0000948830-01-500435.txt : 20011009
0000948830-01-500435.hdr.sgml : 20011009
ACCESSION NUMBER: 0000948830-01-500435
CONFORMED SUBMISSION TYPE: 8-K
PUBLIC DOCUMENT COUNT: 15
CONFORMED PERIOD OF REPORT: 20010906
ITEM INFORMATION: Other events
ITEM INFORMATION: Financial statements and exhibits
FILED AS OF DATE: 20010928
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: BION ENVIRONMENTAL TECHNOLOGIES INC
CENTRAL INDEX KEY: 0000875729
STANDARD INDUSTRIAL CLASSIFICATION: MISC INDUSTRIAL & COMMERCIAL MACHINERY & EQUIPMENT [3590]
IRS NUMBER: 841176672
STATE OF INCORPORATION: CO
FISCAL YEAR END: 0630
FILING VALUES:
FORM TYPE: 8-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-19333
FILM NUMBER: 1747478
BUSINESS ADDRESS:
STREET 1: 18 EAST 50TH STREET
STREET 2: 10TH FLOOR
CITY: NEW YORK
STATE: NY
ZIP: 10022
BUSINESS PHONE: 3032940750
MAIL ADDRESS:
STREET 1: 18 EAST 50TH ST
STREET 2: 10TH FLOOR
CITY: NEW YORK
STATE: NY
ZIP: 10022
FORMER COMPANY:
FORMER CONFORMED NAME: RSTS CORP
DATE OF NAME CHANGE: 19930328
8-K
1
bion8k.txt
BION ENVIRONMENTAL 8-K DTD 9/6/01
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON DC 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report: September 6, 2001
---------------------------------
(Date of earliest event reported)
Bion Environmental Technologies, Inc.
-----------------------------------------------------
(Exact Name of Registrant as Specified in its Charter
Colorado 0-19333 84-1176672
------------------------ --------------------- -------------------
(State of Incorporation) (Commission File No.) (I.R.S. Employer
Identification No.)
18 East 50th Street 10th Floor New York, NY 10022
-----------------------------------------------------
(Address and Zip Code of Principal Executive Offices)
Registrant's telephone number including area code: (212) 758-6622
--------------
ITEM 5. OTHER EVENTS
(a) Changes in our Management. The following changes in our management
were either adopted or ratified by us on September 6, 2001:
- We accepted the resignation of Ron Cullis as a member of our Board
of Directors. The options held by Mr. Cullis will continue to be
exercisable in accordance with their terms. His resignation was
not the result of any disagreement with us on any matter relating
to our operations, policies or practices.
- We accepted the resignation of Jon Northrop as an officer and
director of our company and as an officer and director of each of
our subsidiaries. Mr. Northrop will continue to serve us as a
consultant and will also serve as a member of our Advisory Board.
His resignation was not the result of any disagreement with us on
any matter relating to our operations, policies or practices.
- Mark Smith resigned as Chairman of our Board and was replaced in
that capacity by David Mitchell, our President. Mr. Smith will
continue to serve as a director and as a member of our Executive
Committee.
- Mr. Mitchell will serve as the President of both of our
subsidiaries.
- The resignation of Bart Chilton as our Senior Vice President in
August 2001 to continue his career with the United States
government was ratified. In recognition of his work with us, Mr.
Chilton was granted fully vested options to purchase a total of
66,000 shares of our Common Stock at a purchase price of $1.50 per
share. These options will expire on August 17, 2003. Options to
purchase 100,000 shares that were previously held by Mr. Chilton
were cancelled at the time the new options were issued.
(b) Severance Agreements. We entered into severance agreements with Jon
Northrop and the only other employee that remained in our Denver, Colorado
office. As a result, we no longer have any employees in Denver and
substantially all of our business operations are conducted out of our office
in New York City, although we will continue to have a small office in Denver
which will be used by Mr. Northrop in his capacity as our consultant. Copies
of both severance agreements are attached as Exhibits 10.1 and 10.2.
(c) Restructuring of Notes to Related Parties and Cancellation of
Options and Warrants. We have amended the terms of certain notes that we owe
to certain related parties and have cancelled certain outstanding options and
warrants held by them. The accrued amounts due under notes that we amended
are as follows:
2
Holder Amount of Accrued Debt
(Accrued to November 1, 2001)
Jon Northrop $ 337,466
Jere Northrop $ 297,531
Harley Northrop $ 397,865
Northrop Family Trust $ 136,150
Edward A. Hennig $ 159,173
M. Duane Stutzman $ 181,106
William J. Crossetta $ 279,000
S. Craig Scott $ 49,804
Dublin Holding Ltd. $3,682,944
Mark Smith Rollover IRA $ 393,556
Kelly Smith Rollover IRA $ 339,870
TOTAL $6,254,465
As the result of these amendments we now have approximately $14.2 million
of debt in instruments (including accrued interest to November 1, 2001)that
are now all convertible at the same time and at the same price, subject to
conversion price caps which differ for the various debt instruments from $1.80
to $2.50 per share. The provisions of the agreements vary for each debt
holder, with cancellations of certain options and warrants. All of the
subject debt is convertible to shares of our Common Stock or before April 29,
2002, subject to certain conditions precedent.
Amendments to the agreements relating to Mark Smith and entities owned or
controlled by him are discussed below. Copies of the remaining amended
agreements are attached as Exhibits 10.1 (with respect to Jon Northrop), 10.2
(with respect to Edward Hennig, a former employee in our Denver office), 10.3
(with respect to Harley E. Northrop, Jon and Jere Northrop's father), 10.4
(with respect to Jere Northrop), 10.5 (with respect to William J. Crossetta,
Jr.), 10.6 (with respect to S. Craig Scott, our former shareholder relations
advisor), 10.7 (with respect to the Northrop Family Trust), and 10.8 (with
respect to M. Duane Stutzman, our former Chief Financial Officer). For
further details concerning our capital structure, please see notes 4 and 7 to
our unaudited financial statements contained in our Report on Form 10-QSB for
the quarter ended March 31, 2001.
(d) Mark Smith Agreements.
- Mark Smith and certain entities controlled by him which own shares
of our Common Stock (the "Smith Shares") entered into a voting
agreement that gives David Mitchell, our President and CEO, the
power to vote all of the Smith Shares as to most matters, but Mr.
Smith will still have the right to vote the Smith Shares with
respect to a sale of substantially all of our assets or a merger.
The voting agreement is purely contractual and is not a formal
voting trust.
3
- In addition, Mr. Smith and certain entities that he controls
entered into a separate agreement with us which imposes certain
restrictions on the sale and transfer of the Smith Shares and
amends the respective terms of five convertible promissory notes
payable to Dublin Holding, Ltd, the Mark A. Smith Rollover IRA and
the Kelly Smith Rollover IRA to provide that all five of these
notes will be automatically and fully converted (with all
principal and accrued interest calculated as if they had been held
to maturity) into shares of our Common Stock upon the conversion
of our outstanding Convertible Bridge Notes and 2001 Convertible
Notes at a conversion rate equal to the lesser of (i) $1.80 per
share or (ii) the conversion price of our outstanding Convertible
Bridge Notes and 2001 Convertible Notes.
- Copies of both agreements are attached as Exhibits 10.9 and 10.10.
(e) D2CO, LLC Agreements. We entered into an agreement with D2CO, LLC,
Southview, Inc. and Atlantic Partners, LLC, all of which are affiliates of
David Mitchell, our President and CEO (collectively, "D2") in which, among
other things, we agreed to:
- provide that certain compensation to D2 be paid in a deferred
manner as set forth in an exhibit to the agreement;
- be a party to the voting agreement that gives David Mitchell the
power to vote all of the Smith Shares as to most matters;
- release Jon Northrop from the restrictions related to the sale of
shares of our Common Stock owned by him that are contained in the
Shareholders Agreement dated December 23, 1999, as amended; and
- amend the SV1 and SV2 Warrants held by D2 so that upon earlier of
(i) completion of financing or series of financings large enough
to "trigger" the conversion of Bion's outstanding Bridge Notes and
2001 Convertible Notes (collectively "CV Notes") into Bion Common
Stock; or (ii) conversion of the CV Notes into Bion Common Stock
on April 29, 2002, the outstanding Class SV1 and SV2 Warrants
owned by D2 will be adjusted ("Adjusted Warrants") so that D2 owns
Adjusted Warrants to purchase a number of shares of Bion Common
Stock equal to 20% of the "fully-diluted" outstanding shares,
calculated by including (i) the Adjusted Warrants, (ii) the
securities issued in the conversion of the CV Notes and other
notes, (iii) the securities issued in connection with the subject
financing, and (iv) other outstanding options, warrants and/or
convertible promissory notes which are exercisable or convertible,
as applicable, at a price equal to or lower than the exercise
price of the Adjusted Warrants, which Adjusted Warrants will have
the same expiration date as the current SV1 and SV2 Warrants and
will have an exercise price equal to the lower of $1.00 per share
or the conversion price of the CV Notes; provided, however, that
for purposes of calculating the number of Adjusted Warrants, no
securities outstanding related to any portion of a financing
4
aggregating greater than $10,000,000 will be included in the
calculation. As partial consideration for our agreeing to the
adjustment to the warrants, Southview agreed to extend the term of
the outstanding promissory note (with an accrued balance of
$521,039.81 as of July 31, 2001)so that such promissory note could
be repaid from the proceeds of a new financing.
A copy of the D2 agreement is attached as Exhibit 10.11.
(f) We have adopted a new incentive plan, a copy of which is attached as
Exhibit 10.12.
(g) We have recently issued two press releases, copies of which are
attached as Exhibits 99.1 and 99.2, respectively.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
Listed below are the exhibits filed as a part of this report.
EXHIBITS:
Exhibit
Number Description
------- -----------
10.1 Severance Agreement of Jon Northrop
10.2 Severance Agreement of Edward Hennig
10.3 Agreement of Harley E. Northrop
10.4 Agreement of Jere Northrop
10.5 Agreement of William J. Crossetta, Jr.
10.6 Agreement of S. Craig Scott
10.7 Agreement of Northrop Family Trust
10.8 Agreement of M. Duane Stutzman
10.9 Stock Voting Agreement dated August 1, 2001
10.10 Mark Smith and Related Entities Agreement dated
August 1, 2001
10.11 D2 Agreement dated August 1, 2001
10.12 2001 Incentive Plan
99.1 Press release dated August 6, 2001
99.2 Press release dated August 22, 2001
5
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
Date: September 25, 2001 By: /s/ Mark A. Smith
-------------------------------------
Mark A. Smith, Secretary and Director
6
EX-10
3
bionex101.txt
BION ENVIRONMENTAL EX 10.1 TO 8-K DTD 9/6/01
EXHIBIT 10.1
AGREEMENT
IT IS AGREED this 29th day of August 2001, by and between Jon Northrop ("JN")
and Bion Environmental Technologies, Inc. ("BION") as follows:
WHEREAS BION is entering into agreements with various note holders, D2CO, LLC
and others concerning simplifications of BION's capital structure and changes
in management;
AND WHEREAS JN considers the changes to be in the best interests of BION and
JN;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) JN agrees to and does hereby amend the promissory note attached hereto as
Exhibit A ("Note") to provide that:
a) The term of the Note shall be extended to April 30, 2002;
b) The Note (principal and interest) shall be completely converted to
shares of common stock of BION (with an effective registration
statement related to resale of such shares) upon the earlier of
April 29, 2002 or the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes")
which conversion shall take place at the lower of: 1) $2.25 per
share, or ii) the conversion price of the CV Notes;
2) JN and BION hereby cancel 134,000 options exercisable at $2.25 per share
until 12/31/01;
3) JN and BION agree that, effective August 31, 2001, JN shall cease to be
employed by BION and that the employment agreement attached hereto as
Exhibit B shall be terminated.
4) a) Effective September 1, 2001, JN shall serve as a consultant to BION
for a 12 month period ending August 31, 2002 for a monthly fee of
$10,000 per month (payable in cash and/or securities of BION);
b) plus continuation of JN's existing insurance benefits;
c) the monthly fee set forth above shall be reduced by 50% starting the
first month commencing after the average bid price of BION's common
stock shall have exceeded twice the conversion price of the Note for
a period of 20 trading days; and
d) JN shall be issued 90,000 options exercisable at $2.00 per share
until July 31, 2004;
e) the compensation set forth herein shall be in lieu of any severance
pay.
5) Effective August 31, 2001, JN shall resign as Director of BION and shall
join BION's Board of Advisors for the term of his consulting services.
6) BION agrees that, subject to agreement of necessary third parties,
effective September 1, 2001, JN shall be released from the restrictions
on sale of BION securities owned by JN set forth in a Shareholder's
Agreement (dated December 23, 1999), as amended.
7) JN and BION agree to execute such other documents as may be necessary to
properly carry out the transactions set forth herein.
8) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. Jon Northrop
By: /s/ Mark A. Smith, Chairman /s/ Jon Northrop
--------------------------------- -----------------------------
Authorized Officer Jon Northrop
EXHIBIT A
Initial Principal: $300,000
Date Due: December 31, 2001
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Jon Northrop ("HOLDER"), and his successors and assignees, at 1922 Sanibel
Ct., Littleton, Colorado 80120, or at such other place as the HOLDER of this
Note may from time to time designate in writing, all sums due under this Note
(plus interest) in lawful and immediately available money of the United
States. The initial principal of this loan is $300,000. Interest shall be
accrued and added to principal at one percent (1.0%) per month from date owed
by MAKER. All outstanding principal and interest shall be due and payable on
or before December 31, 2001, if not previously paid. If this Note or interest
due hereunder is not paid when due or declared due hereunder, the principal
shall draw interest at the rate of one and one half percent (1.5%) per month.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on
this Note or any other obligation of MAKER when such shall become due and
payable, whether at the stated maturity thereof or by acceleration or
otherwise;
(b) MAKER (1) admits its inability to pay its debts as they
become due; (2) files a petition in bankruptcy or makes a petition to take
advantage of an insolvency act; (3) makes an assignment for the benefit of
creditors; (4) commences a proceeding for the appointment of a receiver,
trustee, liquidator, or conservator of itself or of the whole or any
substantial part of its properties; (5) files a petition or answer seeking
reorganization or arrangement or similar relief under the federal bankruptcy
laws or any other applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an
order, judgment or decree, appointing a receiver, trustee, liquidator or
conservator of MAKER or of the whole or any substantial part of its
properties, or approve a petition filed against MAKER seeking reorganization
or similar relief under the federal bankruptcy laws or any other applicable
law or statute of the United States or any state; (3) under the provisions of
any other law for the relief or aid of debtors, a court assumes custody or
control of MAKER or the whole or any substantial part of its properties; (4)
there is commenced against MAKER any proceeding for any of the foregoing
relief; (5) a petition in bankruptcy is filed against MAKER; or (6) MAKER by
any act indicates its consent to approval of or acquiescence in any such
proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Denver, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: __________________________________
Authorized Officer
Date: May 21, 1999
EX-10
4
bionex102.txt
BION ENVIRONMENTAL EX 10.2 TO 8-K DTD 9/6/01
EXHIBIT 10.2
AGREEMENT
IT IS AGREED this 27th day of August 2001, by and between Edward A. Hennig
("EAH") and Bion Environmental Technologies, Inc. ("BION") as follows:
IN CONSIDERATION of the mutual promises and covenants herein:
1) EAH agrees to and does hereby amend the promissory note attached hereto
as Exhibit A ("Note") to provide that:
a) The term of the Note shall be extended to April 30, 2002;
b) The Note (principal and interest) shall be completely converted to
shares of common stock of BION (with an effective registration
statement related to resale of such shares) upon the earlier of
April 29, 2002 or the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes")
which conversion shall take place at the lower of: 1) $2.25 per
share, or ii) the conversion price of the CV Notes;
2) EAH and BION hereby cancel 56,000 options exercisable at $2.25 per share
until 12/31/01;
3) a) Effective August 31, 2001, EAH shall cease to be employed by BION
b) EAH shall receive severance pay/consulting fees equal to ten (10)
weeks salary which shall be payable in cash or registered securities
of BION, at BION's sole discretion;
c) provided, however, to the extent BION elects to make all or part of
such payments in securities of BION, the aggregate net received by
EAH shall not be less than the sum set out above;
d) as additional consulting compensation, BION shall issue to EAH
25,000 options to purchase shares of BION common stock at a price of
$2.00 exercisable until July 31, 2003 (to be issued by September 15,
2001), in consideration of which options EAH will make himself
available to Bion, on an as-needed basis, over the 12 months
commencing September 1, 2001 to provide consulting services and aid
BION in the transition regarding files, business relationships, and
contacts related to matters on which EAH worked at BION;
e) EAH's medical insurance premiums shall be paid by BION for ten weeks
from September 1, 2001 and EAH shall be provided COBRA conversion
forms prior to November 1, 2001.
4) EAH and BION agree to execute such other documents as may be necessary to
properly carry out the transactions set forth herein.
5) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. Edward A. Hennig
By: /s/ Mark A. Smith, Chairman /s/ Edward A. Hennig
--------------------------------- -----------------------------
Authorized Officer Edward A. Hennig
EXHIBIT A
Initial Principal: $125,333.33
Date Due: December 31, 2001
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Edward A. Hennig ("HOLDER"), and his successors and assignees, at 1302 Noble
Oaks Dr., Savannah, Georgia 31406, or at such other place as the HOLDER of
this Note may from time to time designate in writing, all sums due under this
Note (plus interest) in lawful and immediately available money of the United
States. The initial principal of this loan is $125,333.33. Interest shall be
accrued and added to principal at one percent (1.0%) per month from date owed
by MAKER. All outstanding principal and interest shall be due and payable on
or before December 31, 2001, if not previously paid. If this Note or interest
due hereunder is not paid when due or declared due hereunder, the principal
shall draw interest at the rate of one and one half percent (1.5%) per month.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Denver, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: __________________________________
Authorized Officer
Date: July 31, 1999
EX-10
5
bionex103.txt
BION ENVIRONMENTAL EX 10.3 TO 8-K DTD 9/6/01
EXHIBIT 10.3
AGREEMENT
IT IS AGREED this ____ day of August 2001, by and between Harley E. Northrop
("HEN") and Bion Environmental Technologies, Inc. ("BION") as follows:
WHEREAS BION is entering into agreements to simplify its capital structure in
preparation for subsequent financing transactions:
AND WHEREAS HEN considers such simplification to be in the best interests of
BION and HEN;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) HEN agrees to and does hereby amend the promissory note attached hereto
as Exhibit A ("Note") to provide that:
a) The term of the Note shall be extended to April 30, 2002;
b) The Note (principal and interest) shall be completely converted to
shares of common stock of BION (with an effective registration
statement related to resale of such shares) upon the earlier of
April 29, 2002 or the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes")
which conversion shall take place at the lower of: 1) $1.80 per
share, or ii) the conversion price of the CV Notes;
2) HEN and BION agree to execute such other documents as may be necessary to
properly carry out the transactions set forth herein.
3) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. Harley E. Northrop
By: By: /s/ Harley E. Northrop
--------------------------------- --------------------------
Authorized Officer Harley E. Northrop
EXHIBIT A
Initial Principal: $308,114.23
Date Due: December 31, 2001
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Harley Northrop, ("HOLDER"), and his successors and assignees, at PO Box 188,
Westfield, NY 14787, or at such other place as the HOLDER of this Note may
from time to time designate in writing, all sums due under this Note (plus
interest) in lawful and immediately available money of the United States. The
initial principal of this loan is $308,114.23. Interest shall be accrued and
added to principal at one percent (1.0%) per month from date owed by MAKER.
All outstanding principal and interest shall be due and payable on or before
December 31, 2001, if not previously paid. If this Note or interest due
hereunder is not paid when due or declared due hereunder, the principal shall
draw interest at the rate of one and one half percent (1.5%) per month.
The outstanding principal and interest due hereunder shall be
convertible, in whole or in part, at the option of the HOLDER, into shares of
MAKER's common stock ("Shares") at a price of $2.00 per share (equitably
adjusted for subsequent stock splits, dividends, mergers, etc.) at any time
prior to payment by MAKER of such principal and interest. MAKER shall give
HOLDER 90 days' notice of intent to pay the principal and interest of this
Note during which period HOLDER may elect to convert this Note to MAKER's
common stock. Upon issuance, MAKER represents that all shares received as a
result of conversion of this Note shall be fully-paid and non-assessable.
As additional consideration for making this note, MAKER will issue one
(1) X Warrant, to purchase one share of MAKER's common stock at a price of
$8.00 per share (equitably adjusted for subsequent stock splits, dividends,
mergers, etc., subsequent to the dividend declared May 21, 1999) for a 24
month period commencing January 1, 2000, for each $2.00 or principal amount of
the Note advanced by Holder (no X Warrants will be issued for interest
accumulated on the principal amount of this Note.)
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Boulder, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: __________________________________
Authorized Officer
Date: May 28, 1999
EX-10
6
bionex104.txt
BION ENVIRONMENTAL EX 10.4 TO 8-K DTD 9/6/01
EXHIBIT 10.4
AGREEMENT
IT IS AGREED this ____ day of August 2001, by and between Jere Northrop ("JN")
and Bion Environmental Technologies, Inc. ("BION") as follows:
WHEREAS BION is entering into agreements concerning simplification of BION's
capital structure:
AND WHEREAS JN considers such simplification to be in the best interests of
BION and JN;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) JN agrees to and does hereby amend the promissory note attached hereto
as Exhibit A ("Note") to provide that:
a) The term of the Note shall be extended to April 30, 2002;
b) The Note (principal and interest) shall be completely converted to
shares of common stock of BION (with an effective registration
statement related to resale of such shares) upon the earlier of
April 29, 2002 or the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes")
at the lower of: 1) $2.25 per share, or ii) the conversion price of
the CV Notes;
2) JN and BION cancel 103,000 options exercisable at $2.25 per share
until 12/31/01;
3) BION and JN agree that, subject to agreement of necessary third parties,
effective September 1, 2001, Jon Northrop shall be released from the
restrictions on sale of BION securities owned by Jon Northrop set forth
in a Shareholder's Agreement (dated December 23, 1999), as amended;
4) JN and BION agree to execute such other documents as may be necessary to
properly carry out the transactions set forth herein.
5) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. Jere Northrop
By: By: /s/ Jere Northrop
--------------------------------- --------------------------
Authorized Officer Jere Northrop
EXHIBIT A
Initial Principal: $230,000
Date Due: December 31, 2001
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Jere Northrop ("HOLDER"), and his successors and assignees, at 1961 Tonawanda
Creek Rd., Amherst, New York 14228, or at such other place as the HOLDER of
this Note may from time to time designate in writing, all sums due under this
Note (plus interest) in lawful and immediately available money of the United
States. The initial principal of this loan is $230,000. Interest shall be
accrued and added to principal at one percent (1.0%) per month from date owed
by MAKER. All outstanding principal and interest shall be due and payable on
or before December 31, 2001, if not previously paid. If this Note or interest
due hereunder is not paid when due or declared due hereunder, the principal
shall draw interest at the rate of one and one half percent (1.5%) per month.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Denver, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: __________________________________
Authorized Officer
Date: May 21, 1999
EX-10
7
bionex105.txt
BION ENVIRONMENTAL EX 10.5 TO 8-K DTD 9/6/01
EXHIBIT 10.5
AGREEMENT
IT IS AGREED this _____ day of August 2001, by and between William J.
Crossetta, Jr. ("WJC") and Bion Environmental Technologies, Inc. ("BION") as
follows:
WHEREAS BION is entering into agreements to simplify its capital structure in
preparation for subsequent financing transactions;
AND WHEREAS WJC considers such simplification to be in the best interests of
BION and WJC;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) WJC agrees to and does hereby amend the promissory note attached hereto
as Exhibit A ("Note") to provide that:
a) The term of the Note shall be extended to April 30, 2002;
b) The Note (principal and interest) shall be completely converted to
shares of common stock of BION (with an effective registration
statement related to resale of such shares) upon the earlier of
April 29, 2002 or the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes")
which conversion shall take place at the lower of: 1) $2.25 per
share, or ii) the conversion price of the CV Notes;
2) WJC and BION cancel 100,000 options exercisable at $2.25 per share
until 12/31/01;
3) WJC and BION agree to execute such other documents as may be necessary to
properly carry out the transactions set forth herein.
4) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. William J. Crossetta, Jr.
By: By: /s/ William J. Crossetta
--------------------------------- --------------------------
Authorized Officer William J. Crossetta
EXHIBIT A
Initial Principal: $75,000
Date Due: December 31, 2001
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
William J. Crossetta ("HOLDER"), and his successors and assignees, at 43 Court
Street, Buffalo, NY 14202, or at such other place as the HOLDER of this Note
may from time to time designate in writing, all sums due under this Note (plus
interest) in lawful and immediately available money of the United States. The
initial principal of this loan is $75,000. Interest shall be accrued and
added to principal at one percent (1.0%) per month from date owed by MAKER.
All outstanding principal and interest shall be due and payable on or before
December 31, 2001, if not previously paid. If this Note or interest due
hereunder is not paid when due or declared due hereunder, the principal shall
draw interest at the rate of one and one half percent (1.5%) per month.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Denver, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: __________________________________
Authorized Officer
Date: November 18, 1999
EX-10
8
bionex106.txt
BION ENVIRONMENTAL EX 10.6 TO 8-K DTD 9/6/01
EXHIBIT 10.6
AGREEMENT
IT IS AGREED this 27th day of August 2001, by and between S. Craig Scott
("SCS") and Bion Environmental Technologies, Inc. ("BION") as follows:
WHEREAS BION is entering into agreements to simplify its capital structure in
preparation for subsequent financing transactions;
AND WHEREAS SCS considers such simplification to be in the best interests of
BION and SCS;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) SCS agrees to and does hereby amend the promissory note attached hereto
as Exhibit A ("Note") to provide that:
a) The term of the Note shall be extended to April 30, 2002;
b) The Note (principal and interest) shall be completely converted to
shares of common stock of BION (with an effective registration
statement related to resale of such shares) upon the earlier of
April 29, 2002 or the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes")
which conversion shall take place at the lower of: 1) $2.25 per
share, or ii) the conversion price of the CV Notes;
2) SCS and BION cancel 18,000 options exercisable at $2.25 per share
until 12/31/01;
3) SCS and BION agree to execute such other documents as may be necessary to
properly carry out the transactions set forth herein.
4) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. S. Craig Scott
By: /s/ Mark A. Smith, Chairman By: /s/ S. Craig Scott
--------------------------------- --------------------------
Authorized Officer S. Craig Scott
EXHIBIT A
Initial Principal: $38,500
Date Due: December 31, 2001
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Craig Scott ("HOLDER"), and his successors and assignees, at 3252 E. Phillips
Drive, Littleton, Colorado 80122, or at such other place as the HOLDER of this
Note may from time to time designate in writing, all sums due under this Note
(plus interest) in lawful and immediately available money of the United
States. The initial principal of this loan is $38,500. Interest shall be
accrued and added to principal at one percent (1.0%) per month from date owed
by MAKER. All outstanding principal and interest shall be due and payable on
or before December 31, 2001, if not previously paid. If this Note or interest
due hereunder is not paid when due or declared due hereunder, the principal
shall draw interest at the rate of one and one half percent (1.5%) per month.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Denver, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: __________________________________
Authorized Officer
Date: May 21, 1999
EX-10
9
bionex107.txt
BION ENVIRONMENTAL EX 10.7 TO 8-K DTD 9/6/01
EXHIBIT 10.7
AGREEMENT
IT IS AGREED this 28 day of August 2001, by and between Northrop Family Trust
("NFT") and Bion Environmental Technologies, Inc. ("BION") as follows:
WHEREAS BION is entering into agreements to simplify its capital structure:
AND WHEREAS NFT considers the simplification to be in the best interests of
BION and NFT;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) NFT agrees to and does hereby amend the promissory note attached hereto
as Exhibit A ("Note") to provide that:
a) The term of the Note shall be extended to April 30, 2002;
b) The Note (principal and interest) shall be completely converted to
shares of common stock of BION (with an effective registration
statement related to resale of such shares) upon the earlier of
April 29, 2002 or the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes")
at the lower of: 1) $2.25 per share, or ii) the conversion price of
the CV Notes;
2) NFT and BION cancel 38,000 warrants exercisable at $2.25 per share
until 12/31/01;
3) NFT and BION agree to execute such other documents as may be necessary to
properly carry out the transactions set forth herein.
4) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. Northrop Family Trust
By: /s/ Mark A. Smith, Chairman By: /s/ Jon Northrop, TTEE
--------------------------------- --------------------------
Authorized Officer Northrop Family Trust
EXHIBIT A
Initial Principal: $85,000
Date Due: December 31, 2001
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Family Trust U/A 3rd U/W Catherine Northrop ("HOLDER"), and his successors and
assignees, all sums due under this Note (plus interest) in lawful and
immediately available money of the United States. The initial principal of
this loan is $85,000. Interest shall be accrued and added to principal at one
percent (1.0%) per month from date owed by MAKER. All outstanding principal
and interest shall be due and payable on or before December 31, 2001, if not
previously paid. If this Note or interest due hereunder is not paid when due
or declared due hereunder, the principal shall draw interest at the rate of
one and one half percent (1.5%) per month.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Denver, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: __________________________________
Authorized Officer
Date: May 21, 1999
EX-10
10
bionex108.txt
BION ENVIRONMENTAL EX 10.8 TO 8-K DTD 9/6/01
EXHIBIT 10.8
AGREEMENT
IT IS AGREED this 29th day of August 2001, by and between M. Duane Stutzman
("MDS") and Bion Environmental Technologies, Inc. ("BION") as follows:
WHEREAS BION is entering into agreements to simplify its capital structure in
preparation for subsequent financing transactions;
AND WHEREAS MDS considers such simplification to be in the best interests of
BION and MDS;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) MDS agrees to and does hereby amend the promissory note attached hereto
as Exhibit A ("Note") to provide that:
a) The term of the Note shall be extended to April 30, 2002;
b) The Note (principal and interest) shall be completely converted to
shares of common stock of BION (with an effective registration
statement related to resale of such shares) upon the earlier of
April 29, 2002 or the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes")
which conversion shall take place at the lower of: 1) $2.25 per
share, or ii) the conversion price of the CV Notes;
2) MDS and BION cancel 63,000 options exercisable at $2.25 per share
until 12/31/01;
3) MDS and BION agree to execute such other documents as may be necessary to
properly carry out the transactions set forth herein.
4) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. M. Duane Stutzman
By: /s/ Mark A. Smith, Chairman By: /s/ M. Duane Stutzman
--------------------------------- --------------------------
Authorized Officer M. Duane Stutzman
EXHIBIT A
Initial Principal: $140,000
Date Due: December 31, 2001
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
M. Duane Stutzman ("HOLDER"), and his successors and assignees, at 7483 West
Laurel Ave., Littleton, Colorado 80128, or at such other place as the HOLDER
of this Note may from time to time designate in writing, all sums due under
this Note (plus interest) in lawful and immediately available money of the
United States. The initial principal of this loan is $140,000. Interest
shall be accrued and added to principal at one percent (1.0%) per month from
date owed by MAKER. All outstanding principal and interest shall be due and
payable on or before December 31, 2001, if not previously paid. If this Note
or interest due hereunder is not paid when due or declared due hereunder, the
principal shall draw interest at the rate of one and one half percent (1.5%)
per month.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Denver, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: __________________________________
Authorized Officer
Date: May 21, 1999
EX-10
11
bionex109.txt
BION ENVIRONMENTAL EX 10.9 TO 8-K DTD 9/6/01
EXHIBIT 10.9
STOCK VOTING AGREEMENT
THIS STOCK VOTING AGREEMENT (the "Agreement"), effective the first day of
August 2001, between and among Bion Environmental Technologies, Inc. ("BION"),
Dublin Holding, Ltd. ("DHL"), LoTayLingKyur, Inc. ("LTLK"), Mark A. Smith
("MAS"), Kelly Smith ("KS"), LoTayLingKyur Foundation ("F"), Kelly Smith
Rollover IRA ("KSIRA"), Mark A. Smith Rollover IRA ("MASIRA"),(collectively
"DHL, LTLK, F, KS, MS, KSIRA and MASIRA are the "Shareholder"), and D2CO, LLC
("D2").
WHEREAS Shareholder owns shares of the issued and outstanding common
stock of BION and promissory notes convertible into shares of common stock of
BION (collectively the "Securities")
NOW THEREFORE, in consideration of the mutual agreements of the parties
hereto and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the parties hereto agree as follows:
1. Shareholder hereby constitutes and appoints D2 with full power of
substitution, for the period commencing on the date hereof and ending on
December 31, 2005, to vote the Securities as the proxy of Shareholder, at any
and all meetings, regular or special of the Shareholders of BION, or at any
adjournments thereof, which may be held during such period, hereby granting to
said D2 (the "Proxy"), as Shareholder's attorney and Proxy, all powers
Shareholder would possess if personally present at any such meetings. The
Proxy granted hereby is expressly acknowledged to be coupled with an interest
and shall be irrevocable to the full extent permitted by law until December
31, 2005, except to the extent specifically provided in Paragraph 3 below, and
except as to vote on the sale of all or substantially all of BION's assets or
a merger of BION.
2. During the entire term of the Agreement, the Proxy shall have full
and absolute discretion as to the manner in which Securities are to be voted
as to any matter whatsoever, except as set forth elsewhere herein, all without
any liability or obligation of any kind to Shareholder.
3. Nothing contained herein shall be construed in such a manner so as
to prohibit or preclude the sale or exchange of all or any part of the
Securities by Shareholder in accordance with the provisions of this Paragraph
3. In the event that all or any portion of the Securities are sold, assigned,
transferred, gifted, donated or exchanged by Shareholder (and/or its assigns)
to non-affiliated persons or entities prior to December 31, 2005, then
transferred portion of the Securities shall no longer be subject in any manner
whatsoever to the terms of this Agreement set forth above, and shall be
entirely released from same, unless otherwise agreed to in writing, provided,
however, no private "non-market" transfer of any portion of the Securities
shall take place which reduces the Securities for which D2 is Proxy to less
than 2/3 of the initial Securities for which D2 is Proxy, unless the
transferee of such transferred portion of the Securities is willing to appoint
D2 as Proxy for the transferred portion of the Securities on the terms set
fort herein.
4. A counterpart of this Agreement shall forthwith be deposited with
BION at its principal place of business.
5. This Agreement shall be construed in accordance with the laws of the
State of Colorado and shall be binding upon the successors and assigns of each
party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date set forth above.
Dublin Holding, Ltd. D2CO, LLC
By: /s/ Mark A. Smith By:
-------------------------- ---------------------------
Authorized Officer Authorized Officer
LoTayLingKyur, Inc. Bion Environmental Technologies, Inc.
By: /s/ Mark A. Smith By: /s/ Mark A. Smith
-------------------------- ---------------------------
Authorized Officer Authorized Officer
/s/ Mark A. Smith
------------------------------
Mark A. Smith
By: /s/ Mark A. Smith,
Attorney in Fact
------------------------------
Kelly Smith
LoTayLingKyur Foundation
/s/ Mark A. Smith
------------------------------
Mark A. Smith
/s/ Mark A. Smith
------------------------------
Mark A. Smith Rollover IRA
By: /s/ Mark A. Smith,
Attorney in Fact
------------------------------
Kelly Smith Rollover IRA
EX-10
12
bionex1010.txt
BION ENVIRONMENTAL EX 10.10 TO 8-K DTD 9/6/01
EXHIBIT 10.10
AGREEMENT
IT IS AGREED the first day of August 2001, by, between and among
LoTayLingKyur, Inc. ("LTLK"), Kelly Smith Rollover IRA ("KSIRA"), Mark A.
Smith Rollover IRA ("MASIRA"), Mark A. Smith ("MAS"), Kelly Smith ("KS"),
LoTayLingKyur Foundation ("F"), and Dublin Holding, Ltd. ("DHL") (collectively
"FIRST PARTIES") and Bion Environmental Technologies, Inc. ("BION") as
follows:
WHEREAS BION is entering into agreements with various note holders and with
D2CO, LLC ("D2") concerning simplifications of BION's capital structure i
preparation for subsequent financing transactions by BION;
AND WHEREAS FIRST PARTIES consider such changes to BION's capital structure to
be in the best interests of BION and FIRST PARTIES;
NOW THEREFORE, IN CONSIDERATION of the mutual promises and covenants herein:
1) FIRST PARTIES AND BION agree to execute the Stock Voting Agreement
attached hereto as Exhibit A ("Stock Voting Agreement")
2) DHL, MASIRA and KSIRA hereby amend the convertible promissory notes
attached hereto as Exhibits B-1, B-2 and B-3 ("NOTES") to provide that
such NOTES, shall be automatically and fully converted (all principal
plus interest calculated as if NOTES were held to maturity) into common
stock of BION upon the conversion of BION's outstanding Convertible
Bridge Notes and 2001 Convertible Notes ("CV Notes") which conversion
shall take place at the lower of: 1) $1.80 per share, or ii) the
conversion price of the CV Notes;
3) MAS resigns as Chairman of BION's Board of Directors effective September
6, 2001. MAS shall continue as a Director of BION and as a member of the
Executive Committee.
4) FIRST PARTIES and BION agree that restrictions on the ability of Jon
Northrop to sell securities of BION set forth in the Shareholders'
Agreement (dated December 23, 1999), as amended, ("Shareholder
Agreement") shall be vacated effective August 31, 2001.
5) FIRST PARTIES and BION agree that:
a) The restrictions on sale/transfer of BION securities set forth in
the Shareholder Agreement shall be extended until 12/31/03 as to
FIRST PARTIES and D2CO, LLC;
b) Provided, however that:
i) From 8/1/01 thru the date on which MAS ceases to be a Director
of BION, FIRST PARTIES may:
A) Make charitable donations/gift transfers of up to 240,000
shares of BION common stock; and
B) Gifts to family members of up to 200,000 shares of BION
common stock (which shares shall be subject to the Stock
Voting Agreement);
free from restrictions of the Shareholder Agreement; and
ii) After MAS ceases to be a Director of BION, FIRST PARTIES, may
sell/transfer up to 1/3 of the BION securities owned by FIRST
PARTIES (including for calculation purposes any BION securities
transferred pursuant to paragraph 5 b)i) above) free from the
restrictions of the Shareholder Agreement, provided that before
any such sale for cash, FIRST PARTIES offer to D2 the right to
"place" any blocks of BION stock of 20,000 shares or more which
"FIRST PARTIES" want to sell;
iii) Transfers of BION securities by LTLK and/or DHL, if any, in
connection with cessation of business, liquidation and/or
dissolution shall be permitted, provided that, if such
transfers:
A) Take place while MAS is a Director of BION; or
B) Are in excess of the volume limitation set forth above,
the transference of such securities shall agree to be
bound by the terms of the Shareholder Agreement and the
Stock Voting Agreement as to BION securities transference
under this paragraph 5) b) iii) A) or B).
6) FIRST PARTIES and BION agree to execute such other documents as may be
necessary to properly carry out the transactions set forth herein.
7) The Agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
BION Environmental Technologies, Inc. LoTayLingKyur, Inc.
By: By: /s/
---------------------------------- ------------------------------
Authorized Officer Authorized Officer
By: /s/ Mark A. Smith
------------------------------
Mark A. Smith Rollover IRA
By: /s/ Mark A. Smith
------------------------------
Mark A. Smith
By: /s/ Kelly Smith
------------------------------
Kelly Smith
LoTayLingKyur Foundation
By: /s/
------------------------------
Authorized Officer
Dublin Holding, Ltd.
By: /s/
------------------------------
Authorized Officer
EXHIBIT A
STOCK VOTING AGREEMENT
THIS STOCK VOTING AGREEMENT (the "Agreement"), effective the first day of
August 2001, between and among Bion Environmental Technologies, Inc. ("BION"),
Dublin Holding, Ltd. ("DHL"), LoTayLingKyur, Inc. ("LTLK"), Mark A. Smith
("MAS"), Kelly Smith ("KS"), LoTayLingKyur Foundation ("F"), Kelly Smith
Rollover IRA ("KSIRA"), Mark A. Smith Rollover IRA ("MASIRA"),(collectively
"DHL, LTLK, F, KS, MS, KSIRA and MASIRA are the "Shareholder"), and D2CO, LLC
("D2").
WHEREAS Shareholder owns shares of the issued and outstanding common
stock of BION and promissory notes convertible into shares of common stock of
BION (collectively the "Securities")
NOW THEREFORE, in consideration of the mutual agreements of the parties
hereto and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the parties hereto agree as follows:
1. Shareholder hereby constitutes and appoints D2 with full power of
substitution, for the period commencing on the date hereof and ending on
December 31, 2005, to vote the Securities as the proxy of Shareholder, at any
and all meetings, regular or special of the Shareholders of BION, or at any
adjournments thereof, which may be held during such period, hereby granting to
said D2 (the "Proxy"), as Shareholder's attorney and Proxy, all powers
Shareholder would possess if personally present at any such meetings. The
Proxy granted hereby is expressly acknowledged to be coupled with an interest
and shall be irrevocable to the full extent permitted by law until December
31, 2005, except to the extent specifically provided in Paragraph 3 below, and
except as to vote on the sale of all or substantially all of BION's assets or
a merger of BION.
2. During the entire term of the Agreement, the Proxy shall have full
and absolute discretion as to the manner in which Securities are to be voted
as to any matter whatsoever, except as set forth elsewhere herein, all without
any liability or obligation of any kind to Shareholder.
3. Nothing contained herein shall be construed in such a manner so as
to prohibit or preclude the sale or exchange of all or any part of the
Securities by Shareholder in accordance with the provisions of this Paragraph
3. In the event that all or any portion of the Securities are sold, assigned,
transferred, gifted, donated or exchanged by Shareholder (and/or its assigns)
to non-affiliated persons or entities prior to December 31, 2005, then
transferred portion of the Securities shall no longer be subject in any manner
whatsoever to the terms of this Agreement set forth above, and shall be
entirely released from same, unless otherwise agreed to in writing, provided,
however, no private "non-market" transfer of any portion of the Securities
shall take place which reduces the Securities for which D2 is Proxy to less
than 2/3 of the initial Securities for which D2 is Proxy, unless the
transferee of such transferred portion of the Securities is willing to appoint
D2 as Proxy for the transferred portion of the Securities on the terms set
fort herein.
4. A counterpart of this Agreement shall forthwith be deposited with
BION at its principal place of business.
5. This Agreement shall be construed in accordance with the laws of the
State of Colorado and shall be binding upon the successors and assigns of each
party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date set forth above.
Dublin Holding, Ltd. D2CO, LLC
By: /s/ Mark A. Smith By:
-------------------------- ---------------------------
Authorized Officer Authorized Officer
LoTayLingKyur, Inc. Bion Environmental Technologies, Inc.
By: /s/ Mark A. Smith By: /s/ Mark A. Smith
-------------------------- ---------------------------
Authorized Officer Authorized Officer
/s/ Mark A. Smith
------------------------------
Mark A. Smith
By: /s/ Mark A. Smith,
Attorney in Fact
------------------------------
Kelly Smith
LoTayLingKyur Foundation
/s/ Mark A. Smith
------------------------------
Mark A. Smith
/s/ Mark A. Smith
------------------------------
Mark A. Smith Rollover IRA
By: /s/ Mark A. Smith,
Attorney in Fact
------------------------------
Kelly Smith Rollover IRA
EXHIBIT B-1
Initial Principal: $1,650,000
Date Due: December 31, 2002
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Dublin Holding Ltd. ("HOLDER"), and its successors and assignees, at 409
Spruce Street, Boulder, Colorado 80302, or at such other place as the HOLDER
of this Note may from time to time designate in writing, all sums due under
this Note (plus interest) in lawful and immediately available money of the
United States. The initial principal of this loan is $1,650,000. Interest
shall be accrued and added to principal at one percent (1.0%) per month from
date owed by MAKER. All outstanding principal and interest shall be due and
payable on or before December 31, 2001, if not previously paid. If this Note
or interest due hereunder is not paid when due or declared due hereunder, the
principal shall draw interest at the rate of one and one half percent (1.5%)
per month.
The outstanding principal and interest due hereunder shall be
convertible, in whole or in part, at the option of the HOLDER, into shares of
MAKER's common stock ("Shares") at a price of $1.80 per share (equitably
adjusted for subsequent stock splits, dividends, mergers, etc.) at any time
prior to payment by MAKER of such principal and interest. MAKER shall not
prepay this Note without permission of HOLDER. However, MAKER and HOLDER
agree that MAKER shall convert this Note to the number of shares which would
be due on maturity upon the events set forth in paragraph 1 of the Agreement
to which this Note is attached as Exhibit A. Upon issuance, MAKER represents
that all shares received as a result of conversion of this Note shall be
fully-paid and non-assessable.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Boulder, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: /s/ Jon Northrop
---------------------------------
Authorized Officer
Date: December 20, 1999
Initial Principal: $915,000
Date Due: December 31, 2002
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Dublin Holding Ltd. ("HOLDER"), and its successors and assignees, at 409
Spruce Street, Boulder, Colorado 80302, or at such other place as the HOLDER
of this Note may from time to time designate in writing, all sums due under
this Note (plus interest) in lawful and immediately available money of the
United States. The initial principal of this loan is $915,000. Interest
shall be accrued and added to principal at one percent (1.0%) per month from
date owed by MAKER. All outstanding principal and interest shall be due and
payable on or before December 31, 2001, if not previously paid. If this Note
or interest due hereunder is not paid when due or declared due hereunder, the
principal shall draw interest at the rate of one and one half percent (1.5%)
per month.
The outstanding principal and interest due hereunder shall be
convertible, in whole or in part, at the option of the HOLDER, into shares of
MAKER's common stock ("Shares") at a price of $1.80 per share (equitably
adjusted for subsequent stock splits, dividends, mergers, etc.) at any time
prior to payment by MAKER of such principal and interest. MAKER shall not
prepay this Note without permission of HOLDER. However, MAKER and HOLDER
agree that MAKER shall convert this Note to the number of shares which would
be due on maturity upon the events set forth in paragraph 1 of the Agreement
to which this Note is attached as Exhibit A. Upon issuance, MAKER represents
that all shares received as a result of conversion of this Note shall be
fully-paid and non-assessable.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Boulder, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: /s/ Jon Northrop
---------------------------------
Authorized Officer
Date: August 9, 2000
EXHIBIT B-2
Initial Principal: $124,857.01
Date Due: December 31, 2002
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Mark A. Smith Rollover IRA ("HOLDER"), and its successors and assignees, at
409 Spruce Street, Boulder, Colorado 80302, or at such other place as the
HOLDER of this Note may from time to time designate in writing, all sums due
under this Note (plus interest) in lawful and immediately available money of
the United States. The initial principal of this loan is $124,857.01.
Interest shall be accrued and added to principal at one percent (1.0%) per
month from date owed by MAKER. All outstanding principal and interest shall
be due and payable on or before December 31, 2001, if not previously paid. If
this Note or interest due hereunder is not paid when due or declared due
hereunder, the principal shall draw interest at the rate of one and one half
percent (1.5%) per month.
The outstanding principal and interest due hereunder shall be
convertible, in whole or in part, at the option of the HOLDER, into shares of
MAKER's common stock ("Shares") at a price of $1.80 per share (equitably
adjusted for subsequent stock splits, dividends, mergers, etc.) at any time
prior to payment by MAKER of such principal and interest. MAKER shall not
prepay this Note without permission of HOLDER. However, MAKER and HOLDER
agree that MAKER shall convert this Note to the number of shares which would
be due on maturity upon the events set forth in paragraph 1 of the Agreement
to which this Note is attached as Exhibit A. Upon issuance, MAKER represents
that all shares received as a result of conversion of this Note shall be
fully-paid and non-assessable.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Boulder, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: /s/ Jon Northrop
---------------------------------
Authorized Officer
Date: September 20, 2000 (re-issue date)
Initial Principal: $149,237.12
Date Due: December 31, 2002
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Mark A. Smith Rollover IRA ("HOLDER"), and its successors and assignees, at
409 Spruce Street, Boulder, Colorado 80302, or at such other place as the
HOLDER of this Note may from time to time designate in writing, all sums due
under this Note (plus interest) in lawful and immediately available money of
the United States. The initial principal of this loan is $149,237.12.
Interest shall be accrued and added to principal at one percent (1.0%) per
month from date owed by MAKER. All outstanding principal and interest shall
be due and payable on or before December 31, 2001, if not previously paid. If
this Note or interest due hereunder is not paid when due or declared due
hereunder, the principal shall draw interest at the rate of one and one half
percent (1.5%) per month.
The outstanding principal and interest due hereunder shall be
convertible, in whole or in part, at the option of the HOLDER, into shares of
MAKER's common stock ("Shares") at a price of $1.80 per share (equitably
adjusted for subsequent stock splits, dividends, mergers, etc.) at any time
prior to payment by MAKER of such principal and interest. MAKER shall not
prepay this Note without permission of HOLDER. However, MAKER and HOLDER
agree that MAKER shall convert this Note to the number of shares which would
be due on maturity upon the events set forth in paragraph 1 of the Agreement
to which this Note is attached as Exhibit A. Upon issuance, MAKER represents
that all shares received as a result of conversion of this Note shall be
fully-paid and non-assessable.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Boulder, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: /s/ Jon Northrop
---------------------------------
Authorized Officer
Date: September 20, 2000 (re-issue date)
EXHIBIT B-3
Initial Principal: $128,879.01
Date Due: December 31, 2002
PROMISSORY NOTE ("Note")
FOR VALUE RECEIVED, the undersigned, Bion Environmental Technologies,
Inc., a Colorado corporation ("MAKER"), hereby promises to pay to the order of
Kelly Smith Rollover IRA ("HOLDER"), and its successors and assignees, at 409
Spruce Street, Boulder, Colorado 80302, or at such other place as the HOLDER
of this Note may from time to time designate in writing, all sums due under
this Note (plus interest) in lawful and immediately available money of the
United States. The initial principal of this loan is $128,879.01. Interest
shall be accrued and added to principal at one percent (1.0%) per month from
date owed by MAKER. All outstanding principal and interest shall be due and
payable on or before December 31, 2001, if not previously paid. If this Note
or interest due hereunder is not paid when due or declared due hereunder, the
principal shall draw interest at the rate of one and one half percent (1.5%)
per month.
The outstanding principal and interest due hereunder shall be
convertible, in whole or in part, at the option of the HOLDER, into shares of
MAKER's common stock ("Shares") at a price of $1.80 per share (equitably
adjusted for subsequent stock splits, dividends, mergers, etc.) at any time
prior to payment by MAKER of such principal and interest. MAKER shall not
prepay this Note without permission of HOLDER. However, MAKER and HOLDER
agree that MAKER shall convert this Note to the number of shares which would
be due on maturity upon the events set forth in paragraph 1 of the Agreement
to which this Note is attached as Exhibit A. Upon issuance, MAKER represents
that all shares received as a result of conversion of this Note shall be
fully-paid and non-assessable.
Upon default by the MAKER of the timely payment of principal or interest
due hereunder or upon any Event of Default as hereinafter defined, the HOLDER
may, in its sole discretion, withhold any payments due and payable to MAKER
and apply same to the MAKER's obligations hereunder. In addition, upon any
Event of Default, the HOLDER may declare the full amount of this Note due and
payable.
If any one or more of the following events ("Events of Default") shall
occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law,
pursuant to or in compliance with any judgment, decree of order of any court,
or any order, rule or regulation of any administrative or governmental body,
or otherwise) the HOLDER of this Note may, at its option, upon written notice
to MAKER, declare this Note and any other promissory note issued by MAKER to
HOLDER (whether or not then due in accordance with its terms) to be due and
payable, whereupon the entire balance of this Note shall forthwith become and
be due and payable:
(a) MAKER fails to make payment of principal or of interest on this
Note or any other obligation of MAKER when such shall become due and payable,
whether at the stated maturity thereof or by acceleration or otherwise;
(b) MAKER (1) admits its inability to pay its debts as they become
due; (2) files a petition in bankruptcy or makes a petition to take advantage
of an insolvency act; (3) makes an assignment for the benefit of creditors;
(4) commences a proceeding for the appointment of a receiver, trustee,
liquidator, or conservator of itself or of the whole or any substantial part
of its properties; (5) files a petition or answer seeking reorganization or
arrangement or similar relief under the federal bankruptcy laws or any other
applicable law or statute or the United States or any State;
(c) MAKER (1) is adjudged as bankrupt, (2) a court enters an order,
judgment or decree, appointing a receiver, trustee, liquidator or conservator
of MAKER or of the whole or any substantial part of its properties, or approve
a petition filed against MAKER seeking reorganization or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the
United States or any state; (3) under the provisions of any other law for the
relief or aid of debtors, a court assumes custody or control of MAKER or the
whole or any substantial part of its properties; (4) there is commenced
against MAKER any proceeding for any of the foregoing relief; (5) a petition
in bankruptcy is filed against MAKER; or (6) MAKER by any act indicates its
consent to approval of or acquiescence in any such proceeding or petition.
Except as otherwise hereinabove expressly provided, MAKER hereby waives
diligence, demand, protest, presentment and all notices (whether of
nonpayment, dishonor, protest, acceleration or otherwise) and consents to
acceleration of the time of payment, surrender or substitution of security or
forbearance, or other indulgence, without notice.
Jurisdiction and venue shall be in a court of general jurisdiction
located in Boulder, Colorado. In the event that litigation is necessary to
collect the principal (and interest) of the Note, HOLDER shall be entitled to
reasonable attorneys' fees and litigation costs associated therewith.
BION ENVIRONMENTAL TECHNOLOGIES, INC.
By: /s/ Jon Northrop
---------------------------------
Authorized Officer
Date: September 20, 2000 (re-issue date)
EX-10
13
bionex1011.txt
BION ENVIRONMENTAL EX 10.11 TO 8-K DTD 9/6/01
EXHIBIT 10.11
AGREEMENT
It is agreed this first day of August 2001, by and between and among Bion
Environmental Technologies, Inc. ("BION") and D2CO, LLC, Southview, Inc. and
Atlantic Partners, LLC (collectively "D2") as follows:
1. BION and D2 agree to execute the documents attached as Exhibit A to effect
the "Deferred Compensation" arrangement, which was agreed to during December
2000. Each party will take such actions and execute such additional documents
as may be necessary related thereto.
2. D2 and BION hereby agree to execute the Stock Voting Agreement attached
hereto as Exhibit B.
3. a) BION and D2 agree to release Jon Northrop from the restrictions
related to sale of BION Securities set forth in the Shareholders Agreement
dated December 23, 1999, as amended ("Shareholder Agreement").
b) BION and D2 agree to be bound by the extensions/amendments to the
Shareholder Agreement set forth at paragraph 5 of the agreement between BION
and "FIRST PARTIES" attached hereto as Exhibit C.
4. a) Upon the earlier of i) completion of financing or series of financings
("Financing") large enough to "trigger" the conversion of BION's outstanding
Bridge Notes and 2001 Convertible Notes (collectively "CV Notes") into BION
common stock; or ii) conversion of the CV Notes into BION common stock on
April 29, 2002, the outstanding Class SV1 and SV2 Warrants owned by D2 shall
be adjusted ("Adjusted Warrants") so that D2 owns Adjusted Warrants to
purchase a number of shares of BION common stock equal 20% of the "fully-
diluted" outstanding shares, calculated by including i) the Adjusted Warrants
ii) the securities issued in the conversions of the CV Notes and other notes,
iii) the securities issued in connection with the Financing, and iv) other
outstanding options, warrants and/or convertible promissory notes which re
exercisable or convertible, as applicable, at a price equal to or lower than
the exercise price of the Adjusted Warrants, which Adjusted Warrants shall
have the same expiration date as the current SV1 and SV2 Warrants and shall
have an exercise price equal to the lower of $1.00 per share or the conversion
price of the CV Notes, provided, however, that for purposes of calculating the
number of Adjusted Warrants no securities outstanding related to any portion
of a Financing aggregating greater than $10,000,000 shall be included in the
calculation.
b) In partial consideration of 4a) above, Southview hereby extends the
term of the outstanding promissory note (with a balance (principal plus
interest) of $521,039.81 as of July 31, 2001) attached hereto as Exhibit D so
that such promissory note shall be repaid from the proceeds of the Financing.
5. The agreement is subject to ratification by BION's Board of Directors on
or before September 15, 2001.
Bion Environmental Technologies, Inc. D2CO, LLC
By: /s/ Mark A. Smith, Chairman By:
--------------------------------- -------------------------------
Authorized Officer Authorized Officer
Southview, Inc.
By:
-------------------------------
Authorized Officer
Atlantic Partners, LLC
By:
-------------------------------
Authorized Officer
EX-10
14
bionex1012.txt
BION ENVIRONMENTAL EX 10.12 TO 8-K DTD 9/6/01
EXHIBIT 10.12
BION ENVIRONMENTAL TECHNOLOGIES, INC.
-------------------------------------
2001 INCENTIVE PLAN
-------------------
1. Purpose of the Plan
The purpose of this Bion Environmental Technologies, Inc. 2001 Incentive
Plan ("Plan") is to create shareholder value. To do so, the Plan provides
incentives to selected employees and directors of the Company and its
Subsidiaries, and selected non-employee consultants and advisors to the
Company and its Subsidiaries, who contribute, and are expected to contribute,
materially to its success. The Plan also provides a means of rewarding
outstanding performance and enhances the interest of such persons in the
Company's success and development by providing them a proprietary interest in
the Company. Further, the Plan is designed to enhance the Company's ability to
maintain a competitive position in attracting and retaining qualified
personnel necessary for the success and development of the Company.
2. Definitions
As used in the Plan, the following definitions apply to the terms
indicated below:
(a) "Board of Directors" shall mean the Board of Directors of Bion
Environmental Technologies, Inc.
(b) "Cause," when used in connection with the termination of a
Participant's employment with the Company, for purposes of the Plan, shall
mean the termination of the Participant's employment by the Company on account
of (i) the willful and continued failure by the Participant substantially to
perform his duties and obligations (other than any such failure resulting from
his incapacity due to physical or mental illness) or (ii) the willful engaging
by the Participant in an act or acts which could reasonably be expected to
cause injury to the Company or are contrary to the best interests of the
Company. For purposes of this Section 2(b), no act, or failure to act, on a
Participant's part shall be considered "willful" unless done, or omitted to be
done, by the Participant in bad faith and without reasonable belief that his
action or omission was in the best interests of the Company.
(c) "Cash Bonus" shall mean an award of a bonus payable in cash
pursuant to Section 13 hereof.
(d) "Change in Control" shall mean:
(i) the acquisition at any time by a"person" or "group" (as that
term is used in Sections 13(d)and 14(d)(2) of the Exchange Act) (excluding,
for this purpose, the Company or any Subsidiary or any employee benefit plan
of the Company or any Subsidiary) of beneficial ownership (as defined in
Rule 13d-3 under the Exchange Act) directly or indirectly, of securities
representing 60% or more of the combined voting power in the election of
directors of the then-outstanding securities of the Company or any successor
of the Company;
(ii) the termination of service as directors, for any reason
other than death, disability or retirement from the Board of Directors, during
any period of two consecutive years or less, of individuals who at the
beginning of such period constituted a majority of the Board of Directors,
unless the election of or nomination for election of each new director during
such period was approved by a vote of at least two-thirds of the directors
still in office who were directors at the beginning of the period;
(iii) approval by the shareholders of the Company of any merger
or consolidation or statutory share exchange as a result of which the Common
Shares shall be changed, converted or exchanged (other than a merger or share
exchange with a wholly-owned Subsidiary of the Company), or liquidation of the
Company, or any sale or disposition of 50% or more of the assets or earning
power of the Company; or
(iv) approval by the shareholders of the Company of any merger,
consolidation or statutory share exchange to which the Company is a party as a
result of which the persons who were shareholders of the Company immediately
prior to the effective date of the merger, consolidation or statutory share
exchange shall have beneficial ownership of less than 50% of the combined
voting power in the election of directors of the surviving corporation
following the effective date of such merger, consolidation or statutory share
exchange;
provided, however, that no change in control shall be deemed to have
occurred if, prior to such time as a change in control would otherwise be
deemed to have occurred, the Company's Board of Directors deems otherwise.
(e) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
(f) "Committee" shall mean the committee appointed by the Board of
Directors from time to time to administer the Plan.
(g) "Common Shares" shall mean Bion Environmental Technologies, Inc.
common shares, no par value per share.
(h) "Company" shall mean Bion Environmental Technologies, Inc., a
Colorado corporation, and each of its Subsidiaries.
(i) "Disability" shall mean a Participant's inability to engage in
any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or
which has lasted or can be expected to last for a continuous period of not
less than twelve (12) months.
(j) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(k) The "Fair Market Value" of Common Shares with respect to any day
shall be (i) the closing sales price on the immediately preceding business day
of Common Shares as reported on the principal securities exchange on which
Common Shares are then listed or admitted to trading, or (ii) if not so
reported, the average of the closing bid and ask prices on the immediately
preceding business day as reported on the National Association of Securities
Dealers Automated Quotation System, or (iii) if not so reported, as furnished
by any member of the National Association of Securities Dealers, Inc. selected
by the Committee. In the event that the price of Common Shares shall not be so
reported, the Fair Market Value of Common Shares shall be determined by the
Committee in its absolute discretion.
(l) "Incentive Award" shall mean an Option, LSAR, Tandem SAR,
Stand-Alone SAR, share of Phantom Stock, Stock Bonus or Cash Bonus granted
pursuant to the terms of the Plan.
(m) "Incentive Stock Option" shall mean an Option which is an
"incentive stock option" within the meaning of Section 422 of the Code and
which is identified as an Incentive Stock Option in the agreement by which it
is evidenced.
(n) "Issue Date" shall mean the date established by the Committee on
which certificates representing shares of Restricted Stock shall be issued by
Bion Environmental Technologies, Inc. pursuant to the terms of Section 10(d)
hereof.
(o) "LSAR" shall mean a limited stock appreciation right which is
granted pursuant to the provisions of Section 7 hereof and which relates to an
Option. Each LSAR shall be exercisable only upon the occurrence of a Change in
Control and only in the alternative to the exercise of its related Option.
(p) "Non-Employee Participant" shall mean a Participant who is not an
employee of the Company.
(q) "Non-Qualified Stock Option" shall mean an Option which is not an
Incentive Stock Option and which is identified as a Non-Qualified Stock Option
in the agreement by which it is evidenced.
(r) "Option" shall mean an option to purchase Common Shares of Bion
Environmental Technologies, Inc. granted pursuant to Section 6 hereof. Each
Option shall be identified as either an Incentive Stock Option or a
Non-Qualified Stock Option in the agreement by which it is evidenced.
(s) "Participant" shall mean a person who is eligible to participate
in the Plan and to whom an Incentive Award is granted pursuant to the Plan,
and, upon his death, his successors, heirs, executors and administrators, as
the case may be.
(t) "Person" shall mean a "person," as such term is used in Sections
13(d) and 14(d) of the Exchange Act.
(u) "Phantom Stock" shall mean the right to receive in cash the
Fair Market Value of Common Shares of Bion Environmental Technologies, Inc.,
which right is granted pursuant to Section 11 hereof and subject to the terms
and conditions contained therein.
(v) "Plan" shall mean the Bion Environmental Technologies, Inc. 2001
Incentive Plan, as it may be amended from time to time.
(w) "Restricted Stock" shall mean a Common Share which is granted
pursuant to the terms of Section 10 hereof and which is subject to the
restrictions set forth in Section 10(c) hereof for so long as such
restrictions continue to apply to such share.
(x) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(y) "Stand-Alone SAR" shall mean a stock appreciation right granted
pursuant to Section 9 hereof which is not related to any Option.
(z) "Stock Bonus" shall mean a grant of a bonus payable in Common
Shares pursuant to Section 12 hereof.
(aa) "Subsidiary" shall mean any corporation in which at the time of
reference Bion Environmental Technologies, Inc. owns, directly or indirectly,
stock comprising more than fifty percent of the total combined voting power of
all classes of stock of such corporation.
(bb) "Tandem SAR" shall mean a stock appreciation right granted
pursuant to Section 8 hereof which is related to an Option. Each Tandem SAR
shall be exercisable only to the extent its related Option is exercisable and
only in the alternative to the exercise of its related Option.
(cc) "Vesting Date" shall mean the date established by the Committee
on which a share of Restricted Stock or Phantom Stock may vest.
(dd) "Bion Environmental Technologies, Inc." shall mean Bion
Environmental Technologies, Inc., a Colorado corporation, and its successors.
3. Stock Subject to the Plan
Under the Plan, the Committee may grant to Participants (i) Options, (ii)
LSARs, (iii) Tandem SARs, (iv) Stand-Alone SARs, (v) shares of Restricted
Stock, (vi) shares of Phantom Stock, (vii) Stock Bonuses and (viii) Cash
Bonuses; provided, however, that grants under the Plan to non-employee
directors of the Company shall be made by the Board of Directors. When
referring to grants under the Plan to non-employee directors of the Company,
any reference in this Plan to the Committee shall be deemed to refer to the
Board of Directors.
Subject to adjustment as provided in Section 14 hereof, the Committee may
grant Options, Stand-Alone SARs, shares of Restricted Stock, shares of Phantom
Stock and Stock Bonuses under the Plan with respect to a number of Common
Shares that in the aggregate does not exceed 1,500,000 shares. The maximum
number of Common Shares for which Incentive Awards, including Incentive Stock
Options, may be granted to any one Participant shall not exceed 500,000 shares
in any one calendar year; and the total of all cash payments to any one
Participant pursuant to the Plan in any calendar year shall not exceed
$500,000. The grant of an LSAR, Tandem SAR or Cash Bonus shall not reduce the
number of Common Shares with respect to which Options, Stand-Alone SARs,
shares of Restricted Stock, shares of Phantom Stock or Stock Bonuses may be
granted pursuant to the Plan.
In the event that any outstanding Option or Stand-Alone SAR expires,
terminates or is canceled for any reason (other than pursuant to Paragraphs
7(b)(2) or 8(b)(3) hereof), the Common Shares subject to the unexercised
portion of such Option or Stand-Alone SAR shall again be available for grants
under the Plan. In the event that an outstanding Option is canceled pursuant
to Paragraphs 7(b)(2) or 8(b)(3) hereof by reason of the exercise of an LSAR
or a Tandem SAR, the Common Shares subject to the canceled portion of such
Option shall not again be available for grants under the Plan. In the event
that any shares of Restricted Stock or Phantom Stock, or any Common Shares
granted in a Stock Bonus are forfeited or canceled for any reason, such shares
shall again be available for grants under the Plan.
Common Shares issued under the Plan may be either newly issued shares or
treasury shares, at the discretion of the Committee, and Bion Environmental
Technologies, Inc. hereby reserves 1,500,000 Common Shares for issuance
pursuant to the Plan.
4. Administration of the Plan
The Plan shall be administered by a Committee of the Board of Directors
consisting of two or more persons, each of whom shall be a "non-employee
director" within the meaning of Rule 16b-3(b)(3) promulgated under Section 16
of the Exchange Act. The Committee shall from time to time designate the
persons who shall be granted Incentive Awards and the amount and type of such
Incentive Awards, provided, however that any Incentive Awards granted to
non-employee directors of the Company shall be granted by the Board and not by
the Committee. When referring to grants under the Plan to non-employee
directors of the Company, any reference in this Plan to the Committee shall be
deemed to refer to the Board of Directors.
The Committee shall have full authority to administer the Plan, including
authority to interpret and construe any provision of the Plan and the terms of
any Incentive Award issued under it and to adopt such rules and regulations
for administering the Plan as it may deem necessary. Decisions of the
Committee shall be final and binding on all parties.
The Committee may, in its absolute discretion (i) accelerate the date on
which any Option or Stand-Alone SAR granted under the Plan becomes
exercisable, (ii) accelerate the Vesting Date or Issue Date, or waive any
condition imposed pursuant to Section 10(b) hereof, with respect to any share
of Restricted Stock granted under the Plan and (iii) accelerate the Vesting
Date or waive any condition imposed pursuant to Section 11 hereof, with
respect to any share of Phantom Stock granted under the Plan.
In addition, the Committee may, in its absolute discretion, grant
Incentive Awards to Participants on the condition that such Participants
surrender to the Committee for cancellation such other Incentive Awards
(including, without limitation, Incentive Awards with higher exercise prices)
as the Committee specifies. Notwithstanding Section 3 herein, prior to the
surrender of such other Incentive Awards, Incentive Awards granted pursuant to
the preceding sentence of this Section 4 shall not count against the limits
set forth in such Section 3.
Whether an authorized leave of absence, or absence in military or
government service, shall constitute termination of employment shall be
determined by the Committee.
No member of the Committee shall be liable for any action, omission, or
determination relating to the Plan, and Bion Environmental Technologies, Inc.
shall indemnify and hold harmless each member of the Committee and each other
director or employee of the Company to whom any duty or power relating to the
administration or interpretation of the Plan has been delegated against any
cost or expense (including counsel fees) or liability (including any sum paid
in settlement of a claim with the approval of the Committee) arising out of
any action, omission or determination relating to the Plan, unless, in either
case, such action, omission or determination was taken or made by such member,
director or employee in bad faith and without reasonable belief that it was in
the best interests of the Company.
5. Eligibility
The persons who shall be eligible to receive Incentive Awards pursuant to
the Plan shall be such persons, including employees, officers, and directors
of the Company and non-employee consultants and advisors to the Company, as
the Committee shall select from time to time.
6. Options
Subject to the provisions of the Plan, the Committee may grant Options,
which Options shall be evidenced by agreements in such form as the Committee
shall from time to time approve. Options shall comply with and be subject to
the following terms and conditions:
(a) Identification of Options
All Options granted under the Plan shall be clearly identified in
the agreement evidencing such Options as either Incentive Stock Options or as
Non-Qualified Stock Options.
(b) Exercise Price
The exercise price of any Non-Qualified Stock Option granted
under the Plan shall be such price as the Committee shall determine on the
date on which such Non-Qualified Stock Option is granted; provided, that such
price may not be less than the minimum price required by applicable law. The
exercise price of any Incentive Stock Option granted under the Plan shall be
not less than 100% of the Fair Market Value of Common Shares on the date on
which such Incentive Stock Option is granted.
(c) Term and Exercise of Option
(1) Each Option shall be exercisable on such date or dates,
during such period and for such number of Common Shares as shall be determined
by the Committee on the day on which such Option is granted and set forth in
the Option agreement with respect to such Option; provided, however, that no
Option shall be exercisable after the expiration of ten years from the date
such Option was granted; and, provided, further, that each Option shall be
subject to earlier termination, expiration or cancellation as provided in the
Plan.
(2) Each Option shall be exercisable in whole or in part;
provided, that no partial exercise of an Option shall be for an aggregate
exercise price of less than $1,000, unless such partial exercise is for the
last remaining unexercised portion of such Option. The partial exercise of an
Option shall not cause the expiration, termination or cancellation of the
remaining portion thereof. Upon the partial exercise of an Option, the
agreements evidencing such Option and any related LSARs and Tandem SARs shall
be returned to the Participant exercising such Option together with the
delivery of the certificates described in Section 6(c)(5) hereof.
(3) An Option shall be exercised by delivering notice to Bion
Environmental Technologies, Inc.'s principal office, to the attention of its
Secretary, no less than one business day in advance of the effective date of
the proposed exercise. Such notice shall be accompanied by the agreements
evidencing the Option and any related LSARs and Tandem SARs, shall specify the
number of Common Shares with respect to which the Option is being exercised
and the effective date of the proposed exercise and shall be signed by the
Participant. The Participant may withdraw such notice at any time prior to the
close of business on the business day immediately preceding the effective date
of the proposed exercise, in which case such agreements shall be returned to
him. Payment for Common Shares purchased upon the exercise of an Option shall
be made on the effective date of such exercise either (i) in cash, by
certified check, bank cashier's check or wire transfer or (ii) subject to the
approval of the Committee, in Common Shares owned by the Participant and
valued at their Fair Market Value on the effective date of such exercise, or
partly in Common Shares with the balance in cash, by certified check, bank
cashier's check or wire transfer. Any payment in Common Shares shall be
effected by the delivery of such shares to the Secretary of Bion Environmental
Technologies, Inc., duly endorsed in blank or accompanied by stock powers duly
executed in blank, together with any other documents and evidences as the
Secretary of Bion Environmental Technologies, Inc. shall require from time to
time.
(4) Any Option granted under the Plan may be exercised by a
broker-dealer acting on behalf of a Participant if (i) the broker-dealer has
received from the Participant or the Company a fully-and-duly-endorsed
agreement evidencing such Option and instructions signed by the Participant
requesting Bion Environmental Technologies, Inc. to deliver the Common Shares
subject to such Option to the broker-dealer on behalf of the Participant and
specifying the account into which such shares should be deposited, (ii)
adequate provision has been made with respect to the payment of any
withholding taxes due upon such exercise and (iii) the broker-dealer and the
Participant have otherwise complied with Section 220.3(e)(4) of Regulation T,
12 CFR Part 220.
(5) Certificates for Common Shares purchased upon the
exercise of an Option shall be issued in the name of the Participant and
delivered to the Participant as soon as practicable following the effective
date on which the Option is exercised.
(d) Limitations on Grant of Incentive Stock Options
(1) The aggregate Fair Market Value of Common Shares with
respect to which "incentive stock options" (within the meaning of Section 422
of the Code) are exercisable for the first time by a Participant during any
calendar year under the Plan and any other stock option plan of the Company
(or any "subsidiary" of Bion Environmental Technologies, Inc. as such term is
defined in Section 425 of the Code) shall not exceed $100,000. Such Fair
Market Value shall be determined as of the date on which each such incentive
stock option is granted. In the event that the aggregate Fair Market Value of
Common Shares with respect to such incentive stock options exceeds $100,000,
then Incentive Stock Options granted hereunder to such Participant shall, to
the extent and in the order required by Regulations promulgated under the Code
(or any other authority having the force of Regulations), automatically be
deemed to be Non-Qualified Stock Options, but all other terms and provisions
of such Incentive Stock Options shall remain unchanged. In the absence of such
Regulations (and authority), or in the event such Regulations (or authority)
require or permit a designation of the options which shall cease to constitute
incentive stock options, Incentive Stock Options shall, to the extent of such
excess and in the order in which they were granted, automatically be deemed to
be Non-Qualified Stock Options, but all other terms and provisions of such
Incentive Stock Options shall remain unchanged.
(2) No Incentive Stock Option may be granted to an individual
if, at the time of the proposed grant, such individual owns stock possessing
more than ten percent of the total combined voting power of all classes of
stock of Bion Environmental Technologies, Inc. or any of its "subsidiaries"
(within the meaning of Section 425 of the Code), unless (i) the exercise price
of such Incentive Stock Option is at least one hundred and ten percent of the
Fair Market Value of a Common Share at the time such Incentive Stock Option is
granted and (ii) such Incentive Stock Option is not exercisable after the
expiration of five years from the date such Incentive Stock Option is granted.
(e) Effect of Termination of Employment
(1) In the event that the employment of a Participant with
the Company shall terminate for any reason other than retirement at age 60 or
later, Cause, Disability or death (i) Options granted to such Participant, to
the extent that they were exercisable at the time of such termination, shall
remain exercisable until the expiration of one month after such termination,
on which date they shall expire, and (ii) Options granted to such Participant,
to the extent that they were not exercisable at the time of such termination,
shall expire at the close of business on the date of such termination;
provided, however, that no Option shall be exercisable after the expiration of
its term.
(2) In the event that the employment of a Participant with
the Company shall terminate on account of the retirement at age 60 or later,
Disability or death of the Participant (i) Options granted to such
Participant, to the extent that they were exercisable at the time of such
termination, shall remain exercisable until the expiration of one year after
such termination, on which date they shall expire, and (ii) Options granted to
such Participant, to the extent that they were not exercisable at the time of
such termination, shall expire at the close of business on the date of such
termination; provided, however, that no Option shall be exercisable after the
expiration of its term.
(3) In the event of the termination of a Participant's
employment for Cause, all outstanding Options granted to such Participant
shall expire at the commencement of business on the date of such termination.
(4) In the event that a Non-Employee Participant ceases to
provide services to the Company, all Options granted to such Non-Employee
Participant shall remain exercisable in accordance with their terms.
(f) Acceleration of Exercise Date Upon Change in Control
Upon the occurrence of a Change in Control, each Option granted
under the Plan and outstanding at such time shall become fully and immediately
exercisable and shall remain exercisable until its expiration, termination or
cancellation pursuant to the terms of the Plan.
7. Limited Stock Appreciation Rights
The Committee may grant in connection with any Option granted hereunder
one or more LSARs relating to a number of Common Shares equal to or less than
the number of Common Shares subject to the related Option. An LSAR may be
granted at the same time as, or subsequent to the time that, its related
Option is granted. Each LSAR shall be evidenced by an agreement in such form
as the Committee shall from time to time approve. Each LSAR granted hereunder
shall be subject to the following terms and conditions:
(a) Benefit Upon Exercise
(1) The exercise of an LSAR relating to a Non-Qualified Stock
Option with respect to any number of Common Shares shall entitle the
Participant to a cash payment, for each such share, equal to the excess of (i)
the greater of (A) the highest price per Common Share paid in the Change in
Control in connection with which such LSAR became exercisable and (B) the Fair
Market Value of a Common Share on the date of such Change in Control over (ii)
the exercise price of the related Option. Such payment shall be paid as soon
as practical, but in no event later than the expiration of five business days,
after the effective date of such exercise.
(2) The exercise of an LSAR relating to an Incentive Stock
Option with respect to any number of Common Shares shall entitle the
Participant to a cash payment, for each such share, equal to the excess of (i)
the Fair Market Value of a Common Share on the effective date of such exercise
over (ii) the exercise price of the related Option. Such payment shall be paid
as soon as practical, but in no event later than the expiration of five
business days, after the effective date of such exercise.
(b) Term and Exercise of LSARs
(1) An LSAR shall be exercisable only during the period
commencing on the first day following the occurrence of a Change in Control
and terminating on the expiration of sixty days after such date.
Notwithstanding the preceding sentence of this Section 7(b), in the event that
an LSAR held by any Participant who is or may be subject to the provisions of
Section 16(b) of the Exchange Act becomes exercisable prior to the expiration
of six months following the date on which it is granted, then the LSAR shall
also be exercisable during the period commencing on the first day immediately
following the expiration of such six month period and terminating on the
expiration of sixty days following such date. Notwithstanding anything else
herein, an LSAR relating to an Incentive Stock Option may be exercised with
respect to a Common Share only if the Fair Market Value of such share on the
effective date of such exercise exceeds the exercise price relating to such
share. Notwithstanding anything else herein, an LSAR may be exercised only if
and to the extent that the Option to which it relates is exercisable.
(2) The exercise of an LSAR with respect to a number of
Common Shares shall cause the immediate and automatic cancellation of the
Option to which it relates with respect to an equal number of shares. The
exercise of an Option, or the cancellation, termination or expiration of an
Option (other than pursuant to this Paragraph (2)), with respect to a number
of Common Shares, shall cause the cancellation of the LSAR related to it with
respect to an equal number of shares.
(3) Each LSAR shall be exercisable in whole or in part;
provided, that no partial exercise of an LSAR shall be for an aggregate
exercise price of less than $1,000, unless such partial exercise is for the
last remaining unexercised portion of such LSAR. The partial exercise of an
LSAR shall not cause the expiration, termination or cancellation of the
remaining portion thereof. Upon the partial exercise of an LSAR, the
agreements evidencing the LSAR, the related Option and any Tandem SARs related
to such Option shall be returned to the Participant exercising such LSAR
together with the payment described in Paragraph 7(a)(1) or (2) hereof, as
applicable.
(4) An LSAR shall be exercised by delivering notice to Bion
Environmental Technologies, Inc.'s principal office, to the attention of its
Secretary, no less than one business day in advance of the effective date of
the proposed exercise. Such notice shall be accompanied by the applicable
agreements evidencing the LSAR, the related Option and any Tandem SARs
relating to such Option, shall specify the number of Common Shares with
respect to which the LSAR is being exercised and the effective date of the
proposed exercise and shall be signed by the Participant. The Participant may
withdraw such notice at any time prior to the close of business on the
business day immediately preceding the effective date of the proposed
exercise, in which case such agreements shall be returned to him.
8. Tandem Stock Appreciation Rights
The Committee may grant in connection with any Option granted hereunder
one or more Tandem SARs relating to a number of Common Shares equal to or less
than the number of Common Shares subject to the related Option. A Tandem SAR
may be granted at the same time as, or subsequent to the time that, its
related Option is granted. Each Tandem SAR shall be evidenced by an agreement
in such form as the Committee shall from time to time approve. Tandem SARs
shall comply with and be subject to the following terms and conditions:
(a) Benefit Upon Exercise
The exercise of a Tandem SAR with respect to any number of Common
Shares shall entitle a Participant to a cash payment, for each such share,
equal to the excess of (i) the Fair Market Value of a Common Share on the
effective date of such exercise over (ii) the exercise price of the related
Option. Such payment shall be paid as soon as practical, but in no event later
than the expiration of five business days, after the effective date of such
exercise.
(b) Term and Exercise of Tandem SAR
(1) A Tandem SAR shall be exercisable at the same time and to
the same extent (on a proportional basis, with any fractional amount being
rounded down to the immediately preceding whole number) as its related Option.
Notwithstanding the first sentence of this Paragraph 8(b)(1), (i) a Tandem SAR
shall not be exercisable at any time that an LSAR related to the Option to
which the Tandem SAR is related is exercisable and (ii) a Tandem SAR relating
to an Incentive Stock Option may be exercised with respect to a Common Share
only if the Fair Market Value of such share on the effective date of such
exercise exceeds the exercise price relating to such share.
(2) Notwithstanding the first sentence of Paragraph 8(b)(1)
hereof, the Committee may, in its absolute discretion, grant one or more
Tandem SARs which shall not become exercisable unless and until the
Participant to whom such Tandem SAR is granted is, in the determination of the
Committee, subject to Section 16(b) of the Exchange Act and which shall cease
to be exercisable if and at the time that the Participant ceases, in the
determination of the Committee, to be subject to such Section 16(b).
(3) The exercise of a Tandem SAR with respect to a number of
Common Shares shall cause the immediate and automatic cancellation of its
related Option with respect to an equal number of shares. The exercise of an
Option, or the cancellation, termination or expiration of an Option (other
than pursuant to this Paragraph (3)), with respect to a number of Common
Shares shall cause the automatic and immediate cancellation of its related
Tandem SARs to the extent that the number of Common Shares subject to such
Option after such exercise, cancellation, termination or expiration is less
than the number of shares subject to such Tandem SARs. Such Tandem SARs shall
be canceled in the order in which they became exercisable.
(4) Each Tandem SAR shall be exercisable in whole or in part;
provided, that no partial exercise of a Tandem SAR shall be for an aggregate
exercise price of less than $1,000, unless such partial exercise is for the
last remaining unexercised portion of such Tandem SAR. The partial exercise of
a Tandem SAR shall not cause the expiration, termination or cancellation of
the remaining portion thereof. Upon the partial exercise of a Tandem SAR, the
agreements evidencing such Tandem SAR, its related Option and LSARs relating
to such Option shall be returned to the Participant exercising such Tandem SAR
together with the payment described in Section 8(a) hereof.
(5) A Tandem SAR shall be exercised by delivering notice to
Bion Environmental Technologies, Inc.'s principal office, to the attention of
its Secretary, no less than one business day in advance of the effective date
of the proposed exercise. Such notice shall be accompanied by the applicable
agreements evidencing the Tandem SAR, its related Option and any LSARs related
to such Option, shall specify the number of Common Shares with respect to
which the Tandem SAR is being exercised and the effective date of the proposed
exercise and shall be signed by the Participant. The Participant may withdraw
such notice at any time prior to the close of business on the business day
immediately preceding the effective date of the proposed exercise, in which
case such agreements shall be returned to him.
9. Stand-Alone Stock Appreciation Rights
Subject to the provisions of the Plan, the Committee may grant
Stand-Alone SARs, which Stand-Alone SARs shall be evidenced by agreements in
such form as the Committee shall from time to time approve. Stand-Alone SARs
shall comply with and be subject to the following terms and conditions:
(a) Exercise Price
The exercise price of any Stand-Alone SAR granted under the Plan
shall be determined by the Committee at the time of the grant of such
Stand-Alone SAR.
(b) Benefit Upon Exercise
The exercise of a Stand-Alone SAR with respect to any number of
Common Shares prior to the occurrence of a Change in Control shall entitle a
Participant to a cash payment, for each such share, equal to the excess of (i)
the Fair Market Value of a Common Share on the exercise date over (ii) the
exercise price of the Stand-Alone SAR. The exercise of a Stand-Alone SAR with
respect to any number of Common Shares upon or after the occurrence of a
Change in Control shall entitle a Participant to a cash payment, for each such
share, equal to the excess of (i) the greater of (A) the highest price per
Common Share paid in connection with such Change in Control and (B) the Fair
Market Value of a Common Share on the date of such Change in Control over (ii)
the exercise price of the Stand-Alone SAR. Such payments shall be paid as soon
as practical, but in no event later than five business days, after the
effective date of the exercise.
(c) Term and Exercise of Stand-Alone SARs
(1) Each Stand-Alone SAR shall be exercisable on such date or
dates, during such period and for such number of Common Shares as shall be
determined by the Committee and set forth in the Stand-Alone SAR agreement
with respect to such Stand-Alone SAR; provided, however, that no Stand-Alone
SAR shall be exercisable after the expiration of ten years from the date such
Stand-Alone SAR was granted; and, provided, further, that each Stand-Alone SAR
shall be subject to earlier termination, expiration or cancellation as
provided in the Plan.
(2) Each Stand-Alone SAR may be exercised in whole or in
part; provided, that no partial exercise of a Stand-Alone SAR shall be for an
aggregate exercise price of less than $1,000, unless such partial exercise is
for the last remaining unexercised portion of such Stand-Alone SAR. The
partial exercise of a Stand-Alone SAR shall not cause the expiration,
termination or cancellation of the remaining portion thereof. Upon the partial
exercise of a Stand-Alone SAR, the agreement evidencing such Stand-Alone SAR
shall be returned to the Participant exercising such Stand-Alone SAR together
with the payment described in Section 9(b) hereof.
(3) A Stand-Alone SAR shall be exercised by delivering notice
to Bion Environmental Technologies, Inc.'s principal office, to the attention
of its Secretary, no less than one business day in advance of the effective
date of the proposed exercise. Such notice shall be accompanied by the
applicable agreement evidencing the Stand-Alone SAR, shall specify the number
of Common Shares with respect to which the Stand-Alone SAR is being exercised
and the effective date of the proposed exercise and shall be signed by the
Participant. The Participant may withdraw such notice at any time prior to the
close of business on the business day immediately preceding the effective date
of the proposed exercise, in which case the agreement evidencing the
Stand-Alone SAR shall be returned to him.
(d) Effect of Termination of Employment
(1) In the event that the employment of a Participant with
the Company shall terminate for any reason other than retirement at age 60 or
later, Cause, Disability or death, (i) Stand-Alone SARs granted to such
Participant, to the extent that they were exercisable at the time of such
termination, shall remain exercisable until the expiration of one month after
such termination, on which date they shall expire, and (ii) Stand-Alone SARs
granted to such Participant, to the extent that they were not exercisable at
the time of such termination, shall expire at the close of business on the
date of such termination; provided, however, that no Stand-Alone SAR shall be
exercisable after the expiration of its term.
(2) In the event that the employment of a Participant with
the Company shall terminate on account of the retirement at age 60 or later,
Disability or death of the Participant, (i) Stand-Alone SARs granted to such
Participant, to the extent that they were exercisable at the time of such
termination, shall remain exercisable until the expiration of one year after
such termination, on which date they shall expire, and (ii) Stand-Alone SARs
granted to such Participant, to the extent that they were not exercisable at
the time of such termination, shall expire at the close of business on the
date of such termination; provided, however, that no Stand-Alone SAR shall be
exercisable after the expiration of its term.
(3) In the event of the termination of a Participant's
employment for Cause, all outstanding Stand-Alone SARs granted to such
Participant shall expire at the commencement of business on the date of such
termination.
(4) In the event that a Non-Employee Participant ceases to
provide services to the Company, all Stand-Alone SARs granted to such
Non-Employee Participant shall remain exercisable in accordance with their
terms.
(e) Acceleration of Exercise Date Upon Change in Control
Upon the occurrence of a Change in Control, each Stand-Alone SAR
granted under the Plan and outstanding at such time shall become fully and
immediately exercisable and shall remain exercisable until its expiration,
termination or cancellation pursuant to the terms of the Plan.
10. Restricted Stock
Subject to the provisions of the Plan, the Committee may grant shares of
Restricted Stock. Each grant of shares of Restricted Stock shall be evidenced
by an agreement in such form as the Committee shall from time to time approve.
Each grant of shares of Restricted Stock shall comply with and be subject to
the following terms and conditions:
(a) Issue Date and Vesting Date
At the time of the grant of shares of Restricted Stock, the
Committee shall establish an Issue Date or Issue Dates and a Vesting Date or
Vesting Dates with respect to such shares. The Committee may divide such
shares into classes and assign a different Issue Date and/or Vesting Date for
each class. Except as provided in Sections 10(c) and 10(f) hereof, upon the
occurrence of the Issue Date with respect to a share of Restricted Stock, a
share of Restricted Stock shall be issued in accordance with the provisions of
Section 10(d) hereof. Provided that all conditions to the vesting of a share
of Restricted Stock imposed pursuant to Section 10(b) hereof are satisfied,
and except as provided in Sections 10(c) and 10(f) hereof, upon the occurrence
of the Vesting Date with respect to a share of Restricted Stock, such share
shall vest and the restrictions of Section 10(c) hereof shall cease to apply
to such share.
(b) Conditions to Vesting
At the time of the grant of shares of Restricted Stock, the
Committee may impose such restrictions or conditions, not inconsistent with
the provisions hereof, to the vesting of such shares as it, in its absolute
discretion, deems appropriate. By way of example and not by way of limitation,
the Committee may require, as a condition to the vesting of any class or
classes of shares of Restricted Stock, that the Participant or the Company
achieve certain performance criteria, such criteria to be specified by the
Committee at the time of the grant of such shares.
(c) Restrictions on Transfer Prior to Vesting
Prior to the vesting of a share of Restricted Stock, no transfer
of a Participant's rights with respect to such shares, whether voluntary or
involuntary, by operation of law or otherwise, shall vest the transferee with
any interest or right in or with respect to such share, but immediately upon
any attempt to transfer such rights, such share, and all of the rights related
thereto, shall be forfeited by the Participant and the transfer shall be of no
force or effect.
(d) Issuance of Certificates
(1) Except as provided in Sections 10(c) or 10(f) hereof,
reasonably promptly after the Issue Date with respect to shares of Restricted
Stock, Bion Environmental Technologies, Inc. shall cause to be issued a stock
certificate, registered in the name of the Participant to whom such shares
were granted, evidencing such shares; provided, that Bion Environmental
Technologies, Inc. shall not cause to be issued such a stock certificate
unless it has received a stock power duly endorsed in blank with respect to
such shares. Each such stock certificate shall bear the following legend:
"The transferability of this certificate and the shares
of stock represented hereby is subject to the restrictions, terms and
conditions (including forfeiture and restrictions against transfer) contained
in the Bion Environmental Technologies, Inc. 2001 Incentive Plan and an
Agreement entered into between the registered owner of such shares and Bion
Environmental Technologies, Inc. A copy of the Plan and Agreement is on file
in the office of the Secretary of Bion Environmental Technologies, Inc. Such
legend shall not be removed from the certificate evidencing such shares until
such shares vest pursuant to the terms hereof."
(2) Each certificate issued pursuant to Paragraph 10(d)(1)
hereof, together with the stock powers relating to the shares of Restricted
Stock evidenced by such certificate, shall be deposited by the Company with a
custodian designated by the Company. The Company shall cause such custodian to
issue to the Participant a receipt evidencing the certificates held by it
which are registered in the name of the Participant.
(e) Consequences Upon Vesting
Upon the vesting of a share of Restricted Stock pursuant to the
terms hereof, the restrictions of Section 10(c) hereof shall cease to apply to
such share. Reasonably promptly after a share of Restricted Stock vests
pursuant to the terms hereof, Bion Environmental Technologies, Inc. shall
cause to be issued and delivered to the Participant to whom such shares were
granted, a certificate evidencing such share, free of the legend set forth in
Paragraph 10(d)(1) hereof, together with any other property of the Participant
held by the custodian pursuant to Section 14(b) hereof.
(f) Effect of Termination of Employment
(1) In the event that the employment of a Participant with
the Company shall terminate for any reason other than Cause prior to the
vesting of shares of Restricted Stock granted to such Participant, a
proportion of such shares, to the extent not forfeited or canceled on or prior
to such termination pursuant to any provision hereof, shall vest on the date
of such termination. The proportion referred to in the preceding sentence
shall be determined by the Committee at the time of the grant of such shares
of Restricted Stock and may be based on the achievement of any conditions
imposed by the Committee with respect to such shares pursuant to Section
10(b). Such proportion may be equal to zero.
(2) In the event of the termination of a Participant's
employment for Cause, all shares of Restricted Stock granted to such
Participant which have not vested as of the date of such termination shall
immediately be forfeited.
(3) In the event that a Non-Employee Participant ceases to
provide services to the Company, all shares of Restricted Stock granted to
such Non-Employee Participant shall vest in accordance with the terms of the
grant.
(g) Effect of Change in Control
Upon the occurrence of a Change in Control, all shares of
Restricted Stock which have not theretofore vested (including those with
respect to which the Issue Date has not yet occurred), or been canceled or
forfeited pursuant to any provision hereof, shall immediately vest.
11. Phantom Stock
Subject to the provisions of the Plan, the Committee may grant shares of
Phantom Stock. Each grant of shares of Phantom Stock shall be evidenced by an
agreement in such form as the Committee shall from time to time approve. Each
grant of shares of Phantom Stock shall comply with and be subject to the
following terms and conditions:
(a) Vesting Date
At the time of the grant of shares of Phantom Stock, the
Committee shall establish a Vesting Date or Vesting Dates with respect to such
shares. The Committee may divide such shares into classes and assign a
different Vesting Date for each class. Provided that all conditions to the
vesting of a share of Phantom Stock imposed pursuant to Section 11(c) hereof
are satisfied, and except as provided in Section 11(d) hereof, upon the
occurrence of the Vesting Date with respect to a share of Phantom Stock, such
share shall vest.
(b) Benefit Upon Vesting
Upon the vesting of a share of Phantom Stock, a Participant shall
be entitled to receive in cash, within 30 days of the date on which such share
vests, an amount in cash in a lump sum equal to the sum of (i) the Fair Market
Value of a Common Share of the Company on the date on which such share of
Phantom Stock vests and (ii) the aggregate amount of cash dividends paid with
respect to a Common Share of the Company during the period commencing on the
date on which the share of Phantom Stock was granted and terminating on the
date on which such share vests.
(c) Conditions to Vesting
At the time of the grant of shares of Phantom Stock, the
Committee may impose such restrictions or conditions, not inconsistent with
the provisions hereof, to the vesting of such shares as it, in its absolute
discretion, deems appropriate. By way of example and not by way of limitation,
the Committee may require, as a condition to the vesting of any class or
classes of shares of Phantom Stock, that the Participant or the Company
achieve certain performance criteria, such criteria to be specified by the
Committee at the time of the grant of such shares.
(d) Effect of Termination of Employment
(1) In the event that the employment of a Participant with
the Company shall terminate for any reason other than Cause prior to the
vesting of shares of Phantom Stock granted to such Participant, a proportion
of such shares, to the extent not forfeited or canceled on or prior to such
termination pursuant to any provision hereof, shall vest on the date of such
termination. The proportion referred to in the preceding sentence shall be
determined by the Committee at the time of the grant of such shares of Phantom
Stock and may be based on the achievement of any conditions imposed by the
Committee with respect to such shares pursuant to Section 11(c). Such
proportion may be equal to zero.
(2) In the event of the termination of a Participant's
employment for Cause, all shares of Phantom Stock granted to such Participant
which have not vested as of the date of such termination shall immediately be
forfeited.
(3) In the event that a Non-Employee Participant ceases to
provide services to the Company, all shares of Phantom Stock granted to such
Non-Employee Participant shall vest in accordance with the terms of the grant.
(e) Effect of Change in Control
Upon the occurrence of a Change in Control, all shares of Phantom
Stock which have not theretofore vested, or been canceled or forfeited
pursuant to any provision hereof, shall immediately vest.
12. Stock Bonuses
Subject to the provisions of the Plan, the Committee may grant Stock
Bonuses in such amounts as it shall determine from time to time. A Stock Bonus
shall be paid at such time and subject to such conditions as the Committee
shall determine at the time of the grant of such Stock Bonus. Certificates for
Common Shares granted as a Stock Bonus shall be issued in the name of the
Participant to whom such grant was made and delivered to such Participant as
soon as practicable after the date on which such Stock Bonus is required to be
paid.
13. Cash Bonuses
Subject to the provisions of the Plan, the Committee may grant, in
connection with any grant of Restricted Stock or Stock Bonus or at any time
thereafter, a cash bonus, payable promptly after the date on which the
Participant is required to recognize income for federal income tax purposes in
connection with such Restricted Stock or Stock Bonus, in such amounts as the
Committee shall determine from time to time; provided however, that in no
event shall the amount of a Cash Bonus exceed 50% of the Fair Market Value of
the related shares of Restricted Stock or Stock Bonus on such date. A Cash
Bonus shall be subject to such conditions as the Committee shall determine at
the time of the grant of such Cash Bonus.
14. Adjustment Upon Changes in Common Shares
(a) Shares Available for Grants
In the event of any change in the number of Common Shares
outstanding by reason of any stock dividend or split, recapitalization,
merger, consolidation, combination or exchange of shares or similar corporate
change, the maximum aggregate number of Common Shares with respect to which
the Committee may grant Options, Stand-Alone SARs, shares of Restricted Stock,
shares of Phantom Stock and Stock Bonuses shall be appropriately adjusted by
the Committee. In the event of any change in the number of Common Shares
outstanding by reason of any other event or transaction, the Committee may,
but need not, make such adjustments in the number and class of Common Shares
with respect to which Options, Stand-Alone SARs, shares of Restricted Stock,
shares of Phantom Stock and Stock Bonuses may be granted as the Committee may
deem appropriate.
(b) Outstanding Restricted Stock and Phantom Stock
Unless the Committee in its absolute discretion otherwise
determines, any securities or other property (including dividends paid in
cash) received by a Participant with respect to a share of Restricted Stock,
the Issue Date with respect to which occurs prior to such event, but which has
not vested as of the date of such event, as the result of any dividend, stock
split, recapitalization, merger, consolidation, combination, exchange of
shares or otherwise, will not vest until such share of Restricted Stock vests,
and shall be promptly deposited with the custodian designated pursuant to
Paragraph 10(d)(2) hereof.
The Committee may, in its absolute discretion, adjust any grant
of shares of Restricted Stock, the Issue Date with respect to which has not
occurred as of the date of the occurrence of any of the following events, or
any grant of shares of Phantom Stock, to reflect any dividend, stock split,
recapitalization, merger, consolidation, combination, exchange of shares or
similar corporate change as the Committee may deem appropriate to prevent the
enlargement or dilution of rights of Participants under the grant.
(c) Outstanding Options, LSARs, Tandem SARs and Stand-Alone
SARs--Certain Increases or Decreases in Issued Shares Without Consideration
Subject to any required action by the shareholders of Bion
Environmental Technologies, Inc., in the event of any increase or decrease in
the number of issued Common Shares resulting from a subdivision or
consolidation of Common Shares or the payment of a stock dividend (but only on
the Common Shares), the Committee shall proportionally adjust the number of
Common Shares subject to each outstanding Option, LSAR, Tandem SAR and
Stand-Alone SAR, and the exercise price per Common Share of each such Option,
LSAR, Tandem SAR and Stand-Alone SAR.
(d) Outstanding Options, LSARs, Tandem SARs and Stand-Alone
SARs--Certain Mergers
Subject to any required action by the shareholders of Bion
Environmental Technologies, Inc., in the event that Bion Environmental
Technologies, Inc. shall be the surviving corporation in any merger or
consolidation (except a merger or consolidation as a result of which the
holders of Common Shares receive securities of another corporation), each
Option, LSAR, Tandem SAR and Stand-Alone SAR outstanding on the date of such
merger or consolidation shall pertain to and apply to the securities which a
holder of the number of Common Shares subject to such Option, LSAR, Tandem SAR
or Stand-Alone SAR would have received in such merger or consolidation.
(e) Outstanding Options, LSARs, Tandem SARs andStand-Alone
SARs--Certain Other Transactions
In the event of (i) a dissolution or liquidation of Bion
Environmental Technologies, Inc., (ii) a sale of all or substantally all of
Bion Environmental Technologies, Inc.'s assets, (iii) a merger or
consolidation involving Bion Environmental Technologies, Inc. in which Bion
Environmental Technologies, Inc. is not the surviving corporation or (iv) a
merger or consolidation involving Bion Environmental Technologies, Inc. in
which Bion Environmental Technologies, Inc. is the surviving corporation but
the holders of Common Shares receive securities of another corporation and/or
other property, including cash, the Committee shall, in its absolute
discretion, have the power to:
(i) cancel, effective immediately prior to the occurrence of
such event, each Option (including each LSAR and Tandem SAR related thereto)
and Stand-Alone SAR outstanding immediately prior to such event (whether or
not then exercisable), and, in full consideration of such cancellation, pay to
the Participant to whom such Option or Stand-Alone SAR was granted an amount
in cash, for each Common Share subject to such Option or Stand-Alone SAR,
respectively, equal to the excess of (A) the value, as determined by the
Committee in its absolute discretion, of the property (including cash)
received by the holder of a Common Share as a result of such event over (B)
the exercise price of such Option or Stand-Alone SAR; or
(ii) provide for the exchange of each Option (including any
related LSAR or Tandem SAR) and Stand-Alone SAR outstanding immediately prior
to such event (whether or not then exercisable) for an option on or stock
appreciation right with respect to, as appropriate, some or all of the
property for which such Option or Stand-Alone SAR is exchanged and, incident
thereto, make an equitable adjustment as determined by the Committee in its
absolute discretion in the exercise price of the option or stock appreciation
right, or the number of shares or amount of property subject to the option or
stock appreciation right or, if appropriate, provide for a cash payment to the
Participant to whom such Option or Stand-Alone SAR was granted in partial
consideration for the exchange of the Option or Stand-Alone SAR.
(f) Outstanding Options, LSARs, Tandem SARs and Stand-Alone
SARs--Other Changes
In the event of any change in the capitalization of Bion
Environmental Technologies, Inc. or corporate change other than those
specifically referred to in Section 14(c), (d) or (e) hereof, the Committee
may, in its absolute discretion, make such adjustments in the number and class
of shares subject to Options, LSARs, Tandem SARs or Stand-Alone SARs
outstanding on the date on which such change occurs and in the per share
exercise price of each such Option, LSAR, Tandem SAR and Stand-Alone SAR as
the Committee may consider appropriate to prevent dilution or enlargement of
rights.
(g) No Other Rights
Except as expressly provided in the Plan, no Participant shall
have any rights by reason of any subdivision or consolidation of shares of
stock of any class, the payment of any dividend, any increase or decrease in
the number of shares of stock of any class or any dissolution, liquidation,
merger or consolidation of Bion Environmental Technologies, Inc. or any other
corporation. Except as expressly provided in the Plan, no issuance by Bion
Environmental Technologies, Inc. of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to the number of
Common Shares subject to an Incentive Award or the exercise price of any
Option, LSAR, Tandem SAR or Stand-Alone SAR.
15. Rights as a Shareholder
No person shall have any rights as a shareholder with respect to any
Common Shares covered by or relating to any Incentive Award granted pursuant
to this Plan until the date of the issuance of a stock certificate with
respect to such shares. Except as otherwise expressly provided in Section 14
hereof, no adjustment to any Incentive Award shall be made for dividends or
other rights for which the record date occurs prior to the date such stock
certificate is issued.
16. No Special Employment Rights; No Right to Incentive Award
Nothing contained in the Plan or any Incentive Award shall confer upon
any Participant any right with respect to the continuation of his employment
by the Company or interfere in any way with the right of the Company, subject
to the terms of any separate employment agreement to the contrary, at any time
to terminate such employment or to increase or decrease the compensation of
the Participant from the rate in existence at the time of the grant of an
Incentive Award.
No person shall have any claim or right to receive an Incentive Award
hereunder. The Committee's granting of an Incentive Award to a Participant at
any time shall neither require the Committee to grant an Incentive Award to
such Participant or any other Participant or other person at any time nor
preclude the Committee from making subsequent grants to such Participant or
any other Participant or other person.
17. Securities Matters
(a) The Company shall be under no obligation to effect the
registration pursuant to the Securities Act of any Common Shares to be issued
hereunder or to effect similar compliance under any state laws.
Notwithstanding anything herein to the contrary, the Company shall not be
obligated to cause to be issued or delivered any certificates evidencing
Common Shares pursuant to the Plan unless and until the Company is advised by
its counsel that the issuance and delivery of such certificates is in
compliance with all applicable laws, regulations of governmental authority and
the requirements of any securities exchange on which Common Shares are traded.
The Committee may require, as a condition of the issuance and delivery of
certificates evidencing Common Shares pursuant to the terms hereof, that the
recipient of such shares make such covenants, agreements and representations,
and that such certificates bear such legends, as the Committee, in its sole
discretion, deems necessary or desirable.
(b) The exercise of any Option granted hereunder shall only be
effective at such time as counsel to the Company shall have determined that
the issuance and delivery of Common Shares pursuant to such exercise is in
compliance with all applicable laws, regulations of governmental authority and
the requirements of any securities exchange on which Common Shares are traded.
The Company may, in its sole discretion, defer the effectiveness of any
exercise of an Option granted hereunder in order to allow the issuance of
shares of Common Stock pursuant thereto to be made pursuant to registration or
an exemption from the registration or other methods for compliance available
under federal or state securities laws. The Company shall inform the
Participant in writing of its decision to defer the effectiveness of the
exercise of an Option granted hereunder. During the period that the
effectiveness of the exercise of an Option has been deferred, the Participant
may, by written notice, withdraw such exercise and obtain the refund of any
amount paid with respect thereto.
(c) With respect to persons subject to Section 16 of the Securities
Exchange Act of 1934, transactions under this Plan are intended to comply with
all applicable conditions of Rule 16b-3 or its successors under the Exchange
Act. To the extent any provision of the Plan, the grant of an Incentive Award,
or action by the Committee fails to so comply, it shall be deemed null and
void, to the extent permitted by law and deemed advisable by the Committee.
18. Withholding Taxes
(a) Cash Remittance
Whenever Common Shares are to be issued upon the exercise of an
Option, the occurrence of the Issue Date or Vesting Date with respect to a
share of Restricted Stock or the payment of a Stock Bonus, the Company shall
have the right to require the Participant to remit to the Company in cash an
amount sufficient to satisfy federal, state and local withholding tax
requirements, if any, attributable to such exercise, occurrence or payment
prior to the delivery of any certificate or certificates for such shares. In
addition, upon the exercise of an LSAR, Tandem SAR or Stand-Alone SAR, the
grant of a Cash Bonus or the making of a payment with respect to a share of
Phantom Stock, the Company shall have the right to withhold from any cash
payment required to be made pursuant thereto an amount sufficient to satisfy
the federal, state and local withholding tax requirements.
(b) Stock Remittance
At the election of the Participant, subject to the approval of
the Committee, when Common Shares are to be issued upon the exercise of an
Option, the occurrence of the Issue Date or the Vesting Date with respect to a
share of Restricted Stock or the grant of a Stock Bonus, in lieu of the
remittance required by Section 18(a) hereof, the Participant may tender to the
Company a number of Common Shares determined by such Participant, the Fair
Market Value of which at the tender date the Committee determines to be
sufficient to satisfy the federal, state and local withholding tax
requirements, if any, attributable to such exercise, occurrence or grant and
not greater than the Participant's estimated total federal, state and local
tax obligations associated with such exercise, occurrence or grant.
(c) Stock Withholding
At the election of the Participant, subject to the approval of
the Committee, when Common Shares are to be issued upon the exercise of an
Option, the occurrence of the Issue Date or the Vesting Date with respect to a
share of Restricted Stock or the grant of a Stock Bonus, in lieu of the
remittance required by Section 18(a) hereof, the Company shall withhold a
number of such shares determined by such Participant, the Fair Market Value of
which at the exercise date the Committee determines to be sufficient to
satisfy the federal, state and local withholding tax requirements, if any,
attributable to such exercise, occurrence or grant and is not greater than the
Participant's estimated total federal, state and local tax obligations
associated with such exercise, occurrence or grant.
19. Amendment of the Plan
The Plan will have no fixed termination date, but may be terminated at
any time by the Board of Directors. Incentive Awards outstanding as of the
date of any such termination will not be affected or impaired by the
termination of the Plan. The Board of Directors may amend, alter, or
discontinue the Plan, but no amendment, alteration or discontinuation shall be
made which would (i) impair the rights of a Participant without the
Participant's consent, except such an amendment which is necessary to cause
any Incentive Award or transaction under the Plan to qualify, or to continue
to qualify, for the exemption provided by Rule 16b-3, or (ii) disqualify any
Incentive Award or transaction under the Plan from the exemption provided by
Rule 16b-3. In addition, no such amendment may be made without the approval of
the Company's shareholders to the extent such approval is required by law or
agreement.
20. No Obligation to Exercise
The grant to a Participant of an Option, LSAR, Tandem SAR or Stand-Alone
SAR shall impose no obligation upon such Participant to exercise such Option,
LSAR, Tandem SAR or Stand-Alone SAR.
21. Nontransferability
Unless the Committee provides otherwise, (i) no right or interest of a
Participant in any Incentive Award may be pledged, encumbered, or hypothecated
to or in favor of any party other than the Company or a Subsidiary, or shall
be subject to any lien, obligation, or liability of such Participant to any
other party other than the Company or a Subsidiary, and (ii) no Incentive
Award shall be assignable or transferable by a Participant other than by will
or the laws of descent and distribution.
22. Expenses and Receipts
The expenses of the Plan shall be paid by the Company. Any proceeds
received by the Company in connection with any Incentive Award will be used
for general corporate purposes.
23. Suspension or Termination of Incentive Award
In addition to the remedies of the Company elsewhere provided for herein,
if the Committee reasonably believes that a Participant has committed an act
of misconduct as described in this Section, the Committee may suspend the
Participant's rights to exercise any Incentive Award pending a determination
by the Board of Directors. If the Board of Directors determines a Participant
has committed an act of misconduct, including, but not limited to,
embezzlement, fraud, dishonesty, nonpayment of any obligation owed to the
Company, breach of fiduciary duty or deliberate disregard of the Company's
rules resulting in loss, damage or injury to the Company, or a Participant
makes an unauthorized disclosure of any Company trade secret or confidential
information, engages in any conduct constituting unfair competition, induces
any Company customer to breach a contract with the Company, induces any
principal for whom the Company acts as agent to terminate such agency
relationship, or has failed to comply with the terms and conditions of the
Plan or any agreement executed by such Participant evidencing an Incentive
Award, unless such failure has been remedied by such Participant within 10
days after having been notified of such failure by the Committee, neither the
Participant nor his or her estate, executors, administrators, or heirs, shall
be entitled to exercise any Incentive Award whatsoever. In making such
determination, the Board of Directors shall act fairly and shall give the
Participant an opportunity to appear and present evidence on his or her behalf
at a hearing before a committee of the Board of Directors. For any Participant
who is an "Executive Officer" for the purposes of Section 16 of the Securities
Exchange Act of 1934, as amended, a determination of the Board of Directors
shall be subject to the approval of the Committee.
24. Code Section 162(m).
The Committee, in its sole discretion, may require that one or more
Incentive Awards contain provisions which provide that, in the event Section
162(m) of the Code, or any successor provision relating to excessive employee
remuneration, would operate to disallow a deduction by the Company for all or
part of any Incentive Award under the Plan, a Participant's receipt of the
portion of such Incentive Award that would not be deductible by the Company
shall be deferred until the next succeeding year or years in which the
Participant's remuneration does not exceed the limit set forth in such
provision of the Code.
25. Effective Date of Plan
The Plan shall be effective as of April 15, 2001.
EX-99
15
bionex991.txt
BION ENVIRONMENTAL EX 99.1 TO 8-K DTD 9/6/01
EXHIBIT 99.1
Monday August 6, 2:54 pm Eastern Time
Press Release
SOURCE: Bion Environmental Technologies, Inc.
Bion Selected for Evaluation of Environmentally Superior Technology
Bion to be Part of North Carolina Demonstration Effort
NEW YORK, NY--(BUSINESS WIRE)--Aug. 6, 2001--Bion Environmental Technologies,
Inc. (Bion-OTCBB)'s patented nutrient management system (Bion NMS(TM)) has
been selected for funding under North Carolina's "Environmental Superior
Technology" program.
The program is funded under the voluntary agreement by and between North
Carolina and Smithfield Foods and the Premium Standard Farms unit of Conti
Group, Inc., to develop and demonstrate solutions to the waste (air, water and
nutrient) from large hog raising facilities. The program will provide funding
for the new generation Bion system. The Bion NMS will be the centerpiece of a
project led by the engineering firm of Wright-Pierce, Inc. to demonstrate a
comprehensive, environmentally-sound management approach for swine manure. The
Bion NMS will be a fully contained, tanked system with computerized monitoring
and control capability. The Bion NMS is designed to resolve all problems
associated with the nutrients, odors and pathogens generated by hogs raised in
concentrated animal feeding operations (CAFOs). The panel of experts from
academia, animal agribusinesses, environmental, agricultural, government and
community interests has selected this project, as one of several, from nearly
100 proposals to receive funds for pilot demonstration facilities in North
Carolina.
Wright-Pierce, experts in the beneficial reuse of organic wastes, combined
Bion's technology with equipment to dry the BionSoil produced by the Bion NMS
to form a comprehensive system for swine manure management. "We selected the
Bion system because it addresses, at low cost, all of the principal
environmental problems, while creating valuable products," said Mike Giggey,
Wright-Pierce's Senior Vice President. "Working with the faculty of North
Carolina State University, and in particular Dr. Mike Williams, we believe
that this demonstration project will show that there is a technically workable
and environmentally viable solution for a significant environmental problem in
North Carolina."
David Mitchell, Chief Executive Officer of Bion, said, "We believe that the
Bion NMS project in collaboration with the NCSU Animal & Poultry Waste
Management Center, under the direction of Dr. Mike Williams, will validate the
Bion solution to the waste problems faced by companies and farmers involved in
large scale commercial hog raising in North Carolina and elsewhere." Bion
anticipates that final agreements related to the project will be completed by
the end of August 2001.
Bion Environmental Technologies, Inc., a publicly traded company (symbol:
BION), is a full service waste management company that has served the
Livestock Industry since 1989. The Company uses technologies that are
revolutionizing the way farm management is addressed by expanding both
economic and environmental opportunities. Bion systems incorporate a patented
biological process that safely converts animal waste into nutrient rich soil
and fertilizer products, which are valued for their high organics, slow
release nutrients, and odorless characteristics. Bion's family of products are
used in home gardens, potting soils, organic farms, golf courses, athletic
fields, and soil remediation projects. There are currently 14 Bion systems
across the nation. The company has recently developed a tank-based system,
which converts animal waste into a nutrient rich fertilizer within a 12-hour
cycle. The new systems have real time electronic monitoring and sensing
controls that precisely track the fate of all nutrient elements and air
emissions. The second-generation systems will be put into commercial operation
later this year.
This material includes forward-looking statements based on management's
current reasonable business expectations. These statements are made in
reliance on the Private Securities Litigation Reform Act, Section 27A of the
Securities act of 1933, as amended. There are numerous risks and uncertainties
that could result in actual results differing materially from expected
outcomes. The material should be read in conjunction with the Company's
current annual and quarterly reports filed with the SEC, which contain
discussions of currently known factors that could significantly impact the
Company's future expectations.
----------------------
Contact:
Bion Environmental Technologies, Inc.
David Mitchell, 212/758-6622
EX-99
16
bionex992.txt
BION ENVIRONMENTAL EX 99.2 TO 8-K DTD 9/6/01
EXHIBIT 99.2
Wednesday August 22, 11:18 am Eastern Time
Press Release
SOURCE: Bion Environmental Technologies, Inc.
Bion Announces Mass Balance Trials Successfully Completed and Further
Development of Integrated Energy Platform
NEW YORK--(BUSINESS WIRE)--Aug. 22, 2001--Bion announces today the Mass
Balance Analysis of its DreamMaker NMS (Nutrient Management System)(TM) in New
York State (announced December 12, 2000) has been completed with extremely
positive results.
The phosphorus and nitrogen removals from the total CAFO (Confined Animal
Feeding Operation) waste stream approximated 80%. Additionally, measurements
on the primary odor producing compounds indicate levels low enough to
essentially eliminate odor problems associated with CAFO waste handling.
"The Bion NMS(TM) reductions of phosphorus and nitrogen from CAFO waste
streams combined with the demonstrated low levels of odor producing elements
will allow dairies and hog raising facilities to operate in an economically
and environmentally satisfactory manner," according to Dr. James Morris,
Bion's Chief Technology Officer.
Further research and development will be focused on the system acceleration of
the current Bion NMS(TM) system to increase capacity and lower costs as well
as integrating the Bion NMS(TM) with a methane digestion system, in order to
create additional revenue streams from the sale of electricity and natural
gas.
"We are confident that the Bion NMS(TM) can be run at significantly higher
speeds which will substantially reduce the costs to both Bion and its
clients," said David Mitchell. "Further, if we can successfully integrate
Bion's technology with methane digestion, Bion will be able to provide a
technology platform which will fully utilize the valuable resources
(nutrients, water and energy) in the CAFO waste stream to generate revenue for
Bion from waste fees, BionSoil(R) and Fertilizer products, and electricity
generation."
The Bion NMS(TM) at DreamMaker Dairy has been developed based on Bion's
existing technology platform. The accelerated Bion NMS(TM) technology, first
deployed at DreamMaker during the fall of 2000, has now been placed in a fully
contained tank system. This NMS(TM) has a real-time computerized monitoring
and control system, which enables Bion to record and alter the material
operating conditions of the NMS(TM) and to correlate the data obtained in the
Mass Balance Analysis. The computerized module allows the NMS(TM) to be
remotely monitored to insure efficient operation. This capability not only
allows superior waste handling, but also allows Bion to control the parameters
associated with the production of BionSoil and Fertilizer, Bion's line of
organic soil and fertilizer products, insuring a level of organic consistency
presently unobtainable in the marketplace. As a result, organic soil products
will for the first time be able to be marketed with the consistent quality of
chemical soil and fertilizer products. This will allow Bion to utilize
existing large sale distribution channels, for the roll-out of its BionSoil
and Fertilizer products.
The Mass Balance Analysis at DreamMaker is based on seven separate
comprehensive sets of system sampling data taken from July 16 through August
6, 2001. The data was analyzed by two independent laboratories. Essentially,
Mass Balance Analysis traces the components of the entire waste stream in a
CAFO, starting from the the animal, through all air, solid and water volumes
until it leaves the Bion NMS(TM) system.
The waste stream is processed in tanks and all water and solid volumes and
components are accounted for upon entering the tanks, and all air, solids and
effluent emissions are quantified and identified exiting the tanks. As a
result, Bion can account for all of the component parts of the waste stream
and provide a report based upon samples analyzed by independent labs
documenting as to the disposition of each aspect of the waste stream. This
total accounting is referred to as Mass Balance Analysis. It essentially
quantifies each component of the waste stream entering the system and
subsequently verifies what becomes of each component in the system. As an
example, the results demonstrate that approximately 80% of the phosphorus
entering the system in the waste stream is exiting the Bion NMS(TM) as part of
the solids that will be processed into BionSoil and Fertilizer. That
significantly reduces the phosphorus volume in the effluent, which is a major
source of water pollution and, as a result, this scientific data quantifies
the benefit both environmentally, and financially, since the removal of
phosphorus from waste water is a known cost to the waste water treatment
industry.
"Bion will be able to guarantee the minimized levels of nutrients in the
effluent from its systems. This will be an integral part of our commercial
service contracts going forward. Mass Balance Analysis provides real time
accounting and verification, which will be a key for further acceptance by the
CAFO industry, environmentalists and state and federal regulatory
communities," said David Mitchell.
Bion Environmental Technologies, Inc., a publicly traded company (symbol:
BION), is a full service waste management company that has served the
Livestock Industry since 1989. The Company uses technologies that are
revolutionizing the way farm management is addressed by expanding both
economic and environmental opportunities. Bion systems incorporate a patented
biological process that safely converts animal waste into nutrient rich soil
and fertilizer products, which are valued for their high organics, slow
release nutrients, and odorless characteristics. Bion's family of products are
used in home gardens, potting soils, organic farms, golf courses, athletic
fields, and soil remediation projects. There are currently 14 Bion systems
across the nation.
This material includes forward-looking statements based on management's
current reasonable business expectations. These statements are made in
reliance on the Private Securities Litigation Reform Act, Section 27A of the
Securities act of 1933, as amended. There are numerous risks and uncertainties
that could result in actual results differing materially from expected
outcomes. The material should be read in conjunction with the Company's
current annual and quarterly reports filed with the SEC, which contain
discussions of currently known factors that could significantly impact the
Company's future expectations.
------------------------
Contact:
Bion Environmental Technologies, Inc., New York
David Mitchell, 212/758-6622