Exhibit
10.2
VOLUNTARY SURRENDER
AGREEMENT
THIS VOLUNTARY
SURRENDER AGREEMENT (the “Agreement”) is dated as of
August ___, 2009 (the “Effective Date”) and made by and
among:
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Nature
Vision, Inc, a Minnesota
corporation (“NVI”), and Nature Vision Operating,
Inc ., a Minnesota corporation (and together with NVI
hereinafter individually, the “Debtor” and
collectively, the “Debtors”); and
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M&I
Business Credit, LLC , a
Minnesota limited liability company, (hereinafter, together with
its participants, successors and assigns, the
“Creditor”).
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R E C I T A L S:
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Capitalized
terms used but not otherwise defined herein shall have the meanings
set forth in the Credit Agreement (as defined herein).
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Debtors and
Creditor entered into a Credit and Security Agreement dated
November 8, 2007 (as amended or supplemented, the “Credit
Agreement”), whereby the Creditor made loans to Debtors and
Debtors executed and delivered for the Creditor’s benefit
certain Security Documents.
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Pursuant to
Section 3(a) of the Credit Agreement, the Creditor was granted
Security Interests in all Collateral, including all proceeds and
products thereof and, including without limitation, the following:
Debtors’ inventory, documents of title, accounts, equipment
and fixtures, investment property, general intangibles, and other
miscellaneous collateral and all other assets, whether now owned or
hereinafter acquired.
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Creditor has
perfected its Security Interests in the Collateral by, among other
things, filing financing statements with the Secretary of State of
Minnesota. Said financing statements represent a first
secured interest in the Collateral.
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As of August
____, 2009, the Debtors’ Obligations to Creditor equal the
principal sum of $_____________, plus accrued interest of
$___________ (which sums, together with accrued and unpaid fees and
expenses of Creditor, together with all other sums now or hereafter
owing to Creditor under the Credit Agreement and related loan
documents shall be referred to herein as the
“Obligations”).
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Debtors are in
default under the Credit Agreement and unable to cure such defaults
and/or repay its Obligations to the Creditor.
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Creditor has
the right to accelerate and demand immediate payment of all amounts
owing under the Credit Agreement.
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Pursuant to the
Credit Agreement, Creditor has the right to take possession of and
to foreclose upon the Collateral if a defaults exists.
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Creditor has
made demand that Debtors marshal and turn over the
Collateral.
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Debtors have
offered the Collateral for sale for a reasonable time period, have
solicited offers to purchase the Collateral, have received various
offers to purchase the Collateral or portions thereof and have
engaged David Dalvey of Mount Yale Capital Group to assist Debtors
in identifying and soliciting prospective purchasers for the
Collateral. As of the date hereof, the Debtors
have failed to close on any such sales.
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Debtors have
further received an offer (the “Stock Purchase
Transaction”) from Swordfish Financial, Inc.
(“Swordfish Financial”) to purchase approximately
10,987,417 shares of common stock of NVI in exchange for a
promissory note payable to NVI in the amount of $3,500,000 (the
“Swordfish Note”).
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Creditor
desires that Debtors marshal and turn over possession of all
Collateral to Creditor and Debtors have requested that Creditor
provide certain accommodations in connection with the Stock
Purchase Transaction, each pursuant and subject to the terms of
this Agreement.
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NOW, THEREFORE, in consideration of the foregoing, and for other
good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties agree as
follows:
A G R E E M E N T:
1.
Affirmation of Facts . Debtors agree that: (a)
each of the recitals set forth above are true and correct
statements of fact; (b) all agreements and other documents
evidencing and governing the Obligations, including without
limitation, the Credit Agreement, together with all other related
Security Documents and documents executed by or for the benefit of
Creditor are in full force and effect and binding on Debtors; (c)
Debtors are now in default under the aforementioned agreements and
other documents governing the Obligations and acknowledge and agree
that the Creditor has duly demanded and accelerated payment of all
Obligations, each of which are currently due and payable in full to
Creditor; and (d) Creditor has the immediate right to exercise all
rights and remedies under the Credit Agreement and the other
Security Documents, including without limitation, any foreclosure
rights and remedies, without further notice to or consent of any
party.
2.
Demand/Turn Over . Creditor hereby makes demand
for marshalling and turn over of the Collateral (including all
computers, software, books and records (inclusive of all electronic
storage media and passwords as needed to access any such
information) of Debtors related thereto and possession of the
Debtors’ premises located at 1480 Northern Pacific Road,
Brainerd, MN (the “Premises”) and Debtor agrees that it
will tender to Creditor possession of Premises and all of
Collateral on the Effective Date.
3.
Delivery and Cooperation . On and after the
Effective Date, Debtors shall cooperate in the surrender of
Collateral to Creditor (wherever located) for sale or other
foreclosure by Creditor of its security interests and the sale of
Collateral and the collection of accounts receivable, including,
without limitation, forwarding all collections and monies to the
Creditor. Debtors acknowledge and agree that the
existing collateral account arrangements shall (including the
collateral account maintained with Deerwood Bank for the benefit of
Creditor) shall remain in effect; provided however that if Lender
shall request that any accounts receivable (or other Collateral
proceeds) be remitted directly to Creditor, then Debtors shall
provide such notices and take such actions as Creditor may request
to effectuate the same. Debtors shall further cooperate
and assist in all actions necessary to deliver full possession and
access to the Premises to Creditor, including obtaining any consent
or approval of Debtors’ landlord thereto and providing all
necessary keys and security passcodes.
4. Stock
Purchase Transaction . In connection with
Debtors’ proposed Stock Purchase Transaction, Debtors and
Creditor agree as follows:
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Debtors shall
not close or consummate such transactions until after the Effective
Date of this Agreement and after the turnover over and deliver of
possession of the Collateral and Premises to Creditor;
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________________ (“Subordinated
Creditor”) intends to provide a $200,000 loan to Debtors (the
“Subordinated Creditor Loan”) to fund, among other
things, certain obligations and expenses of the Debtors in
consummating the Stock Sale Transaction, which loan is to be
secured by a subordinate security interest in all personal property
of Debtors. Debtors intend to deposit the proceeds of
such Subordinated Creditor Loan in a depository account with
___________ Bank (the “Subordinate Loan
Account”). Creditor will not object to the
foregoing and will not seek to attach or levy against the
Subordinate Loan Account or the funds deposited therein provided
that Debtors shall cause the Subordinated Creditor to execute and
deliver a Subordination Agreement in favor of Creditor pursuant to
which the Subordinated Creditor shall subordinate the repayment of
the Subordinated Creditor Loan and its security interest in the
Collateral to the repayment of the Obligations owing to Creditor
and Creditor’s security interest in such assets;
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Debtors shall
and shall cause Swordfish Financial to deliver the original
Swordfis
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