Document:

Telesis Subordination Agreement

 Exhibit 10.4 
 EXECUTION COPY 
 TELESIS SUBORDINATION AGREEMENT 
 This Subordination Agreement (this “Agreement”) is entered into as of the 25th day of April 2006, by and among Laurus Master Fund, Ltd., a Cayman Islands company (the “Senior Lender”), Telesis CDE Two, LLC, a Delaware limited
liability company (the “Subordinated Lender”), Biovax, Inc., a Florida corporation (the “Company”), Biovest International, Inc., a Delaware corporation (“Biovest”), and Accentia Biopharmaceuticals, Inc., a Florida
corporation (“Accentia,” and together with the Senior Lender, the Subordinated Lender, the Company and Biovest, collectively, the “Parties”). Unless otherwise defined herein, capitalized terms used herein shall have the meaning
provided such terms in that certain Consent referred to below. 
 BACKGROUND 
 WHEREAS, pursuant to that certain Consent entered into by and among the Senior Lender, the Company, Biovest and Biolender, LLC, a Delaware limited
liability company (“Biolender”) and others (as amended, modified or supplemented from time to time, the “Consent”), it is a condition to the Senior Lender consenting to (i) that certain Convertible Loan Agreement, to be
dated on or around April 24, 2006 among the Subordinated Lender, the Company and Biovest (the “Junior Loan Agreement”) and that certain Subordinated Convertible Promissory Note to be issued by the Company to the Lender on or about
April 24, 2006 evidencing the obligations arising from the Junior Loan Agreement (the “Junior Note,” and together with the Junior Loan Agreement, collectively, the “Junior Loan Documents”), and (ii) that certain
guaranty, to be dated on or about April 24, 2006 issued by Biovest, Accentia and others to the Subordinated Lender and U.S. Bancorp Community Investment Corporation (the “Guaranty”), that the Senior Lender and the Subordinated Lender
enter into this Agreement. 
 WHEREAS, pursuant to the Junior Loan Documents, the Subordinated Lender has agreed to make available to the
Company a subordinated loan facility on the terms set forth therein; and 
 WHEREAS, it has been agreed that the facilities evidenced by the
Laurus Funding Documents and the Junior Loan Documents should rank in accordance with the priorities established by this Agreement. 
 NOW,
THEREFORE, the Parties agree as follows: 
 TERMS 
 1. All obligations of Biovest or any of its Subsidiaries (as defined below) to the Senior Lender under the Biovest Funding Documents are referred to as “Senior Biovest Liabilities.” All obligations of
Accentia or any of its Subsidiaries to the Senior Lender under the Accentia Funding Documents are referred to as “Senior Accentia Liabilities.” The obligations of the Company under the Junior Loan Documents are referred to as the
“Junior Company Liabilities.” The obligations of Biovest under the Junior Loan Documents and the obligations of 
 Subordination Agreement 

 Biovest to the Subordinate Lender under the Guaranty are referred to, collectively, as the “Junior Biovest
Liabilities.” The obligations of Accentia under the Guaranty are referred to as “Junior Accentia Liabilities,” and together with the Junior Company Liabilities and the Junior Biovest Liabilities, collectively, the “Junior
Liabilities.” 
 “Subsidiary” means (i) a corporation or other entity whose shares of stock or other ownership interests
having ordinary voting power (other than stock or other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the directors of such corporation, or other persons or entities performing similar
functions for such person or entity, are owned, directly or indirectly, by such person or entity or (ii) a corporation or other entity in which such person or entity owns, directly or indirectly, more than 50% of the equity interests at such
time. 
 2. Except (i) to the extent there exists no defaults under Laurus Funding Documents that have not been cured or otherwise
waived by the Senior Lender and the covenants in the New Market Transaction Documents have not been materially changed, the Company shall have the right to convert principal outstanding under the Junior Loan Agreement without the consent of the
Senior Lender and to issue such conversion shares to the Subordinated Lender prior to maturity of such obligations; provided that, in respect of each such conversion, (a) such conversion shall only be permitted using common stock of Biovest as
set forth in the terms and conditions of the aforementioned agreement, (b) the “Conversion Price” of the common stock shall mean the average closing price of the common stock of Biovest on the NASD OTC Bulletin Board or
other market where the common stock is listed for the five business days immediately preceding the conversion, provided that if on any such date the shares of common stock are not listed or admitted for trading on any national securities exchange or
quoted by OTCBB or a similar service, then the current market price shall be determined in good faith by the Board of Directors of the Company and shall be reasonably acceptable to the Senior Lender, and (c) the Company and Biovest covenant
that they will only undertake the conversion as described above on the condition that the Junior Lender agrees not to sell such conversion shares to any third party until the expiration of the original maturity date of such obligations under the
Junior Loan Documents; (ii) as expressly otherwise provided in this Agreement or (iii) as the Senior Lender may otherwise expressly consent in writing, the payment of the Junior Company Liabilities shall be postponed and subordinated in
right of payment and priority to the payment in full of the Senior Biovest Liabilities. Furthermore, no payments or other distributions in respect of the Junior Company 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 Company Liabilities prior to the termination of this agreement or the repayment in full
of Biovest’s obligations under the Biovest Funding Documents, unless otherwise agreed to in writing by the Senior Lender. Notwithstanding anything to the contrary contained in this paragraph 2 or elsewhere in this Agreement, the Company and its
Subsidiaries may make regularly scheduled interest payments and payments of reasonable expenses, as the case may be, to the Subordinated Lender with respect to the Junior Company Liabilities, so long as (i) no Event of Default (as defined in
the Secured Promissory Note, dated as of March 31, 2006 and 
 Telesis Subordination Agreement 
  

 - 2 - 

 issued by Biovest to the Senior Lender (the “Note”)) has occurred and is continuing at the time of any such
payment and (ii) the amount of such regularly scheduled interest payments and the rate of interest, in each case, with respect to the Junior Liabilities is not increased from that in effect on the date hereof. 
 Except as expressly otherwise provided in this Agreement or as the Senior Lender may otherwise expressly consent in writing, the payment of the Junior
Biovest Liabilities shall be unsecured and subordinated in right of payment and priority to the payment in full of the Senior Biovest Liabilities. 
 Except as expressly otherwise provided in this Agreement or as the Senior Lender may otherwise expressly consent in writing, the payment of the Junior Accentia Liabilities shall be unsecured and subordinated in right of payment and priority
to the payment in full of all Senior Accentia Liabilities. 
 4. The Subordinated Lender hereby subordinates all claims and security
interests 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. 
 5. In the event of any dissolution, winding up, liquidation, readjustment, reorganization or other similar proceedings
relating to Accentia, Biovest 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),
(x) the Senior Biovest Liabilities shall first be paid in full before the Subordinated Lender shall be entitled to receive and to retain any payment or distribution in respect of any Junior Company Liabilities or Junior Biovest Liabilities and
(y) the Senior Accentia Liabilities shall first be paid in full before the Subordinated Lender shall be entitled to receive and to retain any payment or distribution in respect of any Junior Accentia Liabilities. 
 6. The Subordinated Lender will mark his books and records so as to clearly indicate that the Junior Company Liabilities, the Junior Biovest Liabilities
and the Junior Accentia Liabilities are subordinated in accordance with the terms of this Agreement. The 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. 
 7. The Subordinated Lender hereby waives all diligence in collection
or protection of or realization upon the Senior Biovest Liabilities and the Senior Accentia Liabilities or any security for the Senior Biovest Liabilities and the Senior Accentia Liabilities. 
 Telesis Subordination Agreement 
  

 - 3 - 

 8. The Subordinated Lender will not during the term of this Agreement without the prior written consent
of the Senior Lender: (a) attempt to enforce or collect any Junior Company Liability or any rights in respect of any Junior Company Liability other than with respect to payments otherwise permitted herein; or (b) commence, or join with any
other creditor in commencing, any bankruptcy, reorganization or insolvency proceedings with respect to Accentia, Biovest and/or any of its Subsidiaries. 
 9. The Senior Lender may, from time to time, at its sole discretion and without notice to the 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 to the extent not longer than the six year anniversary of the date hereof), 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 its 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. 
 10. The Senior Lender may, from time to time, whether before or after any discontinuance of this Agreement, without notice to the 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. 
 11. The Senior Lender shall not be prejudiced in its rights under this Agreement
by any act or failure to act of the Subordinated Lender, or any noncompliance of the 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 the Subordinated Lender under this Agreement. 
 12. 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 
 Telesis Subordination
Agreement 
  

 - 4 - 

 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 the 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 the Subordinated Lender under this Agreement. 
 13. This Agreement and all rights and obligations of the
Parties hereunder shall terminate upon the earlier to occur of (x) the indefeasible repayment in full of the Company’s obligations under the Biovest Funding Documents and the Accentia Funding Documents and (y) if ever, the issuance by
Senior Lender of indebtedness which is in principal amount, at least $5,000,000 in excess of the principal amount of indebtedness of Biovest to Senior Lender as contemplated in the Biovest Funding Documents as in effect on the date hereof.

 14. This Agreement shall be binding upon the Subordinated Lender and upon the heirs, legal representatives, successors and assigns of the
Subordinated Lender and the successors and assigns of the Subordinated Lender. 
 15. 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] 
 Telesis
Subordination Agreement 
  

 - 5 - 

 IN WITNESS WHEREOF, this Agreement has been made and delivered as of the date above first written.

  

			
	TELESIS CDE TWO, LLC
		
	By:	 	Telesis CDE Corporation,
		 	its managing member
		
	By:	 	  

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

	Name:	 	
	Title:	 	

  

			
	Acknowledged and Agreed to by:
	
	 BIOVAX, INC.

		
	 By:
	 	 /s/ James A. McNulty

	 Name:
	 	James A. McNulty
	 Title:
	 	CFO/Secretary
	
	 BIOVEST INTERNATIONAL, INC.

		
	 By:
	 	 /s/ James A. McNulty

	 Name:
	 	James A. McNulty
	 Title:
	 	CFO/Secretary

 Telesis Subordination Agreement 
  

 - 6 -Promissory Note, dated April 25, 2006

 Exhibit 10.5 
 NEITHER THIS NOTE NOR THE SECURITIES WITH WHICH THIS NOTE MAY BE REPAID HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, (THE “SECURITIES ACT”) AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE
REASONABLY ACCEPTABLE TO THE COMPANY. 
 Promissory Note 
  

			
	 $8,500,000
	  	April 25, 2006

 1. FOR VALUE RECEIVED, Biovax Investment LLC, a Delaware limited liability company (“Maker”)
promises to pay to the order of Biolender, LLC, a Delaware limited liability company (“Payee”), in lawful money of the United States of America in immediately available funds at 324 S. Hyde Park Ave., Suite 350, Tampa, Florida
33606, or at such other location as Payee may designate from time to time, the principal sum of Eight Million Five Hundred Thousand Dollars ($8,500,000) (or such lesser amount as may be advanced by Payee to Maker and be outstanding in connection
with this Note), with interest as provided herein (the “Loan”). Capitalized terms not otherwise defined herein shall have the meanings set forth in, and the interpretations applicable thereto, the Loan and Security Agreement of even
date herewith between Maker and Payee (as amended and modified from time to time in accordance with its terms, the “Loan Agreement”). 
 2.
Interest on the Loan shall accrue on the outstanding principal amount of the Loan at the rate of 5.18% per annum, non-compounding, commencing on the Effective Date until the date that is ninety (90) months and two (2) days from the
Effective Date (the “Maturity Date”); and shall be payable as follows: (i) 0.64% interest per annum, non-compounding, shall be payable in arrears on a monthly basis commencing on the first day of the calendar month following
the Effective Date and continuing on the first day of each calendar month thereafter until the Maturity Date; and (ii) any remaining accrued and unpaid interest shall be payable in one installment on the Maturity Date as set forth in
Section 3a. below. All interest on the Loan shall accrue based on the actual number of days elapsed and calculated based on a year of three hundred and sixty (360) days. 
 3. a. The outstanding principal amount on the Loan shall be due and payable by Maker, together with all accrued and unpaid interest thereon, on the Maturity Date (i) in cash in the amount of the outstanding
principal amount on the Loan, together with all accrued and unpaid interest thereon, if Maker received cash distributions from Telesis CDE Two, LLC (the “CDE”) on the Maturity Date from loan repayments of Biovax, Inc. to the CDE, or
(ii) in shares of Common Stock of Biovest International, Inc. (the “Company,” and such shares, the “Shares”), if Maker received shares of Common Stock from the CDE on the Maturity Date. The number of Shares
payable under Section 3.a(ii) above shall be determined by dividing the outstanding principal amount on the Loan, together with all accrued and unpaid interest thereon, by the Conversion Price as defined and further described in
Section 3.3 of that certain Convertible Loan Agreement among Biovax, Inc., the Company and the CDE. 

 b. The Shares will not be registered under the Securities Act and accordingly transfer of the Shares is
restricted as to transfer. It is understood that a legend substantially in the form as set forth below shall be affixed to any certificate issued in connection with the Shares: 
 THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT
WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE 1933 ACT AND APPLICABLE STATE SECURITIES LAWS, OR AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT UNLESS SOLD PURSUANT TO RULE 144 UNDER THE 1933 ACT. 
 4. Maker may, at its election, from time to time prior to maturity, prepay without penalty all or any portion of the principal indebtedness of this Note. 
 5. If payment for which notice has been duly given hereunder is not made when due, or if any payment due under any other note given by Maker to Payee is not made when due, then interest on the unpaid principal amount of this Note and any
other promissory notes given by Maker to Payee shall accrue from the date of default in the earliest due payment at a rate per annum equal to fifteen percent (15%) or the maximum rate permitted by law, whichever is less, until all past due
principal and interest have been paid, and, at the election of Payee without further notice, all principal and interest hereunder and under any such other promissory notes shall be due and payable forthwith. 
 6. Demand for payment shall be presumed to have been issued and the entire unpaid principal sum of this Note, together with accrued interest thereon, if any, shall
become immediately due in the event of the occurrence of any one or more of the following: the filing by Maker of a voluntary petition in bankruptcy; or the failure by Maker within thirty (30) days thereof to lift any filing against Maker of
any involuntary petition in bankruptcy; or any execution against or attachment of any substantial portion of Maker’s assets; or the adjudication of Maker as bankrupt; or any admission by Maker of insolvency or declaration of Maker as insolvent;
or the failure, inability, or unwillingness of Maker to pay its debts when and as they become due; or the application by Maker for, consent of Maker to, or acquiescence of Maker in, the appointment of a trustee, receiver, sequestrator, or other
custodian for Maker or any of its property; or any assignment by Maker for the benefit of its creditors; or the invalidity or illegality of any portion of this Note by reason of any act or omission by Maker. 
 7. No delay or omission of Payee to exercise its rights hereunder shall impair any such right or power or shall be construed to be a waiver of any such default or any
acquiescence therein. Any acceptance by Payee of a partial or late payment made hereunder shall not establish a custom, waiver, or acquiescence. No waiver of any default shall be construed, taken, or held to be a waiver of any other default, or
waiver or acquiescence in, or consent to any further or succeeding default of the same nature. Maker waives demand, notice, and protest and any defense by reason of extension of time for payment or other indulgence granted by Payee. 
 8. By the terms of the Loan Agreement, the undersigned has pledged and does hereby pledge to Payee and grant Payee a first priority security interest in the entire
interest of the undersigned in the CDE, which 
  

 2 

 has been acquired by the undersigned in part with the proceeds of the loan evidenced by this Note, as security for the
payment of this Note. In the event of default by the undersigned in the payment of any principal or interest due upon this Note, Payee shall have, and is hereby granted, upon the expiration of any applicable notice and cure period, all of the rights
and remedies of a secured party under the Uniform Commercial Code with respect to such collateral. Additional provisions relating to such security interest and the enforcement thereof are contained in that Loan and Security Agreement, which
provisions are hereby incorporated in this Note by reference as though fully set forth herein. 
 9. In the event of a default hereunder, Maker shall pay to
Payee, on demand, all reasonable costs and expenses incurred by Payee in enforcing its remedies hereunder, including without limitation attorneys’ fees for advice concerning this Note or the collateral hereunder, whether or not suit is filed,
or for representation in any enforcement hereof or dispute hereunder, whether instituted by Payee, Maker, or any third party, and all other costs and expenses of collection of amounts due hereunder, protection or realization of any collateral for
payment thereof, and resale of such collateral. 
 10. It is the intention of Maker and Payee to conform strictly to applicable usury laws. Accordingly,
notwithstanding anything to the contrary in this Note, amounts constituting interest under applicable law and contracted for, chargeable or receivable hereunder or under this Note shall under no circumstances, together with any other interest, late
charges or other amounts which may be interpreted to be interest contracted for, chargeable or receivable hereunder, exceed the maximum amount of interest permitted by law, and in the event any amounts were to exceed the maximum amount of interest
permitted by law, such excess amounts shall be deemed a mistake and shall either be reduced immediately and automatically to the maximum amount permitted by law or, if required to comply with applicable law, be canceled automatically and, if
theretofore paid, at the option of Payee, be refunded to Maker or credited on the principal amount of this Note then outstanding. 
 11. This Note is given
to Payee at its principal place of business in the State of Delaware, and shall be deemed to be made at such location. This Note shall be governed and controlled, as to interpretation, validity, enforcement, and in all other respects, by the laws of
the State of Delaware, without regard to its conflict of laws provisions. 
 [Signature Page Follows] 
  

 3 

 IN WITNESS WHEREOF, Maker has executed this Promissory Note as of the day and year first written above.

  

					
	Maker:
	 Biovax Investment LLC,
 a Delaware limited
liability company

		
	By:	 	Biovax Investment Corporation,
		 	a Delaware corporation,
		 	its managing member
			
		 	By:	 	  

			
		 	Its:	 	  

 Signature Page – Promissory Note

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00102-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00102-of-00352.parquet"}]]