Document:

EX-4.13 Guaranty

Exhibit 4.13

GUARANTY

     This GUARANTY (this “Guaranty”), dated as of October 17, 2008, is made by Liberator Medical
Supply, Inc., a Florida corporation (the “Guarantor”), in favor of the “Noteholders” (as defined
below).

W I T N E S S E T H:

     WHEREAS, Liberator Medical Holdings, Inc., a Nevada corporation and the holder of all of the
issued and outstanding capital stock of the Guarantor (the “Company”), as issuer, the Guarantor and
Liberator Health and Education Services, Inc., as guarantors, and each party listed as a “Buyer”
(each a “Buyer”, and collectively, the “Buyers” and together with their successors and assigns and
each other holder of a Note, each a “Noteholder” and collectively the “Noteholders”) on the
signature pages attached to the Securities Purchase Agreement, dated as of October 17, 2008 (as
amended, restated or otherwise modified from time to time, the “Securities Purchase Agreement”),
are parties to the Securities Purchase Agreement;

     WHEREAS, the Securities Purchase Agreement requires, among other things, that the Guarantor
execute and deliver to the Buyers a guaranty guaranteeing all of the obligations of the Company
under the Notes (as defined below); and

     WHEREAS, the Guarantor has determined that the execution, delivery and performance of this
Guaranty benefits, and is in the best interest of, the Guarantor.

     NOW, THEREFORE, in consideration of the premises and the agreements herein and in order to
induce the Buyers to perform their obligations under the Securities Purchase Agreement to, among
other things, purchase the Notes and Warrants (as defined in the Securities Purchase Agreement)
from the Company, the Guarantor hereby agrees for the benefit of the Noteholders as follows:

     SECTION 1. Definitions. Reference is hereby made to the “Notes” (as defined in and
issued pursuant to the Securities Purchase Agreement, and as such Notes may be amended, restated,
replaced or otherwise modified from time to time in accordance with the terms thereof,
collectively, the “Notes”). All capitalized terms used in this Guaranty, which are defined in the
Notes and not otherwise defined herein, shall have the same meanings herein as set forth therein.

     SECTION 2. Guaranty. The Guarantor hereby unconditionally and irrevocably,
guaranties the punctual payment, as and when due and payable, by stated maturity or otherwise, of
all obligations of the Company from time to time owing by it in respect of the Notes, including,
without limitation, all interest that accrues after the commencement of any insolvency proceeding
of the Company or the Guarantor, whether or not the payment of such interest is unenforceable or is
not allowable due to the existence of such insolvency proceeding, and all fees, commissions,
expense reimbursements, indemnifications and all other amounts due or to become due under the Notes
(such obligations, to the extent not paid by the Company, being the “Guaranteed Obligations”), and
agrees to pay any and all expenses (including reasonable counsel fees and expenses) reasonably
incurred by the Noteholders in enforcing this Guaranty. Without limiting the generality of the
foregoing, the Guarantor’s liability hereunder shall extend to all amounts that constitute part of
the Guaranteed Obligations and would be owed by the
Company to the Noteholders but for the fact that they are unenforceable or not allowable due
to the existence of an insolvency proceeding involving the Guarantor or the Company (each, a
“Transaction Party”).

 

 

     SECTION 3. Guaranty Absolute; Continuing Guaranty; Assignments; Limitation of
Guaranty.

     (a) The Guarantor guaranties that the Guaranteed Obligations will be paid strictly in
accordance with the terms of the Notes, regardless of any law, regulation or order now or hereafter
in effect in any jurisdiction affecting any of such terms or the rights of the Noteholders with
respect thereto. The obligations of the Guarantor under this Guaranty are independent of the
Guaranteed Obligations, and a separate action or actions may be brought and prosecuted against the
Guarantor to enforce such obligations, irrespective of whether any action is brought against any
Transaction Party or whether any Transaction Party is joined in any such action or actions. The
liability of the Guarantor under this Guaranty shall be irrevocable, absolute and unconditional
irrespective of, and the Guarantor hereby irrevocably waives, to the extent permitted by law, any
defenses it may now or hereafter have in any way relating to, any or all of the following:

          (i) any lack of validity or enforceability of the Notes or any other Transaction Document (as
defined in the Securities Purchase Agreement) or agreement or instrument relating thereto;

          (ii) any change in the time, manner or place of payment of, or in any other term of, all or
any of the Guaranteed Obligations, or any other amendment or waiver of or any consent to departure
from the Notes, including, without limitation, any increase in the Guaranteed Obligations resulting
from the extension of additional credit to any Transaction Party or otherwise;

          (iii) any taking, exchange, release or non-perfection of any collateral securing the
Guaranteed Obligations, if any, or any taking, release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Guaranteed Obligations;

          (iv) any change, restructuring or termination of the corporate, limited liability company or
partnership structure or existence of any Transaction Party; or

          (v) any other circumstance (including any statute of limitations) or any existence of or
reliance on any representation by any Buyer or Noteholder that might otherwise constitute a defense
available to, or a discharge of, any Transaction Party or any other guarantor or surety.

This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time
any payment of any of the Guaranteed Obligations is rescinded or must otherwise be returned by a
Noteholder or any other Person upon the insolvency, bankruptcy or reorganization of any Transaction
Party or otherwise, all as though such payment had not been made.

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     (b) This Guaranty is a continuing guaranty and shall (i) remain in full force and effect until
the indefeasible cash payment in full of the Guaranteed Obligations (other than
inchoate indemnity obligations) and/or the conversion of all of the Notes into shares of
Common Stock (or such other securities or consideration the Notes are then convertible into or
exchangeable for in accordance with the terms of the Notes and payment of all other amounts payable
under this Guaranty (other than inchoate indemnity obligations) (the “Guaranty Satisfaction
Conditions”) and shall not terminate for any reason prior to the Maturity Date of the Notes (other
than satisfaction in full of the Guaranty Satisfaction Conditions) and (ii) be binding upon the
Guarantor and its successors and assigns. This Guaranty shall inure to the benefit of and be
enforceable by each Noteholder and its successors and permitted pledgees, transferees and assigns.
Notwithstanding the foregoing and for the avoidance of doubt, this Guaranty will expire and the
Guarantor will be released from its obligations hereunder upon the earlier of the satisfaction in
full of the Guaranty Satisfaction Conditions

     (c) Any term or provision of this Guaranty or any Transaction Document to the contrary
notwithstanding, the maximum aggregate amount for which the Guarantor shall be liable hereunder
shall not exceed the maximum amount for the Guarantor can be liable without rendering this Guaranty
or any other Transaction Document, as it relates to the Guarantor, subject to avoidance under
applicable requirements of law relating to fraudulent conveyance or fraudulent transfer (including
the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act and Section 548 of Title
11 of the United States Code or any applicable provisions of comparable laws relating to
bankruptcy, insolvency or the protection of creditors).

     SECTION 4. Waivers. To the extent permitted by applicable law, the Guarantor hereby
waives promptness, diligence, notice of acceptance and any other notice with respect to any of the
Guaranteed Obligations and this Guaranty and any requirement that the Noteholders exhaust any right
or take any action against any Transaction Party or any other Person or any collateral, if any,
securing the Guaranteed Obligations. The Guarantor acknowledges that it will receive direct and
indirect benefits from the financing arrangements contemplated by the Securities Purchase Agreement
and the Notes and that the waiver set forth in this Section 4 is knowingly made in
contemplation of such benefits. The Guarantor hereby waives any right to revoke this Guaranty, and
acknowledges that this Guaranty is continuing in nature and applies to all Guaranteed Obligations,
whether existing now or in the future.

     SECTION 5. Subrogation. The Guarantor may not exercise any rights that it may now or
hereafter acquire against the Company or any other guarantor of the Company’s obligations under the
Notes, or any Noteholder or Buyer, that arise from the existence, payment, performance or
enforcement of the Guarantor’s obligations under this Guaranty, including, without limitation, any
right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to
participate in any claim or remedy of any Noteholder against the Company or any other guarantor or
any collateral, if any, securing the Guaranteed Obligations, whether or not such claim, remedy or
right arises in equity or under contract, statute or common law, including, without limitation, the
right to take or receive from the Company or any other guarantor, directly or indirectly, in cash
or other property or by set-off or in any other manner, payment or security solely on account of
such claim, remedy or right, unless and until all of the Guaranteed Obligations (other than
inchoate indemnity obligations) and all other amounts payable under this Guaranty (other than
inchoate indemnity obligations) shall have indefeasibly been paid in full in cash. If any amount
shall be paid to Guarantor in violation of the immediately preceding sentence at any time prior to
the later of the payment in full in cash of the

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Guaranteed Obligations and all other amounts payable under this Guaranty, such amount shall be
held in trust for the benefit of the Noteholders and shall forthwith be paid to the Noteholders to
be credited and applied to the Guaranteed Obligations and all other amounts payable under this
Guaranty, whether matured or unmatured, in accordance with the terms of the Notes, or to be held as
collateral for any Guaranteed Obligations or other amounts payable under this Guaranty thereafter
arising.

     SECTION 6. Representations, Warranties and Covenants. The Guarantor hereby
represents and warrants as of the date first written above as follows:

     (a) The Guarantor (i) is a corporation, validly existing and in good standing under the laws
of the State of Florida, (ii) has all requisite corporate, power and authority to conduct its
business as now conducted and as presently contemplated and to execute and deliver this Guaranty
and to consummate the transactions contemplated hereby, and (iii) is duly qualified to do business
and is in good standing in each jurisdiction in which the character of the properties owned or
leased by it or in which the transaction of its business makes such qualification necessary except
where the failure to be so qualified would not result in a material adverse effect on the business,
operations, properties, prospects of financial condition of the Guarantor and its subsidiaries,
taken as a whole (a “Material Adverse Effect”).

     (b) The execution, delivery and performance by the Guarantor of this Guaranty (i) has been
duly authorized by all necessary corporate action, (ii) does not contravene its certificate of
incorporation or by-laws, or any applicable law or any contractual restriction binding on the
Guarantor or its properties (except to the extent that such contraventions would not, individually
or in the aggregate, result in or be reasonably expected to result in, a Material Adverse Effect),
(iii) does not and will not result in or require the creation of any lien upon or with respect to
any of its properties, and (iv) does not and will not result in any default, noncompliance,
suspension, revocation, impairment, forfeiture or nonrenewal of any material permit, license,
authorization or approval applicable to it or its operations or any of its properties (except to
the extent that such default, noncompliance, suspension, revocation, impairment, forfeiture or
nonrenewal would not, individually or in the aggregate, result in or be reasonably expected to
result in, a Material Adverse Effect).

     (c) No authorization or approval or other action by, and no notice to or filing with, any
governmental authority is required in connection with the due execution, delivery and performance
by the Guarantor of this Guaranty (except to the extent that the failure to obtain such approval or
other action, or give notice or make a filing, would not, individually or in the aggregate, result
in or be reasonably expected to result in, a Material Adverse Effect).

     (d) This Guaranty is a legal, valid and binding obligation of the Guarantor, enforceable
against the Guarantor in accordance with the terms hereof, except as may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, suretyship or other
similar laws and equitable principles (regardless of whether enforcement is sought in equity or at
law).

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     SECTION 7. Notices, Etc. All notices and other communications provided for hereunder
shall be in writing and shall be by hand-delivery, first-class mail (registered or
certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight
delivery, if to the Guarantor, to it at its address set forth on the signature page hereto, or if
to any Noteholder, to it at its respective address set forth in the Schedule of Buyers attached to
Securities Purchase Agreement or at such other address as shall be designated by any Person in a
written notice to such other Person complying as to delivery with the terms of this Section
7. All such notices and communications shall be deemed to have been duly given at: the time
delivered by hand, if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if
transmitted by facsimile; and on the next Business Day, if timely delivered to an air courier
guaranteeing overnight delivery.

     SECTION 8. CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE. ANY LEGAL ACTION
OR PROCEEDING WITH RESPECT TO THIS GUARANTY OR ANY OTHER TRANSACTION DOCUMENT TO WHICH THE
GUARANTOR IS A PARTY MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK IN THE COUNTY OF NEW
YORK OR OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY
EXECUTION AND DELIVERY OF THIS GUARANTY, THE GUARANTOR HEREBY IRREVOCABLY ACCEPTS IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. THE GUARANTOR
HEREBY IRREVOCABLY APPOINTS THE SECRETARY OF STATE OF THE STATE OF NEW YORK AS ITS AGENT FOR
SERVICE OF PROCESS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING AND FURTHER IRREVOCABLY CONSENTS TO
THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS AND IN ANY SUCH ACTION OR PROCEEDING
BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, AT ITS ADDRESS
FOR NOTICES AS SET FORTH ON THE SIGNATURE PAGE HERETO AND TO THE SECRETARY OF STATE OF THE STATE OF
NEW YORK, SUCH SERVICE TO BECOME EFFECTIVE TEN (10) DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL
AFFECT THE RIGHT OF ANY NOTEHOLDER TO SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE GUARANTOR IN ANY OTHER JURISDICTION.
THE GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE JURISDICTION OR LAYING OF VENUE OF ANY SUCH
LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE GUARANTOR HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH
SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH
RESPECT TO ITSELF OR ITS PROPERTY, THE GUARANTOR HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT
OF ITS OBLIGATIONS UNDER THIS GUARANTY AND THE OTHER TRANSACTION DOCUMENTS.

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     SECTION 9. WAIVER OF JURY TRIAL, ETC. THE GUARANTOR HEREBY WAIVES ANY RIGHT TO A
TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS GUARANTY OR THE OTHER TRANSACTION DOCUMENTS
TO WHICH IT IS A PARTY, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT, DOCUMENT OR OTHER
AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH, OR
ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION WITH THIS GUARANTY OR THE OTHER
TRANSACTION DOCUMENTS TO WHICH THE GUARANTOR IS A PARTY, AND AGREES THAT ANY SUCH ACTION,
PROCEEDING OR COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. THE GUARANTOR
CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF ANY BUYER HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT ANY NOTEHOLDER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING OR
COUNTERCLAIM, SEEK TO ENFORCE THE FOREGOING WAIVERS. THE GUARANTOR HEREBY ACKNOWLEDGES THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE BUYERS TO ENTER INTO THE SECURITIES PURCHASE AGREEMENT
AND PERFORM THEIR OBLIGATIONS THEREUNDER.

     SECTION 10. Miscellaneous.

     (a) The Guarantor will make each payment hereunder in lawful money of the United States of
America and in immediately available funds to each Noteholder, at such address specified by in the
Schedule of Buyers attached to the Securities Purchase Agreement or at such other address as such
Noteholder may provide from time to time by written notice to the Guarantor.

     (b) No amendment or waiver of any provision of this Guaranty and no consent to any departure
by the Guarantor therefrom shall in any event be effective unless the same shall be in writing and
signed by the Guarantor and each Person who is a Noteholder at such time, and then such waiver or
consent shall be effective only in the specific instance and for the specific purpose for which
given.

     (c) No failure on the part of any Noteholder to exercise, and no delay in exercising, any
right hereunder or under any other Transaction Document shall operate as a waiver thereof, nor
shall any single or partial exercise of any right hereunder or under any Transaction Document
preclude any other or further exercise thereof or the exercise of any other right. The rights and
remedies of the Noteholders provided herein and in the other Transaction Documents are cumulative
and are in addition to, and not exclusive of, any rights or remedies provided by law. The rights
of the Noteholders under any Transaction Document against any party thereto are not conditional or
contingent on any attempt by any Noteholder to exercise any of its rights under any other
Transaction Document against such party or against any other Person.

     (d) Any provision of this Guaranty that is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining portions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.

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     (e) This Guaranty shall (i) be binding on the Guarantor and its successors and assigns, and
(ii) inure, together with all rights and remedies of the Noteholders and their respective
successors, transferees and assigns. Without limiting the generality of clause (ii) of the
immediately preceding sentence, each Noteholder may assign or otherwise transfer its rights and
obligations under the Securities Purchase Agreement or any other Transaction Document to any other
Person in accordance with the terms thereof, and such other Person shall thereupon become vested
with all of the benefits in respect thereof granted to such Noteholder herein or otherwise. None
of the rights or obligations of the Guarantor hereunder may be assigned or otherwise transferred
without the prior written consent of each Person who is a Noteholder at such time.

     (f) This Guaranty reflects the entire understanding of the Guarantor relating to its guaranty
contemplated hereby and shall not be contradicted or qualified by any other agreement, oral or
written, entered into before the date hereof.

     (g) Section headings herein are included for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.

     (h) THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED THEREIN WITHOUT REGARD TO CONFLICT OF
LAW PRINCIPLES.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

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     IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed by its respective
duly authorized officer, as of the date first above written.

	 	 	 	 	 
	 	LIBERATOR MEDICAL SUPPLY, INC.,

a Florida corporation

 	 
	 	By:  	/s/ Mark A. Libratore
 	 
	 	 	Name:  	Mark A. Libratore 	 
	 	 	Title:  	President 	 
	 

Notice Address:

Mark A. Libratore, President

Liberator Medical Supply, Inc.

2979 SE Gran Park Way

Stuart, FL 34997

Tel: (772) 287-2414

Fax: (772) 781-3867

-8-EX-4.14 Letter dated October 17, 2008

Exhibit 4.14

Liberator Medical Holdings, Inc.

2979 SE Gran Park Way

Stuart, Florida 34997

October 17, 2008

Millennium Partners, L.P.

c/o Millennium Management LLC

666 Fifth Avenue, 8th Floor

New York, NY 10103

Attn: Terry Feeney

Dear Mr. Feeney:

     Reference is made to the Registration Rights Agreement (the “Registration Rights
Agreement”), dated as of May 22, 2008, among Liberator Medical Holdings, Inc. (the
“Company”) and Millennium Partners, L.P. (“Millennium”). Capitalized terms used
but not defined herein shall have the meanings ascribed to them in the Registration Rights
Agreement.

     As you are aware, on July 30, 2008, the Company filed with the Securities and Exchange
Commission (the “SEC”) a registration statement on Form S-1 (File No. 333- 152652) (the
“Registration Statement”) relating to the potential resale by certain selling
securityholders of 9,100,000 shares of common stock, par value $0.001 per share, of the Company
(the “Common Stock”), which shares included: (i) 4,375,000 shares of Common Stock issuable
upon conversion of the Note held by Millennium, (ii) 4,375,000 shares of Common Stock issuable upon
exercise of the Warrant held by Millennium and (iii) 350,000 shares of Common Stock issuable upon
exercise of an outstanding warrant held by another selling securityholder named in the Registration
Statement. In response to comments provided by the staff of the SEC (the “Staff”) pursuant
to a letter, dated August 8, 2008, from the Staff to the Company, the Company intends to reduce the
total number of shares of Common Stock that it is registering for resale pursuant to the
Registration Statement from 9,100,000 shares to 4,862,252 shares, which shares shall include: (i)
487,252 shares of Common Stock issuable upon exercise of conversion of the Note held by Millennium
and (ii) 4,375,000 shares of Common Stock issuable upon exercise of the Warrant held by Millennium.
Accordingly, 3,887,748 shares of Common Stock issuable upon conversion of the Note held by
Millennium (collectively, the “Unregistered Note Shares”) are not being registered for
resale pursuant to the Registration Statement. Subject to the terms and conditions set forth
herein, the Company desires for Millennium to: (i) confirm and acknowledge that the Company shall
not be obligated to cause any of the Unregistered Note Shares to be registered under the Securities
Act unless and until all or a portion of the Unregistered Note Shares are eligible for registration
under the rules and regulations promulgated by the SEC and the Staff has allowed a registration
statement with respect to the Unregistered Note Shares to be filed with the SEC; and (ii) waive and
any all Liquidated Damages with respect to the Unregistered Note Shares.

 

 

     As you also are aware, pursuant to the Securities Purchase Agreement (the “Securities
Purchase Agreement”), being entered into among the Company, Liberator Medical Supply, Inc.,
Liberator Health and Education Services, Inc. and Millennium and the other Buyers listed on
Schedule A thereto (collectively, the “Buyers”) simultaneously with the execution and
delivery of this letter agreement, the Company is, among other things, issuing warrants to purchase
shares of Common Stock (collectively, the “Warrant Shares”) to Millennium and the other
Buyers. The Company and Millennium desire that Millennium and the other Buyers be entitled to
registration rights with respect to the Warrant Shares, subject to the terms and conditions set
forth herein.

     By signing the counterpart to this letter, Millennium, for good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby confirms, acknowledges and
agrees that notwithstanding anything to the contrary contained in the Registration Rights
Agreement, the Purchase Agreement, the Note or any other Transaction Document (as such term is
defined in the Purchase Agreement): (a) the failure to file and/or have declared effective by the
SEC a Shelf Registration Statement covering the resale of the Unregistered Note Shares by the Shelf
Filing Deadline and/or the Effectiveness Target Date shall not constitute a breach of any provision
of any Transaction Document; and (b) Millennium shall not be entitled to any Liquidated Damages
with respect to the Unregistered Note Shares whatsoever. The Company and Millennium acknowledge
and agree that notwithstanding anything to the contrary contained in any Transaction Document, the
Company shall not be obligated to cause any of the Unregistered Note Shares to be registered under
the Securities Act, except as expressly set forth in this letter agreement.

     The Company and Millennium acknowledge and agree that until the Shelf Registration Statement
and, if prior to the expiration of the Note Share Registration Period (as defined herein), any and
all Additional Registration Statements (as defined herein) covering the resale of all of the
Unregistered Note Shares, are declared effective by the SEC, the Company shall not, without the
prior written consent of Millennium, file with the SEC any other registration statement (other than
any registration statements on Forms S-4 or S-8 or another form not available for registering the
Unregistered Note Shares for resale to the public); provided, however, that nothing
contained herein shall prohibit the Company from (i) filing with the SEC (a) any amendment to any
registration statement filed with the SEC prior to the date hereof, including, without limitation,
the Shelf Registration Statement, or (b) any Additional Registration Statement, or (ii) filing with
the SEC any registration statement other than an Additional Registration Statement covering any of
its securities for sale to the public for its own account or for the account of other
securityholders as long as the Company attempts to include in such registration statement the
maximum number of Unregistered Note Shares not registered previously with the SEC that are
permitted by the SEC (any such registration statement including such Unregistered Note Shares shall
be referred to herein as an “Additional Security Registration Statement”);
provided, however, that for purposes of this clause (ii), if and to the extent the
SEC, as a result of a limitation on the maximum number of shares of Common Stock permitted to be
registered by the Staff pursuant to Rule 415 promulgated

 

 

under the Securities Act or otherwise, does not permit all or any portion of the securities
to be registered for the account of securityholders pursuant to the Additional Security
Registration Statement, the Company shall remove from the Additional Security Registration
Statement such portion of the securities to be registered for the account of securityholders;
provided, that, unless the SEC otherwise requires or Millennium otherwise agrees, any such cut-back
imposed (i) first, shall be applied to the securities held by the securityholders other than
Millennium and (ii) then, shall be applied to the Unregistered Note Shares not registered
previously with the SEC; provided, further, however, that for purposes of
this clause (ii), if and to the extent the SEC does not permit all or any portion of the
Unregistered Note Shares not registered previously with the SEC to be included in such Additional
Security Registration Statement, the Company shall not be prohibited from filing such Additional
Security Registration Statement with the SEC.

     The Company and Millennium further acknowledge and agree that as soon as practicable following
the Registration Triggering Event (as defined herein), the Company shall be required to file with
the SEC a registration statement (the “Initial Registration Statement”) covering such
number of Warrant Shares and Unregistered Note Shares that are permitted by the SEC;
provided, however, that if and to the extent the SEC does not permit all or any
portion of the Warrant Shares and the Unregistered Note Shares, as a result of a limitation on the
maximum number of shares of Common Stock permitted to be registered by the Staff pursuant to Rule
415 promulgated under the Securities Act or otherwise, to be registered pursuant to the Initial
Registration Statement or any Additional Registration Statement, the Company shall remove from the
Initial Registration Statement or Additional Registration Statement, as the case may be, such
portion of the Warrant Shares and Unregistered Note Shares; provided, further,
however, that unless the SEC otherwise requires or the Buyers otherwise agree in writing,
any such cut-back imposed on the holders of the Warrant Shares and Unregistered Note Shares (i)
first, shall be applied to any and all Unregistered Note Shares and (ii) then, shall be applied to
the Warrant Shares allocated on a pro rata basis among the Buyers. In the event of any such
cut-back, the Company shall file additional registration statements (each, an “Additional
Registration Statement” and together with the Initial Registration Statement, the
“Additional Registration Statements”) successively in an attempt to register on each such
Additional Registration Statement the maximum number of the remaining Warrant Shares and
Unregistered Note Shares permitted by the SEC, subject to the cut-back provisions of the
immediately preceding sentence, until (i) with respect to the registration of the Warrant Shares,
the earlier to occur of the following: (a) the Warrant Shares have ceased to be Transfer Restricted
Securities and (b) all of the Warrant Shares have been registered under the Securities Act, and
(ii) with respect to the registration of the Unregistered Note Shares, the expiration of the Note
Share Registration Period. For purposes of this letter agreement, the term “Registration
Triggering Event” shall mean the occurrence of both of the following events: (i) all or a
portion of the Warrant Shares and the Unregistered Note Shares are eligible for registration under
the rules and regulations promulgated by the SEC, including without limitation, Rule 415
promulgated under the Securities Act and (ii) the Staff has allowed a registration statement
covering the resale of such Warrant Shares and Unregistered Note Shares to be filed with the SEC;
and the term “Note Share Registration Period” shall
mean the period commencing on the date hereof and ending on the Maturity Date (as such term is
defined in the Note held by Millennium).

 

 

     The Company and Millennium hereby acknowledge and agree that the registration rights with
respect to the Conversion Shares set forth in the Registration Rights Agreement, as modified this
letter agreement, shall govern the registration rights with respect to the Warrant Shares;
provided, however, that in no event shall any Buyer be entitled to any Liquidated
Damages with respect to the Warrant Shares whatsoever.

     For purposes of the Registration Rights Agreement, the term “Shelf Registration
Statement” shall mean each of the Shelf Registration Statement, the Additional Registration
Statements and any Additional Security Registration Statement; and the term “Prospectus”
shall mean, with respect to the Shelf Registration Statement, any Additional Registration Statement
or any Additional Registration Statement, as the case may be, the prospectus included in such Shelf
Registration Statement, Additional Registration Statement or Additional Security Registration
Statement, in each case, as amended or supplemented by any prospectus supplement and by all other
amendments thereto, including post-effective amendments and all material incorporated by reference
into such prospectus. Notwithstanding the foregoing, in no event shall the Company be required,
pursuant to Section 5(b) of the Registration Rights Agreement or otherwise, to reimburse the Buyers
for the reasonable fees and disbursements of more than one counsel (including local counsel) in
connection with the Shelf Registration Statement, the Additional Registration Statements or any
Additional Security Registration Statement.

     The Registration Rights Agreement shall be deemed to be modified to the extent necessary to
give effect to this letter agreement. Except as hereby modified, the Registration Rights Agreement
and each provision thereof is hereby ratified and confirmed in every respect and shall continue in
full force and effect. If and to the extent there is any conflict between the provisions of the
Registration Rights Agreement and this letter agreement, the provisions of this letter agreement
shall govern.

     All questions concerning the construction, validity, enforcement and interpretation of this
letter agreement shall be governed by and construed and enforced in accordance with the internal
laws of the State of New York, without regard to the principles of conflicts of law thereof.

[Remainder of Page Intentionally Left Blank]

 

 

     If you are in agreement with the foregoing, kindly indicate such agreement by signing the
counterpart to this letter and returning the signed copy thereof to the Company by facsimile at
(772) 287-3280.

	 	 	 	 	 
	 	Sincerely,

LIBERATOR MEDICAL HOLDINGS, INC.

 	 
	 	By:  	/s/ Mark A. Libratore
 	 
	 	 	Name:  	Mark A. Libratore 	 
	 	 	Title:  	President 	 
	 

ACKNOWLEDGED AND AGREED TO:

MILLENNIUM PARTNERS, L.P.

By: Millennium Management LLC

	 	 	 	 	 
	 	 
	By:  	/s/ Terry Feeney
 	 
	 	 	Name:  	Terry Feeney 	 
	 	 	Title:  	Chief Operating Officer

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