EXHIBIT 99.2
AGREEMENT
This Agreement is made and entered into effective the __ day of May, 2003
by and among Bion Environmental Technologies, Inc., a Colorado corporation
("Bion"), Centerpoint Corporation, a majority-owned subsidiary of Bion which
is a Delaware corporation ("Centerpoint") and OAM, S.p.A., an Italian
corporation ("OAM").
WHEREAS, OAM is the former parent of Centerpoint and sold Bion its
majority ownership interest in Centerpoint on January 10, 2002 pursuant to a
series of agreements dated as of that date by and among Bion, OAM, Centerpoint
and others (hereinafter collectively referred to as the "Transaction
Documents"); and
WHEREAS, the Transaction Documents contain certain "Post-Closing
Adjustment" provisions that have made it economically undesirable for outside
investors to provide capital to Bion;
WHEREAS, Bion has received verbal commitments for investment of at least
$700,000 to finance its opening an operating test facility in Texas, subject
to the waiver of the Post-Closing Adjustment provisions (the "Financing");
WHEREAS, Bion is fairly confident of having arranged additional funding
of $1.25 million expected to close during November 2003, subject to successful
completion of systems testing at the Texas facility and publication of the
results therefrom;
WHEREAS, subject to the representations, warranties, terms and conditions
set forth herein, the parties hereto believe that it is in their respective
and collective best interests to enter into this Agreement in order to
facilitate Bion's efforts to obtain necessary capital under current market
conditions;
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and for other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto agree as follows:
(1) Subject to paragraphs 2 and 5 below, and to the receipt by OAM of
full and final payment of $25,000 under that certain Stock Transfer Agreement,
dated as of May 27, 2003, between OAM and Xxxxxxx Xxxxxxxx (the "STA"),
Section 1.2 of that certain Stock Purchase Agreement dated as of January 10,
2002 by and between OAM and Bion (the "OAM Stock Purchase Agreement") is
hereby waived as it would apply to the Financing and any financings or other
transactions or issuances thereafter. Without limiting the foregoing and for
avoidance of doubt, Bion acknowledges and agrees that in the event full and
final payment under the STA is not made pursuant to its terms, Bion shall be
required to honor Section 1.2 of the OAM Stock Purchase Agreement as it
applies to the Financing, including any closing of the Financing that may then
have already occurred, in addition to any other rights OAM may have under such
provision.
(2) Bion represents and warrants that on or before closing of the
Financing, all other existing holders of Bion securities as of such date shall
have agreed to waive the applicability to the Financing and any future
financing of any anti-dilution, penalty or post-closing adjustment rights or
similar protections which might otherwise be applicable to the Financing. If
and to the extent Bion directly or indirectly extends to any such holders any
protection against dilution, Bion shall make such adjustment to the Bion
securities held by OAM or issue to OAM such additional shares, or undertake
obligations to do so, such that on an equitable basis OAM is accorded
anti-dilution protection no less favorable than that accorded such other
holder. The representations, warrantees and covenants in this paragraph shall
be deemed a condition to the effectiveness of paragraph 1 above.
(3) The parties acknowledge that (a) under Section 3(1) of that
certain Assignment of Assignment of Claims Agreement and Section 2(1) of that
certain Assignment of Assignment of Escrow Agreement, both of which agreements
are dated January 10, 2002 and are by and between Bion and OAM and which are
binding on Centerpoint in certain respects (together, the "Assignment
Agreements"), OAM is entitled to reimbursement of 35% of certain fees and
expenses, and (b) that OAM is entitled to reimbursement of 100% of certain
other fees accrued by OAM or its parent companies for the benefit of
Centerpoint (together, the reimbursable amounts under clauses (a) and (b)
being, the "Legal Reimbursements"). The parties agree that the amount of the
accrued and unpaid Legal Reimbursements through the date hereof is as set
forth on Exhibit A attached hereto. Additionally, the parties acknowledge
that Deloitte & Touche is owed by OAM $25,000, towards which Centerpoint
Corporation will pay OAM $12,500 (such amount being the "Outstanding
Accounting Accrual") as provided below. Centerpoint acknowledges that such
amount is separate and distinct from, and agrees that it will not use payment
of the Outstanding Accounting Accrual as a defense to or set-off against, any
other sums which Deloitte & Touche may claim are owed to it by Centerpoint.
The parties agree that OAM shall be entitled to have disbursed to it, rather
than Centerpoint Corporation, any settlement proceeds or other proceeds
otherwise payable to Centerpoint based upon its thirty-five percent ownership
of the claims subject of the Assignment Agreements, until such time as the
amount of such disbursements equals the sum of the Legal Reimbursements
accrued through such date and the Outstanding Accounting Accrual. The parties
acknowledge that payment of Legal Reimbursements thereafter shall continue to
be governed by the terms of the Assignment Agreements.
(4) Bion and Centerpoint hereby agree to use their respective and
collective best efforts to cause Centerpoint to hold a special meeting of its
stockholders in New York City within sixty days after the date on which this
Agreement is executed by all of the parties hereto for the purpose of seeking
formal stockholder ratification of that certain Agreement between Bion and
Centerpoint dated February 12, 2003, a copy of which is attached hereto as
Exhibit B (the "Centerpoint Agreement"). OAM hereby agrees that it will not
vote its shares against such ratification at the special meeting. For
purposes of clarification, Bion agrees that Paragraph 2a) of the Centerpoint
Agreement shall only be deemed to apply to: a) Section 2.4 of the Subscription
Agreement between Centerpoint and Bion, and b) Section 1.2 of the Registration
Rights Agreement between Centerpoint and Bion; and not to any other agreement
between or among them.
(5) Bion shall pay (i) to OAM the sum of $80,000, and (ii) on behalf
of OAM, to Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx LLP the sum of $10,000 (towards
legal fees incurred from March 2003 through the date hereof in connection with
the negotiations of the parties), by wire transfer of immediately available
funds in accordance with the wire transfer instructions set forth in Exhibit B
attached hereto within two business days after formal ratification of the
Centerpoint Agreement by a majority of the Centerpoint stockholders that are
present (in person or by proxy) at the Centerpoint stockholder meeting other
than Bion. Full and final payment of such amounts in accordance with the
requirements of this paragraph 5, shall be a condition precedent to
effectiveness of paragraph 1 above.
(6) The parties may not amend this Agreement except in a written
instrument that is executed by an authorized officer of each of the parties
hereto.
(7) This Agreement may be executed by one or more of the parties to
this Agreement on any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.
(8) This Agreement and the rights and obligations of the parties
under this Agreement shall be governed by, and construed and interpreted in
accordance with, the laws of the State of New York, without regard to its
statutes relating to conflicts of laws.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
Bion Environmental Technologies, Inc.,
a Colorado corporation
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Authorized Officer
Centerpoint Corporation,
a Delaware corporation
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Authorized Officer
OAM, S.p.A.,
an Italian corporation
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Authorized Officer
Exhibit A
Legal Reimbursements
Advances to date in respect of which OAM is entitled to 100% reimbursement:
Xxxxxxxx (Xxxxxxx) Euro 15,230
Accrued and unpaid to date, to which OAM is entitled to 35% reimbursement:
Xxxxxxxx (Xxxxxxx) Euro 14,970
Total "Legal Reimbursements" to date:
15,230 + (14,970 X 35%) = Euro 20,469.5
Exhibit B
Wire Transfer Instructions
OAM
ABA #: 000000000
Account #: 00-0000-0000
Account Name: Trident Rowan Group Inc OAM
Contact: Xxxxx Xxxxxxxx
Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx LLP
To: Citibank, N.A.
Citicorp Center 000 X. 00xx Xxxxxx XX, X.X. 00000
XXX #: 000000000
Account: Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx LLP Money Market A\C 00000000
Contact: Xxxxxxxx Xxxx (000) 000-0000
