Exhibit 10.2
WARRANT FOR THE PURCHASE
OF
SHARES OF COMMON STOCK
OF
NATURE
VISION, INC.
THE
SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, OR APPLICABLE STATE SECURITIES
LAW. THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT
AND MAY NOT BE OFFERED FOR SALE, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ASSIGNED OR OTHERWISE DISPOSED OF, AND NO TRANSFER OF THE
SECURITIES WILL BE MADE BY THE COMPANY OR ITS TRANSFER AGENT, IN
THE ABSENCE OF SUCH REGISTRATION OR AN OPINION OF COUNSEL
ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED.
For value received, Nature Vision, Inc., a
Minnesota corporation (the “ Company ”), hereby
grants to Jeffrey P. Zernov , or his successors or assigns
(the “ Lender ”) the right (the “
Warrant ”) to subscribe for and purchase from the
Company, 50,555 of the fully paid and nonassessable shares
of common stock of the Company (the “ Warrant Shares
”). The Exercise Price will initially be $.90,
which is the closing price on the date of issuance of this Warrant,
subject to adjustment as described herein. For purposes
of this Agreement, the “ Exercise Price ” means
the amount payable for exercise of the Warrant for the total number
of Warrant Shares being exercised hereunder at the warrant exercise
price stated in the preceding sentence. The Warrant may
be exercised by the Lender at any time or from time to time from
and after October 28, 2008, and on or prior to October 27,
2010.
The Warrant is subject to the following
provisions, terms and conditions:
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Procedure . The rights represented by the
Warrant may be exercised by the holder hereof, in whole or in part,
by written notice of exercise delivered to the Company at least
twenty (20) days prior to the intended date of exercise and by the
surrender of the Warrant (properly endorsed if required) at the
principal office of the Company and upon payment to the Company by
cash, certified check or bank draft of the purchase price for the
Warrant Shares being so purchased. The Warrant Shares so
purchased will be deemed to be issued as of the close of business
on the date on which the Warrant has been exercised by payment to
the Company of the Exercise Price.
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Cashless
Exercise . In
lieu of exercising the Warrant as described above, the registered
holder may elect to receive Warrant Shares equal to the value (as
determined below) of the Warrant (or the portion thereof being
canceled) by surrender of the Warrant at the principal office of
the Company, together with notice of such election (which notice
will include the number of Warrant Shares being exercised
hereunder), in which event the Company will issue to the registered
holder a certificate representing that number of Warrant Shares
equal to the quotient of the following: (a) the
fair market value of the Warrant Shares being exercised (the
“ Exercised Units ”) on the date of such payment
or receipt by the Company of such notice (unless such notice
specifies a later date, in which case it will be such specified
date) (the “ Exercise Date ”) which fair market
value will be determined by subtracting (A) the aggregate
Exercise Price of the Exercised Units immediately prior to the
exercise of the Warrant from (B) the aggregate fair market
value of the Exercised Units on the Exercise Date; divided
by (b) the fair market value of one Warrant Unit as of the
Exercise Date. No fractional Warrant Shares will be
issuable upon exercise of the Warrant, and if the number of Warrant
Shares to be issued determined in accordance with the foregoing
formula is other than a whole number, the Company will pay to the
registered holder an amount in cash equal to the fair market value
of the resulting fractional share on the Exercise Date.
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Certificates . Certificates will be issued
representing the applicable Warrant Shares as soon as practicable
following the Exercise Date. Unless the Warrant has
expired, following any exercise of the Warrant a new warrant
representing the number of Warrant Shares, if any, with respect to
which the Warrant has not been exercised will also be delivered to
the holder hereof. No fractional Warrant Shares will be
issued upon the exercise of the Warrant.
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Valuation . For purposes of this
Section 1, the “ fair market value ” of the
Warrant Shares will be the average of the closing prices quoted on
the NASDAQ system (or similar system) over the ten day period
ending three days before the day the current fair market value of
the securities is being determined. However, if at any
time the Warrant Shares are not listed on any securities exchange
or the over-the-counter market, the current fair market value of
Warrant Shares will be as determined in good faith by the
Company’s Board of Directors (the “ Board
”), unless the Company will become subject to a merger,
acquisition or other consolidation pursuant to which the Company is
not the surviving party, in which case the fair market value of
Warrant Shares will be deemed to be the value received by the
holders of the Company’s common stock. If the
Lender and the Company disagree as to the Board’s
determination of fair market value, the fair market value will be
determined by arbitration under the rules of the American
Arbitration Association, at the Lender’s expense.
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Company
Covenants . The Company covenants and agrees
that all Warrant Shares that may be issued upon the exercise of the
rights represented by the Warrant will, upon issuance, be duly
authorized and issued, fully paid and nonassessable shares of
common stock in the Company. The Company
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