Exhibit 10.5

STOCKHOLDERS AGREEMENT

     This Stockholders Agreement is made as of February 28, 2005, (this
“Agreement”), by and among NationsHealth, Inc., a Delaware corporation (the
“Company”), RGGPLS Holding, Inc., a Florida corporation (“RGGPLS”), GRH
Holdings, L.L.C., a Florida limited liability company (“GRH”), MHR Capital
Partners LP (“Capital Partners”), OTQ LLC (“OTQ”) and MHR Capital Partners
(100) LP (“Capital Partners 100,” and together with Capital Partners and OTQ,
the “Holders”).

     WHEREAS, the Company and the Holders have entered into the Investment Unit
Purchase Agreement, dated as of the date hereof (the “Purchase Agreement”),
pursuant to which the Holders purchased in the aggregate, 15,000 Units,
consisting in the aggregate of (x) $15,000,000 in principal amount of Notes and
(y) 1,785,714 shares of Common Stock (as defined below). All capitalized terms
not defined herein shall have the meanings as set forth in the Purchase
Agreement

     WHEREAS, the Company, RGGPLS and the Holders desire to make certain
covenants and agreements set forth herein with respect to the voting of certain
shares of Common Stock held by the Holders and certain other matters.

     NOW THEREFORE, in consideration of the premises and the covenants and
agreements contained herein, the parties hereto agree as follows:

ARTICLE I

Definitions

     SECTION 1.01 Definition of Certain Terms Used Herein. As used herein, the
following terms shall have meanings specified below:

          “Affiliate” shall mean, with respect to any person, any other person
that directly or indirectly through one or more intermediaries controls or is
controlled by or is under common control with such person. For the purposes of
this definition, “control” when used with respect to any particular person,
means the power to direct the management and policies of such person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.

          “Affiliate Shares” shall mean the lesser of (i) such number of shares
of Common Stock, which were Capital Partners Shares, OTQ Shares or Capital
Partners 100 Shares at any time prior to the Transfer thereof, which were
Transferred in one or more transactions, among MHR and its Affiliates, and that
are after the Transfer thereof directly beneficially owned by either MHR or any
of its Affiliates (other than Capital Partners, OTQ or Capital Partners
100)(each an “Affiliate Transferee”), and (ii) all shares of Common Stock
directly beneficially owned by such Affiliate Transferee at any time after the
Transfer of such Capital Partners Shares, OTQ Shares or Capital Partners 100
Shares to such Affiliate Transferee. For avoidance of doubt, no shares of Common
Stock shall be deemed to be Affiliate Shares unless and until

 

--------------------------------------------------------------------------------

 

such shares cease to be either Capital Partners Shares, OTQ Shares or Capital
Partners 100 Shares.

          “beneficial owner” shall have the meaning assigned to such term in
Rule 13d-3 under the Exchange Act.

          “Board of Directors” shall mean the Board of Directors of the Company.

          “Capital Partners Shares” shall mean the lesser of (i) 900,027 shares
of Common Stock directly beneficially owned by Capital Partners and (ii) all
shares of Common Stock directly beneficially owned by Capital Partners.

          “Capital Partners 100 Shares” shall mean the lesser of (i) 120,211
shares of Common Stock directly beneficially owned by Capital Partners 100 and
(ii) all shares of Common Stock directly beneficially owned by Capital Partners
100.

          “Common Stock” shall mean the common stock, par value $0.0001 per
share, of the Company.

          “directors” shall mean members of the Board of Directors.

          “DGCL” shall mean the Delaware General Corporation Law, as amended.

          “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder.

          “Holder” shall mean each Holder listed on the signature page hereto.
If a Holder Transfers any shares of Common Stock to an Affiliate, such Affiliate
will be deemed to be a Holder for purposes of this Agreement with respect to the
shares of Common Stock so Transferred.

          “OTQ Shares” shall mean the lesser of (i) 765,476 shares of Common
Stock directly beneficially owned by OTQ and (ii) all shares of Common Stock
directly beneficially owned by OTQ.

          “Other Matter” shall mean any matter (including the election of
directors to the Board of Directors) brought before a Stockholders Meeting and
proposed or sponsored by a person other than RGGPLS, to be acted upon by the
stockholders of the Company.

          “MHR” shall mean MHR Fund Management LLC, its Affiliates and any
Person, directly or indirectly, managed or controlled by MHR Fund Management LLC
or its Affiliates, including without limitation, Capital Partners, OTQ and
Capital Partners 100.

          “Notes” shall mean the 7 3/4% Convertible Secured Notes purchased
pursuant to the Investment Agreement.

2

--------------------------------------------------------------------------------

 

          “Person” shall mean an individual, a partnership, a corporation, a
limited liability company, a business trust, a joint stock company, a trust, an
unincorporated association, a joint venture, or any other entity of whatever
nature.

          “RGGPLS Director” shall mean any RGGPLS Nominee who is elected to the
Board of Directors.

          “RGGPLS Matter” shall mean any matter brought before a Stockholders
Meeting and proposed or sponsored by RGGPLS to be acted upon by the stockholders
of the Company at such Stockholders Meeting.

          “RGGPLS Nominee” shall mean any person nominated by RGGPLS for
election as a director to the Board of Directors.

          “Stockholders Meeting” shall mean (i) any annual or special meeting of
the stockholders of the Company or (ii) any action by written consent of the
stockholders of the Company.

          “Transfer” shall mean the direct or indirect offer, sale, donation,
assignment (as collateral or otherwise), pledge, hypothecation, encumbrance,
transfer or disposition of any security or an agreement to do any of the
foregoing.

     SECTION 1.02 Usage. The definitions in this Article I shall apply equally
to both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. All references in this Agreement to Articles, Sections and
Schedules shall be deemed to be references to Articles, Sections and Schedules
of or to this Agreement, unless the context shall otherwise require. The words
“include”, “includes” and “including” shall be deemed to be followed by the
phrase “without limitation”, regardless of whether such phrase so appears.

ARTICLE II

Representations and Warranties

     SECTION 2.01 Representations and Warranties of the Company. The Company
hereby represents and warrants to each other party as follows: (i) the Company
is a corporation duly organized and validly existing under the laws of the State
of Delaware and has all requisite corporate power and authority to execute and
deliver this Agreement, to carry out the provisions hereof and to perform its
obligations hereunder; (ii) the execution, delivery and performance by the
Company of its obligations under this Agreement and the consummation by it of
the transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of the Company; and (iii) this Agreement has been
duly and validly executed and delivered by the Company and constitutes a legal,
valid and binding obligation of the Company, enforceable against it in
accordance with its terms.

     SECTION 2.02 Representations and Warranties of the Stockholders. Each of
RGGPLS and GRH and each Holder, hereby represents and warrants to each other
party as follows: (i) the execution, delivery and performance by such person of
its obligations under this Agreement and

3

--------------------------------------------------------------------------------

 

the consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary corporate or other action on the part of such
person; and (ii) this Agreement has been duly and validly executed and delivered
by such person and constitutes the legal, valid and binding obligation of such
person, enforceable against it in accordance with its terms.

ARTICLE III

Voting

     SECTION 3.01 Agreement to Vote. Subject to Section 3.03(c), at each and
every Stockholders Meeting, each of the Holders hereby agrees (x) if any annual
or special meeting of the stockholders of the Company is held, to appear at such
meeting or otherwise cause any Affiliate Shares, Capital Partners Shares, OTQ
Shares or Capital Partners 100 Shares owned by such Holder to be counted as
present thereat for purposes of establishing a quorum, and (y) to vote or to act
by written consent with respect to (or cause to be voted or acted upon by
written consent), all Affiliate Shares, Capital Partners Shares, OTQ Shares and
Capital Partners 100 Shares, owned by such Holder, in each case:

     (A) In favor of:

  (i)   All of the RGGPLS Nominees (if directors are to be elected at such
Stockholders Meeting);     (ii)   Any RGGPLS Matter; and/or     (iii)   Any
Other Matter, only if RGGPLS directs (by written notice) the Holder to vote in
favor of such Other Matter; and

     (B) Against:

  (i)   The election of any person or persons nominated in opposition to the
RGGPLS Nominees (if directors are to be elected at such Stockholders Meeting);  
  (ii)   Any matter brought before such Stockholders Meeting to be acted upon by
the stockholders of the Company that is in opposition to an RGGPLS Matter;
and/or     (iii)   Any Other Matter, only if RGGPLS directs (by written notice)
the Holder to vote against such Other Matter.

For the avoidance of doubt, it is agreed by the parties hereto that the
aggregate number of Affiliate Shares, Capital Partners Shares, OTQ Shares and
Capital Partners 100 Shares shall not exceed 1,785,714 shares of Common Stock
(subject to adjustment from time to time to reflect any stock dividends, stock
splits, stock issuances, reverse stock splits, combinations, recapitalizations,
reclassifications, mergers, consolidations or other similar transactions).

4

--------------------------------------------------------------------------------

 

     SECTION 3.02 Grant of Irrevocable Proxy. Subject to Section 3.03(c), each
Holder hereby irrevocably grants to and appoints RGGPLS (and any executive
officer of RGGPLS or each of them individually), the Holder’s proxy and
attorney-in-fact (with full power of substitution), for and in the name, place
and stead of the Holder, to vote, act by written consent or grant a consent,
proxy or approval in respect of such shares of Common Stock with respect to such
vote or action by written consent exclusively as agreed by the Holder in this
Agreement, in the event that the Holder shall fail at any time to vote or act by
written consent with respect to any Affiliate Shares, Capital Partners Shares,
OTQ Shares or Capital Partners 100 Shares as agreed by the Holders in this
Agreement. Each Holder hereby affirms that any such irrevocable proxy set forth
in this Section 3.02 is given to secure the performance of obligations of the
Holder under this Agreement. Each Holder hereby further affirms that any such
proxy hereby granted shall be irrevocable and shall be deemed coupled with an
interest, in accordance with Section 212(e) of the DGCL. Each Holder agrees to
execute and deliver any further powers of attorney, consents, proxies or other
agreements necessary or appropriate to give effect to this Section 3.02.

     SECTION 3.03 Board of Directors.

     (a) From and after the effectiveness of this Agreement and until the
provisions of this Section 3.03 cease to be effective pursuant to
Section 3.03(b), each of the Company, RGGPLS and GRH shall vote all of his, her
or its Common Stock over which such person has voting control and any other
voting securities of the Company over which such person has voting control at
any Stockholders Meeting and shall take all other necessary or desirable actions
within his, her or its control (including, without limitation, attendance at
meetings in person or by proxy for purposes of obtaining a quorum and execution
of written consents in lieu of meetings), and the Company shall take all
necessary and desirable actions within its control (including, without
limitation, calling special board and Stockholders Meetings), to cause (i) the
nomination and the election of one Person designated by MHR as a director (the
“MHR Director”) and provide that MHR shall have the right to designate one
Person to be a representative who shall be permitted to attend all meetings of
the Board of Directors, including all committees thereof, solely in a non-voting
capacity (an “MHR Observer”); provided, however, at the sole discretion of MHR,
MHR may choose not to designate anyone to be an MHR Director in which case it
shall be entitled to select two MHR Observers and (ii) the authorized size of
the Board of Directors to be sufficient to satisfy MHR’s right to designate an
MHR Director or one or more MHR Observers, as the case may be, including,
without limitation, by way of resolution of the Board of Directors or amendment
to the certificate of incorporation or by-laws of the Company. MHR shall have
the right to remove and replace any MHR Director or MHR Observer in its sole
discretion, with or without cause. Any Person designated by MHR as an MHR
Director or MHR Observer shall be subject to the written approval of the
Company, which approval shall not be unreasonably withheld, prior to such person
being able to serve on or observe the Board of Directors; provided, however,
that the Company hereby approves each of Mark H. Rachesky and Emily Fine to
serve on or observe the Board of Directors.

     (b) The provisions of this Section 3.03 shall remain in full force and
effect so long as: (i) MHR beneficially owns at least $5,000,000 in principal
amount of the Notes or (ii) MHR beneficially owns at least 1,000,000 shares of
Common Stock.

5

--------------------------------------------------------------------------------

 

     (c) The parties agree that the Holders shall have no obligations under
Section 3.01 and Section 3.02, and the proxy granted under Section 3.02 shall
become null and void and have no further force and effect, at any time following
a breach of this Agreement by RGGPLS or GRH which results in the persons
designated by MHR not being nominated and elected as an MHR Director (as defined
below) and/or not being allowed to attend and participate in all meetings of the
Board of Directors as an MHR Observer (as defined below) pursuant to this
Section 3.03.

     SECTION 3.04 Certain Actions. Each Holder and each of the Company, RGGPLS,
GRH agrees that it will, and will cause its subsidiaries and Affiliates to, take
all action as a stockholder of the Company or as is otherwise within its control
as are necessary to give effect to the provisions of this Agreement and to
perform, pay and satisfy all of their respective obligations and liabilities
hereunder as and when due.

ARTICLE IV

Covenants

     SECTION 4.01 Transfer of Common Shares to Affiliates. Each of the Holders
hereby agrees that it will not Transfer any Common Shares to an Affiliate unless
such Affiliate agrees to be bound by the terms of this Agreement pursuant to the
execution of a joinder agreement to this Agreement. Notwithstanding the
foregoing, no third party that is not an Affiliate of the Holder shall have any
obligations hereunder with respect to any shares of Common Stock which are
Transferred by the Holder to such third party, it being understood that the
Holders are not restricted in anyway in the Transfer of shares of Common Stock
by virtue of this Agreement, except in connection with Transfers to Affiliates
to the extent set forth in the preceding sentence.

ARTICLE V

Term of Agreement

     SECTION 5.01 Term of Agreement. This Agreement shall terminate with respect
to each Holder, when such Holder no longer owns any shares of Common Stock. This
Agreement may also be terminated with the written consent of each of RGGPLS,
GRH, the Company and each of the Holders.

ARTICLE VI

Miscellaneous Provisions

     SECTION 6.01 Specific Performance. The parties hereto hereby declare that
irreparable damage would occur as a result of the failure of any party hereto to
perform any of its obligations under this Agreement in accordance with the
specific terms hereof. Therefore, all parties hereto shall have the right to
specific performance of the obligations of the other parties under this
Agreement and if any party hereto shall institute any action or proceeding to
enforce the provisions hereof, any person against whom such action or proceeding
is brought hereby waives the claim or defense therein that such party has an
adequate remedy at law. The right to specific

6

--------------------------------------------------------------------------------

 

performance should be in addition to any other remedy to which a party hereto
may be entitled at law or in equity.

     SECTION 6.02 Conflicts and Inconsistent Agreements. Each of the Holders,
and each of RGGPLS, GRH and the Company shall take all action necessary,
including but not limited to the voting of capital stock of the Company, to
ensure that the certificate of incorporation and by-laws of the Company and the
certificates of incorporation and by-laws or other governing documents of the
Company’s subsidiaries are consistent with, and do not conflict with, the terms
of this Agreement, including, without limitation, to the extent necessary,
increasing the authorized size of the Board of Directors. Neither the Company
nor any Holder shall enter into any agreement inconsistent with the terms of
this Agreement.

     SECTION 6.03 Complete Agreement. This Agreement and, with respect to all
parties other than GRH and RGGPLS, the Purchase Agreement and the Notes
constitutes the entire agreement and understanding among the parties hereto with
respect to the matters referred to herein and supersedes all prior agreements
and understandings among the parties hereto with respect to the matters referred
to herein.

     SECTION 6.04 Amendment. This Agreement may not be amended, modified or
supplemented, and no waivers of or consents to departures from the provisions
hereof may be given, unless consented to in writing by the Company, RGGPLS, GRH
and each of the Holders.

     SECTION 6.05 Successors; Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors, and
permitted assigns. Except as expressly provided in this Agreement, neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned, directly or indirectly, including by operation of law, by any party
hereto without the prior written consent of the other parties hereto; provided
that the obligations of Capital Partners, OTQ and Capital Partners 100 hereunder
must be assigned in connection with any Transfer to any of their Affiliates in
accordance with Section 4.01 and provided that, without the consent of the
Holders, this Agreement and the rights, interests and obligations of RGGPLS
hereunder can be assigned to the surviving entity in a reorganization or
recapitalization of RGGPLS, including without limitation, by way of merger or
consolidation with or into another person or entity, if the percentage interest
of the members or stockholders, as the case may be, in the equity interests of
the surviving entity following consummation of such transaction is substantially
the same (on a relative basis) as each such stockholder’s percentage interest in
RGGPLS immediately prior to the consummation of such transaction. Nothing
contained in this Agreement, express or implied, is intended to confer upon any
person other than the parties hereto and their respective permitted assigns any
rights or remedies of any nature whatsoever by reason of this Agreement.

     SECTION 6.06 Attorney Fees. A party in breach of this Agreement shall, on
demand, indemnify and hold harmless the other party for and against all
reasonable out-of-pocket expenses, including legal fees and expenses, incurred
by such other party by reason of the enforcement and protection of its rights
under this Agreement. The payment of such expenses is in addition to any other
relief to which such other party may be entitled.

7

--------------------------------------------------------------------------------

 

     SECTION 6.07 Notices. All notices or other communications required or
permitted to be given hereunder shall be in writing and shall be delivered by
hand or sent by prepaid telex, cable or telecopy or sent, postage prepaid, by
registered, certified or express mail or reputable overnight courier service and
shall be deemed given when so delivered by hand, telexed, cabled or telecopied,
or if mailed, three days after mailing (one business day in the case of express
mail or overnight courier service), as follows (or at such other address,
telephone number and fax number as a party shall notify each other party
hereto):

  (i)   if to the Company:         NationsHealth, Inc.
13650 N.W. 8th St., Suite 109
Sunrise, FL 33325
Attention: Glenn M. Parker M.D.,
Fax number: (954) 903-5005         with a copy to:         McDermott, Will &
Emery
201 S. Biscayne Blvd., Suite 2200
Miami, FL 33131
Attention: Ira J. Coleman, Esq.
Fax number: (305) 347-6500     (ii)   if to RGGPLS:         RGGPLS Holdings,
Inc.
13650 N.W. 8th St., Suite 107
Sunrise, Florida 33325
Attention: Glenn M. Parker M.D.,
         Robert Gregg and Lewis Stone
Fax number: (954) 903-5005         with a copy to:         McDermott, Will &
Emery
201 S. Biscayne Blvd., Suite 2200
Miami, FL 33131
Attention: Ira J. Coleman, Esq.
Fax number: (305) 347-6500     (iii)   if to GRH:         GRH Holdings, L.L.C.
6701 Nob Hill Road
Tamarac, Florida 33321
Attention: Michael Gusky
Fax number: (954) 718-3211

8

--------------------------------------------------------------------------------

 

      with a copy to:         Muller & Lebensburger
7385 Galloway Road, Suite 200
Miami, FL 33173
Attention: Charles E. Muller II
Fax number: 305-670-6769     (iv)   if to the Holders to:         MHR Fund
Management LLC
40 West 57th Street, 24th Floor,
New York, NY 10019
Attention: Hal Goldstein and Emily Fine
Fax number: (212) 262-9356         with a copy to:         Stroock & Stroock &
Lavan LLP
180 Maiden Lane
New York, NY 10038
Attention: Patricia M. Perez, Esq.
Fax number: (212) 806-6006

     SECTION 6.08 Interpretation. The headings contained in this Agreement and
in any Schedule hereto are for reference purposes only and shall not affect in
any way the meaning or interpretation of this Agreement. All Schedules annexed
hereto or referred to herein are hereby incorporated in and made a part of this
Agreement as if set forth in full herein. Any capitalized terms used in any
Schedule but not otherwise defined therein, shall have the meaning as defined in
this Agreement.

     SECTION 6.09 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more such counterparts have been signed by
each of the parties and delivered to the other party.

     SECTION 6.10 Severability. If any provision of this Agreement (or any
portion thereof) or the application of any such provision (or any portion
thereof) to any person or circumstance shall be held invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
hereof (or the remaining portion thereof) or the application of such provision
to any other persons or circumstance.

     SECTION 6.11 Governing Law. This Agreement and all actions contemplated
hereby shall be governed by and construed and enforced in accordance with the
laws of the State of New York (without regard to conflict of laws principles)
except for any provisions of the Agreement and actions contemplated hereby that
are within the scope of the Delaware General Corporation

9

--------------------------------------------------------------------------------

 

Law, which provisions shall be governed by and construed and enforced in
accordance with the laws of the State of Delaware.

     SECTION 6.12 Submission to Jurisdiction. Any and all suits, legal actions
or proceedings arising out of this Agreement shall be brought in the Superior
Court or the Court of Chancery of the State of Delaware or the United States
District Court for the District of Delaware or in the Supreme Court of the State
of New York, New York County or the United States District Court for the
Southern District of New York and each party hereby submits to and accepts the
exclusive jurisdiction of such courts for the purpose of such suits, legal
actions or proceedings. In any such suit, legal action or proceeding, each party
waives personal service of any summons, compliant or other process and agrees
that service thereof may be made by certified or registered mail directed to it
at its address set forth in the books and records of the company. To the fullest
extent permitted by law, each party hereto hereby irrevocably waives any
objection which it may now or hereafter have to the laying of venue or any such
suit, legal action or proceeding in any such court and hereby further waives any
claim that any suit, legal action or proceeding brought in any such court has
been brought in an inconvenient forum.

     SECTION 6.13 Waiver of Jury Trial. Each party hereby waives, to the fullest
extent permitted by applicable law, any right it may have to a trial by jury in
respect of any litigation directly or indirectly arising out of, under or in
connection with this Agreement. Each party (i) certifies that no representative
of any other party has represented, expressly or otherwise, that such other
party would not, in the event of litigation, seek to enforce the foregoing
waiver and (ii) acknowledges that it and the other parties have been induced to
enter into this Agreement by, among other things, the mutual waivers and
certifications in this Section 6.13.

     SECTION 6.14 No Waiver of Rights. No failure or delay on the part of any
party in the exercise of any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such power or right
preclude other or further exercise thereof or of any other right or power. The
waiver by any party or parties hereto of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any other or
subsequent breach hereunder. All rights and remedies existing under this
Agreement are cumulative and are not exclusive of any rights or remedies
otherwise available.

10

--------------------------------------------------------------------------------

 

     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first written above.

              NATIONSHEALTH, INC.
 
       

  By:   /s/ Glenn Parker

       

      Name: Glenn Parker

      Title:
 
            RGGPLS HOLDING, INC.
 
       

  By:   /s/ Lewis P. Stone

       

      Name: Lewis Stone
Title: Treasurer

                      GRH HOLDINGS, L.L.C.
 
                    By:   Viaura Holdings Ltd.
 
                        By:   Viaura, Inc.
 
               

          By:   /s/ Michael Gusky

               

              Name: Michael Gusky

              Title: President

              HOLDERS:
 
            MHR CAPITAL PARTNERS LP

  By:   MHR Advisors LLC, its general partner
 
       

  By:   /s/ Hal Goldstein

       

      Name: Hal Goldstein

      Title: Authorized Signatory
 
            OTQ LLC
 
       

  By:   /s/ Hal Goldstein

       

      Name: Hal Goldstein

      Title: Authorized Signatory

[Signature Page to Registration Rights Agreement]

 

--------------------------------------------------------------------------------

 

              MHR CAPITAL PARTNERS (100) LP

  By:   MHR Advisors LLC, its general partner
 
       

  By:   /s/ Hal Goldstein

       

      Name: Hal Goldstein

      Title: Authorized Signatory

[Signature Page to Registration Rights Agreement]