Document:

exv10w5

Exhibit 10.5

			
	Security Agreement
	 	

     THIS
SECURITY AGREEMENT (this “Agreement”), dated as of
this 11 day of February, 2011,
is made by LIBERATOR MEDICAL SUPPLY, INC. (the “Grantor”), with an address at 1823 SE Airport Road,
Building 30, Stuart, Florida 34996, in favor of PNC BANK, NATIONAL ASSOCIATION (the “Bank”), with
an address at 205 Datura Street, West Palm Beach, Florida 33401.

     Under the terms hereof, the Bank desires to obtain and the Grantor desires to grant the Bank
security for all of the Obligations (as hereinafter defined).

     NOW, THEREFORE, the Grantor and the Bank, intending to be legally bound, hereby agree as
follows:

1. Definitions.

     (a) “Collateral” shall include all personal property of the Grantor, including the following,
all whether now owned or hereafter acquired or arising and wherever located: (i) accounts
(including health-care-insurance receivables and credit card receivables); (ii) securities
entitlements, securities accounts, commodity accounts, commodity contracts and investment property;
(iii) deposit accounts; (iv) instruments (including promissory notes); (v) documents (including
warehouse receipts); (vi) chattel paper (including electronic chattel paper and tangible chattel
paper); (vii) inventory, including raw materials, work in process, or materials used or consumed in
Grantor’s business, items held for sale or lease or furnished or to be furnished under contracts of
service, sale or lease, goods that are returned, reclaimed or repossessed; (viii) goods of every
nature, including stock-in-trade, goods on consignment, standing timber that is to be cut and
removed under a conveyance or contract for sale, the unborn young of animals, crops grown, growing,
or to be grown, manufactured homes, computer programs embedded in such goods and farm products;
(ix) equipment, including machinery, vehicles and furniture; (x) fixtures; (xi) agricultural liens;
(xii) as-extracted collateral; (xiii) commercial tort claims, if any, described on Exhibit “A”
hereto; (xiv) letter of credit rights; (xv) general intangibles, of every kind and description,
including payment intangibles, software, computer information, source codes, object codes, records
and data, all existing and future customer lists, choses in action, claims (including claims for
indemnification or breach of warranty), books, records, patents and patent applications,
copyrights, trademarks, tradenames, tradestyles, trademark applications, goodwill, blueprints,
drawings, designs and plans, trade secrets, contracts, licenses, license agreements, formulae, tax
and any other types of refunds, returned and unearned insurance premiums, rights and claims under
insurance policies; (xvi) all supporting obligations of all of the foregoing property; (xvii) all
property of the Grantor now or hereafter in the Bank’s possession or in transit to or from, or
under the custody or control of, the Bank or any affiliate thereof; (xviii) all cash and cash
equivalents thereof; and (xix) all cash and noncash proceeds (including insurance proceeds) of all
of the foregoing property, all products thereof and all additions and accessions thereto,
substitutions therefor and replacements thereof. The Collateral shall also include any and all
other tangible or intangible property that is
described as being part of the Collateral pursuant to one or more Riders to Security Agreement that
may be attached hereto or delivered in connection herewith, including the Rider to Security
Agreement — Copyrights, the Rider to Security Agreement — Patents, the Rider to Security Agreement
- Trademarks and the Rider to Security Agreement — Cash Collateral Account.

     (b) “Obligations” shall include all loans, advances, debts, liabilities, obligations,
covenants and duties owing by the Grantor or by Liberator Medical Holdings, Inc. to the Bank or to
any other direct or indirect subsidiary of The PNC Financial Services Group, Inc., of any kind or
nature, present or future (including any interest accruing thereon after maturity, or after the
filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding relating to the Grantor, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), whether direct or indirect (including those acquired by
assignment or participation), absolute or contingent, joint or several, due or to become due, now
existing or

Form 10A
— Multistate Rev. 10/09

 

 

hereafter arising, whether or not (i) evidenced by any note, guaranty or other
instrument, (ii) arising under any agreement, instrument or document, (iii) for the payment of
money, (iv) arising by reason of an extension of credit, opening of a letter of credit, loan,
equipment lease or guarantee, (v) under any interest or currency swap, future, option or other
interest rate protection or similar agreement, (vi) under or by reason of any foreign currency
transaction, forward, option or other similar transaction providing for the purchase of one
currency in exchange for the sale of another currency, or in any other manner, (vii) arising out of
overdrafts on deposit or other accounts or out of electronic funds transfers (whether by wire
transfer or through automated clearing houses or otherwise) or out of the return unpaid of, or
other failure of the Bank to receive final payment for, any check, item, instrument, payment order
or other deposit or credit to a deposit or other account, or out of the Bank’s non-receipt of or
inability to collect funds or otherwise not being made whole in connection with depository or other
similar arrangements; and any amendments, extensions, renewals and increases of or to any of the
foregoing, and all costs and expenses of the Bank incurred in the documentation, negotiation,
modification, enforcement, collection and otherwise in connection with any of the foregoing,
including reasonable attorneys’ fees and expenses.

     (c) “UCC” means the Uniform Commercial Code, as adopted and enacted and as in effect from time
to time in the State whose law governs pursuant to the Section of this Agreement entitled
“Governing Law and Jurisdiction.” Terms used herein which are defined in the UCC and not otherwise
defined herein shall have the respective meanings ascribed to such terms in the UCC. To the extent
the definition of any category or type of collateral is modified by any amendment, modification or
revision to the UCC, such modified definition will apply automatically as of the date of such
amendment, modification or revision.

2. Grant of Security Interest. To secure the Obligations, the Grantor, as debtor, hereby
assigns and grants to the Bank, as secured party, a continuing lien on and security interest in the
Collateral.

3. Change in Name or Locations. The Grantor hereby agrees that if the location of the
Collateral changes from the locations listed on Exhibit “A”
hereto and made part hereof, or if the Grantor changes its name, its type of organization, its
state of organization (if Grantor is a registered organization), its principal residence (if
Grantor is an individual), its chief executive office (if Grantor is a general partnership or
non-registered organization) or establishes a name in which it may do business that is not listed
as a tradename on Exhibit “A” hereto, the Grantor will immediately notify the Bank in writing of
the additions or changes.

4. Representations and Warranties. The Grantor represents, warrants and covenants to the
Bank that: (a) all information, including its type of organization, jurisdiction of organization,
chief executive office, and (for individuals only) principal residence are as set forth on Exhibit
“A” hereto and are true and correct on the date hereof; (b) the Grantor has good, marketable and
indefeasible title to the Collateral, has not made any prior sale, pledge, encumbrance, assignment
or other disposition of any of the Collateral, and the Collateral is free from all encumbrances and
rights of setoff of any kind except the lien in favor of the Bank created by this Agreement; (c)
except as herein provided, the Grantor will not hereafter without the Bank’s prior written consent
sell, pledge, encumber, assign or otherwise dispose of any of the Collateral or permit any right of
setoff, lien or security interest to exist thereon except to the Bank; (d) the Grantor will defend
the Collateral against all claims and demands of all persons at any time claiming the same or any
interest therein; (e) each account and general intangible, if included in the definition of
Collateral, is genuine and enforceable in accordance with its terms and the Grantor will defend the
same against all claims, demands, setoffs and counterclaims at any time asserted; and (f) at the
time any account or general intangible becomes subject to this Agreement, such account or general
intangible will be a good and valid account representing a bona fide sale of goods or services by
the Grantor and such goods will have been shipped to the respective account debtors or the services
will have been performed for the respective account debtors, and no such account or general
intangible will be subject to any claim for credit, allowance or adjustment by any account debtor
or any setoff, defense or counterclaim.

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5. Grantor’s Covenants. The Grantor covenants that it shall:

     (a) from time to time and at all reasonable times allow the Bank, by or through any of its
officers, agents, attorneys, or accountants, to examine or inspect the Collateral, and obtain
valuations and audits of the Collateral, at the Grantor’s expense, wherever located. The Grantor
shall do, obtain, make, execute and deliver all such additional and further acts, things, deeds,
assurances and instruments as the Bank may require to vest in and assure to the Bank its rights
hereunder and in or to the Collateral, and the proceeds thereof, including waivers from landlords,
warehousemen and mortgagees. The Grantor agrees that the Bank has the right to notify (on invoices
or otherwise) account debtors and other obligors or payors on any Collateral of its assignment to
the Bank, and that all payments thereon should be made directly to the Bank, and that the Bank has
full power and authority to collect, compromise, endorse, sell or otherwise deal with the
Collateral in its own name or that of the Grantor at any time upon an Event of Default;

     (b) keep the Collateral in good order and repair at all times and immediately notify the Bank
of any event causing a material loss or decline in value of the Collateral, whether or not covered
by insurance, and the amount of such loss or depreciation;

     (c) only use or permit the Collateral to be used in accordance with all applicable federal,
state, county and municipal laws and regulations; and

     (d) have and maintain insurance at all times with respect to all Collateral against risks of
fire (including so-called extended coverage), theft, sprinkler leakage, and other risks (including
risk of flood if any Collateral is maintained at a location in a flood hazard zone) as the Bank may
require, in such form, in such amount, for such period and written by such companies as may be
satisfactory to the Bank in its sole discretion. Each such casualty insurance policy shall contain
a standard Lender’s Loss Payable Clause issued in favor of the Bank under which all losses
thereunder shall be paid to the Bank as the Bank’s interests may appear. Such policies shall
expressly provide that the requisite insurance cannot be altered or canceled without at least
thirty (30) days prior written notice to the Bank and shall insure the Bank notwithstanding the act
or neglect of the Grantor. Upon the Bank’s demand, the Grantor shall furnish the Bank with
duplicate original policies of insurance or such other evidence of insurance as the Bank may
require. In the event of failure to provide insurance as herein provided, the Bank may, at its
option, obtain such insurance and the Grantor shall pay to the Bank, on demand, the cost thereof.
Proceeds of insurance may be applied by the Bank to reduce the Obligations or to repair or replace
Collateral, all in the Bank’s sole discretion.

6. Negative Pledge; No Transfer. The Grantor will not sell or offer to sell or otherwise
transfer or grant or allow the imposition of a lien or security interest upon the Collateral
(except for sales of inventory and collections of accounts in the Grantor’s ordinary course of
business), will not allow any third party to gain control of all or any part of the Collateral, and
will not use any portion thereof in any manner inconsistent with this Agreement or with the terms
and conditions of any policy of insurance thereon.

7. Covenants for Accounts. If accounts are included in the definition of Collateral:

     (a) The Grantor will, on the Bank’s demand, make notations on its books and records showing
the Bank’s security interest and make available to the Bank shipping and delivery receipts
evidencing the shipment of the goods that gave rise to an account, completion certificates or other
proof of the satisfactory performance of services that gave rise to an account, a copy of the
invoice for each account and copies of any written contract or order from which an account arose.
The Grantor shall promptly notify the Bank if an account becomes evidenced or secured by an
instrument or chattel paper and upon the Bank’s request, will promptly deliver any such instrument
or chattel paper to the Bank, including any letter of credit delivered to the Grantor to support a
shipment of inventory by the Grantor.

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     (b) The Grantor will promptly advise the Bank whenever an account debtor refuses to retain or
returns any goods from the sale of which an account arose and will comply with any instructions
that the Bank may give regarding the sale or other disposition of such returns. From time to time
with such frequency as the Bank may request, the Grantor will report to the Bank all credits given
to account debtors on all accounts.

     (c) The Grantor will immediately notify the Bank if any account arises out of contracts with
the United States or any department, agency or instrumentality thereof, and will execute any
instruments and take any steps required by the Bank so that all monies due and to become due under
such contract shall be assigned to the Bank and notice of the assignment given to and acknowledged
by the appropriate government agency or authority under the Federal Assignment of Claims Act.

     (d) At any time after the occurrence of an Event of Default, and without notice to the
Grantor, the Bank may direct any persons who are indebted to the Grantor on any Collateral
consisting of accounts or general intangibles to make payment directly to the Bank of the amounts
due. The Bank is authorized to collect, compromise, endorse and sell any such Collateral in its
own name or in the Grantor’s name and to give receipts to such account debtors for any such
payments and the account debtors will be protected in making such payments to the Bank. Upon the
Bank’s written request, the Grantor will establish with the Bank and maintain a lockbox account
(“Lockbox”) with the Bank and a depository account(s) (“Cash Collateral Account”) with the Bank
subject to the provisions of this subparagraph and such other related agreements as the Bank may
require, and the Grantor shall notify its account debtors to remit payments directly to the
Lockbox. Thereafter, funds collected in the Lockbox shall be transferred to the Cash Collateral
Account, and funds in the Cash Collateral Account shall be applied by the Bank, daily, to reduce
the outstanding Obligations.

8. Further Assurances. By its signature hereon, the Grantor hereby irrevocably authorizes
the Bank to execute (on behalf of the Grantor) and file against the Grantor one or more financing,
continuation or amendment statements pursuant to the UCC in form satisfactory to the Bank, and the
Grantor will pay the cost of preparing and filing the same in all jurisdictions in which such
filing is deemed by the Bank to be necessary or desirable in order to perfect, preserve and protect
its security interests. If required by the Bank, the Grantor will execute all documentation
necessary for the Bank to obtain and maintain perfection of its security interests in the
Collateral. At the Bank’s request, the Grantor will execute, in form satisfactory to the Bank, a
Rider to Security Agreement — Copyrights (if any Collateral consists of registered or unregistered
copyrights), a Rider to Security Agreement — Patents (if any Collateral consists of patents or
patent applications), a Rider to Security Agreement — Trademarks (if any Collateral consists of
trademarks, tradenames, tradestyles or trademark applications). If any Collateral consists of
letter of credit rights, electronic chattel paper, deposit accounts or supporting obligations not
maintained with the Bank or one of its affiliates, or any securities entitlement, securities
account, commodities account, commodities contract or other investment property, then at the Bank’s
request the Grantor will execute, and will cause the depository
institution or securities intermediary upon whose books and records the ownership interest of the
Grantor in such Collateral appears, to execute such Pledge Agreements, Notification and Control
Agreements or other agreements as the Bank deems necessary in order to perfect, prioritize and
protect its security interest in such Collateral, in each case in a form satisfactory to the Bank.

9. Events of Default. The Grantor shall, at the Bank’s option, be in default under this
Agreement upon the happening of any of the following events or conditions (each, an “Event of
Default”): (a) any Event of Default (as defined in any of the Obligations); (b) any default under
any of the Obligations that does not have a defined set of “Events of Default” and the lapse of any
notice or cure period provided in such Obligations with respect to such default; (c) demand by the
Bank under any of the Obligations that have a demand feature; (d) the failure by the Grantor to
perform any of its obligations under this Agreement; (e) falsity, inaccuracy or material breach by
the Grantor of any written warranty, representation or statement made or furnished to the Bank by
or on behalf of the Grantor; (f) an uninsured material loss, theft, damage, or destruction to any
of the Collateral, or the entry of any judgment against the Grantor or any lien against or the
making of any levy, seizure or attachment of or on the Collateral; (g) the failure of the Bank to
have a perfected first priority security interest in the Collateral; (h) any indication or evidence
received by the Bank that the Grantor may have directly or indirectly been engaged in any

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type of activity which, in the Bank’s discretion, might result in the forfeiture of any property of the
Grantor to any governmental entity, federal, state or local; or (i) if the Bank otherwise deems
itself insecure.

10. Remedies. Upon the occurrence of any such Event of Default and at any time thereafter,
the Bank may declare all Obligations secured hereby immediately due and payable and shall have, in
addition to any remedies provided herein or by any applicable law or in equity, all the remedies of
a secured party under the UCC. The Bank’s remedies include, but are not limited to, the right to
(a) peaceably by its own means or with judicial assistance enter the Grantor’s premises and take
possession of the Collateral without prior notice to the Grantor or the opportunity for a hearing,
(b) render the Collateral unusable, (c) dispose of the Collateral on the Grantor’s premises, (d)
require the Grantor to assemble the Collateral and make it available to the Bank at a place
designated by the Bank, and (e) notify the United States Postal Service to send the Grantor’s mail
to the Bank. Unless the Collateral is perishable or threatens to decline speedily in value or is
of a type customarily sold on a recognized market, the Bank will give the Grantor reasonable notice
of the time and place of any public sale thereof or of the time after which any private sale or any
other intended disposition thereof is to be made. The requirements of commercially reasonable
notice shall be met if such notice is sent to the Grantor at least ten (10) days before the time of
the intended sale or disposition. Expenses of retaking, holding, preparing for disposition,
disposing or the like shall include the Bank’s reasonable attorneys’ fees and legal expenses,
incurred or expended by the Bank to enforce any payment due it under this Agreement either as
against the Grantor, or in the prosecution or defense of any action, or concerning any matter
growing out of or connection with the subject matter of this Agreement and the
Collateral pledged hereunder. The Grantor waives all relief from all appraisement or exemption
laws now in force or hereafter enacted.

11. Power of Attorney. The Grantor does hereby make, constitute and appoint any officer or
agent of the Bank as the Grantor’s true and lawful attorney-in-fact, with power to (a) endorse the
name of the Grantor or any of the Grantor’s officers or agents upon any notes, checks, drafts,
money orders, or other instruments of payment or Collateral that may come into the Bank’s
possession in full or part payment of any Obligations; (b) sue for, compromise, settle and release
all claims and disputes with respect to, the Collateral; and (c) sign, for the Grantor, such
documentation required by the UCC, or supplemental intellectual property security agreements;
granting to the Grantor’s said attorney full power to do any and all things necessary to be done in
and about the premises as fully and effectually as the Grantor might or could do. The Grantor
hereby ratifies all that said attorney shall lawfully do or cause to be done by virtue hereof.
This power of attorney is coupled with an interest, and is irrevocable.

12. Payment of Expenses. At its option, the Bank may discharge taxes, liens, security
interests or such other encumbrances as may attach to the Collateral, may pay for required
insurance on the Collateral and may pay for the maintenance, appraisal or reappraisal, and
preservation of the Collateral, as determined by the Bank to be necessary. The Grantor will
reimburse the Bank on demand for any payment so made or any expense incurred by the Bank pursuant
to the foregoing authorization, and the Collateral also will secure any advances or payments so
made or expenses so incurred by the Bank.

13. Notices. All notices, demands, requests, consents, approvals and other communications
required or permitted hereunder (“Notices”) must be in writing and will be effective upon receipt.
Notices may be given in any manner to which the parties may separately agree, including electronic
mail. Without limiting the foregoing, first-class mail, facsimile transmission and commercial
courier service are hereby agreed to as acceptable methods for giving Notices. Regardless of the
manner in which provided, Notices may be sent to a party’s address as set forth above or to such
other address as any party may give to the other for such purpose in accordance with this section.

14. Preservation of Rights. No delay or omission on the Bank’s part to exercise any right
or power arising hereunder will impair any such right or power or be considered a waiver of any
such right or power, nor will the Bank’s action or inaction impair any such right or power. The
Bank’s rights and remedies hereunder are

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cumulative and not exclusive of any other rights or
remedies which the Bank may have under other agreements, at law or in equity.

15. Illegality. If any provision contained in this Agreement should be invalid, illegal or
unenforceable in any respect, it shall not affect or impair the validity, legality and
enforceability of the remaining provisions of this Agreement.

16. Changes in Writing. No modification, amendment or waiver of, or consent to any
departure by the Grantor from, any provision of this
Agreement will be effective unless made in a writing signed by the Bank, and then such waiver or
consent shall be effective only in the specific instance and for the purpose for which given. No
notice to or demand on the Grantor will entitle the Grantor to any other or further notice or
demand in the same, similar or other circumstance.

17. Entire Agreement. This Agreement (including the documents and instruments referred to
herein) constitutes the entire agreement and supersedes all other prior agreements and
understandings, both written and oral, between the parties with respect to the subject matter
hereof.

18. Counterparts. This Agreement may be signed in any number of counterpart copies and by
the parties hereto on separate counterparts, but all such copies shall constitute one and the same
instrument. Delivery of an executed counterpart of signature page to this Agreement by facsimile
transmission shall be effective as delivery of a manually executed counterpart. Any party so
executing this Agreement by facsimile transmission shall promptly deliver a manually executed
counterpart, provided that any failure to do so shall not affect the validity of the counterpart
executed by facsimile transmission.

19. Successors and Assigns. This Agreement will be binding upon and inure to the benefit
of the Grantor and the Bank and their respective heirs, executors, administrators, successors and
assigns; provided, however, that the Grantor may not assign this Agreement in whole
or in part without the Bank’s prior written consent and the Bank at any time may assign this
Agreement in whole or in part.

20. Interpretation. In this Agreement, unless the Bank and the Grantor otherwise agree in
writing, the singular includes the plural and the plural the singular; words importing any gender
include the other genders; references to statutes are to be construed as including all statutory
provisions consolidating, amending or replacing the statute referred to; the word “or” shall be
deemed to include “and/or”, the words “including”, “includes” and “include” shall be deemed to be
followed by the words “without limitation”; references to articles, sections (or subdivisions of
sections) or exhibits are to those of this Agreement; and references to agreements and other
contractual instruments shall be deemed to include all subsequent amendments and other
modifications to such instruments, but only to the extent such amendments and other modifications
are not prohibited by the terms of this Agreement. Section headings in this Agreement are included
for convenience of reference only and shall not constitute a part of this Agreement for any other
purpose. Unless otherwise specified in this Agreement, all accounting terms shall be interpreted
and all accounting determinations shall be made in accordance with GAAP. If this Agreement is
executed by more than one Grantor, the obligations of such persons or entities will be joint and
several.

21. Indemnity. The Grantor agrees to indemnify each of the Bank, each legal entity, if
any, who controls the Bank and each of their respective directors, officers and employees (the
“Indemnified Parties”) and to defend and hold each Indemnified Party harmless from and against any
and all claims, damages, losses, liabilities and expenses (including all fees and charges of
internal or external counsel with whom any Indemnified Party may
consult and all expenses of litigation and preparation therefor) which any Indemnified Party may
incur or which may be asserted against any Indemnified Party by any person, entity or governmental
authority (including any person or entity claiming derivatively on behalf of the Grantor), in
connection with or arising out of or relating to the matters referred to in this Agreement or the
Obligations, whether (a) arising from or incurred in connection with any breach of a
representation, warranty or covenant by the Grantor, or (b) arising out of or resulting from

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any suit, action, claim, proceeding or governmental investigation, pending or threatened, whether based
on statute, regulation or order, or tort, or contract or otherwise, before any court or
governmental authority; provided, however, that the foregoing indemnity agreement
shall not apply to any claims, damages, losses, liabilities and expenses solely attributable to an
Indemnified Party’s gross negligence or willful misconduct. The indemnity agreement contained in
this Section shall survive the termination of this Agreement, payment of the Obligations and
assignment of any rights hereunder. The Grantor may participate at its expense in the defense of
any such claim.

22. Governing Law and Jurisdiction. This Agreement has been delivered to and accepted by
the Bank and will be deemed to be made in the State where the Bank’s office indicated above is
located. This Agreement will be interpreted and the rights and liabilities of the parties
hereto determined in accordance with the laws of the State where the Bank‘s office indicated above
is located, except that the laws of the State where any Collateral is located (if different from
the State where such office of the Bank is located) shall govern the creation, perfection and
foreclosure of the liens created hereunder on such property or any interest therein. The
Grantor hereby irrevocably consents to the exclusive jurisdiction of any state or federal court in
the county or judicial district where the Bank’s office indicated above is located; provided that
nothing contained in this Agreement will prevent the Bank from bringing any action, enforcing any
award or judgment or exercising any rights against the Grantor individually, against any security
or against any property of the Grantor within any other county, state or other foreign or domestic
jurisdiction. The Bank and the Grantor agree that the venue provided above is the most convenient
forum for both the Bank and the Grantor. The Grantor waives any objection to venue and any
objection based on a more convenient forum in any action instituted under this Agreement.

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

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23. WAIVER OF JURY TRIAL. EACH OF THE GRANTOR AND THE BANK IRREVOCABLY WAIVES ANY AND
ALL RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM OF ANY NATURE RELATING
TO THIS AGREEMENT, ANY DOCUMENTS EXECUTED IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED IN ANY OF SUCH DOCUMENTS. THE GRANTOR AND THE BANK ACKNOWLEDGE THAT THE FOREGOING
WAIVER IS KNOWING AND VOLUNTARY.

The Grantor acknowledges that it has read and understood all the provisions of this Agreement,
including the waiver of jury trial, and has been advised by counsel as necessary or appropriate.

WITNESS the due execution hereof as a document under seal, as of the date first written above.

	 	 	 	 	 	 	 	 	 	 	 	 	 

	WITNESS / ATTEST:	 	 	 	LIBERATOR MEDICAL SUPPLY, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	/s/ SCOTT S. WILSON	 	 	 	By:	 	/s/ MARK LIBRATORE	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	(SEAL)	 	 
	Print Name:

	 	SCOTT S. WILSON
	 	 	 	 	 	Name:
	 	MARK LIBRATORE	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	Title:

	 	OFFICER
	 	 	 	 	 	Title:
	 	CEO	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	PNC BANK, NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	/s/ SCOTT S. WILSON	 	 
	 	 	 	 	 	 	(SEAL)	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Scott S. Wilson
Banking Officer	 	 
	 	 	 	 	 	 	 	 		 	 
	 	 	 	 	 	 	 	 		 	 

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EXHIBIT “A”

TO SECURITY AGREEMENT

	1.	 	Grantor’s form of organization (i.e., corporation, partnership, limited liability company):
Corporation
	 
	2.	 	Grantor’s State of organization, if a registered organization (i.e., corporation, limited
partnership or limited liability company):

Florida
	 
	3.	 	Grantor’s principal residence, if a natural person or general partnership:
	 
	4.	 	Address of Grantor’s chief executive office, including the County:

1823 SE Airport Road, Building 30, Stuart, Florida 34996
	 
	5.	 	Grantor’s EIN, if not a natural person:

65-0936904
	 
	6.	 	Grantor’s organizational ID# (if any exists):

P99000064372
	 
	7.	 	Address for books and records, if different:

2979 SE Gran Parkway, Stuart, Florida 34997
	 
	8.	 	Addresses of other Collateral locations, including Counties, for the past five (5) years:
	 
	9.	 	Name and address of landlord or owner if location is not owned by the Grantor:

Sunshine Holdings, Inc.

Address- P.O. Box 1189, Jupiter, Florida 33468
	 
	10.	 	Other names or tradenames now or formerly used by the Grantor:
	 
	11.	 	List of all existing Commercial Tort Claims (by case title with court and brief description
of claim):

9exv10w6

Exhibit 10.6

					
	Guaranty and Suretyship Agreement
	 	 	 	

     THIS GUARANTY AND SURETYSHIP AGREEMENT (this “Guaranty”) is made and entered into as of
this 11 day of February, 2011, by LIBERATOR HEALTH AND EDUCATION SERVICES, INC. (the
“Guarantor”), with an address at 2979 SE Gran Park Way, Stuart, Florida 34997, in consideration of
the extension of credit by PNC BANK, NATIONAL ASSOCIATION (the “Bank”), with an address at 205
Datura Street, West Palm Beach, Florida 33401, to LIBERATOR MEDICAL HOLDINGS, INC. and LIBERATOR
MEDICAL SUPPLY, INC. (the “Borrower”), and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged.

     1. Guaranty of Obligations. The Guarantor hereby unconditionally guarantees, as a
primary obligor, and becomes surety for, the prompt payment and performance of all loans, advances,
debts, liabilities, obligations, covenants and duties owing by the Borrower to the Bank or to any
other direct or indirect subsidiary of The PNC Financial Services Group, Inc., of any kind or
nature, present or future (including any interest accruing thereon after maturity, or after the
filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding relating to the Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), whether direct or indirect (including those acquired by
assignment or participation), absolute or contingent, joint or several, due or to become due, now
existing or hereafter arising, whether or not (i) evidenced by any note, guaranty or other
instrument, (ii) arising under any agreement, instrument or document, (iii) for the payment of
money, (iv) arising by reason of an extension of credit, opening of a letter of credit, loan,
equipment lease or guarantee, (v) under any interest or currency swap, future, option or other
interest rate protection or similar agreement, (vi) under or by reason of any foreign currency
transaction, forward, option or other similar transaction providing for the purchase of one
currency in exchange for the sale of another currency, or in any other manner, or (vii) arising
out of overdrafts on deposit or other accounts or out of electronic funds transfers (whether by
wire transfer or through automated clearing houses or otherwise) or out of the return unpaid of, or
other failure of the Bank to receive final payment for, any check, item, instrument, payment order
or other deposit or credit to a deposit or other account, or out of the Bank’s non-receipt of or
inability to collect funds or otherwise not being made whole in connection with depository or other
similar arrangements; and any amendments, extensions, renewals and increases of or to any of the
foregoing, and all costs and expenses of the Bank incurred in the documentation, negotiation,
modification, enforcement, collection and otherwise in connection with any of the foregoing,
including reasonable attorneys’ fees and expenses (collectively, the “Obligations”). If the
Borrower defaults under any such Obligations, the Guarantor will pay the amount due to the Bank.

     2. Nature of Guaranty; Waivers. This is a guaranty of payment and not of collection
and the Bank shall not be required or obligated, as a condition of the Guarantor’s liability, to
make any demand upon or to pursue any of its rights against the Borrower, or to pursue any rights
which may be available to it with respect to any other person who may be liable for the payment of
the Obligations.

     This is an absolute, unconditional, irrevocable and continuing guaranty and will remain in
full force and effect until all of the Obligations have been indefeasibly paid in full, and the
Bank has terminated this Guaranty. This Guaranty will remain in full force and effect even if there
is no principal balance outstanding under the Obligations at a particular time or from time to
time. This Guaranty will not be affected by any surrender, exchange, acceptance, compromise or
release by the Bank of any other party, or any other guaranty or any security held by it for any of
the Obligations, by any failure of the
Bank to take any steps to perfect or maintain its lien or security interest in or to preserve its
rights to any security or other collateral for any of the Obligations or any guaranty, or by any
irregularity, unenforceability or invalidity of any of the Obligations or any part thereof or any
security or other guaranty thereof. The Guarantor’s obligations hereunder shall not be affected,
modified

Form 9A
— MI/DC/FL (NCOJ) Rev. 6/10

 

 

or impaired by any counterclaim, set-off, recoupment, deduction or defense based upon any
claim the Guarantor may have (directly or indirectly) against the Borrower or the Bank, except
payment or performance of the Obligations.

     Notice of acceptance of this Guaranty, notice of extensions of credit to the Borrower from
time to time, notice of default, diligence, presentment, notice of dishonor, protest, demand for
payment, and any defense based upon the Bank’s failure to comply with the notice requirements under
Sections 9-611 and 9-612 of the Uniform Commercial Code as in effect from time to time are hereby
waived. The Guarantor waives all defenses based on suretyship or impairment of collateral.

     The Bank at any time and from time to time, without notice to or the consent of the Guarantor,
and without impairing or releasing, discharging or modifying the Guarantor’s liabilities hereunder,
may (a) change the manner, place, time or terms of payment or performance of or interest rates on,
or other terms relating to, any of the Obligations; (b) renew, substitute, modify, amend or alter,
or grant consents or waivers relating to any of the Obligations, any other guaranties, or any
security for any Obligations or guaranties; (c) apply any and all payments by whomever paid or
however realized including any proceeds of any collateral, to any Obligations of the Borrower in
such order, manner and amount as the Bank may determine in its sole discretion; (d) settle,
compromise or deal with any other person, including the Borrower or the Guarantor, with respect to
any Obligations in such manner as the Bank deems appropriate in its sole discretion; (e)
substitute, exchange or release any security or guaranty; or (f) take such actions and exercise
such remedies hereunder as provided herein.

     3. Repayments or Recovery from the Bank. If any demand is made at any time upon the
Bank for the repayment or recovery of any amount received by it in payment or on account of any of
the Obligations and if the Bank repays all or any part of such amount by reason of any judgment,
decree or order of any court or administrative body or by reason of any settlement or compromise of
any such demand, the Guarantor will be and remain liable hereunder for the amount so repaid or
recovered to the same extent as if such amount had never been received originally by the Bank. The
provisions of this section will be and remain effective notwithstanding any contrary action which
may have been taken by the Guarantor in reliance upon such payment, and any such contrary action so
taken will be without prejudice to the Bank’s rights hereunder and will be deemed to have been
conditioned upon such payment having become final and irrevocable.

     4. Financial Statements. Unless compliance is waived in writing by the Bank or until
all of the Obligations have been paid in full, the Guarantor will promptly submit to the Bank such
information relating to the Guarantor’s affairs (including but not limited to annual financial
statements and tax returns for the Guarantor) or any security for the Guaranty as the Bank may
reasonably request.

     5. Enforceability of Obligations. No modification, limitation or discharge of the
Obligations arising out of or by virtue of any bankruptcy, reorganization or similar proceeding for
relief of debtors under federal or state law will affect, modify, limit or discharge the
Guarantor’s liability in any manner whatsoever and this Guaranty will remain and continue in full
force and effect and will be enforceable against the Guarantor to the same extent and with the same
force and effect as if any such proceeding had not been instituted. The Guarantor waives all
rights and benefits which might accrue to it by reason of any such proceeding and will be liable to
the full extent hereunder, irrespective of any modification, limitation or discharge of the
liability of the Borrower that may result from any such proceeding.

     6. Events of Default. The occurrence of any of the following shall be an “Event of
Default”: (i) any Event of Default (as defined in any of the Obligations); (ii) any default under
any of the Obligations that does not have a defined set of “Events of Default” and the lapse of any
notice or cure
period provided in such Obligations with respect to such default; (iii) demand by the Bank under
any of the Obligations that have a demand feature; (iv) the Guarantor’s failure to perform any of
its obligations hereunder; (v) the falsity, inaccuracy or material breach by the Guarantor of any
written warranty, representation or statement made or

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furnished to the Bank by or on behalf of the
Guarantor; or (vi) the termination or attempted termination of this Guaranty. Upon the occurrence
of any Event of Default, (a) the Guarantor shall pay to the Bank the amount of the Obligations; or
(b) on demand of the Bank, the Guarantor shall immediately deposit with the Bank, in U.S. dollars,
all amounts due or to become due under the Obligations, and the Bank may at any time use such funds
to repay the Obligations; or (c) the Bank in its discretion may exercise with respect to any
collateral any one or more of the rights and remedies provided a secured party under the applicable
version of the Uniform Commercial Code; or (d) the Bank in its discretion may exercise from time to
time any other rights and remedies available to it at law, in equity or otherwise.

     7. Right of Setoff. In addition to all liens upon and rights of setoff against the
Guarantor’s money, securities or other property given to the Bank by law, the Bank shall have, with
respect to the Guarantor’s obligations to the Bank under this Guaranty and to the extent permitted
by law, a contractual possessory security interest in and a contractual right of setoff against,
and the Guarantor hereby grants Bank a security interest in, and hereby assigns, conveys, delivers,
pledges and transfers to the Bank all of the Guarantor’s right, title and interest in and to, all
of the Guarantor’s deposits, moneys, securities and other property now or hereafter in the
possession of or on deposit with, or in transit to, the Bank or any other direct or indirect
subsidiary of The PNC Financial Services Group, Inc., whether held in a general or special account
or deposit, whether held jointly with someone else, or whether held for safekeeping or otherwise,
excluding, however, all IRA, Keogh, and trust accounts. Every such security interest and right of
setoff may be exercised without demand upon or notice to the Guarantor. Every such right of setoff
shall be deemed to have been exercised immediately upon the occurrence of an Event of Default
hereunder without any action of the Bank, although the Bank may enter such setoff on its books and
records at a later time.

     8. Collateral. This Guaranty is secured by the property described in any collateral
security documents which the Guarantor executes and delivers to the Bank and by such other
collateral as previously may have been or may in the future be granted to the Bank to secure any
Obligations of the Guarantor to the Bank.

     9. Costs. To the extent that the Bank incurs any costs or expenses in protecting or
enforcing its rights under the Obligations or this Guaranty, including reasonable attorneys’ fees
and the costs and expenses of litigation, such costs and expenses will be due on demand, will be
included in the Obligations and will bear interest from the incurring or payment thereof at the
Default Rate (as defined in any of the Obligations).

     10. Postponement of Subrogation. Until the Obligations are indefeasibly paid in full,
expire, are terminated and are not subject to any right of revocation or rescission, the Guarantor
postpones and subordinates in favor of the Bank or its designee (and any assignee or potential
assignee) any and all rights which the Guarantor may have to (a) assert any claim whatsoever
against the Borrower based on subrogation, exoneration, reimbursement, or indemnity or any right of
recourse to security for the Obligations with respect to payments made hereunder, and (b) any
realization on any property of the Borrower, including participation in any marshalling of the
Borrower’s assets.

     11. Notices. All notices, demands, requests, consents, approvals and other
communications required or permitted hereunder (“Notices”) must be in writing and will be effective
upon receipt. Notices may be given in any manner to which the Bank and the Guarantor may
separately agree, including electronic mail. Without limiting the foregoing, first-class mail,
facsimile transmission and
commercial courier service are hereby agreed to as acceptable methods for giving Notices.
Regardless of the manner in which provided, Notices may be sent to addresses for the Bank and the
Guarantor as set forth above or to such other address as either may give to the other for such
purpose in accordance with this section.

     12. Preservation of Rights. No delay or omission on the Bank’s part to exercise any
right or power arising hereunder will impair any such right or power or be considered a waiver of
any such right or power, nor will the Bank’s action or inaction impair any such right or power.
The Bank’s rights and remedies hereunder are cumulative and not exclusive of any other rights or
remedies which the Bank may have under other agreements,

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at law or in equity. The Bank may proceed
in any order against the Borrower, the Guarantor or any other obligor of, or any collateral
securing, the Obligations.

     13. Illegality. If any provision contained in this Guaranty should be invalid,
illegal or unenforceable in any respect, it shall not affect or impair the validity, legality and
enforceability of the remaining provisions of this Guaranty.

     14. Changes in Writing. No modification, amendment or waiver of, or consent to any
departure by the Guarantor from, any provision of this Guaranty will be effective unless made in a
writing signed by the Bank, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice to or demand on the Guarantor will entitle
the Guarantor to any other or further notice or demand in the same, similar or other circumstance.

     15. Entire Agreement. This Guaranty (including the documents and instruments referred
to herein) constitutes the entire agreement and supersedes all other prior agreements and
understandings, both written and oral, between the Guarantor and the Bank with respect to the
subject matter hereof; provided, however, that this Guaranty is in addition to, and not in
substitution for, any other guarantees from the Guarantor to the Bank.

     16. Successors and Assigns. This Guaranty will be binding upon and inure to the
benefit of the Guarantor and the Bank and their respective heirs, executors, administrators,
successors and assigns; provided, however, that the Guarantor may not assign this
Guaranty in whole or in part without the Bank’s prior written consent and the Bank at any time may
assign this Guaranty in whole or in part.

     17. Interpretation. In this Guaranty, unless the Bank and the Guarantor otherwise
agree in writing, the singular includes the plural and the plural the singular; references to
statutes are to be construed as including all statutory provisions consolidating, amending or
replacing the statute referred to; the word “or” shall be deemed to include “and/or”, the words
“including”, “includes” and “include” shall be deemed to be followed by the words “without
limitation”; and references to sections or exhibits are to those of this Guaranty. Section
headings in this Guaranty are included for convenience of reference only and shall not constitute a
part of this Guaranty for any other purpose. If this Guaranty is executed by more than one party
as Guarantor, the obligations of such persons or entities will be joint and several.

     18. Indemnity. The Guarantor agrees to indemnify each of the Bank, each legal entity,
if any, who controls, is controlled by or is under common control with the Bank, and each of their
respective directors, officers and employees (the “Indemnified Parties”), and to defend and hold
each Indemnified Party harmless from and against, any and all claims, damages, losses, liabilities
and expenses (including all fees and charges of internal or external counsel with whom any
Indemnified Party may consult and all expenses of litigation and preparation therefor) which any
Indemnified Party may incur or which may be asserted against any Indemnified Party by any person,
entity or governmental authority (including any person or entity claiming derivatively on behalf of
the Guarantor), in connection with or arising out of or relating to the matters referred to in this
Guaranty, whether (a) arising from or incurred in
connection with any breach of a representation, warranty or covenant by the Guarantor, or (b)
arising out of or resulting from any suit, action, claim, proceeding or governmental investigation,
pending or threatened, whether based on statute, regulation or order, or tort, or contract or
otherwise, before any court or governmental authority; provided, however, that the
foregoing indemnity agreement shall not apply to any claims, damages, losses, liabilities and
expenses solely attributable to an Indemnified Party’s gross negligence or willful misconduct. The
indemnity agreement contained in this Section shall survive the termination of this Guaranty and
assignment of any rights hereunder. The Guarantor may participate at its expense in the defense of
any such claim.

     19. Governing Law and Jurisdiction. This Guaranty has been delivered to and accepted
by the Bank and will be deemed to be made in the State where the Bank’s office indicated above is
located. This Guaranty will be interpreted and the rights and liabilities of the Bank and the
Guarantor

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determined in accordance with the laws of the State where the Bank’s office indicated
above is located, excluding its conflict of laws rules. The Guarantor hereby irrevocably
consents to the exclusive jurisdiction of any state or federal court in the county or judicial
district where the Bank’s office indicated above is located; provided that nothing contained in
this Guaranty will prevent the Bank from bringing any action, enforcing any award or judgment or
exercising any rights against the Guarantor individually, against any security or against any
property of the Guarantor within any other county, state or other foreign or domestic jurisdiction.
The Guarantor acknowledges and agrees that the venue provided above is the most convenient forum
for both the Bank and the Guarantor. The Guarantor waives any objection to venue and any objection
based on a more convenient forum in any action instituted under this Guaranty.

     20. Equal Credit Opportunity Act. If the Guarantor is not an “applicant for credit”
under Section 202.2 (e) of the Equal Credit Opportunity Act of 1974 (“ECOA”), the Guarantor
acknowledges that (i) this Guaranty has been executed to provide credit support for the
Obligations, and (ii) the Guarantor was not required to execute this Guaranty in violation of
Section 202.7(d) of the ECOA.

     21. Authorization to Obtain Credit Reports. By signing below, each Guarantor who is
an individual provides written authorization to the Bank or its designee (and any assignee or
potential assignee) to obtain the Guarantor’s personal credit profile from one or more national
credit bureaus. Such authorization shall extend to obtaining a credit profile in considering this
Guaranty and subsequently for the purposes of update, renewal or extension of such credit or
additional credit and for reviewing or collecting the resulting account.

     22. Waiver of Jury Trial. The Guarantor irrevocably waives any and all right the
Guarantor may have to a trial by jury in any action, proceeding or claim of any nature relating to
this Guaranty, any documents executed in connection with this Guaranty or any transaction
contemplated in any of such documents. The Guarantor acknowledges that the foregoing waiver is
knowing and voluntary.

     The Guarantor acknowledges that it has read and understood all the provisions of this
Guaranty, including the waiver of jury trial, and has been advised by counsel as necessary or
appropriate.

WITNESS the due execution hereof as a document under seal, as of the date first written above,
with the intent to be legally bound hereby.

	 	 	 	 	 	 

	WITNESS / ATTEST:

	 	LIBERATOR HEALTH AND
EDUCATION SERVICES, INC.
	 
	 	 	 	 	 
	/s/ SCOTT S. WILSON

	 	By:
	 	/s/ Mark Libratore
	 

	 	 	 	 
	Print Name: SCOTT S. WILSON

	 	 	 	Mark Libratore 	(SEAL)
	Title: OFFICER

	 	 	 	Chief Executive Officer

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