AGREEMENT
IT IS AGREED this 11 day of December, 1999, effective December 15, 1999, by
and between M. Xxxxx Xxxxxxxx ("MDS") and Bion Environmental Technologies,
Inc. ("BION") as follows:
WHEREAS BION is entering into an agreement ("D2 AGREEMENT") with D2 CO. ("D2")
concerning management, consulting and financing; and
WHEREAS D2 requires that BION and certain major shareholders and/or creditors
of BION, including MDS, agree to certain conditions as partial consideration
for the D2 AGREEMENT with BION; and
WHEREAS MDS considers the D2 AGREEMENT to be in the best interests of BION and
is willing to accept the following conditions;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) MDS agrees to exchange all $2.25 Warrants (63,000 as of 11/30/99) for $2.25
options under the 1994 Incentive Plan and to exercise the options by canceling
existing long term promissory note ($148,906.30 as of 11/30/99) subsequent to
$3,000,000 net additional funding of BION. Any excess to the promissory note
balance will result in additional shares being issued as if the number of
options were greater, or will be paid in cash at closing at the option of
Bion.
2) MDS agrees to recommend and support a registered exchange including BION
Class X Warrants and BION Class Z Warrants with tentative exchange ratios as
follows:
1 Class X Warrant = 0.3 registered BION common shares; and
1 Class Z Warrant = 0.15 registered BION common shares;
provided, however, that based on events subsequent hereto the proposed
exchange ratios may need to be adjusted to insure fairness to all holders or
BION may elect to not proceed with the proposed exchange on any terms.
3) MDS acknowledges that D2 AGREEMENT will entail material management
re-arrangement at all levels of BION, both immediately and over time which may
alter the services required by BION from MDS; and MDS agrees to cooperate with
BION and D2 in all transitions.
Bion Environmental Technologies, Inc. M. Xxxxx Xxxxxxxx
By: /s/ Xxxx X. Xxxxx by: /s/ M. Xxxxx Xxxxxxxx
Authorized Officer M. Xxxxx Xxxxxxxx
