Document:

Demand Note, dated April 25, 2006

 Exhibit 10.2 
 DEMAND NOTE 
  

			
	 $2,500,000
	 	April 25, 2006
		 	New York, New York

 FOR VALUE RECEIVED, BIOVEST INTERNATIONAL, INC., a Delaware corporation, (the
“Maker”), promises to pay to LAURUS MASTER FUND, LTD. (the “Payee”), ON DEMAND, at c/o Laurus Capital Management, LLC, 825 Third Avenue, 14th Floor, New York, New York 10022, or at such other place as may be designated in writing by the holder of this Note, the principal sum of TWO MILLION FIVE
HUNDRED THOUSAND ($2,500,000) DOLLARS, which sum all be payable in lawful money of the United States of America, together with interest on the unpaid principal balance computed from the date hereof at 2.0% per annum. Interest shall be
calculated on the basis of the actual number of days elapsed over a year of 360 days and shall be paid on the first day of each month. 
 1.
DEFAULT INTEREST. In addition to any late payment charge which may be due under this Note, if the principal indebtedness is not paid in full when due, the Maker shall thereafter, pay interest on the principal sum then remaining unpaid from
the due date until the date on which the principal sum then outstanding is paid in full (whether before or after judgment), at a rate per annum (calculated for the actual number of days elapsed on the basis of a 360-day year) equal to the rate
initially payable hereunder plus 2.0%; provided, however, that such interest rate shall in no event exceed the maximum interest rate which the Maker may by law pay. 
 2. AUTHORITY. The Maker (and the undersigned representatives of the Maker, if any) represents that the Maker has full power, authority and legal right to execute and deliver this Note and that this Note
constitutes a valid and binding obligation of the Maker. 
 3. DEFINED TERMS. Whenever used, the singular number shall include the
plural, the plural the singular, and the words “Payee” and “Maker” shall include, respectively, their respective successors and assigns; provided, however, that the Maker shall in no event or
under any circumstance have the right to assign or transfer its obligations under this Note or the related documents, in whole or in part, to any other person, party or entity. 
 4. HEADINGS, ETC. The headings and captions of the numbered paragraphs of this Note are for convenience of reference only and are not to be
construed as defining or limiting, in any way, the scope or intent of the provisions hereof. 
 5. ENFORCEABILITY. The Maker
acknowledges that this Note and the Maker’s obligations under this Note are and shall at all times continue to be absolute and unconditional in 

 all respects, and shall at all times be valid and enforceable irrespective of any other agreements or circumstances of
any nature whatsoever which might otherwise constitute a defense to this Note and the obligations of the Maker under this Note or the obligations of any other person or party relating to this Note. This Note and the instruments and documents
referred to herein (collectively and as the same may be amended or otherwise modified from time to time, the “Documents”) set forth the entire agreement and understanding of the Payee and the Maker, and the Maker absolutely,
unconditionally and irrevocably waives any and all right to assert any set-off, counterclaim or crossclaim of any nature whatsoever with respect to this Note or the obligations of the Maker hereunder or thereunder, or the obligations of any other
person or party relating hereto or thereto or to the obligations of the Maker hereunder or thereunder or otherwise in any action or proceeding brought by the Payee to collect the Note, or any portion thereof, or to enforce, foreclose and realize
upon the liens and security interests of the Payee in any collateral (provided, however, that the foregoing shall not be deemed a waiver of the Maker’s right to assert any compulsory counterclaim maintained in a court of the United States, or
of the State of New York if such counterclaim is compelled under local law or rule of procedure, nor shall the foregoing be deemed a waiver of the Maker’s right to assert any claim which would constitute a defense, setoff, counterclaim or
crossclaim of any nature whatsoever against the Payee in any separate action or proceeding). The Maker acknowledges that no oral or other agreements, conditions, promises, understandings, representations or warranties exist with respect to this Note
or with respect to the obligations of the Maker under this Note, except those specifically set forth in this Note and the instruments and documents being signed concurrently herewith. 
 6. WAIVER. The Maker waives presentment, demand for payment, notice of dishonor and any or all notices or demands in connection with the delivery,
acceptance, performance, default or enforcement of this Note and consents to any or all delays, extensions of time, renewals, release of any party to any document related to this Note (collectively the “Documents”), and of any available
security therefor, and any and all waivers or modifications that may be granted or consented to by the Payee with regard to the time of payment or with respect to any other provisions of any of the Documents, and agrees that no such action, delay or
failure to act on the part of the Payee shall be construed as a waiver by the Payee of, or otherwise affect, in whole or in part, its right to avail itself of any remedy with respect thereto. No notice to or demand on the Maker shall be deemed to be
a waiver of the obligation of the Maker or of the right of the Payee to take further action without further notice or demand as provided in any of the Documents. 
 7. AMENDMENTS. This Note may not be modified, amended, changed or terminated orally, except by an agreement in writing signed by the Maker and the Payee. No waiver of any term, covenant or provision of this
Note shall be effective unless given in writing by the Payee and, if so given by the Payee, shall only be effective in the specific instance in which given. 
 8. GOVERNING LAW. This Note is and shall be deemed entered into in the State of New York and shall be governed by and construed in accordance with the laws of the State of New York, without regard to principles
of conflicts of laws. 
  

 2 

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

  

			
	BIOVEST INTERNATIONAL, INC.
		
	 By:
	 	 /s/ James A. McNulty

	 Name:
	 	James A. McNulty
	 Title:
	 	CFO/Secretary

  

 3First Bank Subordination Agreement

 Exhibit 10.3 
 FIRST BANK 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”), First Bank, a Missouri banking corporation (the “Subordinated Lender”), and Accentia Biopharmaceuticals, Inc., a Florida corporation (“Accentia,” and together with the Senior Lender and the
Subordinated Lender, 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, Accentia and others (as amended, modified or supplemented from time to time, the “Consent”), it is a condition to the Senior Lender consenting to the Accentia Loan that the
Senior Lender and the Subordinated Lender enter into this Agreement; 
 WHEREAS, pursuant to the documents evidencing the Accentia Loan (the
“Junior Loan Documents”), the Subordinated Lender has agreed to make available a subordinated loan facility on the terms thereof; and 
 WHEREAS, it has been agreed that the facilities evidenced by the Accentia 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 Accentia or any of its Subsidiaries to the Senior Lender under the Accentia Funding Documents are
referred to as “Senior Liabilities.” The obligations of Accentia under the Junior Loan Documents are referred to as “Junior Liabilities.” The Subordinated Lender hereby represents and confirms that it has no other obligations
owing from Accentia other than 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. 
 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 the Senior Liabilities. Furthermore, no payments or other distributions in respect of
the Junior Liabilities shall be made (whether at stated maturity, by acceleration or otherwise) nor shall any property or assets of Accentia or any of its Subsidiaries be applied to the purchase or other acquisition or retirement of any Junior
Liabilities prior to the termination of this agreement, 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, Accentia may repay in full the
Junior Liabilities, so long as (i) no Event of Default (as defined in the Secured Promissory Note, dated as of March 31, 2006 and issued by Biovest to the Senior Lender (the “Note”)) has occurred and is continuing at the time of
any such payment and (ii) the source of funds of such repayment shall be derived solely from the proceeds paid by Biovest to Accentia in respect of the Biovest Redemption. Laurus hereby confirms to the Subordinated Lender that, upon giving
effect to the Consent, it has no knowledge as of the date hereof that any Event of Default has occurred or is continuing under the Note. 
 3. The Subordinated Lender hereby subordinates all claims and security interests it may have against, or with respect to, any of the assets of Accentia and/or any of its Subsidiaries, to the security interests granted by Accentia 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 Accentia 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 Accentia and/or any of its Subsidiaries, or any sale of all or substantially all of the assets of
Accentia and/or any of its Subsidiaries, or otherwise), the Senior 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 Liabilities.

 5. The Subordinated Lender will mark his books and records so as to clearly indicate that the Junior 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. 
 6. The 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. 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 Liability or any rights in respect of any Junior Liability other than with respect to payments otherwise permitted pursuant to Section 2 hereof; or
(b) commence, or join with any other creditor in commencing, any bankruptcy, reorganization or insolvency proceedings with respect to Accentia and/or any of its Subsidiaries. 
 Subordination Agreement 
  

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 8. 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), 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. 

9. 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. 
 10. 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. 
 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 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. 
 Subordination Agreement 
  

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 10. This Agreement and all rights and obligations of the Parties hereunder shall terminate upon the
indefeasible repayment in full of Accentia’s obligations under the Accentia Funding Documents, or the indefeasible repayment in full of Accentia’s obligations under the Junior Loan Documents to the extent that such repayment was otherwise
permitted pursuant to Section 2 herein. 
 11. 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. 
 12. 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 
  

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 IN WITNESS WHEREOF, this Agreement has been made and delivered this 25th day of April 2006. 
  

			
	FIRST BANK
		
	By:	 	  

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

	Name:	 	
	Title:	 	

  

			
	Acknowledged and Agreed to by:
	
	ACCENTIA BIOPHARMACEUTICALS, INC.
		
	By:	 	 /s/ James A. McNulty

	Name:	 	James A. McNulty
	Title:	 	Secretary Treasurer

 Subordination Agreement 
  

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