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Exhibit 10.15 SECURITY AGREEMENT THIS SECURITY AGREEMENT (this Agreement) is made as of this 1st day of
August, 2004, by LIFECORE BIOMEDICAL, INC., a Minnesota corporation (the
Debtor), in favor of M&I MARSHALL & ILSLEY BANK, a Wisconsin state banking
corporation (the Secured Party). In order to secure the payment of the obligations of the Debtor to the Secured
Party pursuant to that certain Reimbursement Agreement of even date herewith
(the Reimbursement Agreement) by and between the Debtor and the Secured
Party, all debts and obligations of the Debtor under any interest rate hedging
documents and/or agreements now or hereafter entered into by the Debtor and the
Secured Party with respect to the transaction contemplated by the Reimbursement
Agreement, including, but not limited to, a rate swap transaction, basis swap,
forward rate transaction, commodity option, equity or equity index rate swap,
equity or index option, bond option, interest rate option, foreign exchange
transaction, cap transaction, floor transaction, collar transaction, currency
swap transaction, cross-currency rate swap transaction, currency option or any
similar transaction or combination of similar transactions (including, as
applicable, any ISDA Master Agreement and each schedule, transaction and
confirmation relating to or entered into under an ISDA Master Agreement or any
such other agreement), all as amended, modified, supplemented or extended from
time to time, and including all obligations of the Debtor to reimburse the
Secured Party for any and all amounts paid, and other losses suffered, by the
Secured Party, as a result of the early termination of such transaction, the
amount of which is indeterminate on the date hereof, and each and every other
debt, liability and obligation of every type and description which the Debtor
may now or at any time hereafter owe to the Secured Party (whether such debt,
liability or obligation now exists or is hereafter created or incurred, whether
it arises under or is evidenced by this Agreement, the Reimbursement Agreement,
or any other present or future instrument or agreement or by operation of law,
and whether it is direct or indirect, due or to become due, absolute or
contingent, primary or secondary, liquidated or unliquidated, or sole, joint or
joint and several) (all such debts, liabilities and obligations of the Debtor
to the Secured Party are herein collectively referred to as the Secured
Obligations), the Debtor hereby agrees as follows: 1. SECURITY INTEREST AND COLLATERAL. In order to secure the payment and
performance of the Secured Obligations, the Debtor hereby grants to the Secured
Party a security interest (herein called the Security Interest) in and to the
following property (hereinafter collectively referred to as the Collateral): SEE EXHIBIT A ATTACHED HERETO AND INCORPORATED
HEREIN BY THIS REFERENCE. 2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS. The Debtor hereby represents
and warrants to, and covenants and agrees with, the Secured Party as follows: (a) The Collateral will be used primarily for business purposes. The
Collateral shall be located on the real property located at 3515 Lyman
Boulevard, Chaska, Minnesota 55318.




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(b) The Debtor is a Minnesota corporation and the address of the Debtors
chief executive office is 3515 Lyman Boulevard, Chaska, Minnesota 55318,
and it keeps and will keep all of its books and records with respect to
all of its accounts at such address. The Debtor shall not change its
state of organization or chief executive office without the Secured
Partys prior written consent. The Debtors state of organization has
been its state of organization since the date of the Debtors
organization. (c) If any part or all of the Collateral will become so related to
particular real estate as to become a fixture, the Debtor will promptly
advise the Secured Party as to real estate concerned and the record owner
thereof and execute and deliver any and all instruments necessary to
perfect the Security Interest therein and to assure that such Security
Interest will be prior to the interest therein of the owner of the real
estate. (d) During the preceding one (1) year, the Debtor has not changed its
name or operated or conducted business under any trade name or d/b/a
which is different from its corporate name. The Debtor shall promptly
notify the Secured Party of any change in such name or if it operates or
conducts business under any trade name or d/b/a which is different from
such name. (e) The Debtor has (or will have at the time the Debtor acquires rights
in Collateral hereafter acquired or arising) and will maintain absolute
title to each item of Collateral free and clear of all security
interests, liens and encumbrances, except the Security Interest, and such
other security interests as are permitted under the Reimbursement
Agreement (the Security Interest and the security interests permitted
under the Reimbursement Agreement are hereinafter collectively referred
to as the Permitted Interests), and will defend the Collateral against
all claims or demands of all persons other than the Secured Party and
those holding Permitted Interests. Except as permitted in the
Reimbursement Agreement, the Debtor will not sell or otherwise dispose of
the Collateral or any interest therein. (f) The Debtor will not permit any Collateral to be located in any state
(and, if a county filing is required, in any county) in which a financing
statement covering such Collateral is required to be, but has not in fact
been, filed. (g) The Debtor authorizes the Secured Party to file all of the Secured
Partys financing statements and amendments to financing statements, and
all terminations of the filings of other secured parties, all with
respect to the Collateral, in such form and substance as the Secured
Party, in its sole discretion, may determine. (h) All rights to payment and all instruments, documents, chattel paper
and other agreements constituting or evidencing Collateral are (or will
be when arising or issued) the valid, genuine and legally enforceable
obligation, subject to no defense, set-off or counterclaim (other than
those arising in the ordinary course of business) of each account debtor
or other obligor named therein or in the Debtors records pertaining
thereto as being obligated to pay such obligation. The Debtor will not
agree to any modification, amendment or cancellation of any such
obligation without the Secured Partys prior
written consent, and will not subordinate any such right to payment to
claims of other creditors of such account debtor or other obligor. - 2 -




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(i) The Debtor will (i) keep all Collateral in good repair, working order
and condition, normal depreciation excepted, and will, from time to time,
replace any worn, broken or defective parts thereof; (ii) other than
taxes and other governmental charges contested in good faith and by
appropriate proceedings, promptly pay all taxes and other governmental
charges levied or assessed upon or against any Collateral or upon or
against the creation, perfection or continuance of the Security Interest;
(iii) keep all Collateral free and clear of all security interests, liens
and encumbrances except the Permitted Interests; (iv) at all reasonable
times, permit the Secured Party or its representatives to examine or
inspect any Collateral, wherever located, and to examine, inspect and
copy the Debtors books and records pertaining to the Collateral and its
business and financial condition and to discuss with account debtors and
other obligors requests for verifications of amounts owed to the Debtor;
(v) keep accurate and complete records pertaining to the Collateral and
pertaining to the Debtors business and financial condition and will
submit to the Secured Party such periodic reports concerning the
Collateral and the Debtors business and financial condition as the
Secured Party may from time to time reasonably request; (vi) promptly
notify the Secured Party of any loss or material damage to any Collateral
or of any material adverse change, known to the Debtor, in the prospect
of payment of any sums due on or under any instrument, chattel paper or
account constituting Collateral; (vii) if the Secured Party at any time
so requests promptly deliver to the Secured Party any instrument,
document or chattel paper constituting Collateral, duly endorsed or
assigned by the Debtor to the Secured Party; (viii) at all times keep all
Collateral insured against risks of fire (including so called extended
coverage), theft, collision (in case of collateral consisting of motor
vehicles) and such other risks and in such amounts as the Secured Party
may reasonably request, with any loss payable to the Secured Party to the
extent of its interest and notify the Secured Party in writing of any
loss or damage to the Collateral or any part; (ix) from time to time
execute such financing statements or other forms, including, without
limitation, patent and trademark recordation forms, as the Secured Party
may reasonably deem required to be filed in order to perfect the Security
Interest and, if any Collateral is covered by a certificate of title,
execute such documents as may be required to have the Security Interest
properly noted on a certificate of title; (x) pay when due or reimburse
the Secured Party on demand for all costs of collection of any of the
Secured Obligations and all other out-of-pocket expenses (including in
each case all reasonable attorneys fees) incurred by the Secured Party
in connection with the creation, perfection, satisfaction or enforcement
of the Security Interest or the execution or creation, continuance or
enforcement of this Agreement or any or all of the Secured Obligations
including expenses incurred in any litigation or bankruptcy or insolvency
proceedings; (xi) execute, deliver or endorse any and all instruments,
documents, assignments, security agreements and other agreements and
writings which the Secured Party may at any time reasonably request in
order to secure, protect, perfect or enforce the Security Interest and
the Secured Partys rights under this Agreement, including, without
limitation, an assignment of claim with respect to any account which is a
government receivable; (xii) not use or keep any Collateral, or permit it
to be used or kept, for any unlawful purpose or in violation of any
federal, state or local law, statute or ordinance; (xiii) permit - 3 -




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the Secured Party at any time and from time to time to send requests
(both before and after the occurrence of an Event of Default under the
Reimbursement Agreement) to account debtors or other obligors for
verification of amounts owed to Debtor; and (xiv) not permit any
Collateral to become part of or to be affixed to any real property,
without first assuring to the reasonable satisfaction of the Secured
Party that the Security Interest will be prior and senior to any interest
or lien then held or thereafter acquired by any mortgagee of such real
property or the owner or purchaser of any interest therein. If the
Debtor at any time fails to perform or observe any agreement contained in
this Section 2(i), and if such failure shall continue for a period of ten
(10) calendar days after the Secured Party gives the Debtor written
notice thereof (or, in the case of the agreements contained in clauses
(viii) and (ix) of this Section 2(i), immediately upon the occurrence of
such failure, without notice or lapse of time) the Secured Party may (but
need not) perform or observe such agreement on behalf and in the name,
place and stead of the Debtor (or, at the Secured Partys option, in the
Secured Partys own name) and may (but need not) take any and all other
actions which the Secured Party may reasonably deem necessary to cure or
correct such failure (including, without limitation, the payment of
taxes, the satisfaction of security interests, liens or encumbrances
(other than Permitted Interests), the performance of obligations under
contracts or agreements with account debtors or other obligors, the
procurement and maintenance of insurance, the execution of financing
statements, the endorsement of instruments, and the procurement of
repairs, transportation or insurance); and, except to the extent that the
effect of such payment would be to render any loan or forbearance of
money usurious or otherwise illegal under any applicable law, the Debtor
shall thereupon pay the Secured Party on demand the amount of all moneys
expended and all costs and expenses (including reasonable attorneys
fees) incurred by the Secured Party in connection with or as a result of
the Secured Partys performing or observing such agreements or taking
such actions, together with interest thereon from the date expended or
incurred by the Secured Party at the rate set forth in the Reimbursement
Agreement. To facilitate the performance or observance by the Secured
Party of such agreements of the Debtor, the Debtor hereby irrevocably
appoints (which appointment is coupled with an interest) the Secured
Party, or its delegate, as the attorney-in-fact of the Debtor with the
right (but not the duty) from time to time to create, prepare, complete,
execute, deliver, endorse or file, in the name and on behalf of the
Debtor, any and all instruments, documents, financing statements, forms,
applications for insurance and other agreements and writings required to
be obtained, executed, delivered or endorsed by the Debtor under this
Section 2. 3. ASSIGNMENT OF INSURANCE. The Debtor hereby assigns to the Secured Party, as
additional security for the payment of the Secured Obligations, any and all
moneys (including but not limited to proceeds of insurance and refunds of
unearned premiums) due or to become due under, and all other rights of the
Debtor under or with respect to, any and all policies of insurance covering the
Collateral, and the Debtor hereby directs the issuer of any such policy to pay
any such moneys to the Secured Party. Before and upon the occurrence of an
Event of Default, and at any time thereafter, the Secured Party may (but need
not) in its own name or in the Debtors name, execute and deliver proofs of
claim, receive all such moneys (subject to the Debtors rights), endorse checks
and other instruments representing payment of such monies, and adjust,
litigate, compromise or release any claim against the issuer of any such
policy. - 4 -




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4. COLLECTION OF ACCOUNTS. The Secured Party may, or at the Secured Partys
request, the Debtor shall, either prior to or after the occurrence of an Event
of Default, and at any time thereafter, notify any account debtor or any
obligor on an instrument to make payment directly to a lockbox (the Lockbox)
under the sole control of the Secured Party, whether or not the Secured Party
was theretofore making collections with respect thereto, and the Secured Party
shall be entitled to take control of any proceeds thereof. If so requested by
the Secured Party, the Debtor shall insert appropriate language on each invoice
directing its customers to make payment to the Lockbox. The Debtor hereby
authorizes and directs the Secured Party to deposit into a collateral account
(the Collateral Account) all checks, drafts and cash payments, received in
the Lockbox. All deposits in the Collateral Account shall constitute proceeds
of Collateral and shall not constitute payment of any of the Secured
Obligations. At its option, the Secured Party may, at any time, apply finally
collected funds on deposit in the Collateral Account to the payment of the
Secured Obligations in such order of application as the Secured Party may
determine, or permit the Debtor to withdraw all or any part of the balance on
deposit in the Collateral Account. The Debtor agrees that it will promptly
deliver to the Secured Party for deposit into the Collateral Account, all
payments on accounts and chattel paper received by it. All such payments shall
be delivered to the Secured Party in the form received (except for the Debtors
endorsement where necessary). Until so deposited, all payments on accounts and
chattel paper received by the Debtor shall be held in trust by the Debtor for
and as the property of the Secured Party and shall not be commingled with any
funds or property of the Debtor. 5. REMEDIES. Upon the occurrence of an Event of Default, and at any time
thereafter, the Secured Party may exercise any one or more of the following
rights or remedies if any or all of the Secured Obligations are not paid when
due: (i) exercise and enforce any or all rights and remedies available after
default to a secured party under the Uniform Commercial Code, including but not
limited to the right to take possession of any Collateral, proceeding without
judicial process or by judicial process (without a prior hearing or notice
thereof, which the Debtor hereby expressly waives), and the right to sell,
lease or otherwise dispose of or use any or all of the Collateral; (ii) the
Secured Party may require the Debtor to assemble the Collateral and make it
available to the Secured Party at a place to be designated by the Secured Party
which is reasonably convenient to both parties; (iii) exercise its rights under
any lessors agreements regardless of whether or not the Debtor is in default
under such leases; and (iv) exercise or enforce any or all other rights or
remedies available to the Secured Party by law or agreement against the
Collateral, against the Debtor or against any other person or property. The
Secured Party is hereby granted a non-exclusive, worldwide and royalty-free
license to use or otherwise exploit all trademarks, franchises, copyrights and
patents of the Debtor that the Secured Party deems necessary or appropriate to
the disposition of any Collateral. If notice to the Debtor of any intended
disposition of Collateral or any other intended action is required by law in a
particular instance, such notice shall be deemed commercially reasonable if
given (in the manner specified in Section 6 below) at least ten (10) calendar
days prior to the date of intended disposition or other action. 6. MISCELLANEOUS. This Agreement does not contemplate a sale of accounts or
chattel paper, and, as provided by law, the Debtor is entitled to any surplus
and shall remain liable for any deficiency. This Agreement can be waived,
modified, amended, terminated or discharged, and the Security Interest can be
released, only explicitly in a writing signed by the Secured Party. A waiver
signed by the Secured Party shall be effective only in the specific instance
and for the - 5 -




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purpose given. Mere delay or failure to act shall not preclude the exercise or
enforcement of any of the Secured Partys rights or remedies. All rights and
remedies of the Secured Party shall be cumulative and may be exercised
singularly or concurrently, at the Secured Partys option, and the exercise or
enforcement of any one such right or remedy shall neither be a condition to nor
bar the exercise or enforcement of any other. All notices to be given to the
Debtor shall be deemed sufficiently given if deposited in the United States
mails, registered or certified, postage prepaid, or personally delivered to the
Debtor at its address set forth herein. The Secured Partys duty of care with
respect to Collateral in its possession (as imposed by law) shall be deemed
fulfilled if the Secured Party exercises reasonable care in physically safe
keeping such Collateral or, in the case of Collateral in the custody or
possession of a bailee or other third person, exercises reasonable care in the
selection of the bailee or other third person, and the Secured Party need not
otherwise preserve, protect, insure or care for any Collateral. The Secured
Party shall not be obligated to preserve any rights the Debtor may have against
any other party, to realize on the Collateral at all or in any particular
manner or order, or to apply any cash proceeds of Collateral in any particular
order of application. This Agreement shall be binding upon and inure to the
benefit of the Debtor and the Secured Party and their respective heirs,
representatives, successors and assigns and shall take effect when signed by
the Debtor and delivered to the Secured Party, and the Debtor waives notice of
the Secured Partys acceptance hereof. Except to the extent otherwise required
by law, this Agreement shall be governed by the laws of the State of Minnesota
and, unless the context otherwise requires, all terms used herein which are
defined in Articles 1 and 9 of the Uniform Commercial Code, as in effect in
said state, shall have the meanings therein stated and all capitalized terms
used herein which are defined in the Reimbursement Agreement shall have the
meanings therein stated. If any provision or application of this Agreement is
held unlawful or unenforceable in any respect, such illegality or
unenforceability shall not affect other provisions or applications which can be
given effect, and this Agreement shall be construed as if the unlawful or
unenforceable provision or application had never been contained herein or
prescribed hereby. All representations and warranties contained in this
Agreement shall survive the execution, delivery and performance of this
Agreement and the creation and payment of the Secured Obligations. IN WITNESS WHEREOF, the Debtor has executed and delivered to the Secured Party
this Security Agreement as of the day and year first above written. LIFECORE BIOMEDICAL, INC.By:
    
    /s/ DENNIS J. ALLINGHAMIts: President and CEO
 - 6 -




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EXHIBIT A (Description of Collateral) All of the Debtors Accounts, chattel paper (including, without
limitation, electronic chattel paper and tangible chattel paper),
deposit accounts, documents, Equipment, General Intangibles,
goods, instruments, Inventory, Investment Property,
letter-of-credit rights, letters of credit, patents, patent
rights, copyrights, trademarks, trade names, goodwill, royalty
rights, franchise rights, license rights, software, payment
intangibles, all sums on deposit in any collateral account, any
items in any lockbox, and Receivables; together with (i) all
substitutions and replacements for and products of any of the
foregoing; (ii) proceeds of any and all of the foregoing; (iii) in
the case of all tangible goods, all accessions; (iv) all
accessories, attachments, parts, equipment and repairs now or
hereafter attached or affixed to or used in connection with any
tangible goods; (v) all warehouse receipts, bills of lading and
other documents of title now or hereafter covering such goods;
(vi) all collateral subject to the lien of any Security Document;
(vii) any money, or other assets of the Debtor, that now or
hereafter come into the possession, custody or control of the
Lender; and (viii) all supporting obligations. Capitalized terms
used herein shall have the meanings assigned thereto in Exhibit B
attached hereto.




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EXHIBIT B (Definitions) Accounts means all of the Debtors accounts, as such term is defined in the
Uniform Commercial Code in effect in the State of Minnesota (the UCC),
including without limitation the aggregate unpaid obligations of customers and
other account debtors to the Debtor arising out of the sale or lease of goods
or rendition of services by the Debtor on an open account or deferred payment
basis. Equipment means all of the Debtors equipment, as such term is defined in the
UCC, whether now owned or hereafter acquired, including but not limited to all
present and future machinery, vehicles, furniture, fixtures, manufacturing
equipment, shop equipment, office and recordkeeping equipment, parts, tools,
supplies, and including specifically (without limitation) the goods described
in any equipment schedule or list herewith or hereafter furnished to the
Secured Party by the Debtor. General Intangibles means all of the Debtors general intangibles, as such
term is defined in the UCC, whether now owned or hereafter acquired, including
(without limitation) all present and future patents, patent applications,
copyrights, trademarks, trade names, trade secrets, customer or supplier lists
and contracts, manuals, operating instructions, permits, franchises, the right
to use the Debtors name, and the goodwill of the Debtors business. Investment Property means all of the Debtors investment property, as such
term is defined in the UCC, whether now owned or hereafter acquired, including
but not limited to all securities, security entitlements, securities accounts,
commodity contracts, commodity accounts, stocks, bonds, mutual fund shares,
money market shares and U.S. Government securities. Lockbox means any lockbox established pursuant to any Security Document. Receivables means each and every right of the Debtor to the payment of money,
whether such right to payment now exists or hereafter arises, whether such
right to payment arises out of a sale, lease or other disposition of goods or
other property, out of a rendering of services, out of a loan, out of the
overpayment of taxes or other liabilities, or otherwise arises under any
contract or agreement, whether such right to payment is created, generated or
earned by the Debtor or by some other person who subsequently transfers such
persons interest to the Debtor, whether such right to payment is or is not
already earned by performance, and howsoever such right to payment may be
evidenced, together with all other rights and interests (including all liens
and security interests) which the Debtor may at any time have by law or
agreement against any account debtor or other obligor obligated to make any
such payment or against any property of such account debtor or other obligor;
all including but not limited to all present and future accounts, contract
rights, loans and obligations receivable, chattel papers, bonds, notes and
other debt instruments, tax refunds and rights to payment in the nature of
general intangibles. Security Documents means any document delivered to the Secured Party from
time to time to secure the obligations of the Debtor to the Secured Party.