Document:

exv10w7

Exhibit 10.7

THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL

TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [* * *] AND HAS

BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

...Speeding medicines to people

170 Locke Drive, Marlborough, MA 01752 • Tel: 508-480-9235 • Fax: 508-480-9238 •www.xcellerex.com

Xcellerex Proposal and Binding Term Sheet

for Novavax Inc.

Clinical and Commercial Production of Novavax’s Influenza Virus-Like

Particles Expressed in SF9 Cell Line

October 19, 2009

This Proposal and Binding Term Sheet (“Term Sheet”) contains information belonging to Xcellerex,
Inc. (“Xcellerex”) and information belonging to Novavax, Inc. (“Novavax”) that is confidential.
This information is only intended for the use of the other above named entity, the recipient, as
provided in this proposal and binding term sheet. The recipient may not disclose, and shall use
all reasonable efforts to prevent the inadvertent disclosure of the Confidential Information to any
third party without the prior written consent of the entity who owns such information. In
addition, the recipient may not use the information for any purposes except for the express
purposes set forth in this proposal and binding term sheet. For purposes of any prior
confidentiality agreement between Novavax and Xcellerex, this document shall constitute
confidential information even if not so marked on every page of the documents and may only be used
for the purposes specified. The Confidentiality Agreement between Novavax and Xcellerex dated
March 20, 2009 (the “CDA”) shall govern the exchange of Confidential Information (as defined in the
CDA) set forth herein and pursuant to this Term Sheet, and this Term Sheet shall be deemed to
be Confidential Information of both parties. If you receive this document in error, please
immediately contact us by telephone to arrange for return of the original documents to us.

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THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL

TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [* * *] AND HAS

BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

Executive Summary

Novavax, Inc. (“Novavax”) is a clinical stage biotechnology company, creating novel vaccines to
address a broad range of infectious diseases worldwide using advanced proprietary virus-like
particle (VLP) technology and manufacturing such vaccines using a proprietary process.

Novavax is developing a monovalent Influenza VLP Vaccine for the pandemic human H1N1 influenza
virus (A/California/7/2009), which is commonly referred to as the “swine” flu (the “Product”). The
process uses recombinant baculovirus to infect an insect cell culture and express VLPs that contain
Hemagglutinin (HA), Neuraminidase (NA), and Matrix (M1) Protein. The proteins self-assemble as
they are secreted from the insect cells as particles that resemble influenza virus, but do not
contain flu RNA.

The current proposal is for Xcellerex’s commercial production of the bulk drug substance of the
Product (the “Bulk Material”) for Novavax for use and sale in Mexico. Xcellerex shall produce the
Bulk Material in as many consecutive batches as it deems necessary to produce [* * *] doses of
equivalent Bulk Material, but Xcellerex anticipates an initial campaign of an estimated [* * *]
consecutive batches. Notwithstanding anything in this Term Sheet to the contrary, in no event
shall Xcellerex be required to manufacture more than [* * *] consecutive batches of Bulk Material.
Novavax shall order all lots of Bulk Material to be made in continuous consecutive batches for [* *
*] doses of equivalent Bulk Material. The parties intend for Xcellerex to be the exclusive contract
manufacturer of the Bulk Material for sale in Mexico until February 15, 2010, unless otherwise
agreed to by the parties. For other markets where Xcellerex would be the low cost provider of Bulk
Material, Novavax agrees to appoint Xcellerex as the co-exclusive supplier of Bulk Material in such
market through June 2010, or as mutually agreed, except in territories where Novavax has already
granted rights.

Payment and other legal terms are as outlined in Attachment 3.

Proposal Assumptions

The following proposal is for contract services to manufacture commercial material for Novavax and
its licensees/partners during the Term. The “Term” shall end on the earlier of: 1) the delivery
of [* * *] dose equivalent of Bulk Material; or 2) delivery of Bulk Material from [* * *] batches;
or 3) February 15, 2010; or 4) mutual termination or termination as provided in Attachment 3. For
avoidance of doubt, in no event shall Xcellerex be required to supply Bulk Material after the
expiration of the Term, and in no event shall Novavax be required to pay for Bulk Material
delivered after the expiration of the Term.

	 	A.	 	Materials and Supplies
	 
	 	•	 	Insect cell lines, being delivered to Xcellerex for use in development or manufacturing
programs, require acceptance testing to confirm culture purity and identity prior to
receipt and use in cGMP manufacturing areas at Xcellerex.
	 
	 	•	 	The parties shall agree on the materials to be supplied for manufacture of Product, and
whose responsibility it will be to supply the materials. Novavax will supply, at Novavax’s
expense, to Xcellerex the raw materials set forth on Attachment 7 and any other materials
agreed to by the parties (the “Novavax Materials”), and Xcellerex shall order and supply,
at Xcellerex’s expense, the raw materials set forth on Attachment 7 and any other materials
agreed to by the parties (the “Xcellerex Materials,” and, together with the Novavax
Materials, the “Materials”), in each case for the execution of no more than [* * *] batches
under the Work Plan. Attachment 7 Sets forth the parties initial list of Novavax Materials
and Xcellerex Materials. In order that the

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	 	 	 	relative cost of the Novavax Materials and the Xcellerex Materials will be [* * *]%, the
parties agree that within 10 days of execution of this Term Sheet, the parties will agree to
a budget for the Materials to be provided by each party including the associated expense.
Any expense in excess of a party’s agreed upon budget must be approved by the other party
and, upon approval, will be split [* * *]% and arrangement will be made to provide Novavax
with the appropriate credit to the Per Dose Fee for its portion of the excess expenses. The
Novavax Materials will be arranged to arrive at Xcellerex’s facility 10 days in advance of
each batch whenever possible, and, where necessary, qualified and released by Novavax
quality assurance personnel prior to their expected use in the manufacturing process. In
accordance with, and subject to, Attachment 3, Novavax will receive a credit against the Per
Dose Fee for Bulk Material upon delivery based on the actual cost for the Novavax Materials
supplied by Novavax.

	 	•	 	The Bill of Materials for the Work Plan will be completed by Novavax and Xcellerex and
will include a designation of which Materials are Novavax Materials and which Materials are
Xcellerex Materials. The Parties rely upon Novavax’s information for the completion of the
Bill of Materials.
	 
	 	•	 	To the extent Novavax Materials are not used by Xcellerex in performance hereunder, the
unused Novavax Materials will be handled as set forth in Attachment 3.
	 
	 	B.	 	Analytical
	 
	 	•	 	The analytical methods required for evaluating Bulk Material quality during the project
have yet to be fully specified. A review of the analytical requirements including assay
qualifications, and assays required for in-process testing will be required. Attachment 1
contains a list of assays typically performed by Xcellerex.
	 
	 	C.	 	Capital Equipment
	 
	 	•	 	A list of equipment required by Xcellerex to perform the work in this Term Sheet is
included on Attachment 4. Novavax will purchase the equipment so indicated on Attachment 4
and cause it to be shipped to Xcellerex. All equipment purchased by Novavax and shipped to
Xcellerex shall be owned by Novavax, shall be used exclusively for the work hereunder and
shall be returned to Novavax, at Novavax’s cost, upon completion of the work under the Term
Sheet. Xcellerex shall insure all equipment in its possession, including the equipment to
be returned to Novavax. Novavax shall file UCC-1 financing statements on the equipment for
bailment.
	 
	 	•	 	In the event equipment in addition to that listed on Attachment 4 or already in
Xcellerex’s possession is required, the parties shall mutually agree to a resolution
regarding such equipment in good faith. Novavax shall not have any additional capital
equipment requirements beyond what is indicated in Attachment 4 without mutual consent.
	 
	 	D.	 	Volumes
	 
	 	•	 	All volumes listed are considered to be working volumes.
	 
	 	E.	 	The Manufacturing process to be used by Xcellerex is described in Attachment 2.

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Novavax Contact:

Technical Contact:

Quality Contact:

Business Contact:

Xcellerex Contacts

Project Coordinator:

Regulatory Contact: 

Business Contact:

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	Section	 	Description	 	Duration Estimate	 	Estimated Cost
	1.0

	 	Project/process scope definition,
creation of quality agreement
	 	Weeks [* * *]
	 	Included
	 
	 	 	 	 	 	 
	2.0

	 	Technology Transfer
	 	[* * *] Weeks
	 	Included
	 
	 	 	 	 	 	 
	3.0

	 	Working Virus Stock and Seed
Production
	 	[* * *] weeks
 (includes testing)
	 	Included
	 
	 	 	 	 	 	 
	4.0

	 	Assay Transfer for in-process testing
	 	[* * *] Weeks
	 	Included
	 
	 	 	 	 	 	 
	 

	 	Report	 	 	 	 
	 
	 	 	 	 	 	 
	5.0

	 	Generation and Preparation of cGMP
Documentation
	 	[* * *] Weeks
	 	Included
	 
	 	 	 	 	 	 
	 

	 	Report	 	 	 	 
	 
	 	 	 	 	 	 
	6.0

	 	Process Equipment Installation and
Qualification
	 	[* * *] Weeks
	 	Included
	 
	 	 	 	 	 	 
	 

	 	Report	 	 	 	 
	 
	 	 	 	 	 	 
	7.0

	 	cGMP Consecutive Manufacturing Runs
	 	[* * *] Weeks
	 	Included
	 
	 	 	 	 	 	 
	 

	 	•     [* * *]
	 	 	 	 

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DRAFT Process Flow Scheme

To be confirmed with Novavax prior to commencement of work

[* * *]

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Initial Dose Assumptions and Total Price for the Project

based on assumptions provided by Novavax

	 	 	 	 	 	 	 	 	 
	 	 	 	 	Requirements	 	Amounts	 
	 	 	 	 	
	 	 	 	 
	 	1	 	 	Total Number of Doses Required per Manufacturing Campaign
	 	Minimum [* * *]
	 	 	 	 	 
	 	 	 	 
	 	2	 	 	Price Per Dose
	 	[* * *] per dose

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Draft Work Plan

[* * *]

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 General Terms and Conditions

This Term Sheet, including all of the seven attachments to the Term Sheet, shall be binding on
the parties. Any additional terms related to the transactions described herein, shall be set forth
more fully in an additional agreement to be negotiated in good faith by the parties (the
“Agreement”); provided that the terms of this Term Sheet shall be incorporated into the Agreement,
and this Term Sheet shall remain binding on the parties until such time as an Agreement has been
executed by both parties. The parties shall use good faith and commercially reasonable efforts to
enter into the Agreement as soon as practicable, but in no event more than 21 days from the date
hereof, and the Agreement shall include terms, conditions, representations, warranties,
indemnifications and covenants usual for agreements of this type. The parties also will issue a
press release, as drafted in Attachment 6, upon signing this Term Sheet announcing the partnership
and the intent to produce H1N1 vaccine. In the event the parties are unable to enter into the
Agreement, this Term Sheet shall remain binding on the parties until the earlier of (i) the parties
mutually agree in writing to terminate this Term Sheet, (ii) delivery of [* * *] dose equivalent of
Bulk Material, (iii) delivery of Bulk Material from [* * *] batches, (iv) February 15, 2010, or (v)
termination as provided in Attachment 3.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	NOVAVAX, INC.	 	 	 	XCELLEREX, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	BY:	 	/s/ Rahul Singhvi	 	 	 	BY:	 	/s/ Jon Lieber	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	NAME:
	 	Rahul Singhvi
	 	 	 	 	 	NAME:
	 	Jon Lieber	 	 
	 

	 	TITLE:
	 	President and CEO
	 	 	 	 	 	TITLE:
	 	CFO	 	 
	DATE: October 19, 2009	 	 	 	DATE: October 19, 2009	 	 

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Attachment 1

[* * *]

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Attachment 2

DRAFT Novavax Process Description for VLP Manufacturing [to be confirmed and agreed with

Novavax and transferred to Xcellerex prior to commencement of Work Plan]

CONFIDENTIAL INFORMATION OF NOVAVAX

[* * *]

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Attachment 3

In consideration for services performed by Xcellerex, the payments made by Novavax and the other
representations and covenants of each of the parties, Novavax and Xcellerex would agree to the
following terms:

	 	•	 	All payments shall be by wire transfer in immediately available funds to an account
designated by Xcellerex based upon invoice(s) as provided by Xcellerex if required.
Novavax will issue a P.O. prior to initiation of the first batch, [* * *] at the latest.
	 
	 	•	 	The anticipated initial non-binding production schedule for the initial [* * *] batches
is as follows:

[* * *]

	 	•	 	All payments are due within 30 days of invoice which shall be issued upon delivery and
acceptance of Bulk Material. By [* * *], Novavax will provide a letter of credit to
Xcellerex in an amount equal to [* * *]. The letter of credit will roll over with each
batch and payment so that it will remain in place until the earlier of (a) payment in full
by Novavax under this Term Sheet for [* * *] doses equivalent of Bulk Material, or (b)
delivery of Bulk Material from [* * *] batches, or (c) 30 days after termination of the
Term Sheet. In the event any payment for accepted Bulk Material is not made by Novavax
within 30 days of acceptance, then Xcellerex will be entitled to draw on such Letter of
Credit. Xcellerex shall be entitled to suspend performance during any period in which
Novavax owes Xcellerex in excess of [* * *] provided that 30 days have elapsed since the
oldest invoice then outstanding.
	 
	 	•	 	Novavax shall be responsible for any taxes related to the ownership or use of the
equipment purchased and owned by Novavax. All taxes associated with the sale by Novavax of
Bulk Material, including VAT, will be the responsibility of Novavax.
	 
	 	•	 	Payments received more than three business days after the due date will be subject to
interest daily based on the prime rate as published in the Wall Street Journal.
	 
	 	•	 	Novavax shall pay to Xcellerex [* * *] in immediately available funds via wire transfer
upon execution of this Term Sheet.
	 
	 	•	 	Novavax shall pay to Xcellerex [* * *] in immediately available funds via wire transfer
on [* * *], 2009. Such payments collectively referred to as the “Prepayments” and are
non-refundable but are creditable against the Per Dose Fees as set forth below.
	 
	 	•	 	Novavax shall pay a “Per Dose Fee” equal to [* * *] per dose of equivalent Bulk Material
that is delivered to and accepted by Novavax or its designated Mexican buyer, less a credit
for the

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	 	 	 	actual cost of all Novavax Materials used by Xcellerex in the applicable batch; and less a
credit against the total amount of Prepayments at the rate of [* * *] for each of the first
[* * *] batches. The formulas for Per Dose Fee payments are as follows: Per Dose Fee for
[* * *] batches = ([* * *] X equivalent number of doses of Bulk Material in the applicable
batch that are delivered and accepted) — actual cost of Novavax Materials used in the
applicable batch — [* * *]. Per Dose Fee for [* * *] batches = ([* * *] X equivalent
number of doses of Bulk Material in the applicable batch that are delivered and accepted) —
actual cost of Novavax Materials used to manufacture the applicable batch.
	 
	 	•	 	To the extent that Novavax does not get the benefit of a full credit for the total
amount of Prepayments because Xcellerex delivers [* * *] doses of equivalent Bulk Material
in fewer than [* * *] batches, Novavax shall receive a credit against future purchases of
Xcellerex equipment or services that may be provided by Xcellerex to Novavax.
	 
	 	•	 	Xcellerex will use commercially reasonable efforts to deliver Bulk Material as soon as
possible.
	 
	 	•	 	Delivery terms are FOB [* * *] (INCOTERMS 2000).
	 
	 	•	 	Based on the performance of the work hereunder, the parties may discuss future
manufacturing work by Xcellerex.
	 
	 	•	 	To the extent Xcellerex does not use all Novavax Materials ordered for the production of
Bulk Material, Xcellerex shall return all Novavax Materials to Novavax free of charge,
except that Novavax shall pay shipping charges and designate the shipper with respect to
such Novavax Materials.
	 
	 	•	 	Xcellerex shall have no liability with respect to any defect in Bulk Material that
results from defective Materials or for delay in manufacturing campaigns or delivery of
Bulk Material due to delays from suppliers beyond Xcellerex’s reasonable control.
	 
	 	•	 	In no event shall either party be liable hereunder for consequential, incidental,
indirect, exemplary, special or punitive damages.
	 
	 	•	 	As provided in the Term Sheet, Novavax will provide certain equipment to Xcellerex that
will be returned to Novavax upon completion of the work.
	 
	 	•	 	[* * *]
	 
	 	•	 	Novavax may terminate this Term Sheet prior to January 15, 2010 without material uncured
breach by Xcellerex because (a) the clinical trial of Product fails or is delayed, either
for safety reasons or insufficient immunogenicity data, (b) because Novavax and its Mexican
partner decide not to submit an application for regulatory approval in Mexico, or (c)
because the application for regulatory approval is rejected or not approved in a timely
manner, in which case,

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	 	 	 	Xcellerex shall be entitled to keep the full amount of any Prepayments made up to the
termination date, plus Xcellerex shall return all unused Novavax Materials purchased by
Novavax at no charge, except that Novavax shall pay shipping charges and designate the
shipper with respect to such Novavax Materials, and Xcellerex shall receive no further
payments. If this Term Sheet is terminated after December 2, 2009 and prior to or on
January 15, 2010, and subsequently Novavax has the opportunity to sell doses of Bulk
Material to a third party, then Xcellerex will deliver the Bulk Material that had been
manufactured prior to termination and Novavax shall pay the Per Dose Fee for the delivered
product. Xcellerex will not be obligated to store completed Bulk Material after April 30,
2010.
	 
	 	•	 	On or before December 2, 2009, for any reason, Novavax may terminate this Term Sheet.
If terminated, (a) Xcellerex shall be entitled to keep the full amount of any Prepayments
made up to the date of notice plus the value of the Novavax Materials used up to such date,
and shall receive no further payments (except as set forth in (d) below); (b) Xcellerex
shall return all unused Novavax Materials purchased by Novavax at no charge, except that
Novavax shall pay shipping charges and designate the shipper with respect to such Novavax
Materials; (c) Xcellerex shall deliver all completed Bulk Material to Novavax; and (d)
Novavax may use such Bulk Material for research, development and regulatory purposes or
sell such Bulk Material and, to the extent that Novavax sells any such Bulk Material,
Novavax shall pay to Xcellerex the Per Dose Fee (taking into consideration the per batch
credits for Novavax Materials used in the applicable batch and the [* * *] credit).
	 
	 	•	 	To the extent that Xcellerex is practicing any methods or procedures provided by Novavax
and to the extent that Xcellerex is manufacturing Product, Novavax represents and warrants
that Xcellerex’s manufacture of Bulk Material shall not infringe the intellectual property
rights of any third party.
	 
	 	•	 	To the extent that Xcellerex is practicing any methods or procedures not provided by
Novavax, Xcellerex represents and warrants that Xcellerex’s manufacture of Bulk Material,
and Novavax’s sale of Bulk Material, shall not infringe the intellectual property rights of
any third party. This representation and warranty shall only apply to an infringement
caused solely by the practice of methods or procedures not provided by Novavax.
	 
	 	•	 	Each Party represents and warrants that, as of the date of the execution of this Term
Sheet, it is not aware of any activities it or the other Party is engaged in that would
breach this Term Sheet or cause Xcellerex’s manufacture of Bulk Material to infringe the
intellectual property rights of any third party.

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	 	•	 	Novavax is entitled to have development resources and a quality person on Xcellerex
premises during the term and during production of Bulk Material as long as such person does
not interfere with operations at Xcellerex and has been appropriately trained on and
follows Xcellerex policies and procedures.
	 
	 	•	 	All Bulk Material provided by Xcellerex shall meet the specifications as set forth in
Attachment 5 (the “Specifications”). All Bulk Material shall be manufactured in accordance
with cGMP and all work shall be performed in accordance with all applicable laws and
regulations. All Bulk Material will be delivered with a completed batch review from
Xcellerex quality group and will be subject to inspection and acceptance by Novavax or its
designated Mexican partner no later than two business days from the date of shipment from
Xcellerex. For purposes of this Term Sheet, “cGMP” and “GMP” shall mean any applicable
current Good Manufacturing Practices as defined in the US Federal Food, Drug and Cosmetics
Act of 1938, and the regulations and guidances promulgated thereunder, as may be amended
from time to time, which are in effect as of the date the services are rendered.
	 
	 	•	 	All intellectual property or technology of each of the parties existing prior to this
Term Sheet or developed outside the scope of this Term Sheet shall remain the property of
the owning party and the other party shall have no rights with respect to any such
intellectual property or
technology except that each party will have the right to perform the work as described in
the Term Sheet and Novavax will have the right to export, use and sell all Bulk Material.
If either party creates or discovers any new intellectual property (patentable or not) or
technology of any kind during the course of performing the work under and pursuant to the
Term Sheet (the “Developed Technology”), ownership of intellectual property will follow the
laws of inventorship. Novavax will own Developed Technology made by Novavax (the “Nvax
Developed Technology”); Xcellerex will own Developed Technology made by Xcellerex (the “XRX
Developed Technology”); and Developed Technology that is jointly invented will be owned
jointly (the “Joint Developed Technology”). Each of Novavax and Xcellerex shall promptly
notify the other of any Developed Technology to the other. Novavax is hereby granted a
fully-paid, royalty free, sub-licenseable, nonexclusive license to all XRX Developed
Technology to manufacture, use and sell, and have manufactured, used and sold, any Novavax
VLP product anywhere in the world. Xcellerex is hereby granted a fully-paid, royalty free,
sub-licenseable, nonexclusive license to all Nvax Developed Technology to manufacture, use
and sell, and have manufactured, used and sold products other than a VLP product anywhere in
the world. For avoidance of doubt, the foregoing license grant (A) to Novavax shall not
apply to the bioreactor

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	 	 	 	and mixer technologies and equipment known as XDRTM, XDMTM and FLEXFACTORY®, the Xcellerex
process control methods and electronic batch record technology and PDMaxTM, and any
improvements to any of the foregoing and (B) to Xcellerex shall not apply to Novavax’s VLP
technology, including the process of creating VLP product, and Novavax’s baculovirus
manufacturing process, and any improvements to any of the foregoing.
	 
	 	•	 	Neither party may make any public statement, issue any press release or any other
publication regarding this Proposed Term Sheet, the Agreement, or the transactions contemplated
hereunder and thereunder without the prior consent of the other party, except as set forth in
Attachment 6.

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Attachment 4

[* * *]

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Attachment 5

Specifications

[* * *]

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Attachment 6

Press Release 

Novavax and Xcellerex Announce Collaboration to Develop Large-scale

Manufacturing Process for 2009 H1N1 Influenza VLP Vaccine

Partnership will enable rapid, cost-effective, large-scale production

of novel Novavax VLP vaccine utilizing Xcellerex’s FlexFactory
®

manufacturing solution for Mexico

Rockville, MD and Marlborough, MA — October 21, 2009 — Novavax, Inc. (NASDAQ: NVAX) and
Xcellerex, Inc. has entered into a strategic collaboration to accelerate the development of
Novavax’s vaccine manufacturing process to commercial scale and begin immediate production of
Novavax’s novel 2009 H1N1 influenza vaccine for potential commercial sale. Earlier this week,
Novavax launched a two-stage, 4,000-patient clinical study of its H1N1 flu vaccine in Mexico to
support registration in that country. The two companies will utilize Novavax’s unique virus-like
particle (VLP) vaccine technology to produce initial commercial quantities of H1N1 vaccine with
Xcellerex’s FlexFactory biomanufacturing platform. Xcellerex will provide development expertise and
product manufacturing in exchange for manufacturing supply fees from Novavax.

“We are pleased to apply our state-of-the-art FlexFactory manufacturing technology to enable the
rapid, commercial-scale production of H1N1 flu vaccine by Novavax. Our technology offers Novavax a
cost-effective and flexible manufacturing solution for this public health crisis by achieving full
commercial-scale production of VLP-based vaccines much more rapidly than traditional vaccine
production methods,” stated Joseph Zakrzewski, Xcellerex’s President and Chief Executive Officer.

“This strategic partnership represents a major step forward for Novavax and will allow us to
increase the scale of our VLP vaccine manufacturing process and expand capacity to satisfy
potential demand for our H1N1 VLP vaccine in Mexico. This alliance will also enable us to establish
commercial-scale production capabilities for our VLP-based seasonal influenza vaccine program and
significantly advance our timeline for full scale manufacturing,” said Rahul Singhvi, Novavax’s
President and Chief Executive Officer.

About VLPs

Virus-like particles (VLPs) mimic the external structure of viruses but lack the live genetic
material that causes viral replication and infection. VLPs can be designed quickly to match
individual viral strains and be produced efficiently using portable cell-culture technology.
Novavax VLP-based vaccine candidates are produced more rapidly than egg-based vaccines by using
proprietary, portable, recombinant cell-culture technology.

About FlexFactory

Xcellerex’s FlexFactory is an innovative, portable manufacturing platform, based on the innovative
application of (1) single-use technologies; (2) controlled environmental modules (CEMs); and (3)
advanced and proven process automation including electronic batch records. The FlexFactory
effectively eliminates clean and steam-in-place and clean room infrastructure, greatly simplifies
facility design, reducing manufacturing footprint and capital investment, and creates breakthrough
gains in operating efficiency, flexibility and environmental friendliness.

About Novavax

Novavax, Inc. is a clinical-stage biotechnology company, creating novel vaccines to address a broad
range of infectious diseases worldwide, including H1N1, using advanced proprietary
virus-like-particle (VLP) technology. The company produces potent VLP -based, recombinant vaccines
utilizing new and efficient manufacturing approaches. Novavax is committed to using its VLP
technology to create country-specific vaccine solutions. It recently launched a joint venture with
Cadila Pharmaceuticals, named CPL Biologicals, to develop and manufacture vaccines, biological
therapeutics and diagnostics in India.

Confidential

Page 19 of 21

 

 

THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL

TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [* * *] AND HAS

BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

About Xcellerex, Inc.

     Xcellerex is revolutionizing the way biomolecules are developed, manufactured and commercialized.
The company’s unique single-use component technology platform transforms biomanufacturing
economics, enabling the development of biotherapeutics and vaccines, and dramatically improving the
ability of Xcellerex and its partners to deploy manufacturing capacity. Xcellerex leverages its
technology and services platform by: 1) commercializing its FlexFactories® (complete,
turnkey, modular production trains) and XDRTM (unique, single use component bioreactor systems); 2)
building a portfolio of proprietary biotherapeutics and vaccines through creative alliances and in
licensing; and 3) creatively structuring transactions around FlexFactories, XDRs and its pipeline.
Learn more at http://www.xcellerex.com

Forward-Looking Statements

     Statements herein relating to future financial or business performance, conditions or strategies
and other financial and business matters, including expectations regarding scale-up and commercial
manufacturing of Novavax’s 2009 H1N1 vaccine and other anticipated milestones are forward-looking
statements within the meaning of the Private Securities Litigation Reform Act. Novavax cautions
that these forward-looking statements are subject to numerous assumptions, risks and uncertainties,
which change over time. Factors that may cause actual results to differ materially from the results
discussed in the forward-looking statements or historical experience include risks and
uncertainties, including that Xcellerex has not manufactured Novavax’ 2009 H1N1 vaccine at
commercial levels and Novavax has not manufactured any vaccine at a commercial level; unanticipated
costs and delays during the scale-up process; the manufacturing process will be subject to
inspection and validation, which could also result in delays; the 2009 H1N1 vaccine must be
manufactured quickly, or it may not be sold until after the 2009/2010 flu season has ended; the
2009 H1N1 vaccine has not yet received regulatory approval in Mexico, the intended market;
competition from already approved vaccines for the 2009 H1N1 flu; business abilities and judgment
of personnel and corporate partners; and the availability of qualified personnel. Further
information on the factors and risks that could affect Novavax’ business, financial conditions and
results of operations, is contained in Novavax’ filings with the U.S. Securities and Exchange
Commission, which are available at www.sec.gov. These forward-looking statements speak only
as of the date of this press release, and Novavax assumes no duty to update forward-looking
statements.

	 	 	 
	Contact:
	 	 
	 
	 	 
	Xcellerex, Inc.

	 	Novavax Inc.
	Jon Lieber,

	 	Tricia J. Richardson
	Chief Financial Officer

	 	Snr. Investor Relations Manager
	Tel. 508-683-2239

	 	240 268 2031
	 
	 	 
	Xcellerex Inc.
	 	 
	Robert Gottlieb
	 	 
	RMG Associates
	 	 
	857-891-9091
	 	 

Confidential

Page 20 of 21

 

 

THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL

TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [* * *] AND HAS

BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

Attachment 7

[* * *]

Confidential

Page 21 of 21exv10w1

Exhibit 10.1

BUSINESS LOAN AGREEMENT

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	Principal

$500,000.00
	 	 	Loan Date

09-04-2009
	 	 	Maturity

09-04-2010
	 	 	Loan No

5290007589
	 	 	Call/Coll

122
	 	 	Account
	 	 	Officer

JL
	 	 	Initials	 

References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or item. Any item
above containing “***” has been omitted due to text length limitations.

	 	 	 	 	 	 	 
	Borrower:

	 	Liberator Medical Holdings, Inc. (TIN:
	 	Lender:
	 	Gulfstream Business Bank, a Florida Banking
	 

	 	87-0267292)
	 	 	 	Corporation
	 

	 	2797 SE Gran Park Way
	 	 	 	2400 SE Monterey Road, Suite 100
	 

	 	Stuart, FL 34997
	 	 	 	Stuart, FL 34996-3321
	 

	 	 	 	 	 	(772) 426-8100

THIS BUSINESS LOAN AGREEMENT dated September 4, 2009, is made and executed between Liberator
Medical Holdings, Inc. (“Borrower”) and Gulfstream Business Bank, a Florida Banking Corporation
(“Lender”) on the following terms and conditions. Borrower has received prior commercial loans
from Lender or has applied to Lender for a commercial loan or loans or other financial
accommodations, including those which may be described on any exhibit or schedule attached to
this Agreement. Borrower understands and agrees that: (A) in granting, renewing, or extending
any Loan, Lender is relying upon Borrower’s representations, warranties, and agreements as set
forth in this Agreement; (B) the granting, renewing, or extending of any Loan by Lender at all
times shall be subject to Lender’s sole judgment and discretion; and (C) all such Loans shall
be and remain subject to the terms and conditions of this Agreement.

TERM. This Agreement shall be effective as of September 4, 2009, and shall continue in full
force and effect until such time as all of Borrower’s Loans in favor of Lender have been paid
in full, including principal, interest, costs, expenses, attorneys’ fees, and other fees and
charges, or until September 4, 2010.

CONDITIONS PRECEDENT TO EACH ADVANCE. Lender’s obligation to make the initial Advance and each
subsequent Advance under this Agreement shall be subject to the fulfillment to Lender’s
satisfaction of all of the conditions set forth in this Agreement and in the Related Documents.

Loan Documents. Borrower shall provide to Lender the following documents for the Loan: (1)
the Note; (2) Security Agreements granting to Lender security interests in the Collateral;
(3) financing statements and all other documents perfecting Lender’s Security Interests; (4)
evidence of insurance as required below; (5) together with all such Related Documents as
Lender may require for the Loan; all in form and substance satisfactory to Lender and
Lender’s counsel.

Borrower’s Authorization. Borrower shall have provided in form and substance satisfactory to
Lender properly certified resolutions, duly authorizing the execution and delivery of this
Agreement, the Note and the Related Documents. In addition, Borrower shall have provided
such other resolutions, authorizations, documents and instruments as Lender or its counsel,
may require.

Payment of Fees and Expenses. Borrower shall have paid to Lender all fees, charges, and
other expenses which are then due and payable as specified in this Agreement or any Related
Document.

Representations and Warranties. The representations and warranties set forth in this
Agreement, in the Related Documents, and in any document or certificate delivered to Lender
under this Agreement are true and correct.

No Event of Default. There shall not exist at the time of any Advance a condition which
would constitute an Event of Default under this Agreement or under any Related Document.

REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender, as of the date of
this Agreement, as of the date of each disbursement of loan proceeds, as of the date of any
renewal, extension or modification of any Loan, and at all times any Indebtedness exists:

Organization. Borrower is a corporation for profit which is, and at all times shall be, duly
organized, validiy existing, and in good standing under and by virtue of the laws of the
State of Nevada. Borrower is duly authorized to transact business in all other states in
which Borrower is doing business, having obtained all necessary filings, governmental
licenses and approvals for each state in which Borrower is doing business. Specifically,
Borrower is, and at all times shall be, duly qualified as a foreign corporation in all
states in which the failure to so qualify would have a material adverse effect on its
business or financial condition. Borrower has the full power and authority to own its
properties and to transact the business in which it is presently engaged or presently
proposes to engage. Borrower maintains an office at 2797 SE Gran Park Way, Stuart, FL 34997.
Unless Borrower has designated otherwise in writing, the principal office is the office at
which Borrower keeps its books and records including its records concerning the Collateral.
Borrower will notify Lender prior to any change in the location of Borrower’s state of
organization or any change in Borrower’s name. Borrower shall do all things necessary to
preserve and to keep in full force and effect its existence, rights and privileges, and
shall comply with all regulations, rules, ordinances, statutes, orders and decrees of any
governmental or quasi-governmental authority or court applicable to Borrower and Borrower’s
business activities.

Assumed Business Names. Borrower has filed or recorded all documents or filings required by
law relating to all assumed business names used by Borrower. Excluding the name of Borrower,
the following is a complete list of all assumed business names under which Borrower does
business: None.

Authorization. Borrower’s execution, delivery, and performance of this Agreement and all the
Related Documents have been duly authorized by all necessary action by Borrower and do not
conflict with, result in a violation of, or constitute a default under (1) any provision of
(a) Borrower’s articles of incorporation or organization, or bylaws, or (b) any agreement or
other instrument binding upon Borrower or (2) any law, governmental regulation, court
decree, or order applicable to Borrower or to Borrower’s properties.

Financial Information. Each of Borrower’s financial statements supplied to Lender truly and
completely disclosed Borrower’s financial condition as of the date of the statement, and
there has been no material adverse change in Borrower’s financial condition subsequent to
the date of the most recent financial statement supplied to Lender. Borrower has no material
contingent obligations except as disclosed in such financial statements.

Legal Effect. This Agreement constitutes, and any instrument or agreement Borrower is
required to give under this Agreement when delivered will constitute legal, valid, and
binding obligations of Borrower enforceable against Borrower in accordance with their
respective terms.

Properties. Except as contemplated by this Agreement or as previously disclosed in
Borrower’s financial statements or in writing to Lender and as accepted by Lender, and
except for property tax liens for taxes not presently due and payable, Borrower owns and has
good title to all of Borrower’s properties free and clear of all Security Interests, and has
not executed any security documents or financing statements relating to such properties. All
of Borrower’s properties are titled in Borrower’s legal name, and Borrower has not used or
filed a financing statement under any other name for at least the last five (5) years.

Hazardous Substances. Except as disclosed to and acknowledged by Lender in writing, Borrower
represents and warrants that: (1) During the period of Borrower’s ownership of the
Collateral, there has been no use, generation, manufacture, storage, treatment, disposal,
release or threatened release of any Hazardous Substance by any person on, under, about or
from any of the Collateral. (2) Borrower has no knowledge of, or reason to believe that
there has been (a) any breach or violation of any Environmental Laws; (b) any use,
generation, manufacture, storage, treatment, disposal, release or threatened release of any
Hazardous Substance on, under, about or from the Collateral by any prior owners or occupants
of any of the Collateral; or (c) any actual or threatened litigation or claims of any kind
by any person relating to such matters. (3) Neither Borrower nor any tenant, contractor,
agent or other authorized user of any of the Collateral shall use, generate, manufacture,
store, treat, dispose of or release any Hazardous Substance on, under, about or from any of
the Collateral; and any such activity shall be conducted in compliance with all applicable
federal, state, and local laws, regulations, and ordinances, including without limitation
all Environmental Laws. Borrower authorizes Lender and its agents to enter upon the
Collateral to make such inspections and tests as Lender may deem appropriate to determine
compliance of the Collateral with this section of the Agreement. Any inspections or tests
made by Lender shall be at Borrower’s expense and for Lender’s purposes only and shall not
be construed to create any responsibility or liability on the part of Lender to Borrower or
to any other person. The representations and warranties contained herein are based on
Borrower’s due diligence in investigating the Collateral for hazardous waste and Hazardous
Substances. Borrower hereby (1) releases and waives any future claims against Lender for
indemnity or contribution in the event Borrower becomes liable for cleanup or other costs
under any such laws, and (2) agrees to indemnify, defend, and hold harmless Lender against
any and all claims, losses, liabilities, damages, penalties, and expenses which Lender may
directly or indirectly sustain or suffer resulting from a breach of this section of the
Agreement or as a consequence of any use, generation, manufacture, storage, disposal,
release or threatened release of a hazardous waste or substance on the Collateral. The
provisions of this section of the Agreement, including the obligation to indemnify and
defend, shall survive the payment of the Indebtedness and the termination, expiration or
satisfaction of this Agreement and shall not be affected by Lender’s acquisition of any
interest in any of the Collateral, whether by foreclosure or otherwise.

Litigation and Claims. No litigation, claim, investigation, administrative proceeding or
similar action (including those for unpaid taxes)

 

	 	 	 	 	 
	Loan No: 5290007589
	 	BUSINESS LOAN AGREEMENT
(Continued)
	 	Page 2

against Borrower is pending or
threatened, and no other event has occurred which may materially adversely affect
Borrower’s financial condition or properties, other than litigation, claims, or other events, if any, that have been
disclosed to and acknowledged by Lender in writing.

Taxes. To the best of Borrower’s knowledge, all of Borrower’s tax returns and reports that are
or were required to be filed, have been filed, and all taxes, assessments and other
governmental charges have been paid in full, except those presently being or to be contested by
Borrower in good faith in the ordinary course of business and for which adequate reserves have
been provided.

Lien Priority. Unless otherwise previously disclosed to Lender in writing. Borrower has not
entered into or granted any Security Agreements, or permitted the filing or attachment of any
Security Interests on or affecting any of the Collateral directly or indirectly securing
repayment of Borrower’s Loan and Note, that would be prior or that may in any way be superior to
Lender’s Security Interests and rights in and to such Collateral.

Binding Effect. This Agreement, the Note, all Security Agreements (if any), and all Related
Documents are binding upon the signers thereof, as well as upon their successors,
representatives and assigns, and are legally enforceable in accordance with their respective
terms.

AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that, so long as this Agreement
remains in effect, Borrower will:

Notices of Claims and Litigation. Promptly inform Lender in writing of (1) all material adverse
changes in Borrower’s financial condition, and (2) all existing and all threatened litigation,
claims, investigations, administrative proceedings or similar actions affecting Borrower or any
Guarantor which could materially affect the financial condition of Borrower or the financial
condition of any Guarantor.

Financial Records. Maintain its books and records in accordance with GAAP, applied on a
consistent basis, and permit Lender to examine and audit Borrower’s books and records at all
reasonable times.

Financial Statements. Furnish Lender with the following:

Annual Statements. As soon as available, but in no event later than one-hundred-twenty (120)
days after the end of each fiscal year, Borrower’s balance sheet and income statement for the
year ended, audited by a certified public accountant satisfactory to Lender.

Additional Requirements. Any two of the following individuals have the authority to sign for
advance requests on this line of credit.

____________ Initials

Robert J. Davis,
Chief Financial Officer 

Mark A. Libratore, President

Cynthia R. Libratore

All financial reports required to be provided under this Agreement shall be prepared in
accordance with GAAP, applied on a consistent basis, and certified by Borrower as being true
and correct.

Additional Information. Furnish such additional information and statements, as Lender may
request from time to time.

Insurance. Maintain fire and other risk insurance, public liability insurance, and such other
insurance as Lender may require with respect to Borrower’s properties and operations, in form,
amounts, coverages and with insurance companies acceptable to Lender. Borrower, upon request of
Lender, will deliver to Lender from time to time the policies or certificates of insurance in
form satisfactory to Lender, including stipulations that coverages will not be cancelled or
diminished without at least thirty (30) days prior written notice to Lender. Each insurance
policy also shall include an endorsement providing that coverage in favor of Lender will not be
impaired in any way by any act, omission or default of Borrower or any other person. In
connection with all policies covering assets in which Lender holds or is offered a security
interest for the Loans, Borrower will provide Lender with such lender’s loss payable or other
endorsements as Lender may require.

Insurance Reports. Furnish to Lender, upon request of Lender, reports on each existing
insurance policy showing such information as Lender may reasonably request, including without
limitation the following: (1) the name of the insurer; (2) the risks insured; (3) the amount of
the policy; (4) the properties insured; (5) the then current property values on the basis of
which insurance has been obtained, and the manner of determining those values; and (6) the
expiration date of the policy. In addition, upon request of Lender (however not more often than
annually), Borrower will have an independent appraiser satisfactory to Lender determine, as
applicable, the actual cash value or replacement cost of any Collateral. The cost of such
appraisal shall be paid by Borrower.

Other Agreements. Comply with all terms and conditions of all other agreements, whether now or
hereafter existing, between Borrower and any other party and notify Lender immediately in
writing of any default in connection with any other such agreements.

Loan Proceeds. Use all Loan proceeds solely for Borrower’s business operations, unless
specifically consented to the contrary by Lender in writing.

Taxes, Charges and Liens. Pay and discharge when due all of its indebtedness and obligations,
including without limitation all assessments, taxes, governmental charges, levies and liens, of
every kind and nature, imposed upon Borrower or its properties, income, or profits, prior to
the date on which penalties would attach, and all lawful claims that, if unpaid, might become a
lien or charge upon any of Borrower’s properties, income, or profits. Provided however,
Borrower will not be required to pay and discharge any such assessment, tax, charge, levy, lien
or claim so long as (1) the legality of the same shall be contested in good faith by
appropriate proceedings, and (2) Borrower shall have established on Borrower’s books adequate
reserves with respect to such contested assessment, tax, charge, levy, lien, or claim in
accordance with GAAP.

Performance. Perform and comply, in a timely manner, with all terms, conditions, and provisions
set forth in this Agreement, in the Related Documents, and in all other instruments and
agreements between Borrower and Lender. Borrower shall notify Lender immediately in writing of
any default in connection with any agreement.

Operations. Maintain executive and management personnel with substantially the same
qualifications and experience as the present executive and management personnel; provide
written notice to Lender of any change in executive and management personnel; conduct its
business affairs in a reasonable and prudent manner.

Environmental Studies. Promptly conduct and complete, at Borrower’s expense, all such
investigations, studies, samplings and testings as may be requested by Lender or any
governmental authority relative to any substance, or any waste or by-product of any substance
defined as toxic or a hazardous substance under applicable federal, state, or local law, rule,
regulation, order or directive, at or affecting any property or any facility owned, leased or
used by Borrower.

Compliance with Governmental Requirements. Comply with all laws, ordinances, and regulations,
now or hereafter in effect, of all governmental authorities applicable to the conduct of
Borrower’s properties, businesses and operations, and to the use or occupancy of the
Collateral, including without limitation, the Americans With Disabilities Act. Borrower may
contest in good faith any such law, ordinance, or regulation and withhold compliance during any
proceeding, including appropriate appeals, so long as Borrower has notified Lender in writing
prior to doing so and so long as, in Lender’s sole opinion, Lender’s interests in the
Collateral are not jeopardized. Lender may require Borrower to post adequate security or a
surety bond, reasonably satisfactory to Lender, to protect Lender’s interest.

Inspection. Permit employees or agents of Lender at any reasonable time to inspect any and all
Collateral for the Loan or Loans and Borrower’s other properties and to examine or audit
Borrower’s books, accounts, and records and to make copies and memoranda of Borrower’s books,
accounts, and records. If Borrower now or at any time hereafter maintains any records
(including without limitation computer generated records and computer software programs for the
generation of such records) in the possession of a third party, Borrower, upon request of
Lender, shall notify such party to permit Lender free access to such records at all reasonable
times and to provide Lender with copies of any records it may request, all at Borrower’s
expense.

Compliance Certificates. Unless waived in writing by Lender, provide Lender at least annually,
with a certificate executed by Borrower’s chief financial officer, or other officer or person
acceptable to Lender, certifying that the representations and warranties set forth in this
Agreement are true and correct as of the date of the certificate and further certifying that,
as of the date of the certificate, no Event of Default exists under this Agreement.

Environmental Compliance and Reports. Borrower shall comply in all respects with any and all
Environmental Laws; not cause or permit to exist, as a result of an intentional or
unintentional action or omission on Borrower’s part or on the part of any third party, on
property owned and/or occupied by Borrower, any environmental activity where damage may result
to the environment, unless such environmental activity is pursuant to and in compliance with
the conditions of a permit issued by the appropriate federal, state or local governmental
authorities; shall furnish to Lender promptly and in any event within thirty (30) days after
receipt thereof a copy of any notice, summons, lien, citation, directive, letter or other
communication from any governmental agency or instrumentality concerning any intentional or
unintentional action or omission on Borrower’s part in connection with any environmental
activity whether or not there is damage to the environment and/or other natural resources.

Additional Assurances. Make, execute and deliver to Lender such promissory notes, mortgages,
deeds of trust, security agreements, assignments, financing statements, instruments, documents
and other agreements as Lender or its attorneys may reasonably request to

 

BUSINESS LOAN AGREEMENT

	 	 	 	 	 
	Loan No: 5290007589
	 	(Continued)
	 	Page 3

evidence and secure the Loans and to perfect all Security Interests.

RECOVERY OF ADDITIONAL COSTS. If the imposition of or any change in any law, rule, regulation or
guideline, or the interpretation or application of any thereof by any court or administrative or
governmental authority (including any request or policy not having the force of law) shall impose,
modify or make applicable any taxes (except federal, state or local income or franchise taxes
imposed on Lender), reserve requirements, capital adequacy requirements or other obligations which
would (A) increase the cost to Lender for extending or maintaining the credit facilities to which
this Agreement relates, (B) reduce the amounts payable to Lender under this Agreement or the
Related Documents, or (C) reduce the rate of return on Lender’s capital as a consequence of
Lender’s obligations with respect to the credit facilities to which this Agreement relates, then
Borrower agrees to pay Lender such additional amounts as will compensate Lender therefor, within
five (5) days after Lender’s written demand for such payment, which demand shall be accompanied by
an explanation of such imposition or charge and a calculation in reasonable detail of the
additional amounts payable by Borrower, which explanation and calculations shall be conclusive in
the absence of manifest error.

LENDER’S EXPENDITURES. If any action or proceeding is commenced that would materially affect
Lender’s interest in the Collateral or if Borrower fails to comply with any provision of this
Agreement or any Related Documents, including but not limited to Borrower’s failure to discharge or
pay when due any amounts Borrower is required to discharge or pay under this Agreement or any
Related Documents, Lender on Borrower’s behalf may (but shall not be obligated to) take any action
that Lender deems appropriate, including but not limited to discharging or paying all taxes, liens,
security interests, encumbrances and other claims, at any time levied or placed on any Collateral
and paying all costs for insuring, maintaining and preserving any Collateral. All such expenditures
incurred or paid by Lender for such purposes will then bear interest at the rate charged under the
Note from the date incurred or paid by Lender to the date of repayment by Borrower. All such
expenses will become a part of the Indebtedness and, at Lender’s option, will (A) be payable on
demand; (B) be added to the balance of the Note and be apportioned among and be payable with any
installment payments to become due during either (1) the term of any applicable insurance policy;
or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due
and payable at the Note’s maturity.

NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while this Agreement is in
effect, Borrower shall not, without the prior written consent of Lender:

Indebtedness and Liens. (1) Except for trade debt incurred in the normal course of business and
indebtedness to Lender contemplated by this Agreement, create, incur or assume indebtedness for
borrowed money, including capital leases, (2) sell, transfer, mortgage, assign, pledge, lease,
grant a security interest in, or encumber any of Borrower’s assets (except as allowed as
Permitted Liens), or (3) sell with recourse any of Borrower’s accounts, except to Lender.

Continuity of Operations. (1) Engage in any business activities substantially different than
those in which Borrower is presently engaged, (2) cease operations, liquidate, merge, transfer,
acquire or consolidate with any other entity, change its name, dissolve or transfer or sell
Collateral out of the ordinary course of business, or (3) pay any dividends on Borrower’s stock
(other than dividends payable in its stock), provided, however that notwithstanding the
foregoing, but only so long as no Event of Default has occurred and is continuing or would
result from the payment of dividends, if Borrower is a “Subchapter S Corporation” (as defined
in the Internal Revenue Code of 1986, as amended), Borrower may pay cash dividends on its stock
to its shareholders from time to time in amounts necessary to enable the shareholders to pay
income taxes and make estimated income tax payments to satisfy their liabilities under federal
and state law which arise solely from their status as Shareholders of a Subchapter S
Corporation because of their ownership of shares of Borrower’s stock, or purchase or retire any
of Borrower’s outstanding shares or alter or amend Borrower’s capital structure.

Loans, Acquisitions and Guaranties. (1) Loan, invest in or advance money or assets to any other
person, enterprise or entity, (2) purchase, create or acquire any interest in any other
enterprise or entity, or (3) incur any obligation as surety or guarantor other than in the
ordinary course of business.

Agreements. Borrower will not enter into any agreement containing any provisions which would be
violated or breached by the performance of Borrower’s obligations under this Agreement or in
connection herewith.

CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to Borrower, whether
under this Agreement or under any other agreement, Lender shall have no obligation to make Loan
Advances or to disburse Loan proceeds if: (A) Borrower or any Guarantor is in default under the
terms of this Agreement or any of the Related Documents or any other agreement that Borrower or
any Guarantor has with Lender; (B) Borrower or any Guarantor dies, becomes incompetent or becomes
insolvent, files a petition in bankruptcy or similar proceedings, or is adjudged a bankrupt; (C)
there occurs a material adverse change in Borrower’s financial condition, in the financial
condition of any Guarantor, or in the value of any Collateral securing any Loan; or (D) any
Guarantor seeks, claims or otherwise attempts to limit, modify or revoke such Guarantor’s guaranty
of the Loan or any other loan with Lender; or (E) Lender in good faith deems itself insecure, even
though no Event of Default shall have occurred.

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in
all Borrower’s accounts with Lender (whether checking, savings, or some other account). This
includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open
in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for
which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on the Indebtedness against any and all such
accounts, and, at Lender’s option, to administratively freeze all such accounts to allow Lender to
protect Lender’s charge and setoff rights provided in this paragraph.

DEFAULT. Each of the following shall constitute an Event of
Default under this Agreement:

Payment Default. Borrower
fails to make any payment when due under the Loan.

Other Defaults. Borrower fails to comply with or to perform any other term, obligation,
covenant or condition contained in this Agreement or in any of the Related Documents or to
comply with or to perform any term, obligation, covenant or condition contained in any other
agreement between Lender and Borrower.

False Statements. Any warranty, representation or statement made or furnished to Lender by
Borrower or on Borrower’s behalf under this Agreement or the Related Documents is false or
misleading in any material respect, either now or at the time made or furnished or becomes
false or misleading at any time thereafter.

Insolvency. The dissolution or termination of Borrower’s existence as a going business, the
insolvency of Borrower, the appointment of a receiver for any part of Borrower’s property, any
assignment for the benefit of creditors, any type of creditor workout, or the commencement of
any proceeding under any bankruptcy or insolvency laws by or against Borrower.

Defective Collateralization. This Agreement or any of the Related Documents ceases to be in
full force and effect (including failure of any collateral document to create a valid and
perfected security interest or lien) at any time and for any reason.

Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings,
whether by judicial proceeding, self-help, repossession or any other method, by any creditor of
Borrower or by any governmental agency against any collateral securing the Loan. This includes
a garnishment of any of Borrower’s accounts, including deposit accounts, with Lender. However,
this Event of Default shall not apply if there is a good faith dispute by Borrower as to the
validity or reasonableness of the claim which is the basis of the creditor or forfeiture
proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding
and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in
an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond
for the dispute.

Events Affecting Guarantor. Any of the preceding events occurs with respect to any Guarantor of
any of the Indebtedness or any Guarantor dies or becomes incompetent, or revokes or disputes
the validity of, or liability under, any Guaranty of the Indebtedness.

Change in Ownership. Any change in ownership of twenty-five percent (25%) or more of the common
stock of Borrower.

Adverse Change. A material adverse change occurs in Borrower’s financial condition, or Lender
believes the prospect of payment or performance of the Loan is impaired.

Insecurity. Lender in good faith believes itself insecure.

Right to Cure. If any default, other than a default on Indebtedness, is curable and if Borrower
or Grantor, as the case may be, has not been given a notice of a similar default within the
preceding twelve (12) months, it may be cured if Borrower or Grantor, as the case may be, after
receiving written notice from Lender demanding cure of such default: (1) cure the default
within thirty (30) days; or (2) if the cure requires more than thirty (30) days, immediately
initiate steps which Lender deems in Lender’s sole discretion to be sufficient to cure the
default and thereafter continue and complete all reasonable and necessary steps sufficient to
produce compliance as soon as reasonably practical.

EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except where otherwise
provided in this Agreement or the Related Documents, all commitments and obligations of Lender
under this Agreement or the Related Documents or any other agreement immediately will terminate
(including any obligation to make further Loan Advances or disbursements), and, at Lender’s
option, all Indebtedness immediately will become due and payable, all without notice of any kind
to Borrower, except that in the case of an Event of Default of the type described in the

 

	 	 	 	 	 
	Loan No: 5290007589
	 	BUSINESS LOAN AGREEMENT
(Continued)
	 	Page 4

“Insolvency” subsection above, such acceleration shall be automatic and not optional. In addition,
Lender shall have all the rights and remedies provided in the Related Documents or available at
law, in equity, or otherwise. Except as may be prohibited by
applicable law, all of Lender’s rights
and remedies shall be cumulative and may be exercised singularly or concurrently. Election by
Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make
expenditures or to take action to perform an obligation of Borrower or of any Grantor shall not
affect Lender’s right to declare a default and to exercise its rights and remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Agreement:

Amendments. This Agreement, together with any Related Documents, constitutes the entire
understanding and agreement of the parties as to the matters set forth in this Agreement. No
alteration of or amendment to this Agreement shall be effective unless given in writing and
signed by the party or parties sought to be charged or bound by the alteration or amendment.

Attorneys’ Fees; Expenses. Borrower agrees to pay upon demand all of Lender’s costs and
expenses, including Lender’s reasonable attorneys’ fees and Lender’s legal expenses, incurred
in connection with the enforcement of this Agreement. Lender may hire or pay someone else to
help enforce this Agreement, and Borrower shall pay the costs and expenses of such
enforcement. Costs and expenses include Lender’s reasonable attorneys’ fees and legal expenses
whether or not there is a lawsuit, including reasonable attorneys’ fees and legal expenses for
bankruptcy proceedings (including efforts to modify or vacate any automatic stay or
injunction), appeals, and any anticipated post-judgment collection services. Borrower also
shall pay all court costs and such additional fees as may be directed by the court.

Caption Headings. Caption headings in this Agreement are for convenience purposes only and are
not to be used to interpret or define the provisions of this Agreement.

Consent to Loan Participation. Borrower agrees and consents to Lender’s sale or transfer,
whether now or later, of one or more participation interests in the Loan to one or more
purchasers, whether related or unrelated to Lender. Lender may provide, without any limitation
whatsoever, to any one or more purchasers, or potential purchasers, any information or
knowledge Lender may have about Borrower or about any other matter relating to the Loan, and
Borrower hereby waives any rights to privacy Borrower may have with respect to such matters.
Borrower additionally waives any and all notices of sale of participation interests, as well as
all notices of any repurchase of such participation interests. Borrower also agrees that the
purchasers of any such participation interests will be considered as the absolute owners of
such interests in the Loan and will have all the rights granted under the participation
agreement or agreements governing the sale of such participation interests. Borrower further
waives all rights of offset or counterclaim that it may have now or later against Lender or
against any purchaser of such a participation interest and unconditionally agrees that either
Lender or such purchaser may enforce Borrower’s obligation under the Loan irrespective of the
failure or insolvency of any holder of any interest in the Loan. Borrower further agrees that
the purchaser of any such participation interests may enforce its interests irrespective of any
personal claims or defenses that Borrower may have against Lender.

Governing Law. This Agreement will be governed by federal law applicable to Lender and, to the
extent not preempted by federal law, the laws of the State of Florida without regard to its
conflicts of law provisions. This Agreement has been accepted by Lender in the State of
Florida.

Choice of Venue. If there is a lawsuit, Borrower agrees upon Lender’s request to submit to the
jurisdiction of the courts of Martin County, State of Florida.

No Waiver by Lender. Lender shall not be deemed to have waived any rights under this Agreement
unless such waiver is given in writing and signed by Lender. No delay or omission on the part
of Lender in exercising any right shall operate as a waiver of such right or any other right. A
waiver by Lender of a provision of this Agreement shall not prejudice or constitute a waiver of
Lender’s right otherwise to demand strict compliance with that provision or any other provision
of this Agreement. No prior waiver by Lender, nor any course of dealing between Lender and
Borrower, or between Lender and any Grantor, shall constitute a waiver of any of Lender’s
rights or of any of Borrower’s or any Grantor’s obligations as to any future transactions.
Whenever the consent of Lender is required under this Agreement, the granting of such consent
by Lender in any instance shall not constitute continuing consent to subsequent instances where
such consent is required and in all cases such consent may be granted or withheld in the sole
discretion of Lender.

Notices. Any notice required to be given under this Agreement shall be given in writing, and
shall be effective when actually delivered, when actually received by telefacsimile (unless
otherwise required by law), when deposited with a nationally recognized overnight courier, or,
if mailed, when deposited in the United States mail, as first class, certified or registered
mail postage prepaid, directed to the addresses shown near the beginning of this Agreement. Any
party may change its address for notices under this Agreement by giving written notice to the
other parties, specifying that the purpose of the notice is to change the party’s address. For
notice purposes, Borrower agrees to keep Lender informed at all times of Borrower’s current
address. Unless otherwise provided or required by law, if there is more than one Borrower, any
notice given by Lender to any Borrower is deemed to be notice given to all Borrowers.

Severability.
If a court of competent jurisdiction finds any provision of this Agreement to be
illegal, invalid, or unenforceable as to any circumstance, that finding shall not make the
offending provision illegal, invalid, or unenforceable as to any other circumstance. If
feasible, the offending provision shall be considered modified so that it becomes legal, valid
and enforceable. If the offending provision cannot be so modified, it shall be considered
deleted from this Agreement. Unless otherwise required by law, the illegality, invalidity, or
unenforceability of any provision of this Agreement shall not affect the legality, validity or
enforceability of any other provision of this Agreement.

Subsidiaries and Affiliates of Borrower. To the extent the context of any provisions of this
Agreement makes it appropriate, including without limitation any representation, warranty or
covenant, the word “Borrower” as used in this Agreement shall include all of Borrower’s
subsidiaries and affiliates. Notwithstanding the foregoing however, under no circumstances
shall this Agreement be construed to require Lender to make any Loan or other financial
accommodation to any of Borrower’s subsidiaries or affiliates.

Successors and Assigns. All covenants and agreements by or on behalf of Borrower contained in
this Agreement or any Related Documents shall bind Borrower’s successors and assigns and shall
inure to the benefit of Lender and its successors and assigns. Borrower shall not, however,
have the right to assign Borrower’s rights under this Agreement or any interest therein,
without the prior written consent of Lender.

Survival of Representations and Warranties. Borrower understands and agrees that in extending
Loan Advances, Lender is relying on all representations, warranties, and covenants made by
Borrower in this Agreement or in any certificate or other instrument delivered by Borrower to
Lender under this Agreement or the Related Documents. Borrower further agrees that regardless
of any investigation made by Lender, all such representations, warranties and covenants will
survive the extension of Loan Advances and delivery to Lender of the Related Documents, shall
be continuing in nature, shall be deemed made and redated by Borrower at the time each Loan
Advance is made, and shall remain in full force and effect until such time as Borrower’s
Indebtedness shall be paid in full, or until this Agreement shall be terminated in the manner
provided above, whichever is the last to occur.

Time is of the Essence. Time is of the essence in the performance of this Agreement.

Waive Jury. All parties to this Agreement hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by any party against any other party.

DEFINITIONS. The following capitalized words and terms shall have the following meanings when used
in this Agreement. Unless specifically stated to the contrary, all references to dollar amounts
shall mean amounts in lawful money of the United States of America. Words and terms used in the
singular shall include the plural, and the plural shall include the singular, as the context may
require. Words and terms not otherwise defined in this Agreement shall have the meanings
attributed to such terms in the Uniform Commercial Code. Accounting words and terms not otherwise
defined in this Agreement shall have the meanings assigned to them in accordance with generally
accepted accounting principles as in effect on the date of this Agreement:

Advance. The word “Advance” means a disbursement of Loan funds made, or to be made, to Borrower
or on Borrower’s behalf on a line of credit or multiple advance basis under the terms and
conditions of this Agreement.

Agreement. The word “Agreement” means this Business Loan Agreement, as this Business Loan
Agreement may be amended or modified from time to time, together with all exhibits and
schedules attached to this Business Loan Agreement from time to time.

Borrower. The word “Borrower” means Liberator Medical Holdings, Inc. and includes all
co-signers and co-makers signing the Note and all their successors and assigns.

Collateral. The word “Collateral” means all property and assets granted as collateral security
for a Loan, whether real or personal property, whether granted directly or indirectly, whether
granted now or in the future, and whether granted in the form of a security interest, mortgage,
collateral mortgage, deed of trust, assignment, pledge, crop pledge, chattel mortgage,
collateral chattel mortgage, chattel trust, factor’s lien, equipment trust, conditional sale,
trust receipt, lien, charge, lien or title retention contract, lease or consignment intended as
a security device, or any other security or lien interest whatsoever, whether created by law,
contract, or otherwise.

Environmental Laws. The words “Environmental Laws” mean any and all state, federal and local
statutes, regulations and ordinances relating to the protection of human health or the
environment, including without limitation the Comprehensive Environmental Response,

 

	 	 	 	 	 
	 	 	BUSINESS LOAN AGREEMENT	 	 
	Loan No: 5290007589
	 	(Continued)
	 	Page 5

Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq.
(“CERCLA”), the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499
(“SARA”), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., or other applicable
state or federal laws, rules, or regulations adopted pursuant thereto.

Event of Default. The words “Event of Default” mean any of the events of default set forth in
this Agreement in the default section of this Agreement.

GAAP. The word “GAAP” means generally accepted accounting principles.

Grantor. The word “Grantor” means each and all of the persons or entities granting a Security
Interest in any Collateral for the Loan, including without limitation all Borrowers granting
such a Security Interest.

Guarantor. The word “Guarantor” means any guarantor, surety, or accommodation party of any or
all of the Loan.

Guaranty. The word “Guaranty” means the guaranty from Guarantor to Lender, including without
limitation a guaranty of all or part of the Note.

Hazardous Substances. The words “Hazardous Substances” mean materials that, because of their
quantity, concentration or physical, chemical or infectious characteristics, may cause or pose a
present or potential hazard to human health or the environment when improperly used, treated,
stored, disposed of, generated, manufactured, transported or otherwise handled. The words
“Hazardous Substances” are used in their very broadest sense and include without limitation any
and all hazardous or toxic substances, materials or waste as defined by or listed under the
Environmental Laws. The term “Hazardous Substances” also includes, without limitation, petroleum
and petroleum by-products or any fraction thereof and asbestos.

Indebtedness. The word “Indebtedness” means the indebtedness evidenced by the Note or Related
Documents, including all principal and interest together with all other indebtedness and costs
and expenses for which Borrower is responsible under this Agreement or under any of the Related
Documents.

Lender. The word “Lender” means Gulfstream Business Bank, a Florida Banking Corporation, its
successors and assigns.

Loan. The word “Loan” means any and all loans and financial accommodations from Lender to
Borrower whether now or hereafter existing, and however evidenced, including without limitation
those loans and financial accommodations described herein or described on any exhibit or
schedule attached to this Agreement from time to time.

Note. The word “Note” means the Note executed by Liberator Medical Holdings, Inc. in the
principal amount of $500,000.00 dated September 4, 2009, together with all renewals of,
extensions of, modifications of, refinancings of, consolidations of, and substitutions for the
note or credit agreement.

Permitted Liens. The words “Permitted Liens” mean (1) liens and security interests securing
Indebtedness owed by Borrower to Lender; (2) liens for taxes, assessments, or similar charges
either not yet due or being contested in good faith; (3) liens of materialmen, mechanics,
warehousemen, or carriers, or other like liens arising in the ordinary course of business and
securing obligations which are not yet delinquent; (4) purchase money liens or purchase money
security interests upon or in any property acquired or held by Borrower in the ordinary course
of business to secure indebtedness outstanding on the date of this Agreement or permitted to be
incurred under the paragraph of this Agreement titled “Indebtedness and Liens”; (5) liens and
security interests which, as of the date of this Agreement, have been disclosed to and approved
by the Lender in writing; and (6) those liens and security interests which in the aggregate
constitute an immaterial and insignificant monetary amount with respect to the net value of
Borrower’s assets.

Related Documents. The words “Related Documents” mean all promissory notes, credit agreements,
loan agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of
trust, security deeds, collateral mortgages, and all other instruments, agreements and
documents, whether now or hereafter existing, executed in connection with the Loan.

Security Agreement. The words “Security Agreement” mean and include without limitation any
agreements, promises, covenants, arrangements, understandings or other agreements, whether
created by law, contract, or otherwise, evidencing, governing, representing, or creating a
Security Interest.

Security Interest. The words “Security Interest” mean, without limitation, any and all types of
collateral security, present and future, whether in the form of a lien, charge, encumbrance,
mortgage, deed of trust, security deed, assignment, pledge, crop pledge, chattel mortgage,
collateral chattel mortgage, chattel trust, factor’s lien, equipment trust, conditional sale,
trust receipt, lien or title retention contract, lease or consignment intended as a security
device, or any other security or lien interest whatsoever whether created by law, contract, or
otherwise.

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT AND BORROWER
AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS DATED SEPTEMBER 4, 2009.

BORROWER:

LIBERATOR MEDICAL HOLDINGS, INC.

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

	 	 
	 

	 	Mark A. Libratore, President of
Liberator Medical Holdings, Inc.	 	 

LENDER:

     GULFSTREAM BUSINESS BANK, A FLORIDA BANKING CORPORATION

	 	 	 	 
	By:
	 	 
	 

	 	 
	 

	 	Authorized Signer

LASER PRO Lending, Ver. 5.45.004 Corp. Harland Financial Solutions, Inc. 1997, 2009. All Right Reserved,. - FL F:\CF\LPL\C40.FC TR-4269 PR-6

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