYMPUS SECURITIES, LTD.
By: /s/ Xxxx X. Xxxxxxxxx By: /s/ X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxxx Name: X. Xxxxxxxx
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Title: Title:
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XXXXXX PARTNERS LAKESHORE INTERNATIONAL, LTD.
By: /s/ X. Xxxxxxxx By: /s/ Xxxx X. Xxxxxxxxxxx
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Name: X. Xxxxxxxx Name: Xxxx X. Xxxxxxxxxxx
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Title: Title:
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