Document:

Second Amended and Restated Term Note (Laurus) February 13, 2006

 Exhibit 10.2 
  
 THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS. THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE UNDER SAID
ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO ACCENTIA BIOPHARMACEUTICALS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED. 
  
 SECOND AMENDED AND RESTATED 
 SECURED CONVERTIBLE MINIMUM BORROWING NOTE 
  
 FOR VALUE RECEIVED, each of ACCENTIA BIOPHARMACEUTICALS, INC., a Florida corporation (the “Parent”), and the other companies listed on Exhibit A attached hereto (such other companies together
with the Parent, each a “Company” and collectively, the “Companies”), jointly and severally, promises to pay to LAURUS MASTER FUND, LTD., c/o M&C Corporate Services Limited, P.O. Box 309 GT, Ugland House, South
Church Street, George Town, Grand Cayman, Cayman Islands, Fax: 345-949-8080 (the “Holder”) or its registered assigns or successors in interest, the sum of Two Million Five Hundred Thousand Dollars ($2,500,000), or, if different, the
aggregate principal amount of all Loans (as defined in the Security Agreement referred to below), together with any accrued and unpaid interest hereon, on April 29, 2006 (the “Maturity Date”) if not sooner indefeasibly paid in
full; provided, however, if the Parent shall have consummated the initial public offering of Common Stock (as defined in the Security Agreement) on or prior to March 31, 2006, the Maturity Date shall be April 29, 2008. This
Second Amended and Restated Secured Convertible Minimum Borrowing Note amends and restates in its entirety (and is given in substitution for and not in satisfaction of) that certain $2,500,000 Secured Convertible Minimum Borrowing Note made by the
Companies in favor of the Holder on April 29, 2005 and amended and restated on or about September 13, 2005. 
  
 Capitalized terms used herein without definition shall have the meanings ascribed to such terms in the Security Agreement among the Companies and the
Holder dated as of the date hereof (as amended and restated, further amended, modified and/or supplemented from time to time, the “Security Agreement”). 
  
 The following terms shall apply to this Second Amended and Restated Secured Convertible Minimum Borrowing Note (this
“Note”): 
  
 ARTICLE I 
 CONTRACT RATE 
  
 1.1 Contract Rate. Subject to Sections 4.2 and 5.10, interest payable on the outstanding principal amount of this Note (the “Principal
Amount”) shall accrue at a rate per annum equal to the “prime rate” published in The Wall Street Journal from time to time (the “Prime Rate”), plus two percent (2.0%) (the “Contract
Rate”). The Contract Rate shall be 

  

			
	 Second A&R Minimum Borrowing Note
	  	 

 
increased or decreased as the case may be for each increase or decrease in the Prime Rate in an amount equal to such increase or decrease in the Prime Rate;
each change to be effective as of the day of the change in the Prime Rate. The Contract Rate shall not at any time be less than seven and three-quarters percent (7.75%). Interest shall be (i) calculated on the basis of a 360 day year, and
(ii) payable monthly, in arrears, commencing on May 4, 2005 on the first business day of each consecutive calendar month thereafter through and including the Maturity Date and on the Maturity Date, whether by acceleration or otherwise.

  
 1.2 Contract Rate Payments. The Contract Rate shall be
calculated on the last business day of each calendar month hereafter (other than for increases or decreases in the Prime Rate which shall be calculated and become effective in accordance with the terms of Section 1.1) until the Maturity Date
(each a “Determination Date”) and shall be subject to adjustment as set forth herein.. 
  
 ARTICLE II 
 LOANS; PAYMENTS UNDER THIS NOTE 
  
 2.1 Loans. All Loans evidenced by this Note shall be made in
accordance with the terms and provisions of the Security Agreement. 
  
 2.2 No Effective Registration. Notwithstanding anything to the contrary herein, the Holder shall not be required to accept shares of Common Stock as payment following a conversion by the Holder if there fails to exist an effective
current Registration Statement (as defined in the Registration Rights Agreement) covering the shares of Common Stock to be issued, or if an Event of Default hereunder exists and is continuing, unless such requirement is otherwise waived in writing
by the Holder in whole or in part at the Holder’s option. 
  
 2.3 Optional Redemption in Cash. The Companies will have the option of prepaying this Note (“Optional Redemption”) by paying to the Holder a sum of money equal to one hundred thirty percent (130%) of the
principal amount of this Note together with accrued but unpaid interest thereon and any and all other sums due, accrued or payable to the Holder arising under this Note, the Security Agreement, or any other Ancillary Agreement (the
“Redemption Amount”) outstanding on the Redemption Payment Date (as defined below). The Company shall deliver to the Holder a written notice of redemption (the “Notice of Redemption”) specifying the date for such
Optional Redemption (the “Redemption Payment Date”), which date shall be seven (7) days after the date of the Notice of Redemption (the “Redemption Period”). A Notice of Redemption shall not be effective with
respect to any portion of this Note for which the Holder has previously delivered a Notice of Conversion (defined below) pursuant to Section 3.1, or for conversions elected to be made by the Holder pursuant to Section 3.1 during the
Redemption Period. The Redemption Amount shall be determined as if such Holder’s conversion elections had been completed immediately prior to the date of the Notice of Redemption. On the Redemption Payment Date, the Redemption Amount (plus any
additional interest and fees accruing on the Notes during the Redemption Period) must be irrevocably paid in full in immediately available funds to the Holder. In the event the Companies fail to pay the Redemption Amount on the Redemption Payment
Date, then such Redemption Notice shall be null and void. 
  

			
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 ARTICLE III 
 CONVERSION RIGHTS AND FIXED CONVERSION PRICE 
  
 3.1 Optional Conversion. Subject to the terms of this Article III, the Holder shall have the right, but not the obligation, at any time until the Maturity Date, or during an Event of Default (as defined in
Article IV), and, subject to the limitations set forth in Section 3.2 hereof, to convert all or any portion of the outstanding Principal Amount and/or accrued interest and fees due and payable into fully paid and nonassessable shares of the
Common Stock at the Fixed Conversion Price. For purposes hereof, subject to Section 3.6 hereof, the initial “Fixed Conversion Price” shall be $6.80. The shares of Common Stock to be issued upon such conversion are herein
referred to as the “Conversion Shares.” 
  
 3.2
Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which
would exceed the difference between (i) 4.99% of the outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by the Holder. For purposes of the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Conversion Shares limitation described in this Section 3.2 shall automatically become null and void without any notice
to any Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Parent. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and
may not be waived by the Holder or any Company. 
  
 3.3
Mechanics of Holder’s Conversion. In the event that the Holder elects to convert this Note into Common Stock, the Holder shall give notice of such election by delivering an executed and completed notice of conversion in substantially the
form of Exhibit A hereto (appropriately completed) (“Notice of Conversion”) to the Parent and such Notice of Conversion shall provide a breakdown in reasonable detail of the Principal Amount, accrued interest and fees that are being
converted. On each Conversion Date (as hereinafter defined) and in accordance with its Notice of Conversion, the Holder shall make the appropriate reduction to the Principal Amount, accrued interest and fees as entered in its records and shall
provide written notice thereof to the Parent within two (2) Business Days after the Conversion Date. Each date on which a Notice of Conversion is delivered or telecopied to the Parent in accordance with the provisions hereof shall be deemed a
Conversion Date (the “Conversion Date”). Pursuant to the terms of the Notice of Conversion, the Parent will issue instructions to the transfer agent accompanied by an opinion of counsel within one (1) Business Day of the date
of the delivery to the Parent of the Notice of Conversion and shall cause the transfer agent to transmit the certificates representing the Conversion Shares to the Holder by crediting the account of the Holder’s designated broker with the
Depository Trust Corporation (“DTC”) through its Deposit Withdrawal Agent Commission (“DWAC”) system within three (3) Business Days after receipt by the Parent of the Notice of Conversion (the “Delivery
Date”). In the case of the exercise of the conversion rights set forth herein the conversion privilege shall be deemed to have been exercised and the Conversion Shares issuable upon such conversion shall be deemed to have been issued upon
the date of receipt by the Parent of the Notice of Conversion. The Holder shall be treated for all purposes as the record holder of the Conversion Shares, unless the Holder provides the Parent written instructions to the contrary. 
  

			
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 3.4 Late Payments. Each Company understands that a delay in the delivery of the Conversion Shares
in the form required pursuant to this Article beyond the Delivery Date could result in economic loss to the Holder. As compensation to the Holder for such loss, in addition to all other rights and remedies which the Holder may have under this Note,
applicable law or otherwise, the Companies shall, jointly and severally, pay late payments to the Holder for any late issuance of Conversion Shares in the form required pursuant to this Article III upon conversion of this Note, in the amount equal
to $500 per Business Day after the Delivery Date. The Companies shall, jointly and severally, make any payments incurred under this Section in immediately available funds upon demand. 
  
 3.5 Conversion Mechanics. The number of shares of Common Stock to be issued upon each conversion of this Note shall
be determined by dividing that portion of the principal and interest and fees to be converted, if any, by the then applicable Fixed Conversion Price. 
  
 3.6 Adjustment Provisions. The Fixed Conversion Price and number and kind of shares or other securities to be issued upon conversion determined
pursuant to Section 3.1 shall be subject to adjustment from time to time upon the occurrence of certain events during the period that this conversion right remains outstanding, as follows: 
  
 (a) Reclassification. If the Parent at any time shall, by
reclassification or otherwise, change the Common Stock into the same or a different number of securities of any class or classes, this Note, as to the unpaid Principal Amount and accrued interest thereon, shall thereafter be deemed to evidence the
right to purchase an adjusted number of such securities and kind of securities as would have been issuable as the result of such change with respect to the Common Stock (i) immediately prior to or (ii) immediately after such
reclassification or other change at the sole election of the Holder. 
  
 (b) Stock Splits, Combinations and Dividends. If the shares of Common Stock are subdivided or combined into a greater or smaller number of shares of Common Stock, or if a dividend is paid on the Common Stock or any preferred stock
issued by the Parent in shares of Common Stock, the Fixed Conversion Price shall be proportionately reduced in case of subdivision of shares or stock dividend or proportionately increased in the case of combination of shares, in each such case by
the ratio which the total number of shares of Common Stock outstanding immediately after such event bears to the total number of shares of Common Stock outstanding immediately prior to such event. 
  
 3.7 Reservation of Shares. During the period the conversion right
exists, the Parent will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of Conversion Shares upon the full conversion of this Note, the Term Note and the Warrants. The Parent represents
that upon issuance, the Conversion Shares will be duly and validly issued, fully paid and non-assessable. The Parent agrees that its issuance 

  

			
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of this Note shall constitute full authority to its officers, agents, and transfer agents who are charged with the duty of executing and issuing stock
certificates to execute and issue the necessary certificates for the Conversion Shares upon the conversion of this Note. 
  
 3.8 Registration Rights. The Holder has been granted registration rights with respect to the Conversion Shares as set forth in a Registration
Rights Agreement. 
  
 3.9 Issuance of New Note. Upon any
partial conversion of this Note, a new Note containing the same date and provisions of this Note shall, at the request of the Holder, be issued by the Parent to the Holder for the principal balance of this Note and interest which shall not have been
converted or paid. Subject to the provisions of Article IV of this Note, the Parent shall not pay any costs, fees or any other consideration to the Holder for the production and issuance of a new Note. 
  
 3.10 Further Conversion Limitation. Notwithstanding anything contained
herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note any amounts that would be convertible into Conversion Shares prior to the earlier to occur of (i) two hundred seventy (270) days after
the date hereof and (i) one hundred eighty (180) days after the date of the initial public offering of Common Stock. The Conversion Shares limitation described in this Section 3.10 shall automatically become null and void without any
notice to any Company upon the occurrence and during the continuance of an Event of Default. 
  
 3.11 Additional Conversion. If the Company shall have registered the shares of the Common Stock underlying the conversion of this Note and each Warrant on a registration statement declared effective by the SEC,
then, if (i) the average closing price of the Common Stock as reported by Bloomberg, L.P. on the Principal Market for five consecutive (5) trading days (the “Determination Date”) shall be greater than or equal to $10.00
per share, then the Holder shall convert into Common Stock an amount equal to twenty per cent (20%) of the average dollar trading volume for the consecutive five trading days immediately preceding the Determination Date (the “Maximum
Amount”). Notwithstanding the immediately foregoing, the Maximum Amount shall not exceed twenty percent (20%) of the aggregate dollar trading volume of the Common Stock for the period of twenty (20) trading days immediately
preceding the Determination Date (the “Aggregate Maximum Amount”). In determining the Maximum Amount, any Maximum Amount conversion required hereunder shall be aggregated with all Maximum Amount conversions required under this Note
and the Secured Convertible Term Note between the Holder and the Company; in no event shall the Holder convert, pursuant to this Section 3.11 any amount in excess of the Aggregate Maximum Amount. Conversions made pursuant to this
Section 3.11 shall be deemed to be effective on the Determination Date. No more than one Determination Date may occur during any consecutive five (5) trading day period, and no more than two (2) Determination Dates may occur in any
calendar month. Any principal amount of this Note that is converted pursuant to this Section 3.11 shall be deemed to constitute payments of outstanding principal. 
  

			
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 ARTICLE IV 
 EVENTS OF DEFAULT AND DEFAULT RELATED PROVISIONS 
  
 4.1 Events of Default. The occurrence of an Event of Default under the Security Agreement shall constitute an event of default (“Event of Default”) hereunder. 
  
 4.2 Default Interest. Following the occurrence and during the
continuance of an Event of Default, the Companies shall, jointly and severally, pay additional interest on the outstanding principal balance of this Note in an amount equal to one and one half percent (1.5%) per month, and all outstanding
Obligations, including unpaid interest, shall continue to accrue interest at such additional interest rate from the date of such Event of Default until the date such Event of Default is cured or waived. 
  
 4.3 Default Payment. Following the occurrence and during the
continuance of an Event of Default, the Holder, at its option, may elect, in addition to all rights and remedies of the Holder under the Security Agreement and the Ancillary Agreements and all obligations of each Company under the Security Agreement
and the Ancillary Agreements, to require the Companies, jointly and severally, to make a Default Payment (“Default Payment”). The Default Payment shall be 130% of the outstanding principal amount of the Note, plus accrued but unpaid
interest, all other fees then remaining unpaid, and all other amounts payable hereunder. The Default Payment shall be applied first to any fees due and payable to the Holder pursuant to the Notes and/or the Ancillary Agreements, then to accrued and
unpaid interest due on the Notes, the Security Agreement and then to the outstanding principal balance of the Notes. The Default Payment shall be due and payable immediately on the date that the Holder has exercised its rights pursuant to this
Section 4.3. 
  
 ARTICLE V 
 MISCELLANEOUS 
  
 5.1 Conversion Privileges. The conversion privileges set forth in Article III shall remain in full force and effect immediately from the date
hereof until the date this Note is indefeasibly paid in full and irrevocably terminated. 
  
 5.2 Cumulative Remedies. The remedies under this Note shall be cumulative. 
  
 5.3 Failure or Indulgence Not Waiver. No failure or delay on the part of the Holder hereof in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. All rights and remedies existing
hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available. 
  
 5.4 Notices. Any notice herein required or permitted to be given shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party notified, (b) when sent by confirmed
telex or facsimile if sent during normal business hours of the recipient, if not, then on the next business day, (c) five days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one
day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of 

  

			
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receipt. All communications shall be sent to the respective Company at the addresses provided for such Company in the Security Agreement executed in
connection herewith, and to the Holder at the address provided in the Security Agreement for such Holder, with a copy to John E. Tucker, Esq., 825 Third Avenue, 14th Floor, New York, New York 10022, facsimile number (212) 541-4434, or at such other address as the respective Company or the Holder may designate by ten days advance written notice to the other
parties hereto. 
  
 5.5 Amendment Provision. The term
“Note” and all references thereto, as used throughout this instrument, shall mean this instrument as originally executed, or if later amended or supplemented, then as so amended or supplemented, and any successor instrument as such
successor instrument may be amended or supplemented. 
  
 5.6
Assignability. This Note shall be binding upon each Company and its successors and assigns, and shall inure to the benefit of the Holder and its successors and assigns, and may be assigned by the Holder in accordance with the requirements of
the Security Agreement. No Company may assign any of its obligations under this Note without the prior written consent of the Holder, any such purported assignment without such consent being null and void. 
  
 5.7 Cost of Collection. In case of any Event of Default under this
Note, the Companies shall, jointly and severally, pay the the Holder’s reasonable costs of collection, including reasonable attorneys’ fees. 
  
 5.8 Governing Law, Jurisdiction and Waiver of Jury Trial. 
  

(a) THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. 
  
 (b) EACH COMPANY HEREBY CONSENTS AND AGREES
THAT THE STATE OR FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN ANY COMPANY, ON THE ONE HAND, AND THE HOLDER, ON THE OTHER HAND, PERTAINING
TO THIS NOTE, THE SECURITY AGREEMENT OR ANY OF THE OTHER ANCILLARY AGREEMENTS OR TO ANY MATTER ARISING OUT OF OR RELATED TO THIS NOTE, THE SECURITY AGREEMENT OR ANY OF THE OTHER ANCILLARY AGREEMENTS; PROVIDED, THAT EACH COMPANY ACKNOWLEDGES
THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW YORK; AND FURTHER PROVIDED, THAT NOTHING IN THIS NOTE SHALL BE DEEMED OR OPERATE TO PRECLUDE THE HOLDER FROM
BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE HOLDER. EACH
COMPANY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND 

  

			
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EACH COMPANY HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. EACH
COMPANY HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE
COMPANY AT THE ADDRESS SET FORTH IN THE SECURITY AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF THE COMPANY’S ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE
PREPAID. 
  
 (c) EACH COMPANY DESIRES THAT ITS DISPUTES BE
RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, EACH COMPANY HERETO WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING
BROUGHT TO RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE HOLDER, AND/OR ANY COMPANY ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS NOTE,
THE SECURITY AGREEMENT, ANY OTHER ANCILLARY AGREEMENT OR THE TRANSACTIONS RELATED HERETO OR THERETO. 
  
 5.9 Severability. In the event that any provision of this Note is invalid or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect
the validity or enforceability of any other provision of this Note. 
  
 5.10 Maximum Payments. Nothing contained herein shall be deemed to establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the event that the rate of interest
required to be paid or other charges hereunder exceed the maximum rate permitted by such law, any payments in excess of such maximum rate shall be credited against amounts owed by the Companies to the Holder and thus refunded to the Companies.

  
 5.11 Security Interest and Guarantee. The Holder has
been granted a security interest in (i) certain assets of the Companies as more fully described in the Security Agreement and the Master Security Agreement, (ii) the equity interests of certain Subsidiaries of the Parent pursuant to the
Stock Pledge Agreement dated as of the date hereof and (iii) the equity interests of Star Scientific, Inc. held by The Francis E. O’Donnell, Jr. Irrevocable Trust No. 1 pursuant to the O’Donnell Stock Pledge Agreement dated as of
the date hereof. The obligations of the Companies under this Note are guaranteed by certain Subsidiaries of the Parent pursuant to the Subsidiaries Guaranty dated as of the date hereof. 
  
 5.12 Registered Obligation. This Note is intended to be a registered obligation within the meaning of Treasury
Regulation Section 1.871-14(c)(1)(i) and the Companies (or their 

  

			
	 Second A&R Minimum Borrowing Note
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agent) shall register this Note (and thereafter shall maintain such registration) as to both principal and any stated interest. Notwithstanding any document,
instrument or agreement relating to this Note to the contrary, transfer of this Note (or the right to any payments of principal or stated interest thereunder) may only be effected by (i) surrender of this Note and either the reissuance by the
Companies of this Note to the new holder or the issuance by the Companies of a new instrument to the new holder, or (ii) transfer through a book entry system maintained by the Companies (or their agent), within the meaning of Treasury
Regulation Section 1871-14(c)(1)(i)(B). 
  
 5.13
Construction. Each party acknowledges that its legal counsel participated in the preparation of this Note and, therefore, stipulates that the rule of construction that ambiguities are to be resolved against the drafting party shall not be
applied in the interpretation of this Note to favor any party against the other. 
  
 [Balance of page intentionally left blank; signature page follows] 
  

			
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 IN WITNESS WHEREOF, each Company has caused this Second Amended and Restated Secured Convertible
Minimum Borrowing Note to be signed in its name effective as of the 29th day of April 2005. 
  

					
	 	 	ACCENTIA BIOPHARMACEUTICALS, INC.
			
	 	 	By:	 	  

	 	 	Name:	 	 
	 	 	Title:	 	 
	 WITNESS:
  
  

	 	 	 	 
		
	 	 	THE ANALYTICA GROUP, INC.
			
	 	 	By:	 	  

	 	 	Name:	 	 
	 	 	Title:	 	 
	 WITNESS:
  
  

	 	 	 	 

  

			
	 Second A&R Minimum Borrowing Note
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 EXHIBIT A 
  
 OTHER COMPANIES 
  
 THE ANALYTICA GROUP, INC., a Florida corporation 
  

			
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 EXHIBIT B 
  
 NOTICE OF CONVERSION 
  

(To be executed by the Holder in order to convert the 
 Amended and Restated Secured Convertible Minimum Borrowing Note) 
  
 The undersigned hereby elects to convert $             of the principal and
$             of the interest due on the Second Amended and Restated Secured Convertible Minimum Borrowing Note dated as of April 29, 2005, and amended and restated as of
August 16th, 2005 and February 13, 2006 (the “Note”) issued by Accentia
Biopharmaceuticals, Inc. (the “Parent”) and the other Companies named and as defined therein into shares of Common Stock of the Parent in accordance with the terms and conditions set forth in the Note, as of the date written below.

  

			
	Date of Conversion:	  	  

	Conversion Price:	  	  

	Shares To Be Delivered:	  	  

	Signature:	  	  

	Print Name:	  	  

	Address:	  	  

	Holder DWAC instructions	  	  

  

			
	 Second A&R Minimum Borrowing Note
	  	12MSB Subordination Agreement (Laurus) February 13, 2006

 Exhibit 10.3 
  
 FORM OF SUBORDINATION AGREEMENT 
  
 This Subordination Agreement (this “Agreement”) is entered into as of the 13th day of February 2006, by and among the Missouri State Bank and its affiliates (collectively, the “Subordinated Lenders” and each, a
“Subordinated Lender”), and Laurus Master Fund, Ltd. (the “Senior Lender”). Unless otherwise defined herein, capitalized terms used herein shall have the meaning provided such terms in the Securities Purchase
Agreement and the Security Agreement (as applicable) referred to below. 
  
 BACKGROUND 
  
 WHEREAS, it is a condition to the Senior
Lender’s maintenance of its investment in Accentia Biopharmaceuticals, a Florida corporation (the “Parent”) pursuant to, and in accordance with, (i) that certain Securities Purchase Agreement dated as of the date hereof by
and between the Parent and Laurus (as amended, modified or supplemented from time to time, the “Securities Purchase Agreement”) and (ii) the Related Agreements referred to in the Securities Purchase Agreement, (iii) that
certain Security Agreement dated as of the date hereof by and between the Parent, The Analytica Group, Inc., a Florida corporation (“Analytica” and, together with the Parent, collectively, the “Company”) and Laurus
(as amended, modified or supplemented from time to time, the “Security Agreement”) and (iv) the Ancillary Agreements referred to in the Security Agreement. 
  
 WHEREAS, the Subordinated Lenders have made a $3,000,000 revloving credit facility available to Parent, which facility is
(x) guaranteed by TEAMM Pharmaceuticals, Inc. (“TEAMM”) and has a maturity date of January 15, 2007 and (y) intended to fund the acquisition and licensing of pharmaceutical products and medical devices. 
  
 NOW, THEREFORE, each Subordinated Lender and the Senior Lender agree as
follows: 
  
 TERMS 
  
 1. All obligations of each the Company and/or any of its Subsidiaries to the
Senior Lender, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent or now or hereafter existing, or due or to become due are referred to as “Senior Liabilities”. Any and all loans made by the
Subordinated Lenders to the Company and/or any of its Subsidiaries, together with all other obligations of the Company and/or any of its Subsidiaries to any Subordinated Lender (in each case, including any interest, fees or penalties related
thereto), howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent or now or hereafter existing, or due or to become due are referred to as “Junior Liabilities”. It is expressly understood and agreed that
the term “Senior Liabilities”, as used in this Agreement, shall include, without limitation, any and all interest, fees and penalties accruing on any of the Senior Liabilities after the commencement of any proceedings referred to in
paragraph 4 of this Agreement, notwithstanding any provision or rule of law which might restrict the rights of the Senior Lender, as against the Company, its Subsidiaries or anyone else, to collect such interest, fees or penalties, as the case may
be. 
  

			
	 Subordination Agreement
	  	 

 2. Except as expressly otherwise provided in this Agreement or as the Senior Lender may otherwise
expressly consent in writing, the payment of the Junior Liabilities shall be postponed and subordinated in right of payment and priority to the payment in full of all Senior Liabilities. Furthermore, whether directly or indirectly, no payments or
other distributions whatsoever in respect of any Junior Liabilities shall be made (whether at stated maturity, by acceleration or otherwise), nor shall any property or assets of the Company or any of its Subsidiaries be applied to the purchase or
other acquisition or retirement of any Junior Liability. Notwithstanding anything to the contrary contained in this paragraph 2 or elsewhere in this Agreement, the Company and its Subsidiaries may make principal and interest payments, as the case
may be, to the Subordinated Lenders with respect to the Junior Liabilities, so long as (i) no Event of Default (as defined in the Note) has occurred and is continuing at the time of any such payment, (ii) no such payment shall be made with
Common Stock of the Parent and (iii) the rate of interest with respect to the Junior Liabilities is not increased from that in effect on the date hereof. 
  

3. Each Subordinated Lender hereby subordinates all claims and security interests (if any) it may have against, or with respect to, any of the assets
of the Company and/or any of its Subsidiaries, to the security interests granted by the Company and/or any of its Subsidiaries to the Senior Lender in respect of the Senior Liabilities. 
  
 4. In the event of any dissolution, winding up, liquidation, readjustment, reorganization or other similar proceedings
relating to the Company and/or any of its Subsidiaries or to its creditors, as such, or to its property (whether voluntary or involuntary, partial or complete, and whether in bankruptcy, insolvency or receivership, or upon an assignment for the
benefit of creditors, or any other marshalling of the assets and liabilities of the Company and/or any of its Subsidiaries, or any sale of all or substantially all of the assets of the Company and/or any of its Subsidiaries, or otherwise), the
Senior Liabilities shall first be paid in full before any Subordinated Lender shall be entitled to receive and to retain any payment or distribution in respect of any Junior Liability. 
  
 5. Each Subordinated Lender will mark his books and records so as to clearly indicate that their respective Junior
Liabilities are subordinated in accordance with the terms of this Agreement. Each Subordinated Lender will execute such further documents or instruments and take such further action as the Senior Lender may reasonably request from time to time
request to carry out the intent of this Agreement. 
  
 6. Each
Subordinated Lender hereby waives all diligence in collection or protection of or realization upon the Senior Liabilities or any security for the Senior Liabilities. 
  
 7. No Subordinated Lender will without the prior written consent of the Senior Lender: (a) attempt to enforce or
collect any Junior Liability or any rights in respect of any Junior Liability; or (b) commence, or join with any other creditor in commencing, any bankruptcy, reorganization or insolvency proceedings with respect to the Company and/or any of
its Subsidiaries. 
  

			
	 Subordination Agreement
	  	- 2 -

 8. The Senior Lender may, from time to time, at its sole discretion and without notice to any
Subordinated Lender, take any or all of the following actions: (a) retain or obtain a security interest in any property to secure any of the Senior Liabilities; (b) retain or obtain the primary or secondary obligation of any other obligor
or obligors with respect to any of the Senior Liabilities; (c) extend or renew for one or more periods (whether or not longer than the original period), alter, increase or exchange any of the Senior Liabilities, or release or compromise any
obligation of any nature of any obligor with respect to any of the Senior Liabilities; and (d) release their security interest in, or surrender, release or permit any substitution or exchange for, all or any part of any property securing any of
the Senior Liabilities, or extend or renew for one or more periods (whether or not longer than the original period) or release, compromise, alter or exchange any obligations of any nature of any obligor with respect to any such property. 

 
 9. The Senior Lender may, from time to time, whether before or after any
discontinuance of this Agreement, without notice to any Subordinated Lender, assign or transfer any or all of the Senior Liabilities or any interest in the Senior Liabilities; and, notwithstanding any such assignment or transfer or any subsequent
assignment or transfer of the Senior Liabilities, such Senior Liabilities shall be and remain Senior Liabilities for the purposes of this Agreement, and every immediate and successive assignee or transferee of any of the Senior Liabilities or of any
interest in the Senior Liabilities shall, to the extent of the interest of such assignee or transferee in the Senior Liabilities, be entitled to the benefits of this Agreement to the same extent as if such assignee or transferee were the Senior
Lender, as applicable; provided, however, that, unless the Senior Lender shall otherwise consent in writing, the Senior Lender shall have an unimpaired right, prior and superior to that of any such assignee or transferee, to enforce this Agreement,
for the benefit of the Senior Lender, as to those of the Senior Liabilities which the Senior Lender has not assigned or transferred. 
  
 10. The Senior Lender shall not be prejudiced in its rights under this Agreement by any act or failure to act of any Subordinated Lender, or any
noncompliance of any Subordinated Lender with any agreement or obligation, regardless of any knowledge thereof which the Senior Lender may have or with which the Senior Lender may be charged; and no action of the Senior Lender permitted under this
Agreement shall in any way affect or impair the rights of the Senior Lender and the obligations of any Subordinated Lender under this Agreement. 
  
 11. No delay on the part of the Senior Lender in the exercise of any right or remedy shall operate as a waiver of such right or remedy, and no single or
partial exercise by the Senior Lender of any right or remedy shall preclude other or further exercise of such right or remedy or the exercise of any other right or remedy; nor shall any modification or waiver of any of the provisions of this
Agreement be binding upon the Senior Lender except as expressly set forth in a writing duly signed and delivered on behalf of the Senior Lender. For the purposes of this Agreement, Senior Liabilities shall have the meaning set forth in
Section 1 above, notwithstanding any right or power of any Subordinated Lender or anyone else to assert any claim or defense as to the invalidity or unenforceability of any such obligation, and no such claim or defense shall affect or impair
the agreements and obligations of any Subordinated Lender under this Agreement. 
  

			
	 Subordination Agreement
	  	- 3 -

 12. This Agreement shall be binding upon each Subordinated Lender and upon the heirs, legal
representatives, successors and assigns of each Subordinated Lender and the successors and assigns of any Subordinated Lender. 
  
 13. This Agreement shall be construed in accordance with and governed by the laws of New York without regard to conflict of laws provisions. Wherever
possible each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement. 
  

[signature page follows] 
  

			
	 Subordination Agreement
	  	- 4 -

 IN WITNESS WHEREOF, this Agreement has been made and delivered this 13th day of February 2006. 
  

							
	 	 	 	  	MISSOURI STATE BANK
				
	 	 	 	  	By:	  	  

	 	 	 	  	Name:	  	 
	 	 	 	  	Title:	  	 
			
	 	 	 	  	LAURUS MASTER FUND, LTD.
				
	 	 	 	  	By:	  	  

	 	 	 	  	Name:	  	 
	 	 	 	  	Title:	  	 
			
	Acknowledged and Agreed to by:	  	 	  	 
			
	ACCENTCIA BIOPHARMACEUTICALS, INC.	  	 	  	 
				
	By:	 	  

	  	 	  	 
	Name:	 	 	  	 	  	 
	Title:	 	 	  	 	  	 
			
	THE ANALYTICA GROUP, INC.	  	 	  	 
				
	By:	 	  

	  	 	  	 
	Name:	 	 	  	 	  	 
	Title:	 	 	  	 	  	 

  

			
	 Subordination Agreement
	  	- 5 -

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