Document:

Security Agreement

 Exhibit 10.4 
  
 SECURITY AGREEMENT 
  
 LAURUS MASTER FUND, LTD. 
  
 ACCENTIA BIOPHARMACEUTICALS, INC. 
  
 and 
  
 EACH ELIGIBLE SUBSIDIARY SET FORTH ON EXHIBIT A HERETO 
  
 Dated: April 29, 2005 
 Amended and Restated: February 13, 2006 

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page

	 1.
	  	General Definitions and Terms; Rules of Construction.	  	1
			
	 2.
	  	Loan Facility	  	2
			
	 3.
	  	Repayment of the Loans	  	4
			
	 4.
	  	Procedure for Loans	  	5
			
	 5.
	  	Interest and Payments.	  	5
			
	 6.
	  	Security Interest.	  	7
			
	 7.
	  	Representations, Warranties and Covenants Concerning the Collateral	  	8
			
	 8.
	  	Payment of Accounts.	  	10
			
	 9.
	  	Collection and Maintenance of Collateral.	  	11
			
	 10.
	  	Inspections and Appraisals	  	12
			
	 11.
	  	Financial Reporting	  	12
			
	 12.
	  	Additional Representations and Warranties	  	13
			
	 13.
	  	Covenants	  	24
			
	 14.
	  	Further Assurances	  	32
			
	 15.
	  	Representations, Warranties and Covenants of Laurus.	  	32
			
	 16.
	  	Power of Attorney	  	34
			
	 17.
	  	Term of Agreement	  	34
			
	 18.
	  	Termination of Lien	  	35
			
	 19.
	  	Events of Default	  	35
			
	 20.
	  	Remedies	  	37
			
	 21.
	  	Waivers	  	38
			
	 22.
	  	Expenses	  	39
			
	 23.
	  	Assignment By Laurus	  	39

  

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	 	  	 	  	Page(s)

	24.	  	No Waiver; Cumulative Remedies	  	41
			
	25.	  	Application of Payments	  	41
			
	26.	  	Indemnity	  	41
			
	27.	  	Revival	  	42
			
	28.	  	Borrowing Agency Provisions	  	42
			
	29.	  	Notices	  	43
			
	30.	  	Governing Law, Jurisdiction and Waiver of Jury Trial	  	44
			
	31.	  	Limitation of Liability	  	45
			
	32.	  	Entire Understanding	  	45
			
	33.	  	Severability	  	46
			
	34.	  	Survival	  	46
			
	35.	  	Captions	  	46
			
	36.	  	Counterparts; Telecopier Signatures	  	46
			
	37.	  	Construction	  	46
			
	38.	  	Publicity	  	46
			
	39.	  	Joinder	  	46
			
	40.	  	Legends	  	47

  

 ii 

 AMENDED AND RESTATED SECURITY AGREEMENT 
  
 This Amended and Restated Security Agreement is made as of April 29,
2005 and Amended and Restated as of February 13, 2006 by and among LAURUS MASTER FUND, LTD., a Cayman Islands corporation (“Laurus”), ACCENTIA BIOPHARMACEUTICALS, INC., a Florida corporation (“the Parent”), and
each party listed on Exhibit A attached hereto (each an “Eligible Subsidiary” and collectively, the “Eligible Subsidiaries”) the Parent and each Eligible Subsidiary, each a “Company” and
collectively, the “Companies”). This Security Agreement amends and restates in its entirety that certain Security Agreement made by the Companies in favor of Laurus on April 29, 2005 (the “Original Security Agreement”).

  
 BACKGROUND 
  
 On April 29, 2005, Laurus made certain advances available to the
Companies pursuant to the terms of that certain Original Security Agreement; and 
  
 The Companies and Laurus have agreed to amend and restate the Original Agreement in the form hereof in order to incorporate certain mutually agreed-to terms; and 
  
 Laurus has agreed to continue to make such advances on the terms and
conditions set forth in this Amended and Restated Security Agreement (this “Agreement”). 
  
 AGREEMENT 
  
 NOW, THEREFORE, in consideration of the mutual covenants and undertakings and the terms and conditions contained herein, the parties hereto agree as follows: 
  
 1. General Definitions and Terms; Rules of Construction. 

 
 (a) General Definitions. Capitalized terms used in this Agreement
shall have the meanings assigned to them in Annex A. 
  
 (b) Accounting Terms. Any accounting terms used in this Agreement which are not specifically defined shall have the meanings customarily given them in accordance with GAAP and all financial computations shall be computed, unless
specifically provided herein, in accordance with GAAP consistently applied. 
  
 (c) Other Terms. All other terms used in this Agreement and defined in the UCC, shall have the meaning given therein unless otherwise defined herein. 
  
 (d) Rules of Construction. All Schedules, Addenda, Annexes and
Exhibits hereto or expressly identified to this Agreement are incorporated herein by reference and taken together with this Agreement constitute but a single agreement. The words “herein”, “hereof” and “hereunder” or
other words of similar import refer to this Agreement as a whole, including the Exhibits, Addenda, Annexes and Schedules thereto, as the same may be from time to time amended, modified, restated or supplemented, and not to any particular section,
subsection or clause contained in this Agreement. Wherever from the context it appears appropriate, each term stated in either the singular or plural shall include the singular and the plural, and pronouns 

 
stated in the masculine, feminine or neuter gender shall include the masculine, the feminine and the neuter. The term “or” is not exclusive. The
term “including” (or any form thereof) shall not be limiting or exclusive. All references to statutes and related regulations shall include any amendments of same and any successor statutes and regulations. All references in this Agreement
or in the Schedules, Addenda, Annexes and Exhibits to this Agreement to sections, schedules, disclosure schedules, exhibits, and attachments shall refer to the corresponding sections, schedules, disclosure schedules, exhibits, and attachments of or
to this Agreement. All references to any instruments or agreements, including references to any of this Agreement or the Ancillary Agreements shall include any and all modifications or amendments thereto and any and all extensions or renewals
thereof. 
  
 2. Loan Facility. 
  
 (a) Loans. 
  
 (i) Subject to the terms and conditions set forth herein and in the
Ancillary Agreements, Laurus may make loans (the “Loans”) to Companies from time to time during the Term which, in the aggregate at any time outstanding, will not exceed the lesser of (x) (I) the Capital Availability Amount
minus (II) such reserves as Laurus may reasonably in its good faith judgment deem proper and necessary from time to time (the “Reserves”) and (y) an amount equal to (I) the Accounts Availability, plus (II) the Inventory
Availability, plus the Stock Availability, minus (IV) the Reserves. The amount derived at any time from Section 2(a)(i)(y)(I) plus Section 2(a)(i)(y)(II) plus Section 2(a)(i)(y)(III) minus 2(a)(i)(y)(IV) shall be
referred to as the “Formula Amount.” The Companies shall, jointly and severally, execute and deliver to Laurus on the Closing Date the Revolving Note and a Minimum Borrowing Note evidencing the Loans funded on the Closing Date. The
Companies hereby each acknowledge and agree that Laurus’ obligation to purchase the Revolving Note and the Minimum Borrowing Note from the Companies on the Closing Date shall be contingent upon the satisfaction (or waiver by Laurus in its sole
discretion) of the items and matters set forth in the closing checklist provided by Laurus to the Companies on or prior to the Closing Date. 
  
 (ii) Notwithstanding the limitations set forth above, if requested by any Company, Laurus retains the right to lend to such Company from time to time
such amounts in excess of such limitations as Laurus may determine in its sole discretion. 
  
 (iii) The Companies acknowledge that the exercise of Laurus’ discretionary rights hereunder may result during the Term in one or more increases or decreases in the advance percentages used in determining Accounts
Availability, Inventory Availability and/or Stock Availability and each of the Companies hereby consent to any such increases or decreases which may limit or restrict advances requested by the Companies. 
  
 (iv) If any interest, fees, costs or charges payable to Laurus hereunder are
not paid when due, each of the Companies shall thereby be deemed to have requested, and Laurus is hereby authorized at its discretion to make and charge to the Companies’ account, a Loan as of such date in an amount equal to such unpaid
interest, fees, costs or charges. 
  

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 (v) If any Company at any time fails to perform or observe any of the covenants contained in this
Agreement or any Ancillary Agreement, Laurus may, but need not, upon prior written notice to the Company, perform or observe such covenant on behalf and in the name, place and stead of such Company (or, at Laurus’ option, in Laurus’ name)
and may, but need not, upon prior written notice to the Company, take any and all other actions which Laurus may deem necessary to cure or correct such failure (including the payment of taxes, the satisfaction of Liens, the performance of
obligations owed to Account Debtors, lessors or other obligors, the procurement and maintenance of insurance, the execution of assignments, security agreements and financing statements, and the endorsement of instruments). The amount of all monies
expended and all costs and expenses (including attorneys’ fees and legal expenses) incurred by Laurus in connection with or as a result of the performance or observance of such agreements or the taking of such action by Laurus shall be charged
to the Companies’ account as a Loan and added to the Obligations. To facilitate Laurus’ performance or observance of such covenants by each Company, each Company hereby irrevocably appoints Laurus, or Laurus’ delegate, acting alone,
as such Company’s attorney in fact (which appointment is coupled with an interest) with the right (but not the duty) from time to time to create, prepare, complete, execute, deliver, endorse or file in the name and on behalf of such Company any
and all instruments, documents, assignments, security agreements, financing statements, applications for insurance and other agreements and writings required to be obtained, executed, delivered or endorsed by such Company. 
  
 (vi) Laurus will account to Company Agent monthly with a statement of all
Loans and other advances, charges and payments made pursuant to this Agreement, and such account rendered by Laurus shall be deemed final, binding and conclusive unless Laurus is notified by Company Agent in writing to the contrary within thirty
(30) days of the date each account was rendered specifying the item or items to which objection is made. 
  
 (vii) During the Term, the Companies may borrow and prepay Loans in accordance with the terms and conditions hereof. 
  
 (viii) If any Eligible Account is not paid by the Account Debtor within
ninety (90) days after the date that such Eligible Account was invoiced or if any Account Debtor asserts a deduction, dispute, contingency, set-off, or counterclaim with respect to any Eligible Account, (a “Delinquent
Account”), the Companies shall jointly and severally (i) reimburse Laurus for the amount of the Loans made with respect to such Delinquent Account plus an adjustment fee in an amount equal to one-half of one percent (0.50%) of the
gross face amount of such Eligible Account or (ii) immediately replace such Delinquent Account with an otherwise Eligible Account. 
  
 (b) Receivables Purchase. Following the occurrence and during the continuance of an Event of Default, Laurus may, at its option, elect to convert
the credit facility contemplated hereby to an accounts receivable purchase facility. Upon such election by Laurus (subsequent notice of which Laurus shall provide to Company Agent), the Companies shall be deemed to hereby have sold, assigned,
transferred, conveyed and delivered to Laurus, and Laurus shall be deemed to have purchased and received from the Companies, all right, title and interest of the Companies in and to all Accounts which shall at any time constitute Eligible Accounts
(the “Receivables Purchase”). All outstanding Loans hereunder shall be deemed obligations under 

  

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such accounts receivable purchase facility. The conversion to an accounts receivable purchase facility in accordance with the terms hereof shall not be
deemed an exercise by Laurus of its secured creditor rights under Article 9 of the UCC. Immediately following Laurus’ request, the Companies shall execute all such further documentation as may be required by Laurus to more fully set forth the
accounts receivable purchase facility herein contemplated, including, without limitation, Laurus’ standard form of accounts receivable purchase agreement and account debtor notification letters, but any Company’s failure to enter into any
such documentation shall not impair or affect the Receivables Purchase in any manner whatsoever. 
  
 (c) Minimum Borrowing Note. After a registration statement registering the resale of the Registrable Securities (as defined in the Registration
Rights Agreement) has been declared effective by the SEC, conversions of the Minimum Borrowing Note into the Common Stock may be initiated as set forth in the Minimum Borrowing Note. 
  
 3. Repayment of the Loans. The Companies (a) may prepay the Obligations from time to time in accordance with the
terms and provisions of the Notes (and Section 17 hereof if such prepayment is due to a termination of this Agreement); (b) shall repay on the expiration of the Term (i) the then aggregate outstanding principal balance of the Loans
together with accrued and unpaid interest, fees and charges and; (ii) all other amounts owed Laurus under this Agreement and the Ancillary Agreements; and (c) subject to Section 2(a)(ii), shall repay on any day on which the then
aggregate outstanding principal balance of the Loans are in excess of the Formula Amount at such time, Loans in an amount equal to such excess (the “Excess Amount”); provided that, to the extent that the Companies fail to
repay in full the Excess Amount within three days from the date such Excess Amount shall have first occurred, in addition to all other rights and remedies available to Laurus hereunder and under the Ancillary Agreements, Laurus shall have the right,
but not the obligation, to sell, transfer or otherwise dispose of such Collateral as may be pledged to Laurus from time to time pursuant to the O’Donnell Stock Pledge Agreement to the extent necessary to generate cash proceeds sufficient to
repay in full, and Laurus shall apply such cash proceeds in repayment of, such Excess Amount plus such other costs and expenses incurred by Laurus as a result thereof. Any payments of principal, interest, fees or any other amounts payable hereunder
or under any Ancillary Agreement shall be made prior to 12:00 noon (New York time) on the due date thereof in immediately available funds. 
  
 4. Procedure for Loans. Company Agent may by written notice request a borrowing of Loans prior to 12:00 noon (New York time) on the Business Day of
its request to incur, on the next Business Day, a Loan. Together with each request for a Loan (or at such other intervals as Laurus may request), Company Agent shall deliver to Laurus a Borrowing Base Certificate in the form of Exhibit B
attached hereto, which shall be certified as true and correct by the Chief Executive Officer or Chief Financial Officer of Company Agent together with all supporting documentation relating thereto. All Loans shall be disbursed from whichever office
or other place Laurus may designate from time to time and shall be charged to the Companies’ account on Laurus’ books. The proceeds of each Loan made by Laurus shall be made available to Company Agent on the Business Day following the
Business Day so requested in accordance with the terms of this Section 4 by way of credit to the applicable Company’s operating account maintained with such bank as Company Agent designated to Laurus. Any and all Obligations due and owing
hereunder may be charged to the Companies’ account and shall constitute Loans. 
  

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 5. Interest and Payments. 
  
 (a) Interest. 
  
 (i) Except as modified by Section 5(a)(iii) below, the Companies shall jointly and severally pay interest at the Contract Rate on the unpaid
principal balance of each Loan until such time as such Loan is collected in full in good funds in dollars of the United States of America. 
  
 (ii) Interest and payments shall be computed on the basis of actual days elapsed in a year of 360 days. At Laurus’ option, Laurus may charge the
Companies’ account for said interest. 
  
 (iii) Effective
upon the occurrence of any Event of Default and for so long as any Event of Default shall be continuing, the Contract Rate shall automatically be increased as set forth in the Notes (such increased rate, the “Default Rate”), and all
outstanding Obligations, including unpaid interest, shall continue to accrue interest from the date of such Event of Default at the Default Rate applicable to such Obligations. 
  
 (iv) In no event shall the aggregate interest payable hereunder exceed the maximum rate permitted under any applicable law
or regulation, as in effect from time to time (the “Maximum Legal Rate”), and if any provision of this Agreement or any Ancillary Agreement is in contravention of any such law or regulation, interest payable under this Agreement and
each Ancillary Agreement shall be computed on the basis of the Maximum Legal Rate (so that such interest will not exceed the Maximum Legal Rate). 
  
 (v) The Companies shall jointly and severally pay principal, interest and all other amounts payable hereunder, or under any Ancillary Agreement, without
any deduction whatsoever, including any deduction for any set-off or counterclaim. 
  
 (b) Payments; Certain Closing Conditions. 
  
 (i) Closing/Annual Payments. Upon execution of this Agreement by each Company and Laurus, the Companies shall jointly and severally pay to Laurus Capital Management, LLC a closing payment in an amount equal to
three and three-quarters percent (3.75%) of the Capital Availability Amount. Such payment shall be deemed fully earned on the Closing Date and shall not be subject to rebate or proration for any reason. 
  
 (ii) Overadvance Payment. Without affecting Laurus’ rights
hereunder in the event the Loans exceed the Formula Amount (each such event, an “Overadvance”), all such Overadvances shall bear additional interest at a rate equal to one percent (1%) per month of the amount of such
Overadvances for all times such amounts shall be in excess of the Formula Amount. All amounts that are incurred pursuant to this Section 5(b)(ii) shall be due and payable by the Companies monthly, in arrears, on the first business day of each
calendar month and upon expiration of the Term. 
  
 (iii)
Financial Information Default. Without affecting Laurus’ other rights and remedies, in the event any Company fails to deliver the financial information required 

  

 5 

 
by Section 11 on or before the date required by this Agreement, the Companies shall jointly and severally pay Laurus an aggregate fee in the amount of
$500.00 per week (or portion thereof) for each such failure until such failure is cured to Laurus’ satisfaction or waived in writing by Laurus. All amounts that are incurred pursuant to this Section 5(b)(iv) shall be due and payable by the
Companies monthly, in arrears, on the first business of each calendar month and upon expiration of the Term. 
  
 (iv) Expenses. The Companies shall jointly and severally reimburse Laurus for its expenses (including reasonable legal fees and expenses) incurred
in connection with the preparation and negotiation of this Agreement and the Ancillary Agreements, and expenses incurred in connection with Laurus’ due diligence review of each Company and its Subsidiaries and all related matters. Amounts
required to be paid under this Section 5(b)(iv) together with amounts required to be paid pursuant to Section 2(d) of the Securities Purchase Agreement between the Parent and Laurus dated as of the date hereof (as amended, modified or
supplemented from time to time, the “Securities Purchase Agreement”) will be paid on the Closing Date and shall be $37,500 for such expenses referred to in this Section 5(b)(iv); provided that, to the extent that the need
exists to engage outside counsel in connection with the transactions described herein, such additional reasonable fees and expenses shall also be reimbursed, on a joint and several basis, by the Companies to Laurus. 
  
 (v) O’Donnell Stock Pledge Agreement. On or prior to the Closing
Date, the Parent shall cause The Francis E. O’Donnell, Jr. Irrevocable Trust No. 1 (the “O’Donnell Trust”) to pledge 1,500,000 shares of common stock of Star Scientific, Inc. held by the O’Donnell Trust pursuant
to a stock pledge agreement in form and substance satisfactory to Laurus in its sole discretion (as amended, modified and/or or supplemented from time to time, the “O’Donnell Stock Pledge Agreement”). 
  
 (vi) Subordination. On or prior to the Closing Date, the Parent shall
cause McKesson as holder of certain of the Parent’s outstanding debt obligations, to enter into a subordination agreement in respect of such debt obligations in form and substance satisfactory to Laurus (as amended, modified and/or or
supplemented from time to time, “McKesson Subordination Agreement”). 
  
 (vii) Refinancing. On or prior to the Closing Date, all indebtedness under the Revolving Credit Agreement dated as of March 30, 2004 between Missouri State Bank and Trust Company (“MSB”)
and the Parent (as amended, modified and/or supplemented, the “Existing Credit Agreement”) shall have been repaid in full and all commitments in respect thereof shall have been terminated and all Liens and guaranties in connection
therewith shall have been terminated (and all appropriate releases, termination statements or other instruments of assignment with respect thereto shall have been obtained) to the reasonable satisfaction of Laurus. Laurus shall have received
satisfactory evidence (including satisfactory pay-off letters, mortgage releases, intellectual property releases and UCC-3 termination statements) that the matters set forth in the immediately preceding sentence have been satisfied as of the Closing
Date. 
  
 (viii) Series E Preferred Stock Consent. On or
prior to the Closing Date, the Parent shall have provided Laurus with evidence reasonably satisfactory to Laurus that 

  

 6 

 
the requisite consent of the holder’s of the Parent’s Series E preferred stock has been obtained in respect of the consummation of the transactions
described herein, including, without limitation, the granting to Laurus of registration rights pursuant to the terms of the Registration Rights Agreement. 
  
 6. Security Interest. 
  
 (a) To secure the prompt payment to Laurus of the Obligations, each Company hereby acknowledges, confirms and agrees that Laurus has and shall continue to
have a security interest in all of the Collateral heretofore granted by such Company to Laurus pursuant to the Original Security Agreement and hereby assigns, pledges and grants to Laurus a continuing security interest in and Lien upon all of the
Collateral. All of each Company’s Books and Records relating to the Collateral shall, until delivered to or removed by Laurus, be kept by such Company in trust for Laurus until all Obligations have been paid in full. Each confirmatory
assignment schedule or other form of assignment hereafter executed by each Company shall be deemed to include the foregoing grant, whether or not the same appears therein. 
  
 (b) Each Company hereby (i) authorizes Laurus to file any financing statements, continuation statements or amendments
thereto that (x) indicate the Collateral (1) as all assets and personal property of such Company or words of similar effect, regardless of whether any particular asset comprised in the Collateral falls within the scope of Article 9 of the
UCC of such jurisdiction, or (2) as being of an equal or lesser scope or with greater detail, and (y) contain any other information required by Part 5 of Article 9 of the UCC for the sufficiency or filing office acceptance of any financing
statement, continuation statement or amendment, (ii) ratifies its authorization for Laurus to have filed any initial financial statements, or amendments thereto if filed prior to the date hereof and (iii) agrees to actively assist Laurus
in the preparation and filing of grants and assignments of such Company’s Intellectual Property with the United States Patent and Trademark Office to the extent deemed necessary or prudent by Laurus in its sole discretion to properly perfect
Laurus’ security interest in such Intellectual Property. Each Company acknowledges that it is not authorized to file any financing statement or amendment or termination statement with respect to any financing statement without the prior written
consent of Laurus and agrees that it will not do so without the prior written consent of Laurus, subject to such Company’s rights under Section 9-509(d)(2) of the UCC. 
  
 (c) Each Company hereby grants to Laurus an irrevocable, non-exclusive license (exercisable upon the termination of this
Agreement due to an occurrence and during the continuance of an Event of Default without payment of royalty or other compensation to such Company) to use, transfer, license or sublicense any Intellectual Property now owned, licensed to, or hereafter
acquired by such Company, and wherever the same may be located, and including in such license access to all media in which any of the licensed items may be recorded or stored and to all computer and automatic machinery software and programs used for
the compilation or printout thereof, and represents, promises and agrees that any such license or sublicense is not and will not be in conflict with the contractual or commercial rights of any third Person; provided, that such license will terminate
on the termination of this Agreement and the payment in full of all Obligations. Notwithstanding the foregoing, it is agreed and understood that the Parent and its Subsidiaries may, without the prior approval of Laurus, grant licenses for the use of
its Intellectual Property to third parties pursuant to agreements to develop, conduct 

  

 7 

 
trials, commercialize, manufacture and/or market any of its technologies, products, pharmaceuticals, and or devices; provided that (i) such licenses and
agreements, as the case may be, are in the ordinary course of business of the Parent and/or its Subsidiaries and consistent with past practice and (ii) the Parent’s and/or its Subsidiary’s interest in such licenses and agreements, as
the case may be, are each subject to and covered by Laurus’ security interest hereunder. 
  
 7. Representations, Warranties and Covenants Concerning the Collateral. Each Company represents, warrants (each of which such representations and warranties shall be deemed repeated upon the making of each
request for a Loan and made as of the time of each and every Loan hereunder) and covenants as follows: 
  
 (a) all of the Collateral (i) is owned by it free and clear of all Liens (including any claims of infringement) except those in Laurus’ favor
and Permitted Liens and (ii) is not subject to any agreement prohibiting the granting of a Lien or requiring notice of or consent to the granting of a Lien. 
  
 (b) it shall not encumber, mortgage, pledge, assign or grant any Lien in any Collateral or any other assets to anyone other
than Laurus and except for Permitted Liens. 
  
 (c) the Liens
granted pursuant to this Agreement, upon completion of the filings and other actions listed on Schedule 7(c) (which, in the case of all filings and other documents referred to in said Schedule, have been delivered to Laurus in duly executed
form) constitute valid perfected security interests in all of the Collateral in favor of Laurus as security for the prompt and complete payment and performance of the Obligations, enforceable in accordance with the terms hereof against any and all
of its creditors and purchasers and such security interest is prior to all other Liens in existence on the date hereof. 
  
 (d) no effective security agreement, mortgage, deed of trust, financing statement, equivalent security or Lien instrument or continuation statement
covering all or any part of the Collateral is or will be on file or of record in any public office, except those relating to Permitted Liens. 
  
 (e) it shall not dispose of any of the Collateral whether by sale, lease or otherwise except for the sale of Inventory in the ordinary course of business
and for the disposition or transfer in the ordinary course of business during any fiscal year of obsolete and worn-out Equipment having an aggregate fair market value of not more than $75,000 and only to the extent that (i) the proceeds of any
such disposition are used to acquire replacement Equipment which is subject to Laurus’ first priority security interest or are used to repay Loans or to pay general corporate expenses, or (ii) following the occurrence of an Event of
Default which continues to exist the proceeds of which are remitted to Laurus to be held as cash collateral for the Obligations. 
  
 (f) it shall defend the right, title and interest of Laurus in and to the Collateral against the claims and demands of all Persons whomsoever, and take
such actions, including (i) all actions necessary to grant Laurus “control” of any Investment Property, Deposit Accounts, Letter-of-Credit Rights or electronic Chattel Paper owned by it, with any agreements establishing control to be
in form and substance satisfactory to Laurus, (ii) the prompt (but in no event later 

  

 8 

 
than five (5) Business Days following Laurus’ request therefor) delivery to Laurus of all original Instruments, Chattel Paper, negotiable Documents
and certificated Stock owned by it (in each case, accompanied by stock powers, allonges or other instruments of transfer executed in blank), (iii) notification of Laurus’ interest in Collateral at Laurus’ request, and (iv) the
institution of litigation against third parties as shall be prudent in order to protect and preserve its and/or Laurus’ respective and several interests in the Collateral. 
  
 (g) it shall promptly, and in any event within five (5) Business Days after the same is acquired by it, notify Laurus
of any commercial tort claim (as defined in the UCC) acquired by it and unless otherwise consented by Laurus, it shall enter into a supplement to this Agreement granting to Laurus a Lien in such commercial tort claim. 
  
 (h) it shall place notations upon its Books and Records and any of its
financial statements to disclose Laurus’ Lien in the Collateral. 
  
 (i) if it retains possession of any Chattel Paper or Instrument with Laurus’ consent, upon Laurus’ request such Chattel Paper and Instruments shall be marked with the following legend: “This writing and obligations evidenced
or secured hereby are subject to the security interest of Laurus Master Fund, Ltd.” Notwithstanding the foregoing, upon the reasonable request of Laurus, such Chattel Paper and Instruments shall be delivered to Laurus. 
  
 (j) it shall perform in a reasonable time all other steps requested by Laurus
to create and maintain in Laurus’ favor a valid perfected first Lien in all Collateral subject only to Permitted Liens. 
  
 (k) it shall notify Laurus promptly and in any event within three (3) Business Days after obtaining knowledge thereof (i) of any event or
circumstance that, to its knowledge, would cause Laurus to consider any then existing Account and/or Inventory as no longer constituting an Eligible Account or Eligible Inventory, as the case may be; (ii) of any material delay in its
performance of any of its obligations to any Account Debtor; (iii) of any assertion by any Account Debtor of any material claims, offsets or counterclaims; (iv) of any allowances, credits and/or monies granted by it to any Account Debtor;
(v) of all material adverse information relating to the financial condition of an Account Debtor; (vi) of any material return of goods; and (vii) of any loss, damage or destruction of any of the Collateral. 
  
 (l) all Eligible Accounts (i) represent complete bona fide transactions
which require no further act under any circumstances on its part to make such Accounts payable by the Account Debtors, (ii) are not subject to any present, future contingent offsets or counterclaims, and (iii) do not represent bill and
hold sales, consignment sales, guaranteed sales, sale or return or other similar understandings or obligations of any Affiliate or Subsidiary of such Company. It has not made, nor will it make, any agreement with any Account Debtor for any extension
of time for the payment of any Account, any compromise or settlement for less than the full amount thereof, any release of any Account Debtor from liability therefor, or any deduction therefrom except a discount or allowance for prompt or early
payment or reasonable marketing expenses allowed by it in the ordinary course of its business consistent with historical practice and as previously disclosed to Laurus in writing. 
  

 9 

 (m) it shall keep and maintain its Equipment in good operating condition, except for ordinary wear and
tear, and shall make all necessary repairs and replacements thereof so that the value and operating efficiency shall at all times be maintained and preserved. It shall not permit any such items to become a Fixture to real estate or accessions to
other personal property. 
  
 (n) it shall maintain and keep all of
its Books and Records concerning the Collateral at its executive offices listed in Schedule 12(aa). 
  
 (o) it shall maintain and keep the tangible Collateral at the addresses listed in Schedule 12(bb), provided, that it may change such locations or
open a new location, provided that it provides Laurus at least thirty (30) days prior written notice of such changes or new location and (ii) prior to such change or opening of a new location where Collateral having a value of more than
$75,000 will be located, it executes and delivers to Laurus such agreements deemed reasonably necessary or prudent by Laurus, including landlord agreements, mortgagee agreements and warehouse agreements, each in form and substance satisfactory to
Laurus, to adequately protect and maintain Laurus’ security interest in such Collateral. 
  
 (p) Schedule 7(p) lists all banks and other financial institutions at which it maintains deposits and/or other accounts, and such Schedule correctly identifies the name, address and telephone number of each
such depository, the name in which the account is held, a description of the purpose of the account, and the complete account number. It shall not establish any depository or other bank account with any financial institution (other than the accounts
set forth on Schedule 7(p)) without Laurus’ prior written consent. 
  
 (q) All Inventory manufactured by it in the United States of America shall be produced in accordance with the requirements of the Federal Fair Labor Standards Act of 1938, as amended and all rules, regulations and
orders related thereto or promulgated thereunder. 
  
 8.
Payment of Accounts. 
  
 (a) Each Company will irrevocably
direct all of its present and future Account Debtors and other Persons obligated to make payments constituting Collateral to make such payments directly to the lockboxes maintained by such Company (the “Lockboxes”) with Missouri
State Bank and Trust Company or such other financial institution accepted by Laurus in writing as may be selected by such Company (the “Lockbox Bank”) pursuant to the terms of the certain agreements among one or more Companies,
Laurus and/or the Lockbox Bank dated as of April 29, 2005. On or prior to the Closing Date, each Company shall and shall cause the Lockbox Bank to enter into all such documentation acceptable to Laurus pursuant to which, among other things, the
Lockbox Bank agrees to: (a) sweep the Lockbox on a daily basis and deposit all checks received therein to an account designated by Laurus in writing and (b) comply only with the instructions or other directions of Laurus concerning the
Lockbox. All of each Company’s invoices, account statements and other written or oral communications directing, instructing, demanding or requesting payment of any Account of any Company or any other amount constituting Collateral shall
conspicuously direct that all payments be made to the Lockbox or such other address as Laurus may direct in writing. If, notwithstanding the instructions to Account Debtors, any Company receives any payments, such Company shall 

  

 10 

 
immediately remit such payments to Laurus in their original form with all necessary endorsements. Until so remitted, such Company shall hold all such
payments in trust for and as the property of Laurus and shall not commingle such payments with any of its other funds or property. 
  
 (b) At Laurus’ election, following the occurrence of an Event of Default which is continuing, Laurus may notify each Company’s Account Debtors
of Laurus’ security interest in the Accounts, collect them directly and charge the collection costs and expenses thereof to Company’s and the Eligible Subsidiaries joint and several account. 
  
 9. Collection and Maintenance of Collateral. 
  
 (a) Laurus may verify each Company’s Accounts from time to time, but
not more often than once every three (3) months, unless an Event of Default has occurred and is continuing, utilizing an audit control company or any other agent of Laurus. 
  
 (b) Proceeds of Accounts received by Laurus will be deemed received on the Business Day after Laurus’ receipt of such
proceeds in good funds in dollars of the United States of America to an account designated by Laurus. Any amount received by Laurus after 12:00 noon (New York time) on any Business Day shall be deemed received on the next Business Day.

  
 (c) As Laurus receives the proceeds of Accounts of any
Company, it shall (i) apply such proceeds, as required, to amounts outstanding under the Notes, and (ii) remit all such remaining proceeds (net of interest, fees and other amounts then due and owing to Laurus hereunder) to Company Agent
(for the benefit of the applicable Companies) upon request (but no more often than twice a week). Notwithstanding the foregoing, following the occurrence and during the continuance of an Event of Default, Laurus, at its option, may (a) apply
such proceeds to the Obligations in such order as Laurus shall elect, (b) hold all such proceeds as cash collateral for the Obligations and each Company hereby grants to Laurus a security interest in such cash collateral amounts as security for
the Obligations and/or (c) do any combination of the foregoing. 
  
 10. Inspections and Appraisals. At all times during normal business hours, and, prior to the occurrence of an Event of Default, upon twenty four (24) hours prior notice, Laurus, and/or any agent of Laurus shall have the right to
(a) have access to, visit, inspect, review, evaluate and make physical verification and appraisals of each Company’s properties and the Collateral, (b) inspect, audit and copy (or take originals if necessary) and make extracts from
each Company’s Books and Records, including management letters prepared by the Accountants, and (c) discuss with each Company’s directors, principal officers, and independent accountants, each Company’s business, assets,
liabilities, financial condition, results of operations and business prospects. Each Company will deliver to Laurus any instrument necessary for Laurus to obtain records from any service bureau maintaining records for such Company. If any internally
prepared financial information, including that required under this Section is unsatisfactory in any manner to Laurus, Laurus may request that the Accountants review the same. 
  

 11 

 11. Financial Reporting. Company Agent will deliver, or cause to be delivered, to Laurus each of
the following, which shall be in form and detail acceptable to Laurus: 
  
 (a) As soon as available, and in any event within ninety (90) days after the end of each fiscal year of the Parent, each Company’s audited financial statements with a report of independent certified public accountants of
recognized standing selected by the Parent and acceptable to Laurus (the “Accountants”), which annual financial statements shall be without qualification and shall include each Company’s balance sheet as at the end of such
fiscal year and the related statements of each Company’s income, retained earnings and cash flows for the fiscal year then ended, prepared, if Laurus so requests, on a consolidating and consolidated basis to include all Subsidiaries and
Affiliates of each Company, all in reasonable detail and prepared in accordance with GAAP, together with (i) if and when available, copies of any management letters prepared by the Accountants; and (ii) a certificate of the Parent’s
President, Chief Executive Officer or Chief Financial Officer stating that such financial statements have been prepared in accordance with GAAP and whether or not such officer has knowledge of the occurrence of any Default or Event of Default
hereunder and, if so, stating in reasonable detail the facts with respect thereto; 
  
 (b) As soon as available and in any event within forty five (45) days after the end of each quarter, an unaudited/internal balance sheet and statements of income, retained earnings and cash flows of each Company
as at the end of and for such quarter and for the year to date period then ended, prepared, if Laurus so requests, on a consolidating and consolidated basis to include all Subsidiaries and Affiliates of each Company, in reasonable detail and stating
in comparative form the figures for the corresponding date and periods in the previous year, all prepared in accordance with GAAP, subject to year-end adjustments and accompanied by a certificate of the Parent’s President, Chief Executive
Officer or Chief Financial Officer, stating (i) that such financial statements have been prepared in accordance with GAAP, subject to year-end audit adjustments, and (ii) whether or not such officer has knowledge of the occurrence of any
Default or Event of Default hereunder not theretofore reported and remedied and, if so, stating in reasonable detail the facts with respect thereto; 
  
 (c) Within thirty (30) days after the end of each month (or more frequently if Laurus so requests), agings of each Company’s Accounts, unaudited
trial balances and their accounts payable and a calculation of each Company’s Accounts, Eligible Accounts, Inventory and/or Eligible Inventory, provided, however, that if Laurus shall request the foregoing information more often than as set
forth in the immediately preceding clause, each Company shall have thirty (30) days from each such request to comply with Laurus’ demand; and 
  
 (d) Promptly after (i) the filing thereof, copies of the Parent’s most recent registration statements and annual, quarterly, monthly or other
regular reports which the Parent files with the SEC, and (ii) the issuance thereof, copies of such financial statements, reports and proxy statements as the Parent shall send to its stockholders. 
  

 12 

 12. Additional Representations and Warranties. Each Company hereby represents and warrants to
Laurus as follows: 
  
 (a) Organization, Good Standing and
Qualification. It and each of its Subsidiaries is a corporation, partnership or limited liability company, as the case may be, duly organized, validly existing and in good standing under the laws of its jurisdiction of organization. It and each
of its Subsidiaries has the corporate, limited liability company or partnership, as the case may be, power and authority to own and operate its properties and assets and, insofar as it is or shall be a party thereto, to (i) execute and deliver
this Agreement and the Ancillary Agreements, (ii) to issue the Notes and the shares of Common Stock issuable upon conversion of the Minimum Borrowing Note (the “Note Shares”), (iii) to issue the Warrants and the shares of
Common Stock issuable upon exercise of the Warrants (the “Warrant Shares”), and to (iv) carry out the provisions of this Agreement and the Ancillary Agreements and to carry on its business as presently conducted. It and each of
its Subsidiaries is duly qualified and is authorized to do business and is in good standing as a foreign corporation, partnership or limited liability company, as the case may be, in all jurisdictions in which the nature or location of its
activities and of its properties (both owned and leased) makes such qualification necessary, except for those jurisdictions in which failure to do so has not had, or could not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect. 
  
 (b) Subsidiaries. Each of its
direct and indirect Subsidiaries, the direct owner of each such Subsidiary and its percentage ownership thereof, is set forth on Schedule 12(b). 
  
 (c) Capitalization; Voting Rights. 
  
 (i) The authorized capital stock of the Parent, as of the date hereof consists of 425,000,000 shares, of which (i) 300,000,000 are shares of Common
Stock, par value $0.001 per share, 10,865,645 shares of which are issued and outstanding, (ii) 10,000,000 are shares of Series A preferred stock, par value $1.00 per share of which 6,183,000 shares of Series A preferred stock are issued and
outstanding, (iii) 30,000,000 are shares of Series B preferred stock, par value $1.00 per share of which 8,074,263 shares of Series B preferred stock are issued and outstanding, (iv) 10,000,000 are shares of Series C preferred stock, par
value $1.00 per share of which 7,500,000 shares of Series C preferred stock are issued and outstanding, (v) 15,000,000 are shares of Series D preferred stock, par value $1.00 per share of which 9,728,201 shares of Series D preferred stock are
issued and outstanding, and (vi) 60,000,000 are shares of Series E preferred stock, par value $1.00 per share of which 32,054,606 shares of Series E preferred stock are issued and outstanding. The authorized, issued and outstanding capital
stock of each Subsidiary of each Company is set forth on Schedule 12(c). 
  
 (ii) Except as disclosed on Schedule 12(c), other than: (i) the shares reserved for issuance under the Parent’s stock option plans; and (ii) shares which may be issued pursuant to this Agreement
and the Ancillary Agreements, there are no outstanding options, warrants, rights (including conversion or preemptive rights and rights of first refusal), proxy or stockholder agreements, or arrangements or agreements of any kind for the purchase or
acquisition from the Parent of any of its securities. Except as disclosed on Schedule 12(c), neither the offer or issuance of any of the Notes or the Warrants, or the issuance of any of the Note Shares or the Warrant Shares, nor the
consummation of any transaction contemplated hereby will result in a change in the price or number of any securities of the Parent outstanding, under anti-dilution or other similar provisions contained in or affecting any such securities.

  

 13 

 (iii) All issued and outstanding shares of the Parent’s Common Stock: (i) have been duly
authorized and validly issued and are fully paid and nonassessable; and (ii) were issued in compliance with all applicable state and federal laws concerning the issuance of securities. 
  
 (iv) The rights, preferences, privileges and restrictions of the shares of
the Common Stock are as stated in the Parent’s Certificate of Incorporation (the “Charter”). The Note Shares and the Warrant Shares have been duly and validly reserved for issuance. When issued in compliance with the provisions
of this Agreement and the Parent’s Charter, the Securities will be validly issued, fully paid and nonassessable, and will be free of any liens or encumbrances; provided, however, that the Securities may be subject to restrictions
on transfer under state and/or federal securities laws as set forth herein or as otherwise required by such laws at the time a transfer is proposed. 
  
 (d) Authorization; Binding Obligations. All corporate, partnership or limited liability company, as the case may be, action on its and its
Subsidiaries’ part (including their respective officers and directors) necessary for the authorization of this Agreement and the Ancillary Agreements, the performance of all of its and its Subsidiaries’ obligations hereunder and under the
Ancillary Agreements on the Closing Date and, the authorization, issuance and delivery of the Notes and the Warrant has been taken or will be taken prior to the Closing Date. This Agreement and the Ancillary Agreements, when executed and delivered
and to the extent it is a party thereto, will be its and its Subsidiaries’ valid and binding obligations enforceable against each such Person in accordance with their terms, except: 
  
 (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors’ rights; and 
  
 (ii)
general principles of equity that restrict the availability of equitable or legal remedies. 
  
 The issuance of the Notes and the subsequent conversion of the Minimum Borrowing Note into Note Shares are not and will not be subject to any preemptive rights or rights of first refusal that have not been properly
waived or complied with. The issuance of the Warrants and the subsequent exercise of the Warrants for Warrant Shares are not and will not be subject to any preemptive rights or rights of first refusal that have not been properly waived or complied
with. 
  
 (e) Liabilities. Neither it nor any of its
Subsidiaries has any liabilities, except current liabilities incurred in the ordinary course of business and liabilities disclosed in any Exchange Act Filings. 
  

(f) Agreements; Action. Except as set forth on Schedule 12(f), as disclosed in any Exchange Act Filings or, prior to consummation of the
initial public offering of Common Stock, as disclosed in any Securities Act Filings: 
  
 (i) There are no agreements, understandings, instruments, contracts, proposed transactions, judgments, orders, writs or decrees to which it or any of its Subsidiaries is a party or to its knowledge by which it is
bound which may involve: (i) obligations (contingent or otherwise) of, or payments to, it or any of its Subsidiaries in excess of $50,000 (other than 

  

 14 

 
obligations of, or payments to, it or any of its Subsidiaries arising from purchase or sale agreements entered into in the ordinary course of business); or
(ii) the transfer or license of any patent, copyright, trade secret or other proprietary right to or from it (other than licenses arising from the purchase of “off the shelf” or other standard products); or (iii) provisions
restricting the development, manufacture or distribution of its or any of its Subsidiaries’ products or services; or (iv) indemnification by it or any of its Subsidiaries with respect to infringements of proprietary rights. 
  
 (ii) Except as set forth in the Parent’s quarterly unaudited financial
statements for its fiscal quarter ended December 31, 2004, since September 30, 2004 (the “Balance Sheet Date”) neither it nor any of its Subsidiaries has: (i) declared or paid any dividends, or authorized or made any
distribution upon or with respect to any class or series of its capital stock; (ii) incurred any indebtedness for money borrowed or any other liabilities (other than ordinary course obligations) individually in excess of $50,000 or, in the case
of indebtedness and/or liabilities individually less than $50,000, in excess of $100,000 in the aggregate; (iii) made any loans or advances to any Person not in excess, individually or in the aggregate, of $100,000, other than ordinary advances
for travel expenses; or (iv) sold, exchanged or otherwise disposed of any of its assets or rights, other than the sale of its Inventory in the ordinary course of business. 
  
 (iii) For the purposes of subsections (i) and (ii) of this Section 12(f), all indebtedness, liabilities,
agreements, understandings, instruments, contracts and proposed transactions involving the same Person (including Persons it or any of its applicable Subsidiaries has reason to believe are affiliated therewith or with any Subsidiary thereof) shall
be aggregated for the purpose of meeting the individual minimum dollar amounts of such subsections. 
  
 (iv) the Parent maintains disclosure controls and procedures (“Disclosure Controls”) designed to ensure that information required to be
disclosed by the Parent in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the rules and forms of the SEC. 
  
 (v) The Parent makes and keeps books, records, and accounts, that, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of its assets. It maintains internal control over financial reporting (“Financial Reporting Controls”) designed by, or under the supervision of, its
principal executive and principal financial officers, and effected by its board of directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with GAAP, including that: 
  
 (1) transactions are executed in accordance with management’s general or specific authorization; 
  
 (2) unauthorized acquisition, use, or disposition of the Parent’s assets that could have a material effect on the financial statements are prevented
or timely detected; 
  

 15 

 (3) transactions are recorded as necessary to permit preparation of financial statements in accordance
with GAAP, and that its receipts and expenditures are being made only in accordance with authorizations of the Parent’s management and board of directors; 
  

(4) transactions are recorded as necessary to maintain accountability for assets; and 
  
 (5) the recorded accountability for assets is compared with the existing assets at reasonable intervals, and appropriate
action is taken with respect to any differences. 
  
 (vi) There
is no weakness in any of its Disclosure Controls or Financial Reporting Controls that is required to be disclosed in any of the Exchange Act Filings, except as so disclosed. 
  
 (g) Obligations to Related Parties. Except as set forth on Schedule 12(g), neither it nor any of its
Subsidiaries has any obligations to their respective officers, directors, stockholders or employees other than: 
  
 (i) for payment of salary for services rendered and for bonus payments; 
  
 (ii) reimbursement for reasonable expenses incurred on its or its Subsidiaries’ behalf; 
  
 (iii) for other standard employee benefits made generally available to all
employees (including stock option agreements outstanding under any stock option plan approved by its and its Subsidiaries’ Board of Directors, as applicable); and 
  
 (iv) obligations listed in its and each of its Subsidiary’s financial statements or disclosed in any of the
Parent’s Exchange Act Filings. 
  
 Except as described above or set forth on
Schedule 12(g), none of its or any of its Subsidiaries’ officers, directors or, to the best of its knowledge, key employees or stockholders, any of its Subsidiaries or any members of their immediate families, are indebted to it or any of
its Subsidiaries, individually or in the aggregate, in excess of $50,000 or have any direct or indirect ownership interest in any Person with which it or any of its Subsidiaries is affiliated or with which it or any of its Subsidiaries has a
business relationship, or any Person which competes with it or any of its Subsidiaries, other than passive investments in publicly traded companies (representing less than one percent (1%) of such company) which may compete with it or any of
its Subsidiaries. Except as described above, none of its officers, directors or stockholders, or any member of their immediate families, is, directly or indirectly, interested in any material contract with it or any of its Subsidiaries and no
agreements, understandings or proposed transactions are contemplated between it or any of its Subsidiaries and any such Person. Except as set forth on Schedule 12(g), neither it nor any of its Subsidiaries is a guarantor or indemnitor of any
indebtedness of any other Person. 
  

 16 

 (h) Changes. Since the Balance Sheet Date, except as disclosed in any Exchange Act Filing or in
any Schedule to this Agreement or to any of the Ancillary Agreements, there has not been: 
  
 (i) any change in its or any of its Subsidiaries’ business, assets, liabilities, condition (financial or otherwise), properties, operations or prospects, which, individually or in the aggregate, has had, or could
reasonably be expected to have, a Material Adverse Effect; 
  
 (ii) any resignation or termination of any of its or its Subsidiaries’ officers, key employees or groups of employees; 
  
 (iii) any material change, except in the ordinary course of business, in its or any of its Subsidiaries’ contingent obligations by way of guaranty,
endorsement, indemnity, warranty or otherwise; 
  
 (iv) any
damage, destruction or loss, whether or not covered by insurance, which has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; 
  
 (v) any waiver by it or any of its Subsidiaries of a valuable right or of a material debt owed to it; 
  
 (vi) any direct or indirect material loans made by it or any of its
Subsidiaries to any of its or any of its Subsidiaries’ stockholders, employees, officers or directors, other than advances made in the ordinary course of business; 
  
 (vii) any material change in any compensation arrangement or agreement with any employee, officer, director or stockholder;

  
 (viii) any declaration or payment of any dividend or other
distribution of its or any of its Subsidiaries’ assets; 
  
 (ix) any labor organization activity related to it or any of its Subsidiaries; 
  
 (x) any debt, obligation or liability incurred, assumed or guaranteed by it or any of its Subsidiaries, except those for immaterial amounts and for current liabilities incurred in the ordinary course of business;

  
 (xi) any sale, assignment or transfer of any Intellectual
Property or other intangible assets; 
  
 (xii) any change in any
material agreement to which it or any of its Subsidiaries is a party or by which either it or any of its Subsidiaries is bound which, either individually or in the aggregate, has had, or could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect; 
  

 17 

 (xiii) any other event or condition of any character that, either individually or in the aggregate, has
had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; or 
  
 (xiv) any arrangement or commitment by it or any of its Subsidiaries to do any of the acts described in subsection (i) through (xiii) of this
Section 12(h). 
  
 (i) Title to Properties and Assets;
Liens, Etc. Except as set forth on Schedule 12(i), it and each of its Subsidiaries has good and marketable title to their respective properties and assets, and good title to its leasehold interests, in each case subject to no Lien,
other than Permitted Liens. 
  
 All facilities, Equipment, Fixtures, vehicles and
other properties owned, leased or used by it or any of its Subsidiaries are in good operating condition and repair and are reasonably fit and usable for the purposes for which they are being used. Except as set forth on Schedule 12(i), it and
each of its Subsidiaries is in compliance with all material terms of each lease to which it is a party or is otherwise bound. 
  
 (j) Intellectual Property. 
  
 (i) It and each of its Subsidiaries owns or possesses sufficient legal rights to all Intellectual Property necessary for their respective businesses as
now conducted and, to its knowledge as presently proposed to be conducted, without any known infringement of the rights of others. There are no outstanding options, licenses or agreements of any kind relating to its or any of its Subsidiary’s
Intellectual Property, nor is it or any of its Subsidiaries bound by or a party to any options, licenses or agreements of any kind with respect to the Intellectual Property of any other Person other than such licenses or agreements arising from the
purchase of “off the shelf” or standard products. 
  
 (ii) Neither it nor any of its Subsidiaries has received any communications alleging that it or any of its Subsidiaries has violated any of the Intellectual Property or other proprietary rights of any other Person, nor is it or any of its
Subsidiaries aware of any basis therefor. 
  
 (iii) Neither it
nor any of its Subsidiaries believes it is or will be necessary to utilize any inventions, trade secrets or proprietary information of any of its employees made prior to their employment by it or any of its Subsidiaries, except for inventions, trade
secrets or proprietary information that have been rightfully assigned to it or any of its Subsidiaries. 
  
 (k) Compliance with Other Instruments. Neither it nor any of its Subsidiaries is in violation or default of (x) any term of its Charter or
Bylaws, or (y) any provision of any indebtedness, mortgage, indenture, contract, agreement or instrument to which it is party or by which it is bound or of any judgment, decree, order or writ, which violation or default, in the case of this
clause (y), has had, or could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect. The execution, delivery and performance of and compliance with this Agreement and the Ancillary Agreements to which it
is a party, and the issuance of the Notes and the other Securities each pursuant hereto and thereto, will not, with or 

  

 18 

 
without the passage of time or giving of notice, result in any such material violation, or be in conflict with or constitute a default under any such term or
provision, or result in the creation of any Lien upon any of its or any of its Subsidiary’s properties or assets or the suspension, revocation, impairment, forfeiture or non-renewal of any permit, license, authorization or approval applicable
to it or any of its Subsidiaries, their businesses or operations or any of their assets or properties. 
  
 (l) Litigation. Except as set forth on Schedule 12(l), there is no action, suit, proceeding or investigation pending or, to its knowledge,
currently threatened against it or any of its Subsidiaries that prevents it or any of its Subsidiaries from entering into this Agreement or the Ancillary Agreements, or from consummating the transactions contemplated hereby or thereby, or which has
had, or could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect, or could result in any change in its or any of its Subsidiaries’ current equity ownership, nor is it aware that there is any basis
to assert any of the foregoing. Neither it nor any of its Subsidiaries is a party to or subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality. There is no action, suit,
proceeding or investigation by it or any of its Subsidiaries currently pending or which it or any of its Subsidiaries intends to initiate. 
  
 (m) Tax Returns and Payments. It and each of its Subsidiaries has timely filed all tax returns (federal, state and local) required to be filed by
it. All taxes shown to be due and payable on such returns, any assessments imposed, and all other taxes due and payable by it and each of its Subsidiaries on or before the Closing Date, have been paid or will be paid prior to the time they become
delinquent. Except as set forth on Schedule 12(m), neither it nor any of its Subsidiaries has been advised: 
  
 (i) that any of its returns, federal, state or other, have been or are being audited as of the date hereof; or 
  
 (ii) of any adjustment, deficiency, assessment or court decision in respect
of its federal, state or other taxes. 
  
 Neither it nor any of its Subsidiaries
has any knowledge of any liability of any tax to be imposed upon its properties or assets as of the date of this Agreement that is not adequately provided for. 
  

(n) Employees. Except as set forth on Schedule 12(n), neither it nor any of its Subsidiaries has any collective bargaining agreements
with any of its employees. There is no labor union organizing activity pending or, to its knowledge, threatened with respect to it or any of its Subsidiaries. Except as disclosed in the Exchange Act Filings or on Schedule 12(n), neither it
nor any of its Subsidiaries is a party to or bound by any currently effective employment contract, deferred compensation arrangement, bonus plan, incentive plan, profit sharing plan, retirement agreement or other employee compensation plan or
agreement. To its knowledge, none of its or any of its Subsidiaries’ employees, nor any consultant with whom it or any of its Subsidiaries has contracted, is in violation of any term of any employment contract, proprietary information agreement
or any other agreement relating to the right of any such individual to be employed by, or to contract with, it or any of its Subsidiaries because of the nature of the business to be conducted by it or any of its Subsidiaries; and to its knowledge
the continued 

  

 19 

 
employment by it and its Subsidiaries of their present employees, and the performance of its and its Subsidiaries contracts with its independent contractors,
will not result in any such violation. Neither it nor any of its Subsidiaries is aware that any of its or any of its Subsidiaries’ employees is obligated under any contract (including licenses, covenants or commitments of any nature) or other
agreement, or subject to any judgment, decree or order of any court or administrative agency that would interfere with their duties to it or any of its Subsidiaries. Neither it nor any of its Subsidiaries has received any notice alleging that any
such violation has occurred. Except for employees who have a current effective employment agreement with it or any of its Subsidiaries, none of its or any of its Subsidiaries’ employees has been granted the right to continued employment by it
or any of its Subsidiaries or to any material compensation following termination of employment with it or any of its Subsidiaries. Except as set forth on Schedule 12(n), neither it nor any of its Subsidiaries is aware that any officer,
key employee or group of employees intends to terminate his, her or their employment with it or any of its Subsidiaries, as applicable, nor does it or any of its Subsidiaries have a present intention to terminate the employment of any officer, key
employee or group of employees. 
  
 (o) Registration Rights and
Voting Rights. Except as set forth on Schedule 12(o) and except as disclosed in Exchange Act Filings (including, without limitation, the Form S-1 filed in connection with the proposed initial public offering of Common Stock), neither
it nor any of its Subsidiaries is presently under any obligation, and neither it nor any of its Subsidiaries has granted any rights, to register any of its or any of its Subsidiaries’ presently outstanding securities or any of its securities
that may hereafter be issued. Except as set forth on Schedule 12(o) and except as disclosed in Exchange Act Filings (including, without limitation, the Form S-1 filed in connection with the proposed initial public offering of Common
Stock), to its knowledge, none of its or any of its Subsidiaries’ stockholders has entered into any agreement with respect to its or any of its Subsidiaries’ voting of equity securities. 
  
 (p) Compliance with Laws; Permits. Neither it nor any of its
Subsidiaries is in violation of the Sarbanes-Oxley Act of 2002 or any SEC related regulation or rule or any rule of the Principal Market promulgated thereunder or any other applicable statute, rule, regulation, order or restriction of any domestic
or foreign government or any instrumentality or agency thereof in respect of the conduct of its business or the ownership of its properties which has had, or could reasonably be expected to have, either individually or in the aggregate, a Material
Adverse Effect. No governmental orders, permissions, consents, approvals or authorizations are required to be obtained and no registrations or declarations are required to be filed in connection with the execution and delivery of this Agreement or
any Ancillary Agreement and the issuance of any of the Securities, except such as have been duly and validly obtained or filed, or with respect to any filings that must be made after the Closing Date, as will be filed in a timely manner. It and each
of its Subsidiaries has all material franchises, permits, licenses and any similar authority necessary for the conduct of its business as now being conducted by it, the lack of which could, either individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. 
  
 (q)
Environmental and Safety Laws. Neither it nor any of its Subsidiaries is in violation of any applicable statute, law or regulation relating to the environment or occupational health and safety, and to its knowledge, no material expenditures
are or will be required in order to comply with any such existing statute, law or regulation. Except as set forth 

  

 20 

 
on Schedule 12(q), no Hazardous Materials (as defined below) are used or have been used, stored, or disposed of by it or any of its Subsidiaries or,
to its knowledge, by any other Person on any property owned, leased or used by it or any of its Subsidiaries. For the purposes of the preceding sentence, “Hazardous Materials” shall mean: 
  
 (i) materials which are listed or otherwise defined as
“hazardous” or “toxic” under any applicable local, state, federal and/or foreign laws and regulations that govern the existence and/or remedy of contamination on property, the protection of the environment from contamination, the
control of hazardous wastes, or other activities involving hazardous substances, including building materials; and 
  
 (ii) any petroleum products or nuclear materials. 
  
 (r) Valid Offering. Assuming the accuracy of the representations and warranties of Laurus contained in this Agreement, the offer and issuance of
the Securities will be exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), and will have been registered or qualified (or are exempt from registration and qualification) under
the registration, permit or qualification requirements of all applicable state securities laws. 
  
 (s) Full Disclosure. It and each of its Subsidiaries has provided Laurus with all information requested by Laurus in connection with Laurus’
decision to enter into this Agreement, including all information each Company and its Subsidiaries believe is reasonably necessary to make such investment decision. Neither this Agreement, the Ancillary Agreements nor the exhibits and schedules
hereto and thereto nor any other document delivered by it or any of its Subsidiaries to Laurus or its attorneys or agents in connection herewith or therewith or with the transactions contemplated hereby or thereby, contain any untrue statement of a
material fact nor omit to state a material fact necessary in order to make the statements contained herein or therein, in light of the circumstances in which they are made, not misleading. Any financial projections and other estimates provided to
Laurus by it or any of its Subsidiaries were based on its and its Subsidiaries’ experience in the industry and on assumptions of fact and opinion as to future events which it or any of its Subsidiaries, at the date of the issuance of such
projections or estimates, believed to be reasonable. 
  
 (t)
Insurance. It and each of its Subsidiaries has general commercial, product liability, fire and casualty insurance policies with coverages which it believes are customary for companies similarly situated to it and its Subsidiaries in the same
or similar business. 
  
 (u) Financial Statements. The
Parent has furnished Laurus with copies of: (i) its annual audited financial statements for its fiscal year ended September 30, 2004; and (ii) its quarterly unaudited financial statements for its fiscal quarters ended
December 31, 2004 and March 31, 2005 (collectively, the “Financial Statements”). Except as set forth on Schedule 12(u), each Financial Statement was, at the time of its preparation, in substantial compliance with
the requirements of its respective form and none of the Financial Statements (and the notes thereto), as of their respective preparation dates, contained any untrue statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. 

  

 21 

 
Such Financial Statements have been prepared in accordance with GAAP applied on a consistent basis during the periods involved (except (i) as may be
otherwise indicated in such financial statements or the notes thereto or (ii) in the case of unaudited interim statements, to the extent they may not include footnotes or may be condensed) and fairly present in all material respects the
financial condition, the results of operations and cash flows of the Parent and its Subsidiaries, on a consolidated basis, as of, and for, the periods presented in each such Financial Statement. 
  
 (v) Listing. The Parent has prepared in all material respects the
listing application in respect of its Common Stock to be, upon consummation of the initial public offering of Common Stock, listed on the Principal Market and the Parent reasonably believes that it and such listing application shall satisfy all
requirements for such listing on the Principal Market, and once listed on the Principal Market, the Parent shall do all things necessary for the continuation of such listing. The Parent has not received any notice that its Common Stock will not be
listed on the Principal Market upon consummation of the initial public offering of Common Stock or that its Common Stock shall not meet all requirements for such listing. 
  
 (w) No Integrated Offering. Neither it, nor any of its Subsidiaries nor any of its Affiliates, nor any Person acting
on its or their behalf, has directly or indirectly made any offers or sales of any security or solicited any offers to buy any security (other than an offering to Laurus under a Securities Purchase Agreement) under circumstances that would cause the
offering of the Securities pursuant to this Agreement or any Ancillary Agreement to be integrated with prior offerings by it for purposes of the Securities Act which would prevent it from issuing the Securities pursuant to Rule 506 under the
Securities Act, or any applicable exchange-related stockholder approval provisions, nor will it or any of its Affiliates or Subsidiaries take any action or steps that would cause the offering of the Securities to be integrated with other offerings.

  
 (x) Stop Transfer. The Securities are restricted
securities as of the date of this Agreement. Neither it nor any of its Subsidiaries will issue any stop transfer order or other order impeding the sale and delivery of any of the Securities at such time as the Securities are registered for public
sale or an exemption from registration is available, except as required by state and federal securities laws. 
  
 (y) Dilution. It specifically acknowledges that the Parent’s obligation to issue the shares of Common Stock upon conversion of the Minimum
Borrowing Note and exercise of the Warrants is binding upon the Parent and enforceable regardless of the dilution such issuance may have on the ownership interests of other shareholders of the Parent. 
  
 (z) Patriot Act. It certifies that, to the best of its knowledge,
neither it nor any of its Subsidiaries has been designated, nor is or shall be owned or controlled, by a “suspected terrorist” as defined in Executive Order 13224. It hereby acknowledges that Laurus seeks to comply with all applicable laws
concerning money laundering and related activities. In furtherance of those efforts, it hereby represents, warrants and covenants that: (i) none of the cash or property that it or any of its Subsidiaries will pay or will contribute to Laurus
has been or shall be derived from, or related to, any activity that is deemed criminal under United States law; and (ii) no contribution or payment by it or any of its Subsidiaries to Laurus, to the extent that they are within its or any such
Subsidiary’s control shall cause Laurus to be in violation of the 

  

 22 

 
United States Bank Secrecy Act, the United States International Money Laundering Control Act of 1986 or the United States International Money Laundering
Abatement and Anti-Terrorist Financing Act of 2001. It shall promptly notify Laurus if any of these representations, warranties and covenants ceases to be true and accurate regarding it or any of its Subsidiaries. It shall provide Laurus with any
additional information regarding it and each Subsidiary thereof that Laurus deems necessary or convenient to ensure compliance with all applicable laws concerning money laundering and similar activities. It understands and agrees that if at any time
it is discovered that any of the foregoing representations, warranties and covenants are incorrect, or if otherwise required by applicable law or regulation related to money laundering or similar activities, Laurus may undertake appropriate actions
to ensure compliance with applicable law or regulation, including but not limited to segregation and/or redemption of Laurus’ investment in it. It further understands that Laurus may release confidential information about it and its
Subsidiaries and, if applicable, any underlying beneficial owners, to proper authorities if Laurus, in its sole discretion, determines that it is in the best interests of Laurus in light of relevant rules and regulations under the laws set forth in
subsection (ii) above. 
  
 (aa) Company Name; Locations of
Offices, Records and Collateral. Schedule 12(aa) sets forth each Company’s name as it appears in official filings in the state of its organization, the type of entity of each Company, the organizational identification number
issued by each Company’s state of organization or a statement that no such number has been issued, each Company’s state of organization, and the location of each Company’s chief executive office, corporate offices, warehouses, other
locations of Collateral and locations where records with respect to Collateral are kept (including in each case the county of such locations) and, except as set forth in such Schedule 12(aa), such locations have not changed during the
preceding twelve months. As of the Closing Date, during the prior five years, except as set forth in Schedule 12(aa), no Company has been known as or conducted business in any other name (including trade names). Each Company has only one
state of organization. 
  
 (bb) ERISA. Based upon the
Employee Retirement Income Security Act of 1974 (“ERISA”), and the regulations and published interpretations thereunder: (i) neither it nor any of its Subsidiaries has engaged in any Prohibited Transactions (as defined in
Section 406 of ERISA and Section 4975 of the Code); (ii) it and each of its Subsidiaries has met all applicable minimum funding requirements under Section 302 of ERISA in respect of its plans; (iii) neither it nor any of its
Subsidiaries has any knowledge of any event or occurrence which would cause the Pension Benefit Guaranty Corporation to institute proceedings under Title IV of ERISA to terminate any employee benefit plan(s); (iv) neither it nor any of its
Subsidiaries has any fiduciary responsibility for investments with respect to any plan existing for the benefit of persons other than its or such Subsidiary’s employees; and (v) neither it nor any of its Subsidiaries has withdrawn,
completely or partially, from any multi-employer pension plan so as to incur liability under the Multiemployer Pension Plan Amendments Act of 1980. 
  
 13. Covenants. Each Company, as applicable, covenants and agrees with Laurus as follows: 
  
 (a) Stop-Orders. It shall advise Laurus, promptly after it receives
notice of issuance by the SEC, any state securities commission or any other regulatory authority of any stop order or of any order preventing or suspending any offering of any securities of the Parent, or of the suspension of the qualification of
the Common Stock of the Parent for offering or sale in any jurisdiction, or the initiation of any proceeding for any such purpose. 
  

 23 

 (b) Listing. On or prior to the date of consummation of the initial public offering of Common
Stock, it shall promptly secure the listing of the shares of Common Stock issuable upon conversion of the Minimum Borrowing Note and exercise of the Warrants on the Principal Market. On and after the date of the initial listing of the shares of
Common Stock on the Principal Market, the Parent shall maintain such listing of its Common Stock on the Principal Market, and will comply in all material respects with the Parent’s reporting, filing and other obligations under the bylaws or
rules of the National Association of Securities Dealers (“NASD”) and such exchanges, as applicable. 
  
 (c) Market Regulations. It shall notify the SEC, NASD and applicable state authorities, in accordance with their requirements, of the transactions
contemplated by this Agreement, and shall take all other necessary action and proceedings as may be required and permitted by applicable law, rule and regulation, for the legal and valid issuance of the Securities to Laurus and promptly provide
copies thereof to Laurus. 
  
 (d) Reporting Requirements.
It shall timely file with the SEC all reports required to be filed pursuant to the Exchange Act and refrain from terminating its status as an issuer required by the Exchange Act to file reports thereunder even if the Exchange Act or the rules or
regulations thereunder would permit such termination. 
  
 (e)
Use of Funds. It shall use the proceeds of the Loans (i) to repay in full all of its obligations owing to MSB under the Existing Credit Agreement and (ii) for general working capital purposes only. 
  
 (f) Access to Facilities. It shall, and shall cause each of its
Subsidiaries to, permit any representatives designated by Laurus (or any successor of Laurus), upon reasonable notice and during normal business hours, at Company’s expense and accompanied by a representative of Company Agent (provided that no
such prior notice shall be required to be given and no such representative shall be required to accompany Laurus in the event Laurus believes such access is necessary to preserve or protect the Collateral or following the occurrence and during the
continuance of an Event of Default), to: 
  
 (i) visit and
inspect any of its or any such Subsidiary’s properties; 
  
 (ii) examine its or any such Subsidiary’s corporate and financial records (unless such examination is not permitted by federal, state or local law or by contract) and make copies thereof or extracts therefrom; and 
  
 (iii) discuss its or any such Subsidiary’s affairs, finances and
accounts with its or any such Subsidiary’s directors, officers and Accountants. 
  
 Notwithstanding the foregoing, neither it nor any of its Subsidiaries shall provide any material, non-public information to Laurus unless Laurus signs a confidentiality agreement and otherwise complies with Regulation FD, under the federal
securities laws. 
  

 24 

 (g) Taxes. It shall, and shall cause each of its Subsidiaries to, promptly pay and discharge, or
cause to be paid and discharged, when due and payable, all lawful taxes, assessments and governmental charges or levies imposed upon it and its Subsidiaries’ income, profits, property or business, as the case may be; provided, however, that any
such tax, assessment, charge or levy need not be paid currently if (i) the validity thereof shall currently and diligently be contested in good faith by appropriate proceedings, (ii) such tax, assessment, charge or levy shall have no
effect on the Lien priority of Laurus in the Collateral, and (iii) if it and/or such Subsidiary, as applicable, shall have set aside on its and/or such Subsidiary’s books adequate reserves with respect thereto in accordance with GAAP; and
provided, further, that it shall, and shall cause each of its Subsidiaries to, pay all such taxes, assessments, charges or levies forthwith upon the commencement of proceedings to foreclose any lien which may have attached as security therefor.

  
 (h) Insurance. It shall bear the full risk of loss from
any loss of any nature whatsoever with respect to the Collateral. It and each of its Subsidiaries shall keep its assets which are of an insurable character insured by financially sound and reputable insurers against loss or damage by fire, explosion
and other risks customarily insured against by companies in similar business similarly situated as it and its Subsidiaries; and it and its Subsidiaries shall maintain, with financially sound and reputable insurers, insurance against other hazards
and risks and liability to persons and property to the extent and in the manner which it and/or such Subsidiary thereof reasonably believes is customary for companies in similar business similarly situated as it and its Subsidiaries and to the
extent available on commercially reasonable terms. It and each of its Subsidiaries will jointly and severally bear the full risk of loss from any loss of any nature whatsoever with respect to the assets pledged to Laurus as security for its
obligations hereunder and under the Ancillary Agreements. At its own cost and expense in amounts and with carriers reasonably acceptable to Laurus, it and each of its Subsidiaries shall (i) keep all their insurable properties and properties in
which they have an interest insured against the hazards of fire, flood, sprinkler leakage, those hazards covered by extended coverage insurance and such other hazards, and for such amounts, as is customary in the case of companies engaged in
businesses similar to it or the respective Subsidiary’s including business interruption insurance; (ii) maintain a bond in such amounts as is customary in the case of companies engaged in businesses similar to it and its Subsidiaries’
insuring against larceny, embezzlement or other criminal misappropriation of insured’s officers and employees who may either singly or jointly with others at any time have access to its or any of its Subsidiaries assets or funds either directly
or through governmental authority to draw upon such funds or to direct generally the disposition of such assets; (iii) maintain public and product liability insurance against claims for personal injury, death or property damage suffered by
others; (iv) maintain all such worker’s compensation or similar insurance as may be required under the laws of any state or jurisdiction in which it or any of its Subsidiaries is engaged in business; and (v) furnish Laurus with
(x) copies of all policies and evidence of the maintenance of such policies at least thirty (30) days before any expiration date, (y) excepting its and its Subsidiaries’ workers’ compensation policy, endorsements to such
policies naming Laurus as “co-insured” or “additional insured” and appropriate loss payable endorsements in form and substance satisfactory to Laurus, naming Laurus as lenders loss payee, and (z) evidence that as to Laurus
the insurance coverage shall not be impaired or invalidated by any act or neglect of any Company or any of its Subsidiaries and the insurer will provide Laurus with at least thirty (30) days notice prior to cancellation. It shall instruct the
insurance carriers that in the event of any loss thereunder, the carriers shall make 

  

 25 

 
payment for such loss to Laurus and not to any Company or any of its Subsidiaries and Laurus jointly. If any insurance losses are paid by check, draft or
other instrument payable to any Company and/or any of its Subsidiaries and Laurus jointly, Laurus may endorse, as applicable, such Company’s and/or any of its Subsidiaries’ name thereon and do such other things as Laurus may deem advisable
to reduce the same to cash. Laurus is hereby authorized to adjust and compromise claims. All loss recoveries received by Laurus upon any such insurance may be applied to the Obligations, in such order as Laurus in its sole discretion shall determine
or shall otherwise be delivered to Company Agent for the benefit of the applicable Company and/or its Subsidiaries. Any surplus shall be paid by Laurus to Company Agent for the benefit of the applicable Company and/or its Subsidiaries, or applied as
may be otherwise required by law. Any deficiency thereon shall be paid, as applicable, by Companies and their Subsidiaries to Laurus, on demand. 
  
 (i) Intellectual Property. It shall, and shall cause each of its Subsidiaries to, maintain in full force and effect its corporate existence, rights
and franchises and all licenses and other rights to use Intellectual Property owned or possessed by it and reasonably deemed to be necessary to the conduct of its business. 
  
 (j) Properties. It shall, and shall cause each of its Subsidiaries to, keep its properties in good repair, working
order and condition, reasonable wear and tear excepted, and from time to time make all needful and proper repairs, renewals, replacements, additions and improvements thereto; and it shall, and shall cause each of its Subsidiaries to, at all times
comply with each provision of all leases to which it is a party or under which it occupies property if the breach of such provision could reasonably be expected to have a Material Adverse Effect. 
  
 (k) Confidentiality. It shall not, and shall not permit any of its
Subsidiaries to, disclose, and will not include in any public announcement, the name of Laurus, unless expressly agreed to by Laurus or unless and until such disclosure is required by law or applicable regulation, and then only to the extent of such
requirement. Notwithstanding the foregoing, each Company and its Subsidiaries may disclose Laurus’ identity and the terms of this Agreement to its current and prospective debt and equity financing sources. 
  
 (l) Required Approvals. It shall not, and shall not permit any of its
Subsidiaries to, without the prior written consent of Laurus, 
  
 (i) create, incur, assume or suffer to exist any indebtedness (exclusive of trade debt) whether secured or unsecured other than (w) each Company’s indebtedness to Laurus, (x) indebtedness in such
maximum amounts as set forth on Schedule 13(l)(i) attached hereto and made a part hereof, (y) in respect of TEAMM, indebtedness in the aggregate principal amount not to exceed $7,000,000 at any time (including the aggregate
principal amount of outstanding indebtedness owed to Harbinger pursuant to the Harbinger Debt Documentation); provided that (I) no Event of Default has occurred and is continuing at such time, (II) such indebtedness if secured, shall only be
secured by TEAMM’s assets, (III) the terms and conditions of such indebtedness are no more onerous than the terms and conditions of the Harbinger Debt Documentation and (IV) the maturity date of such indebtedness shall be no earlier than six
months following expiration of 

  

 26 

 
the Term and (z) indebtedness incurred in connection with arrangements otherwise permitted pursuant to Section 13(l)(v)(y) below; provided that
indebtedness under this clause (z) shall only be permitted to be secured by Intellectual Property, General Intangibles and/or contract rights which are directly subject of such arrangement; 
  
 (ii) cancel any debt owing to it in excess of $150,000 in
the aggregate during any 12 month period; 
  
 (iii) assume, guarantee, endorse or otherwise become directly or contingently liable in connection with any obligations of any other Person, except: 
  

(w) the endorsement of negotiable instruments by it or its Subsidiaries for deposit or collection or similar transactions in the
ordinary course of business, 
  
 (x) in respect
of each Subsidiary of the Parent, so long as each such Subsidiary is designated as either a co-borrower hereunder or has entered into such guaranty and security documentation required by Laurus, including, without limitation, to grant to Laurus a
first priority perfected security interest in substantially all of such Subsidiary’s assets to secure the Obligations, 
  
 (y) in respect of TEAMM, the guarantee by the Parent of TEAMM’s indebtedness not to exceed $7,000,000 in the aggregate to
(I) Harbinger pursuant to the Harbinger Debt Documentation and (II) each other creditor of TEAMM pursuant to documentation reasonably satisfactory to Laurus; provided that (A) no Event of Default has occurred and is continuing both before
and after giving effect to such guarantee and (B) such new TEAMM indebtedness is otherwise permitted under Section 13(l)(i)(y) and 
  
 (z) in respect of Biovest; provided that (I) no Event of Default has occurred and is continuing both before and after giving effect
to the incurrence of such direct and/or contingent liability and (II) the aggregate amount of such indebtedness of Biovest subject of such direct and/or contingent liability shall not exceed in aggregate amount, when added to the aggregate amount of
indebtedness permitted under Section 13(l)(v)(z)(I) below which is outstanding at the time of determination, the fair market value of the assets of Biovest as reasonably determined by the Parent in which the Parent has been granted a first
priority security interest; 
  
 (iv) directly or
indirectly declare, pay or make any dividend or distribution on any class of its Stock or apply any of its funds, property or assets to the purchase, redemption or other retirement of any of its or its Subsidiaries’ Stock outstanding on the
date hereof, or issue any preferred stock; provided that: 
  
 (x) the Parent shall be permitted to pay dividends to the holder’s of the Parent’s Series E preferred stock up to such amounts and at such times as are contractually required pursuant to the terms and
conditions of the documentation governing such Series E preferred stock as in effect on the date hereof and 
  

 27 

 (y) the purchase and/or redemption of no more than 4,300,000 shares of Series E
preferred stock shall be permitted in connection with the McKesson Restructuring Payment to the extent such McKesson Restructuring Payment is otherwise permitted hereunder; 
  
 (v) purchase or hold beneficially any Stock or other securities or evidences of indebtedness of, make or
permit to exist any loans or advances to, or make any investment or acquire any interest whatsoever in, any other Person, including any partnership or joint venture, except: 
  
 (u) travel advances, 
  
 (v) loans to its and its Subsidiaries’ officers and employees not exceeding at any one time an
aggregate of $10,000, 
  
 (w) loans to its
existing Subsidiaries so long as such Subsidiaries are designated as either a co-borrower hereunder or has entered into such guaranty and security documentation required by Laurus, including, without limitation, to grant to Laurus a first priority
perfected security interest in substantially all of such Subsidiary’s assets to secure the Obligations, 
  
 (x) loans to TEAMM; provided that, the aggregate amount of all such loans shall not exceed at any time outstanding (A) prior to
consummation of the Initial Public Offering, $15,000,000, of which $12,000,000 is outstanding on the date hereof and (B) on and after consummation of the Initial Public Offering and to the extent Laurus shall not have been granted a first
priority perfected security interest in substantially all of TEAMM’s assets to secure the Obligations, $20,000,000, of which $12,000,000 is outstanding on the date hereof; provided further that all loans from the Company to TEAMM shall be
evidenced by an intercompany note in form and substance reasonably satisfactory to Laurus and shall be subject to a first priority perfected security interest in favor of Laurus to secure the Obligations, 
  
 (y) in relation to arrangements relating to the
acquisition, licensing or commercialization of pharmaceutical products, as well as other medical and similar products or devices; provided that (I) such arrangements are in the ordinary course of business of the Company and are consistent with
past practice, (II) no Event of Default has occurred and is continuing both before and after giving effect to such arrangement and (III) Laurus shall 

  

 28 

 
have been granted a first priority perfected security interest in all of the Company’s rights under such arrangement to secure the Obligations and

  
 (z) loans or advances to, or investments in:

  
 (I) Biovest, provided that (A) the
Parent shall hold directly or indirectly no less than seventy percent (70%) of all issued and outstanding voting equity interests of Biovest at such time, (B) the aggregate amount of all such investments shall not exceed at any time
outstanding the greater of (1) $23,750,000 and (2) the maximum amount of investments contractually required pursuant to the Investment Agreement dated as of April 9, 2003 between the Parent and Biovest as in effect on the date hereof
(subject to the anti-dilution related rights granted to the Parent permitting it to invest a discounted amount to offset the dilutive effect of future equity issuances by Biovest as set forth in the Agreement, dated as of June 16, 2003, between
the Parent and Biovest as in effect on the date hereof) and (C) the aggregate amount of all such loans shall not exceed at any time, when added to the aggregate amount of the indebtedness of Biovest outstanding and guaranteed by the Parent at
the time of determination, the fair market value of the assets of Biovest as reasonably determined by the Parent in which the Parent has been granted a first priority security interest; provided that such loans from the Parent to Biovest shall be
evidenced by an intercompany note in form and substance reasonably satisfactory to Laurus and shall be subject to a first priority perfected security interest in favor of Laurus to secure the Obligations; and 
  
 (II) IMOR-Analytica; provided that the aggregate amount of
all such loans and investments shall not exceed at any time outstanding (A) prior to consummation of the Initial Public Offering, $500,000 and (B) on and after consummation of the Initial Public Offering, $2,000,000; 
  
 (vi) create or permit to exist any Subsidiary, other than
any Subsidiary in existence on the date hereof and listed in Schedule 12(b) unless such new Subsidiary is a wholly-owned Subsidiary and is designated by Laurus as either a co-borrower or guarantor hereunder and such Subsidiary shall have
entered into all such documentation required by Laurus, including, without limitation, to grant to Laurus a first priority perfected security interest in substantially all of such Subsidiary’s assets to secure the Obligations; 
  
 (vii) directly or indirectly, prepay any indebtedness (other
than to Laurus and in the ordinary course of business), or repurchase, redeem, retire or otherwise acquire any indebtedness (other than to Laurus and in the ordinary course of business); provided that the Parent shall be permitted to apply proceeds

  

 29 

 
received from the Initial Public Offering to repay its obligations owed to (A) McKesson pursuant to the Subordinated Debt Documentation to the extent
not in excess of $6,100,000 and (B) Harbinger pursuant to the Harbinger Debt Documentation to the extent not in excess of $7,000,000; 
  
 (viii) enter into any merger, consolidation or other reorganization with or into any other Person or acquire all or a portion of the
assets or Stock of any Person or permit any other Person to consolidate with or merge with it, unless (1) such Company is the surviving entity of such merger or consolidation, (2) no Event of Default shall exist immediately prior to and
after giving effect to such merger or consolidation, (3) such Company shall have provided Laurus copies of all documentation relating to such merger or consolidation and (4) such Company shall have provided Laurus with at least thirty
(30) days’ prior written notice of such merger or consolidation; 
  
 (ix) materially change the nature of the business in which it is presently engaged; 
  
 (x) become subject to (including, without limitation, by way of amendment to or modification of) any agreement or instrument which by its
terms would (under any circumstances) restrict its or any of its Subsidiaries’ right to perform the provisions of this Agreement or any of the Ancillary Agreements; 
  
 (xi) change its fiscal year or make any changes in accounting treatment and reporting practices without
prior written notice to Laurus except as required by GAAP or in the tax reporting treatment or except as required by law; 
  
 (xii) enter into any transaction with any employee, director or Affiliate, except in the ordinary course on arms-length terms; 

 
 (xiii) bill Accounts under any name except the present
name of such Company; or 
  
 (xiv) sell, lease,
transfer or otherwise dispose of any of its properties or assets, or any of the properties or assets of its Subsidiaries, except for (1) the sale of Inventory in the ordinary course of business and (2) the disposition or transfer in the
ordinary course of business during any fiscal year of obsolete and worn-out Equipment and only to the extent that (x) the proceeds of any such disposition are used to acquire replacement Equipment which is subject to Laurus’ first priority
security interest or are used to repay Loans or to pay general corporate expenses, or (y) following the occurrence of an Event of Default which continues to exist, the proceeds of which are remitted to Laurus to be held as cash collateral for
the Obligations. 
  
 (m) Reissuance of Securities. The
Parent shall reissue certificates representing the Securities without the legends set forth in Section 39 below at such time as: 
  
 (i) the holder thereof is permitted to dispose of such Securities pursuant to Rule 144(k) under the Securities Act; or 
  

 30 

 (ii) upon resale subject to an effective registration statement after such Securities are
registered under the Securities Act. 
  
 The Parent agrees to cooperate with
Laurus in connection with all resales pursuant to Rule 144(d) and Rule 144(k) and provide legal opinions necessary to allow such resales provided the Parent and its counsel receive reasonably requested representations from Laurus and broker, if any.

  
 (n) Opinion. On the Closing Date, it shall deliver to
Laurus an opinion acceptable to Laurus from the Company’s in house counsel. Each Company will provide, at the Companies’ joint and several expense, such other legal opinions in the future as are reasonably necessary for the conversion of
the Minimum Borrowing Note and the exercise of the Warrants. 
  
 (o) Legal Name, etc. It shall not, without providing Laurus with 30 days prior written notice, change (i) its name as it appears in the official filings in the state of its organization, (ii) the type of legal entity it is,
(iii) its organization identification number, if any, issued by its state of organization, (iv) its state of organization or (v) amend its certificate of incorporation, by-laws or other organizational document. 
  
 (p) Compliance with Laws. The operation of each of its and each of its
Subsidiaries’ business is and shall continue to be in compliance in all material respects with all applicable federal, state and local laws, rules and ordinances, including to all laws, rules, regulations and orders relating to taxes, payment
and withholding of payroll taxes, employer and employee contributions and similar items, securities, employee retirement and welfare benefits, employee health and safety and environmental matters. 
  
 (q) Notices. It and each of its Subsidiaries shall promptly inform
Laurus in writing of: (i) the commencement of all proceedings and investigations by or before and/or the receipt of any notices from, any governmental or nongovernmental body and all actions and proceedings in any court or before any arbitrator
against or in any way concerning any event which could reasonably be expected to have singly or in the aggregate, a Material Adverse Effect; (ii) any change which has had, or could reasonably be expected to have, a Material Adverse Effect;
(iii) any Event of Default or Default; and (iv) any default or any event which with the passage of time or giving of notice or both would constitute a default under any agreement for the payment of money to which it or any of its
Subsidiaries is a party or by which it or any of its Subsidiaries or any of its or any such Subsidiary’s properties may be bound the breach of which would have a Material Adverse Effect. 
  
 (r) Margin Stock. It shall not permit any of the proceeds of the Loans
made hereunder to be used directly or indirectly to “purchase” or “carry” “margin stock” or to repay indebtedness incurred to “purchase” or “carry” “margin stock” within the respective
meanings of each of the quoted terms under Regulation U of the Board of Governors of the Federal Reserve System as now and from time to time hereafter in effect. 
  

 31 

 (s) Offering Restrictions. Except as previously disclosed in the Financial Statements or in the
Exchange Act Filings, or stock or stock options granted to its employees or directors, neither it nor any of its Subsidiaries shall, prior to the full repayment or conversion of the Minimum Borrowing Note (together with all accrued and unpaid
interest and fees related thereto), (x) enter into any equity line of credit agreement or similar agreement or (y) issue, or enter into any agreement to issue, any securities with a variable/floating conversion and/or pricing feature which
are or could be (by conversion or registration) free-trading securities (i.e. common stock subject to a registration statement) that, in any case, results or could potentially result in a conversion price for Common Stock below 110% of the issuance
price of Common Stock in connection with the initial public offering of Common Stock, as reasonably determined by Laurus. It is agreed and understood that the Parent shall be permitted, without prior Laurus consent but subject to the restrictions
set forth in this Section 13(s), to consummate, equity issuances of Common Stock in addition to the Initial Public Offering to the extent the fair market value of the Common Stock subject of all such equity issuances, as reasonably determined
by Laurus, is not at any time in excess of $25,000,000. 
  
 (t)
Authorization and Reservation of Shares. The Parent shall at all times have authorized and reserved a sufficient number of shares of Common Stock to provide for the conversion of the Minimum Borrowing Note and exercise of the Warrants.

  
 (u) Right of Consultation. 
  
 It hereby agrees to exercise commercially reasonable efforts to consult Laurus in respect of
any additional indebtedness and/or the sale or issuance of any equity interests of any Company and/or any of its Subsidiaries (an “Additional Financing”) to be issued by any Company and/or any of its Subsidiaries prior to the
incurrence of such Additional Financing. 
  
 (v) Prohibition of
Amendments to Subordinated Debt Documentation and Harbinger Debt Documentation. It shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of Laurus, amend, modify or in any way alter the terms of any of the
Subordinated Debt Documentation or Harbinger Debt Documentation unless such amendment, modification, alteration or other action contemplated by this clause (v) could not reasonably be expected to be adverse to the interests of Laurus in
any material respect. 
  
 (w) Prohibition of Grant of
Collateral for Subordinated Debt Documentation and Harbinger Debt Documentation. It shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of Laurus, grant or permit any of its Subsidiaries to grant to any
Person any Collateral of such Company or any collateral of any of its Subsidiaries as security for any obligation arising under the Subordinated Debt Documentation or the Harbinger Debt Documentation. 
  
 (x) Prohibitions of Payment Under Subordinated Debt Documentation,
Harbinger Debt Documentation and MacInnis Promisory Note. Neither it nor any of its Subsidiaries shall, without the prior written consent of Laurus, make any payments in respect of the indebtedness evidenced by the Subordinated Debt
Documentation, the Harbinger Debt 

  

 32 

 
Documentation or the promissory note issued by the Parent to Alan MacInnis, dated as of
             (the “MacInnis Promissory Note”), other than as expressly required by the terms thereof; provided that the Parent shall be permitted to apply proceeds
received from the Initial Public Offering or other financing permitted hereunder to repay its obligations owed to (i) McKesson pursuant to the Subordinated Debt Documentation to the extent not in excess of $6,100,000, (ii) Harbinger
pursuant to the Harbinger Debt Documentation to the extent not in excess of $7,000,000 and (iii) Alan MacInnis McKesson pursuant to the MacInnis Promissory Note to the extent not in excess of $350,000. 
  
 (y) Conversion of Preferred Stock. On or prior to the date of
consummation of the Initial Public Offering, the Parent shall cause the holders of its existing Series A Convertible Preferred Stock, Series B Convertible Preferred Stock, Series C Convertible Preferred Stock, Series D Convertible Preferred Stock,
Series E Convertible Preferred Stock and its existing convertible note holders to convert their respective outstanding preferred stock and debt obligations into Common Stock of the Company. 
  
 (z) McKesson Restructuring Payment. For the avoidance of doubt, to the
extent that no Event of Default has occurred and is continuing, the Parent shall be permitted to make the McKesson Restructuring Payment in accordance with the terms of the McKesson Restructuring Agreement as in effect on the date hereof.

  
 14. Further Assurances. At any time and from time to
time, upon the written request of Laurus and at the sole expense of Companies, each Company shall promptly and duly execute and deliver any and all such further instruments and documents and take such further action as Laurus may reasonably request
(a) to obtain the full benefits of this Agreement and the Ancillary Agreements, (b) to protect, preserve and maintain Laurus’ rights in the Collateral and under this Agreement or any Ancillary Agreement, and/or (c) to enable
Laurus to exercise all or any of the rights and powers herein granted or any Ancillary Agreement. 
  
 15. Representations, Warranties and Covenants of Laurus. Laurus hereby represents, warrants and covenants to each Company as follows: 

 
 (a) Requisite Power and Authority. Laurus has all necessary power
and authority under all applicable provisions of law to execute and deliver this Agreement and the Ancillary Agreements and to carry out their provisions. All corporate action on Laurus’ part required for the lawful execution and delivery of
this Agreement and the Ancillary Agreements have been or will be effectively taken prior to the Closing Date. Upon their execution and delivery, this Agreement and the Ancillary Agreements shall be valid and binding obligations of Laurus,
enforceable in accordance with their terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights, and (b) as limited by
general principles of equity that restrict the availability of equitable and legal remedies. 
  
 (b) Investment Representations. Laurus understands that the Securities are being offered pursuant to an exemption from registration contained in the Securities Act based in part upon Laurus’
representations contained in this Agreement, including, without limitation, that Laurus is an “accredited investor” within the meaning of Regulation D under the Securities Act. 

  

 33 

 
Laurus has received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision with respect
to the Notes to be issued to it under this Agreement and the Securities acquired by it upon the conversion of the Minimum Borrowing Note. 
  
 (c) Laurus Bears Economic Risk. Laurus has substantial experience in evaluating and investing in private placement transactions of securities in
companies similar to the Parent so that it is capable of evaluating the merits and risks of its investment in the Parent and has the capacity to protect its own interests. Laurus must bear the economic risk of this investment until the Securities
are sold pursuant to (i) an effective registration statement under the Securities Act, or (ii) an exemption from registration is available. 
  
 (d) Investment for Own Account. The Securities are being issued to Laurus for its own account for investment only, and not as a nominee or agent
and not with a view towards or for resale in connection with their distribution. 
  
 (e) Laurus Can Protect Its Interest. Laurus represents that by reason of its, or of its management’s, business and financial experience, Laurus has the capacity to evaluate the merits and risks of its
investment in the Notes, and the Securities and to protect its own interests in connection with the transactions contemplated in this Agreement, and the Ancillary Agreements. Further, Laurus is aware of no publication of any advertisement in
connection with the transactions contemplated in the Agreement or the Ancillary Agreements. 
  
 (f) Accredited Investor. Laurus represents that it is an accredited investor within the meaning of Regulation D under the Securities Act and that, as of the date of this Agreement, Laurus (i) owns and
invests on a discretionary basis at least $100,000,000 in securities of issuers that are not affiliated with Laurus and (ii) has an audited net worth of at least $25,000,000 according to its latest audited annual financial statements.

  
 (g) Shorting. Neither Laurus nor any of its Affiliates
or investment partners has, will, or will cause any Person, to directly engage in “short sales” of the Parent’s Common Stock as long as any Minimum Borrowing Note shall be outstanding. 
  
 (h) Patriot Act. Laurus certifies that, to the best of Laurus’
knowledge, Laurus has not been designated, and is not owned or controlled, by a “suspected terrorist” as defined in Executive Order 13224. Laurus seeks to comply with all applicable laws concerning money laundering and related activities.
In furtherance of those efforts, Laurus hereby represents, warrants and covenants that: (i) none of the cash or property that Laurus will use to make the Loans has been or shall be derived from, or related to, any activity that is deemed
criminal under United States law; and (ii) no disbursement by Laurus to any Company to the extent within Laurus’ control, shall cause Laurus to be in violation of the United States Bank Secrecy Act, the United States International Money
Laundering Control Act of 1986 or the United States International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001. Laurus shall promptly notify the Company Agent if any of these representations ceases to be true and accurate
regarding Laurus. Laurus agrees to provide the Company any additional information regarding Laurus that the Company deems necessary or convenient to ensure compliance with all applicable laws concerning money laundering and similar activities.
Laurus 

  

 34 

 
understands and agrees that if at any time it is discovered that any of the foregoing representations are incorrect, or if otherwise required by applicable
law or regulation related to money laundering similar activities, Laurus may undertake appropriate actions to ensure compliance with applicable law or regulation, including but not limited to segregation and/or redemption of Laurus’ investment
in the Parent. Laurus further understands that the Parent may release information about Laurus and, if applicable, any underlying beneficial owners, to proper authorities if the Parent, in its sole discretion, determines that it is in the best
interests of the Parent in light of relevant rules and regulations under the laws set forth in subsection (ii) above. 
  
 (i) Limitation on Acquisition of Common Stock. Notwithstanding anything to the contrary contained in this Agreement, any Ancillary Agreement, or
any document, instrument or agreement entered into in connection with any other transaction entered into by and between Laurus and any Company (and/or Subsidiaries or Affiliates of any Company), Laurus shall not acquire stock in the Parent
(including, without limitation, pursuant to a contract to purchase, by exercising an option or warrant, by converting any other security or instrument, by acquiring or exercising any other right to acquire, shares of stock or other security
convertible into shares of stock in the Parent, or otherwise, and such options, warrants, conversion or other rights shall not be exercisable) to the extent such stock acquisition would cause any interest (including any original issue discount)
payable by any Company to Laurus not to qualify as portfolio interest, within the meaning of Section 881(c)(2) of the Internal Revenue Code of 1986, as amended (the “Code”) by reason of Section 881(c)(3) of the Code,
taking into account the constructive ownership rules under Section 871(h)(3)(C) of the Code (the “Stock Acquisition Limitation”). The Stock Acquisition Limitation shall automatically become null and void without any notice to
any Company upon the earlier to occur of either (a) the Parent’s delivery to Laurus of a Notice of Redemption (as defined in the Notes) or (b) the existence of an Event of Default at a time when the average closing price of the Common
Stock as reported by Bloomberg, L.P. on the Principal Market for the immediately preceding five trading days is greater than or equal to 150% of the Fixed Conversion Price (as defined in the Minimum Borrowing Note). 
  
 16. Power of Attorney. Each Company hereby appoints Laurus, or any
other Person whom Laurus may designate as such Company’s attorney, with power to: (i) endorse such Company’s name on any checks, notes, acceptances, money orders, drafts or other forms of payment or security that may come into
Laurus’ possession; (ii) sign such Company’s name on any invoice or bill of lading relating to any Accounts, drafts against Account Debtors, schedules and assignments of Accounts, notices of assignment, financing statements and other
public records, verifications of Account and notices to or from Account Debtors; (iii) verify the validity, amount or any other matter relating to any Account by mail, telephone, telegraph or otherwise with Account Debtors; (iv) do all
things necessary to carry out this Agreement, any Ancillary Agreement and all related documents; and (v) on or after the occurrence and during the continuation of an Event of Default, notify the post office authorities to change the address for
delivery of such Company’s mail to an address designated by Laurus, and to receive, open and dispose of all mail addressed to such Company. Each Company hereby ratifies and approves all acts of the attorney. Neither Laurus, nor the attorney
will be liable for any acts or omissions or for any error of judgment or mistake of fact or law, except for gross negligence or willful misconduct. This power, being coupled with an interest, is irrevocable so long as Laurus has a security interest
and until the Obligations have been fully satisfied. 
  

 35 

 17. Term of Agreement. Laurus’ agreement to make Loans and extend financial accommodations
under and in accordance with the terms of this Agreement or any Ancillary Agreement shall continue in full force and effect until the expiration of the Term. At Laurus’ election following the occurrence of an Event of Default, Laurus may
terminate this Agreement. The termination of the Agreement shall not affect any of Laurus’ rights hereunder or any Ancillary Agreement and the provisions hereof and thereof shall continue to be fully operative until all transactions entered
into, rights or interests created and the Obligations have been irrevocably disposed of, concluded or liquidated. Notwithstanding the foregoing, Laurus shall release its security interests at any time after thirty (30) days notice upon
irrevocable payment to it of all Obligations if each Company shall have (i) provided Laurus with an executed release of any and all claims which such Company may have or thereafter have under this Agreement and all Ancillary Agreements and
(ii) paid to Laurus an early payment fee in an amount equal to (1) five percent (5%) of the Capital Availability Amount if such payment occurs prior to the first anniversary of the Closing Date, (2) four percent (4%) of the
Capital Availability Amount if such payment occurs on or after the first anniversary of the Closing Date and prior to the second anniversary of the Closing Date and (3) three percent (3%) of the Capital Availability Amount if such
termination occurs thereafter during the Term; such fee being intended to compensate Laurus for its costs and expenses incurred in initially approving this Agreement or extending same. Such early payment fee shall be due and payable jointly and
severally by the Companies to Laurus upon termination by acceleration of this Agreement by Laurus due to the occurrence and continuance of an Event of Default. 
  

18. Termination of Lien. The Liens and rights granted to Laurus hereunder and any Ancillary Agreements and the financing statements filed in
connection herewith or therewith shall continue in full force and effect, notwithstanding the termination of this Agreement or the fact that any Company’s account may from time to time be temporarily in a zero or credit position, until all of
the Obligations have been indefeasibly paid or performed in full after the termination of this Agreement. Laurus shall not be required to send termination statements to any Company, or to file them with any filing office, unless and until this
Agreement and the Ancillary Agreements shall have been terminated in accordance with their terms and all Obligations indefeasibly paid in full in immediately available funds. Upon the indefeasible payment in full of the Obligations and the
termination of this Agreement and the Ancillary Agreements, Laurus agrees to promptly file UCC-3 termination statements at the joint and several expense of the Companies to the extent reasonably required to evidence the foregoing. 
  
 19. Events of Default. The occurrence of any of the following shall
constitute an “Event of Default”: 
  
 (a)
failure to make payment of any of the Obligations when required hereunder, and, in any such case, such failure shall continue for a period of three (3) days following the date upon which any such payment was due; provided that the failure to
make payment of any Obligations arising solely as a result of (i) the reclassification by Laurus of the Reserves pursuant to Section 2(a)(i) or (ii) decreases by Laurus in the advance percentages used in determining Accounts
Availability, Inventory Availability and/or Stock Availability pursuant to Section 2(a)(iii) shall not constitute an “Event of Default” unless such failure shall continue for a period of six (6) business days following the date
upon which any such payment was due; 
  

 36 

 (b) failure by any Company or any of its Subsidiaries to pay any taxes when due unless such taxes are
being contested in good faith by appropriate proceedings and with respect to which adequate reserves have been provided on such Company’s and/or such Subsidiary’s books; 
  
 (c) failure to perform under, and/or committing any breach of, in any material respect, this Agreement or any covenant
contained herein, which failure or breach shall continue without remedy for a period of fifteen (15) days after the occurrence thereof; 
  
 (d) any representation, warranty or statement made by any Company or any of its Subsidiaries hereunder, in any Ancillary Agreement, any certificate,
statement or document delivered pursuant to the terms hereof, or in connection with the transactions contemplated by this Agreement should prove to be false or misleading in any material respect on the date as of which made or deemed made;

  
 (e) the occurrence of any default (or similar term) in the
observance or performance of any other agreement or condition relating to any indebtedness or contingent obligation of any Company or any of its Subsidiaries (including, without limitation, the contingent obligations evidenced by the O’Donnell
Stock Pledge Agreement and the indebtedness evidenced by the Subordinated Debt Documentation) beyond the period of grace (if any), the effect of which default is to cause, or permit the holder or holders of such indebtedness or beneficiary or
beneficiaries of such contingent obligation to cause, such indebtedness to become due prior to its stated maturity or such contingent obligation to become payable; 
  
 (f) attachments or levies in excess of $50,000 in the aggregate are made upon any Company’s assets or a judgment is
rendered against any Company’s property involving a liability of more than $50,000 which shall not have been vacated, discharged, stayed or bonded within thirty (30) days from the entry thereof; 
  
 (g) any change in any Company’s or any of its Subsidiary’s
condition or affairs (financial or otherwise) which in Laurus’ reasonable, good faith opinion, could reasonably be expected to have a Material Adverse Effect; 
  
 (h) any Lien created hereunder or under any Ancillary Agreement for any reason ceases to be or is not a valid and perfected
Lien having a first priority interest; 
  
 (i) any Company or any
of its Subsidiaries shall (i) apply for, consent to or suffer to exist the appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property, (ii) make a
general assignment for the benefit of creditors, (iii) commence a voluntary case under the federal bankruptcy laws (as now or hereafter in effect), (iv) be adjudicated a bankrupt or insolvent, (v) file a petition seeking to take
advantage of any other law providing for the relief of debtors, (vi) acquiesce to without challenge within ten (10) days of the filing thereof, or failure to have dismissed within thirty (30) days, any petition filed against it in any
involuntary case under such bankruptcy laws, or (vii) take any action for the purpose of effecting any of the foregoing; 
  

 37 

 (j) any Company or any of its Subsidiaries shall admit in writing its inability, or be generally unable,
to pay its debts as they become due or cease operations of its present business; 
  
 (k) any Company or any of its Subsidiaries directly or indirectly sells, assigns, transfers, conveys, or suffers or permits to occur any sale, assignment, transfer or conveyance of any assets of such Company or any
interest therein, except as permitted herein; 
  
 (l) any
“Person” or “group” (as such terms are defined in Sections 13(d) and 14(d) of the Exchange Act, as in effect on the date hereof) is or becomes the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the
Exchange Act), directly or indirectly, of 35% or more on a fully diluted basis of the then outstanding voting equity interest of the Parent (other than a “Person” or “group” that beneficially owns 35% or more of such outstanding
voting equity interests of the Parent on the date hereof) or (ii) the Board of Directors of the Parent shall cease to consist of a majority of the Parent’s board of directors on the date hereof (or directors appointed by a majority of the
board of directors in effect immediately prior to such appointment); 
  
 (m) the indictment or threatened indictment of any Company or any of its Subsidiaries or any executive officer of any Company or any of its Subsidiaries under any criminal statute, or commencement or threatened commencement of criminal or
civil proceeding against any Company or any of its Subsidiaries or any executive officer of any Company or any of its Subsidiaries pursuant to which statute or proceeding penalties or remedies sought or available include forfeiture of any of the
property of any Company or any of its Subsidiaries that could reasonably be expected to be adverse to the interests of Laurus in any material respect; 
  
 (n) an Event of Default shall occur under and as defined in any Note, in any other Ancillary Agreement, the Securities Purchase Agreement or any Related
Agreement referred to in the Securities Purchase Agreement; 
  
 (o) any Company or any of its Subsidiaries shall breach any term or provision of any Ancillary Agreement to which it is a party, in any material respect which breach is not cured within any applicable cure or grace period provided in
respect thereof (if any); 
  
 (p) any Company or any of its
Subsidiaries attempts to terminate, challenges the validity of, or its liability under this Agreement or any Ancillary Agreement, or any proceeding shall be brought to challenge the validity, binding effect of any Ancillary Agreement or any
Ancillary Agreement ceases to be a valid, binding and enforceable obligation of such Company or any of its Subsidiaries (to the extent such Persons are a party thereto); 
  
 (q) on or after the consummation of an initial public offering of Common Stock, an SEC stop trade order or Principal Market
trading suspension of the Common Stock shall be in effect for five (5) consecutive days or five (5) days during a period of ten (10) consecutive days, excluding in all cases a suspension of all trading on a Principal Market, provided
that the Parent shall not have been able to cure such trading suspension within thirty (30) days of the notice thereof or list the Common Stock on another Principal Market within sixty (60) days of such notice; 
  

 38 

 (r) The Parent’s failure to deliver Common Stock to Laurus pursuant to and in the form required by
the Notes and this Agreement, if such failure to deliver Common Stock shall not be cured within two (2) Business Days or any Company is required to issue a replacement Note to Laurus and such Company shall fail to deliver such replacement Note
within seven (7) Business Days; or 
  
 (s) any Company, or
any of its Subsidiaries shall take or participate in any action which would be prohibited under the provisions of any of the Subordinated Debt Documentation or make any payment on the indebtedness evidenced by the Subordinated Debt Documentation to
a Person that was not entitled to receive such payments under the subordination provisions of applicable Subordinated Debt Documentation. 
  
 20. Remedies. Following the occurrence of an Event of Default, Laurus shall have the right to demand repayment in full of all Obligations, whether
or not otherwise due. Until all Obligations have been fully and indefeasibly satisfied, Laurus shall retain its Lien in all Collateral. Laurus shall have, in addition to all other rights provided herein and in each Ancillary Agreement, the rights
and remedies of a secured party under the UCC, and under other applicable law, all other legal and equitable rights to which Laurus may be entitled, including the right to take immediate possession of the Collateral, to require each Company to
assemble the Collateral, at Companies’ joint and several expense, and to make it available to Laurus at a place designated by Laurus which is reasonably convenient to both parties and to enter any of the premises of any Company or wherever the
Collateral shall be located, with or without force or process of law, and to keep and store the same on said premises until sold (and if said premises be the property of any Company, such Company agrees not to charge Laurus for storage thereof), and
the right to apply for the appointment of a receiver for such Company’s property. Further, Laurus may, at any time or times after the occurrence of an Event of Default, sell and deliver all Collateral held by or for Laurus at public or private
sale for cash, upon credit or otherwise, at such prices and upon such terms as Laurus, in Laurus’ sole discretion, deems advisable or Laurus may otherwise recover upon the Collateral in any commercially reasonable manner as Laurus, in its sole
discretion, deems advisable. The requirement of reasonable notice shall be met if such notice is mailed postage prepaid to Company Agent at Company Agent’s address as shown in Laurus’ records, at least ten (10) days before the time of
the event of which notice is being given. Laurus may be the purchaser at any sale, if it is public. In connection with the exercise of the foregoing remedies, Laurus is granted permission to use all of each Company’s Intellectual Property. The
proceeds of sale shall be applied first to all costs and expenses of sale, including attorneys’ fees, and second to the payment (in whatever order Laurus elects) of all Obligations. After the indefeasible payment and satisfaction in full of all
of the Obligations, and after the payment by Laurus of any other amount required by any provision of law, including Section 9-608(a)(1) of the UCC (but only after Laurus has received what Laurus considers reasonable proof of a subordinate
party’s security interest), the surplus, if any, shall be paid to Company Agent (for the benefit of the applicable Companies) or its representatives or to whosoever may be lawfully entitled to receive the same, or as a court of competent
jurisdiction may direct. The Companies shall remain jointly and severally liable to Laurus for any deficiency. In addition, the Companies shall jointly and severally pay Laurus a liquidation fee (“Liquidation Fee”) in the amount of
five percent (5%) of the actual amount collected in respect of each Account outstanding at any time during a Liquidation Period”. For purposes hereof, “Liquidation Period” means a period: (i) beginning on the earliest
date of (x) an event referred 

  

 39 

 
to in Section 19(i) or 19(j), or (y) the cessation of any Company’s business; and (ii) ending on the date on which Laurus has actually
received all Obligations due and owing it under this Agreement and the Ancillary Agreements. The Liquidation Fee shall be paid on the date on which Laurus collects the applicable Account by deduction from the proceeds thereof. Each Company and
Laurus acknowledge that the actual damages that would be incurred by Laurus after the occurrence of an Event of Default would be difficult to quantify and that such Company and Laurus have agreed that the fees and obligations set forth in this
Section and in this Agreement would constitute fair and appropriate liquidated damages in the event of any such termination. The parties hereto each hereby agree that the exercise by any party hereto of any right granted to it or the exercise by any
party hereto of any remedy available to it (including, without limitation, the issuance of a notice of redemption, a borrowing request and/or a notice of default), in each case, hereunder or under any Ancillary Agreement which has been publicly
filed with the SEC shall not constitute confidential information and no party shall have any duty to the other party to maintain such information as confidential, except for the portions of such publicly filed documents that are subject to
confidential treatment request made by the Companies to the SEC. 
  
 21. Waivers. To the full extent permitted by applicable law, each Company hereby waives (a) presentment, demand and protest, and notice of presentment, dishonor, intent to accelerate, acceleration, protest, default, nonpayment,
maturity, release, compromise, settlement, extension or renewal of any or all of this Agreement and the Ancillary Agreements or any other notes, commercial paper, Accounts, contracts, Documents, Instruments, Chattel Paper and guaranties at any time
held by Laurus on which such Company may in any way be liable, and hereby ratifies and confirms whatever Laurus may do in this regard; (b) all rights to notice and a hearing prior to Laurus’ taking possession or control of, or to
Laurus’ replevy, attachment or levy upon, any Collateral or any bond or security that might be required by any court prior to allowing Laurus to exercise any of its remedies; and (c) the benefit of all valuation, appraisal and exemption
laws. Each Company acknowledges that it has been advised by counsel of its choices and decisions with respect to this Agreement, the Ancillary Agreements and the transactions evidenced hereby and thereby. 
  
 22. Expenses. The Companies shall jointly and severally pay all of
Laurus’ out-of-pocket costs and expenses, including reasonable fees and disbursements of in-house or outside counsel and appraisers, in connection with the preparation, execution and delivery of this Agreement and the Ancillary Agreements, and
in connection with the prosecution or defense of any action, contest, dispute, suit or proceeding concerning any matter in any way arising out of, related to or connected with this Agreement or any Ancillary Agreement. The Companies shall also
jointly and severally pay all of Laurus’ reasonable fees, charges, out-of-pocket costs and expenses, including fees and disbursements of counsel and appraisers, in connection with (a) the preparation, execution and delivery of any waiver,
any amendment thereto or consent proposed or executed in connection with the transactions contemplated by this Agreement or the Ancillary Agreements, (b) Laurus’ obtaining performance of the Obligations under this Agreement and any
Ancillary Agreements, including, but not limited to, the enforcement or defense of Laurus’ security interests, assignments of rights and Liens hereunder as valid perfected security interests, (c) any attempt to inspect, verify, protect,
collect, sell, liquidate or otherwise dispose of any Collateral, (d) any appraisals or re-appraisals of any property (real or personal) pledged to Laurus by any Company or any of its Subsidiaries as Collateral for, or any other Person as

  

 40 

 
security for, the Obligations hereunder and (e) any consultations in connection with any of the foregoing. The Companies shall also jointly and
severally pay Laurus’ customary bank charges for all bank services (including wire transfers) performed or caused to be performed by Laurus for any Company or any of its Subsidiaries at any Company’s or such Subsidiary’s request or in
connection with any Company’s loan account with Laurus. All such costs and expenses together with all filing, recording and search fees, taxes and interest payable by the Companies to Laurus shall be payable on demand and shall be secured by
the Collateral. If any tax by any Governmental Authority is or may be imposed on or as a result of any transaction between any Company and/or any Subsidiary thereof, on the one hand, and Laurus on the other hand, which Laurus is or may be required
to withhold or pay, the Companies hereby jointly and severally indemnifies and holds Laurus harmless in respect of such taxes, and the Companies will repay to Laurus the amount of any such taxes which shall be charged to the Companies’ account;
and until the Companies shall furnish Laurus with indemnity therefor (or supply Laurus with evidence satisfactory to it that due provision for the payment thereof has been made), Laurus may hold without interest any balance standing to each
Company’s credit and Laurus shall retain its Liens in any and all Collateral. 
  
 23. Assignment By Laurus. Laurus may assign any or all of the Obligations together with any or all of the security therefor to any Person which is not a competitor of any Company and any such transferee shall
succeed to all of Laurus’ rights with respect thereto. Upon such transfer, Laurus shall be released from all responsibility for the Collateral to the extent same is assigned to any transferee. Laurus may from time to time sell or otherwise
grant participations in any of the Obligations and the holder of any such participation shall, subject to the terms of any agreement between Laurus and such holder, be entitled to the same benefits as Laurus with respect to any security for the
Obligations in which such holder is a participant. Each Company agrees that each such holder may exercise any and all rights of banker’s lien, set-off and counterclaim with respect to its participation in the Obligations as fully as though such
Company were directly indebted to such holder in the amount of such participation. 
  
 24. No Waiver; Cumulative Remedies. Failure by Laurus to exercise any right, remedy or option under this Agreement, any Ancillary Agreement or any supplement hereto or thereto or any other agreement between or
among any Company and Laurus or delay by Laurus in exercising the same, will not operate as a waiver; no waiver by Laurus will be effective unless it is in writing and then only to the extent specifically stated. Laurus’ rights and remedies
under this Agreement and the Ancillary Agreements will be cumulative and not exclusive of any other right or remedy which Laurus may have. 
  
 25. Application of Payments. Each Company irrevocably waive the right to direct the application of any and all payments at any time or times
hereafter received by Laurus from or on such Company’s behalf and each Company hereby irrevocably agrees that Laurus shall have the continuing exclusive right to apply and reapply any and all payments received at any time or times hereafter
against the Obligations hereunder in such manner as Laurus may deem advisable notwithstanding any entry by Laurus upon any of Laurus’ books and records. 
  
 26. Indemnity. Each Company hereby jointly and severally indemnifies and holds Laurus, and its respective affiliates, employees, attorneys and
agents (each, an “Indemnified Person”), harmless from and against any and all suits, actions, proceedings, claims, 

  

 41 

 
damages, losses, liabilities and expenses of any kind or nature whatsoever (including attorneys’ fees and disbursements and other costs of investigation
or defense, including those incurred upon any appeal) which may be instituted or asserted against or incurred by any such Indemnified Person as the result of credit having been extended, suspended or terminated under this Agreement or any of the
Ancillary Agreements or with respect to the execution, delivery, enforcement, performance and administration of, or in any other way arising out of or relating to, this Agreement, the Ancillary Agreements or any other documents or transactions
contemplated by or referred to herein or therein and any actions or failures to act with respect to any of the foregoing, except to the extent that any such indemnified liability is finally determined by a court of competent jurisdiction to have
resulted solely from such Indemnified Person’s gross negligence or willful misconduct. NO INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR LIABLE TO ANY COMPANY OR TO ANY OTHER PARTY OR TO ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OR ANY
OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF CREDIT HAVING BEEN EXTENDED, SUSPENDED OR TERMINATED UNDER THIS AGREEMENT OR ANY ANCILLARY
AGREEMENT OR AS A RESULT OF ANY OTHER TRANSACTION CONTEMPLATED HEREUNDER OR THEREUNDER. 
  
 27. Revival. The Companies further agree that to the extent any Company makes a payment or payments to Laurus, which payment or payments or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy act, state or federal law, common law or equitable cause, then, to the extent of such payment or repayment, the
obligation or part thereof intended to be satisfied shall be revived and continued in full force and effect as if said payment had not been made. 
  
 28. Borrowing Agency Provisions. 
  
 (a) Each Company hereby irrevocably designates Company Agent to be its attorney and agent and in such capacity to borrow, sign and endorse notes, and
execute and deliver all instruments, documents, writings and further assurances now or hereafter required hereunder, on behalf of such Company, and hereby authorizes Laurus to pay over or credit all loan proceeds hereunder in accordance with the
request of Company Agent. 
  
 (b) The handling of this credit
facility as a co-borrowing facility with a borrowing agent in the manner set forth in this Agreement is solely as an accommodation to the Companies and at their request. Laurus shall not incur any liability to any Company as a result thereof. To
induce Laurus to do so and in consideration thereof, each Company hereby indemnifies Laurus and holds Laurus harmless from and against any and all liabilities, expenses, losses, damages and claims of damage or injury asserted against Laurus by any
Person arising from or incurred by reason of the handling of the financing arrangements of the Companies as provided herein, reliance by Laurus on any request or instruction from Company Agent or any other action taken by Laurus with respect to this
Paragraph 28. 
  

 42 

 (c) All Obligations shall be joint and several, and the Companies shall make payment upon the maturity of
the Obligations by acceleration or otherwise, and such obligation and liability on the part of the Companies shall in no way be affected by any extensions, renewals and forbearance granted by Laurus to any Company, failure of Laurus to give any
Company notice of borrowing or any other notice, any failure of Laurus to pursue to preserve its rights against any Company, the release by Laurus of any Collateral now or thereafter acquired from any Company, and such agreement by any Company to
pay upon any notice issued pursuant thereto is unconditional and unaffected by prior recourse by Laurus to any Company or any Collateral for such Company’s Obligations or the lack thereof. 
  
 (d) Each Company expressly waives any and all rights of subrogation,
reimbursement, indemnity, exoneration, contribution or any other claim which such Company may now or hereafter have against the other or other Person directly or contingently liable for the Obligations, or against or with respect to any other’s
property (including, without limitation, any property which is Collateral for the Obligations), arising from the existence or performance of this Agreement, until all Obligations have been indefeasibly paid in full and this Agreement has been
irrevocably terminated. 
  
 (e) Each Company represents and
warrants to Laurus that (i) Companies have one or more common shareholders, directors and officers, (ii) the businesses and corporate activities of Companies are closely related to, and substantially benefit, the business and corporate
activities of Companies, (iii) the financial and other operations of Companies are performed on a combined basis as if Companies constituted a consolidated corporate group, (iv) Companies will receive a substantial economic benefit from
entering into this Agreement and will receive a substantial economic benefit from the application of each Loan hereunder, in each case, whether or not such amount is used directly by any Company and (v) all requests for Loans hereunder by the
Company Agent are for the exclusive and indivisible benefit of the Companies as though, for purposes of this Agreement, the Companies constituted a single entity. 
  
 29. Notices. Any notice or request hereunder may be given to any Company, Company Agent or Laurus at the respective
addresses set forth below or as may hereafter be specified in a notice designated as a change of address under this Section. Any notice or request hereunder shall be given by registered or certified mail, return receipt requested, hand delivery,
overnight mail or telecopy (confirmed by mail). Notices and requests shall be, in the case of those by hand delivery, deemed to have been given when delivered to any officer of the party to whom it is addressed, in the case of those by mail or
overnight mail, deemed to have been given three (3) Business Days after the date when deposited in the mail or with the overnight mail carrier, and, in the case of a telecopy, when confirmed. 
  

 43 

 Notices shall be provided as follows: 
  

					
	If to Laurus:	  	Laurus Master Fund, Ltd.
	 	  	c/o Laurus Capital Management, LLC
	 	  	825 Third Avenue, 14th Fl.
	 	  	New York, New York 10022
	 	  	Attention:	  	John E. Tucker, Esq.
	 	  	Telephone:	  	(212) 541-4434
	 	  	Telecopier:	  	(212) 541-5800
		
	 If to any Company,
 or Company Agent:
	  	Accentia Biopharmaceuticals, Inc.
	 	  	324 South Hyde Park Ave., Suite 350
	 	  	Tampa, Florida 33606
			
	 	  	Attention:	  	Chief Financial Officer
	 	  	Telephone:	  	813-864-2554
	 	  	Facsimile:	  	813-258-1659

  
 or such other address as may be
designated in writing hereafter in accordance with this Section 29 by such Person. 
  
 30. Governing Law, Jurisdiction and Waiver of Jury Trial. 
  
 (a) THIS AGREEMENT AND THE ANCILLARY AGREEMENTS SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. 
  
 (b) EACH COMPANY HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL HAVE EXCLUSIVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN ANY COMPANY, ON THE ONE HAND, AND LAURUS, ON THE OTHER HAND, PERTAINING TO THIS AGREEMENT OR ANY OF THE ANCILLARY AGREEMENTS OR TO ANY MATTER ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR ANY OF THE ANCILLARY AGREEMENTS; PROVIDED, THAT LAURUS AND EACH COMPANY ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW YORK; AND
FURTHER PROVIDED, THAT NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE LAURUS FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY
OTHER SECURITY FOR THE 

  

 44 

 
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF LAURUS. EACH COMPANY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN
ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH COMPANY HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. EACH COMPANY HEREBY WAIVES PERSONAL SERVICE OF
THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO COMPANY AGENT AT THE ADDRESS SET FORTH IN
SECTION 29 AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF COMPANY AGENT’S ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE PREPAID. 
  
 (c) THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING
SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE,
WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN LAURUS, AND/OR ANY COMPANY ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT, ANY ANCILLARY AGREEMENT OR THE
TRANSACTIONS RELATED HERETO OR THERETO. 
  
 31. Limitation of
Liability. Each Company acknowledges and understands that in order to assure repayment of the Obligations hereunder Laurus may be required to exercise any and all of Laurus’ rights and remedies hereunder and agrees that, except as limited
by applicable law, neither Laurus nor any of Laurus’ agents shall be liable for acts taken or omissions made in connection herewith or therewith except for actual bad faith. 
  
 32. Entire Understanding; Maximum Interest. This Agreement and the Ancillary Agreements contain the entire
understanding among each Company and Laurus as to the subject matter hereof and thereof and any promises, representations, warranties or guarantees not herein contained shall have no force and effect unless in writing, signed by each Company’s
and Laurus’ respective officers. Neither this Agreement, the Ancillary Agreements, nor any portion or provisions thereof may be changed, modified, amended, waived, supplemented, discharged, cancelled or terminated orally or by any course of
dealing, or in any manner other than by an agreement in writing, signed by the party to be charged. Nothing contained in this Agreement, any Ancillary Agreement or in any document referred to herein or delivered in connection herewith shall be
deemed to establish or require the payment of a rate of interest or other charges in excess of the maximum rate permitted by applicable law. In the event that the rate of interest or dividends required to be paid or other charges hereunder exceed
the maximum rate permitted by such law, any payments in excess of such maximum shall be credited against amounts owed by the Companies to Laurus and thus refunded to the Companies. 
  

 45 

 33. Severability. Wherever possible each provision of this Agreement or the Ancillary Agreements
shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement or the Ancillary Agreements shall be prohibited by or invalid under applicable law such provision shall be ineffective to
the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions thereof. 
  
 34. Survival. The representations, warranties, covenants and agreements made herein shall survive any investigation made by Laurus and the closing
of the transactions contemplated hereby to the extent provided therein. All statements as to factual matters contained in any certificate or other instrument delivered by or on behalf of the Companies pursuant hereto in connection with the
transactions contemplated hereby shall be deemed to be representations and warranties by the Companies hereunder solely as of the date of such certificate or instrument. All indemnities set forth herein shall survive the execution, delivery and
termination of this Agreement and the Ancillary Agreements and the making and repaying of the Obligations. 
  
 35. Captions. All captions are and shall be without substantive meaning or content of any kind whatsoever. 
  
 36. Counterparts; Telecopier Signatures. This Agreement may be
executed in one or more counterparts, each of which shall constitute an original and all of which taken together shall constitute one and the same agreement. Any signature delivered by a party via telecopier transmission shall be deemed to be any
original signature hereto. 
  
 37. Construction. The
parties acknowledge that each party and its counsel have reviewed this Agreement and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of
this Agreement or any amendments, schedules or exhibits thereto. 
  
 38. Publicity. Each Company hereby authorizes Laurus to make appropriate announcements of the financial arrangement entered into by and among each Company and Laurus, including, without limitation, announcements which are commonly
known as tombstones, in such publications and to such selected parties as Laurus shall in its sole and absolute discretion deem appropriate, or as required by applicable law. 
  
 39. Joinder. It is understood and agreed that any Person that desires to become a Company hereunder, or is required
to execute a counterpart of this Agreement after the date hereof pursuant to the requirements of this Agreement or any Ancillary Agreement, shall become a Company hereunder by (a) executing a Joinder Agreement in form and substance satisfactory
to Laurus, (b) delivering supplements to such exhibits and annexes to this Agreement and the Ancillary Agreements as Laurus shall reasonably request and (c) taking all actions as specified in this Agreement as would have been taken by such
Company had it been an original party to this Agreement, in each case with all documents required above to be delivered to Laurus and with all documents and actions required above to be taken to the reasonable satisfaction of Laurus. 
  

 46 

 40. Legends. The Securities shall bear legends as follows; 
  
 (a) The Minimum Borrowing Note shall bear substantially the following
legend: 
  
 “THIS NOTE AND THE COMMON STOCK ISSUABLE UPON
CONVERSION OF THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE, STATE SECURITIES LAWS. THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED
OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE OR SUCH SHARES UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO ACCENTIA BIOPHARMACEUTICALS, INC. THAT SUCH
REGISTRATION IS NOT REQUIRED.” 
  
 (b) The Revolving Note
shall bear substantially the following legend: 
  
 “THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE, STATE SECURITIES LAWS. THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO
THIS NOTE OR SUCH SHARES UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO ACCENTIA BIOPHARMACEUTICALS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.” 
  
 (c) Any shares of Common Stock issued pursuant to conversion of the Minimum
Borrowing Note or exercise of the Warrants, shall bear a legend which shall be in substantially the following form until such shares are covered by an effective registration statement filed with the SEC: 
  
 “THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE, STATE SECURITIES LAWS. THESE SHARES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO ACCENTIA BIOPHARMACEUTICALS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.” 
  

 47 

 (d) The Warrants shall bear substantially the following legend: 
  
 “THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS
WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT OR THE UNDERLYING SHARES OF COMMON STOCK UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO ACCENTIA
BIOPHARMACEUTICALS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.” 
  
 [Balance of page intentionally left blank; signature page follows.] 
  

 48 

 IN WITNESS WHEREOF, the parties have executed this Security Agreement as of the date first written above.

  

			
	ACCENTIA BIOPHARMACEUTICALS, INC.
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	THE ANALYTICA GROUP, INC.
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	LAURUS MASTER FUND, LTD.
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

  

 49 

 Annex A - Definitions 
  
 “Account Debtor” means any Person who is or may be obligated with respect to, or on account of, an Account.

  
 “Accountants” has the meaning given to such
term in Section 11(a). 
  
 “Accounts” means
all “accounts”, as such term is defined in the UCC, now owned or hereafter acquired by any Person, including: (a) all accounts receivable, other receivables, book debts and other forms of obligations (other than forms of obligations
evidenced by Chattel Paper or Instruments) (including any such obligations that may be characterized as an account or contract right under the UCC); (b) all of such Person’s rights in, to and under all purchase orders or receipts for goods
or services; (c) all of such Person’s rights to any goods represented by any of the foregoing (including unpaid sellers’ rights of rescission, replevin, reclamation and stoppage in transit and rights to returned, reclaimed or
repossessed goods); (d) all rights to payment due to such Person for Goods or other property sold, leased, licensed, assigned or otherwise disposed of, for a policy of insurance issued or to be issued, for a secondary obligation incurred or to
be incurred, for energy provided or to be provided, for the use or hire of a vessel under a charter or other contract, arising out of the use of a credit card or charge card, or for services rendered or to be rendered by such Person or in connection
with any other transaction (whether or not yet earned by performance on the part of such Person); and (e) all collateral security of any kind given by any Account Debtor or any other Person with respect to any of the foregoing. 
  
 “Accounts Availability” means the amount of Loans against
Eligible Accounts Laurus may from time to time make available to Company Agent up to eighty-five percent (85%) of the net face amount of Eligible Accounts based on Accounts of the Companies. 
  
 “Affiliate” means, with respect to any Person, (a) any
other Person (other than a Subsidiary) which, directly or indirectly, is in control of, is controlled by, or is under common control with such Person or (b) any other Person who is a director or officer (i) of such Person, (ii) of any
Subsidiary of such Person or (iii) of any Person described in clause (a) above. For the purposes of this definition, control of a Person shall mean the power (direct or indirect) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise. 
  
 “Ancillary Agreements” means the Notes, the Warrants, the Registration Rights Agreements, the McKesson Subordination Agreement, each Security Document and all other agreements, instruments, documents, mortgages, pledges,
powers of attorney, consents, assignments, contracts, notices, security agreements, trust agreements and guarantees whether heretofore, concurrently, or hereafter executed by or on behalf of any Company, any of its Subsidiaries or any other Person
or delivered to Laurus, relating to this Agreement or to the transactions contemplated by this Agreement or otherwise relating to the relationship between or among any Company and Laurus, as each of the same may be amended, supplemented, restated or
otherwise modified from time to time. 
  
 “Balance Sheet
Date” has the meaning given such term in Section 12(f)(ii). 

 “Biovest” means Biovest International, Inc., a Delaware corporation and non-wholly owned
subsidiary of the Parent. 
  
 “Books and Records”
means all books, records, board minutes, contracts, licenses, insurance policies, environmental audits, business plans, files, computer files, computer discs and other data and software storage and media devices, accounting books and records,
financial statements (actual and pro forma), filings with Governmental Authorities and any and all records and instruments relating to the Collateral or otherwise necessary or helpful in the collection thereof or the realization thereupon.

  
 “Business Day” means a day on which Laurus is
open for business and that is not a Saturday, a Sunday or other day on which banks are required or permitted to be closed in the State of New York. 
  
 “Capital Availability Amount” means $5,000,000. 
  

“Charter” has the meaning given such term in Section 12(c)(iv). 
  
 “Chattel Paper” means all “chattel paper,” as such term is defined in the UCC, including
electronic chattel paper, now owned or hereafter acquired by any Person. 
  
 “Closing Date” means the date on which any Company shall first receive proceeds of the initial Loans or the date hereof, if no Loan is made under the facility on the date hereof. 
  
 “Code” has the meaning given such term in
Section 15(i). 
  
 “Collateral” means all of
each Company’s property and assets, whether real or personal, tangible or intangible, and whether now owned or hereafter acquired, or in which it now has or at any time in the future may acquire any right, title or interests including all of
the following property in which it now has or at any time in the future may acquire any right, title or interest: 
  
 (a) all Inventory; 
  
 (b) all Equipment; 
  
 (c) all Fixtures; 
  
 (d) all Goods 
  
 (e) all General Intangibles; 
  
 (f) all Accounts; 
  
 (g) all Deposit Accounts, other bank accounts and all funds on deposit therein; 
  
 (h) all Investment Property; 
  

 2 

 (i) all Stock; 
  

(j) all Chattel Paper; 
  
 (k) all Letter-of-Credit Rights; 
  
 (l) all Instruments; 
  
 (m) all commercial tort claims set forth on Schedule 1(A); 
  

(n) all Books and Records; 
  
 (o) all Intellectual Property; 
  
 (p) all Supporting Obligations including letters of credit and guarantees issued in support of Accounts, Chattel Paper, General Intangibles and Investment
Property; 
  
 (q) (i) all money, cash and cash equivalents
and (ii) all cash held as cash collateral to the extent not otherwise constituting Collateral, all other cash or property at any time on deposit with or held by Laurus for the account of any Company (whether for safekeeping, custody, pledge,
transmission or otherwise); and 
  
 (r) all products and Proceeds
of all or any of the foregoing, tort claims and all claims and other rights to payment including (i) insurance claims against third parties for loss of, damage to, or destruction of, the foregoing Collateral and (ii) payments due or to
become due under leases, rentals and hires of any or all of the foregoing and Proceeds payable under, or unearned premiums with respect to policies of insurance in whatever form. 
  
 “Common Stock” means the shares of stock representing the Parent’s common equity interests.

  
 “Company Agent” means Accentia
Biopharmaceuticals, Inc. 
  
 “Contract Rate” has
the meaning given such term in the respective Note. 
  
 “Default” means any act or event which, with the giving of notice or passage of time or both, would constitute an Event of Default. 
  
 “Deposit Accounts” means all “deposit accounts” as such term is defined in the UCC, now or hereafter held in the name of any
Person, including, without limitation, the Lockboxes. 
  
 “Disclosure Controls” has the meaning given such term in Section 12(f)(iv). 
  
 “Documents” means all “documents”, as such term is defined in the UCC, now owned or hereafter acquired by any Person, wherever
located, including all bills of lading, dock warrants, dock receipts, warehouse receipts, and other documents of title, whether negotiable or non-negotiable. 
  

 3 

 “Eligible Accounts” means each Account of each Company which conforms to the following
criteria: (a) shipment of the merchandise or the rendition of services has been completed; (b) no return, rejection or repossession of the merchandise has occurred; (c) merchandise or services shall not have been rejected or disputed
by the Account Debtor and there shall not have been asserted any offset, defense or counterclaim; (d) continues to be in full conformity with the representations and warranties made by such Company to Laurus with respect thereto;
(e) Laurus is, and continues to be, satisfied with the credit standing of the Account Debtor in relation to the amount of credit extended; (f) there are no facts existing or threatened which are likely to result in any adverse change in an
Account Debtor’s financial condition; (g) is documented by an invoice in a form approved by Laurus and shall not be unpaid more than ninety (90) days from invoice date; (h) not more than twenty-five percent (25%) of the
unpaid amount of invoices due from such Account Debtor, other than from McKesson or Cardinal Health, remains unpaid more than ninety (90) days from invoice date; (i) is not evidenced by chattel paper or an instrument of any kind with
respect to or in payment of the Account unless such instrument is duly endorsed to and in possession of Laurus or represents a check in payment of an Account; (j) the Account Debtor is located in the United States; provided,
however, Laurus may, from time to time, in the exercise of its sole discretion and based upon satisfaction of certain conditions to be determined at such time by Laurus, deem certain Accounts as Eligible Accounts notwithstanding that such
Account is due from an Account Debtor located outside of the United States; (k) Laurus has a first priority perfected Lien in such Account and such Account is not subject to any Lien other than Permitted Liens; (l) does not arise out of
transactions with any employee, officer, director, stockholder or Affiliate of any Company; (m) is payable to such Company; (n) does not arise out of a bill and hold sale prior to shipment and does not arise out of a sale to any Person to
which such Company is indebted; (o) is net of any returns, discounts, claims, credits and allowances; (p) if the Account arises out of contracts between such Company, on the one hand, and the United States, on the other hand, any state, or
any department, agency or instrumentality of any of them, such Company has so notified Laurus, in writing, prior to the creation of such Account, and there has been compliance with any governmental notice or approval requirements, including
compliance with the Federal Assignment of Claims Act; (q) is a good and valid account representing an undisputed bona fide indebtedness incurred by the Account Debtor therein named, for a fixed sum as set forth in the invoice relating thereto
with respect to an unconditional sale and delivery upon the stated terms of goods sold by such Company or work, labor and/or services rendered by such Company; (r) does not arise out of progress billings prior to completion of the order;
(s) the total unpaid Accounts from such Account Debtor, other than from McKesson or Cardinal Health, does not exceed twenty-five percent (25%) of all Eligible Accounts; (t) such Company’s right to payment is absolute and not
contingent upon the fulfillment of any condition whatsoever; (u) such Company is able to bring suit and enforce its remedies against the Account Debtor through judicial process; (v) does not represent interest payments, late or finance
charges owing to such Company, and (w) is otherwise satisfactory to Laurus as determined by Laurus in the exercise of its sole discretion. In the event any Company requests that Laurus include within Eligible Accounts certain Accounts of one or
more of such Company’s acquisition targets, Laurus shall at the time of such request consider such inclusion, but any such inclusion shall be at the sole option of Laurus and shall at all times be subject to the execution and delivery to Laurus
of all such documentation (including, without limitation, guaranty and security documentation) as Laurus may require in its sole discretion. 
  

 4 

 “Eligible Inventory” means Inventory owned by a Company which Laurus, in its sole and
absolute discretion, determines: (a) is subject to a first priority perfected Lien in favor of Laurus and is subject to no other Liens whatsoever (other than Permitted Liens); (b) is located on premises with respect to which Laurus has
received a landlord or mortgagee waiver acceptable in form and substance to Laurus; (c) is not in transit; (d) is in good condition and meets all standards imposed by any governmental agency, or department or division thereof having
regulatory Governmental Authority over such Inventory, its use or sale including the Federal Fair Labor Standards Act of 1938 as amended, and all rules, regulations and orders thereunder; (e) is currently either usable or salable in the normal
course of such Company’s business; (f) is not placed by such Company on consignment or held by such Company on consignment from another Person; (g) is in conformity with the representations and warranties made by such Company to
Laurus with respect thereto; (h) is not subject to any licensing, patent, royalty, trademark, trade name or copyright agreement with any third parties; (i) does not require the consent of any Person for the completion of manufacture, sale
or other disposition of such Inventory and such completion, manufacture or sale does not constitute a breach or default under any contract or agreement to which such Company is a party or to which such Inventory is or may be subject; (j) is not
work-in-process; (k) is covered by casualty insurance acceptable to Laurus and under which Laurus has been named as a lender’s loss payee and additional insured; and (l) not to be ineligible for any other reason. 
  
 “Eligible Subsidiary” means each Subsidiary of the Parent
set forth on Exhibit A hereto, as the same may be updated from time to time with Laurus’ written consent. 
  
 “Eligible Stock” means the shares of common stock of Star Scientific, Inc. pledged by the O’Donnell Trust in support of the
Obligations pursuant to the O’Donnell Stock Pledge Agreement to the extent freely tradeable. 
  
 “Equipment” means all “equipment” as such term is defined in the UCC, now owned or hereafter acquired by any Person, wherever
located, including any and all machinery, apparatus, equipment, fittings, furniture, Fixtures, motor vehicles and other tangible personal property (other than Inventory) of every kind and description that may be now or hereafter used in such
Person’s operations or that are owned by such Person or in which such Person may have an interest, and all parts, accessories and accessions thereto and substitutes and replacements therefor. 
  
 “ERISA” has the meaning given such term in
Section 12(bb). 
  
 “Event of Default” means
the occurrence of any of the events set forth in Section 19. 
  
 “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
  
 “Exchange Act Filings” means the Parent’s filings under the Exchange Act made prior to the date of this Agreement. 
  
 “Existing Credit Agreement” has the meaning given such term
in Section 5(b)(vii). 
  

 5 

 “Financial Reporting Controls” has the meaning given such term in Section 12(f)(v).

  
 “Financial Statements” has the meaning given
such term in Section 12(u). 
  
 “Fixtures”
means all “fixtures” as such term is defined in the UCC, now owned or hereafter acquired by any Person. 
  
 “Formula Amount” has the meaning given such term in Section 2(a)(i). 
  
 “GAAP” means generally accepted accounting principles, practices and procedures in effect from time to time
in the United States of America. 
  
 “General
Intangibles” means all “general intangibles” as such term is defined in the UCC, now owned or hereafter acquired by any Person including all right, title and interest that such Person may now or hereafter have in or under any
contract, all Payment Intangibles, customer lists, Licenses, Intellectual Property, interests in partnerships, joint ventures and other business associations, permits, proprietary or confidential information, inventions (whether or not patented or
patentable), technical information, procedures, designs, knowledge, know-how, Software, data bases, data, skill, expertise, experience, processes, models, drawings, materials, Books and Records, Goodwill (including the Goodwill associated with any
Intellectual Property), all rights and claims in or under insurance policies (including insurance for fire, damage, loss, and casualty, whether covering personal property, real property, tangible rights or intangible rights, all liability, life,
key-person, and business interruption insurance, and all unearned premiums), uncertificated securities, choses in action, deposit accounts, rights to receive tax refunds and other payments, rights to received dividends, distributions, cash,
Instruments and other property in respect of or in exchange for pledged Stock and Investment Property, and rights of indemnification. 
  
 “Goods” means all “goods”, as such term is defined in the UCC, now owned or hereafter acquired by any Person, wherever located,
including embedded software to the extent included in “goods” as defined in the UCC, manufactured homes, standing timber that is cut and removed for sale and unborn young of animals. 
  
 “Goodwill” means all goodwill, trade secrets, proprietary or
confidential information, technical information, procedures, formulae, quality control standards, designs, operating and training manuals, customer lists, and distribution agreements now owned or hereafter acquired by any Person. 
  
 “Governmental Authority” means any nation or government, any
state or other political subdivision thereof, and any agency, department or other entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government. 
  
 “Harbinger” means Harbinger Mezzanine Partners, L.P., a
Delaware limited partnership. 
  

 6 

 “Harbinger Debt Documentation” shall mean the Loan Agreement, dated as of August 9,
2002 between Harbinger and TEAMM and each other document entered into in connection therewith (each as amended, modified and/or supplemented from time to time). 
  

“IMOR-Analytica” means IMOR-Analytica GmbH, a corporation organized under the laws of Germany and wholly-owned subsidiary of The
Analytica Group, Inc., a wholly-owned subsidiary of the Parent. 
  
 “Initial Public Offering” means the underwritten public sale of shares of Common Stock pursuant to a registration statement declared effective by the SEC resulting in the receipt by the Parent of net cash proceeds
(calculated before underwriting discounts and commissions) of no less than $30,000,000. 
  
 “Instruments” means all “instruments”, as such term is defined in the UCC, now owned or hereafter acquired by any Person, wherever located, including all certificated securities and all
promissory notes and other evidences of indebtedness, other than instruments that constitute, or are a part of a group of writings that constitute, Chattel Paper. 
  
 “Intellectual Property” means any and all patents, trademarks, service marks, trade names, copyrights,
trade secrets, Licenses, information and other proprietary rights and processes. 
  
 “Inventory” means all “inventory”, as such term is defined in the UCC, now owned or hereafter acquired by any Person, wherever located, including all inventory, merchandise, goods and other
personal property that are held by or on behalf of such Person for sale or lease or are furnished or are to be furnished under a contract of service or that constitute raw materials, work in process, finished goods, returned goods, or materials or
supplies of any kind, nature or description used or consumed or to be used or consumed in such Person’s business or in the processing, production, packaging, promotion, delivery or shipping of the same, including all supplies and embedded
software. 
  
 “Inventory Availability” means the
amount of Loans against Eligible Inventory Laurus may from time to time make available to Companies up to the lesser of (a) fifty percent (50%) of the value of Companies’ Eligible Inventory (calculated on the basis of the lower of
cost or market, on a first-in first-out basis) and (b) $750,000. 
  
 “Investment Property” means all “investment property”, as such term is defined in the UCC, now owned or hereafter acquired by any Person, wherever located. 
  
 “Letter-of-Credit Rights” means “letter-of-credit
rights” as such term is defined in the UCC, now owned or hereafter acquired by any Person, including rights to payment or performance under a letter of credit, whether or not such Person, as beneficiary, has demanded or is entitled to demand
payment or performance. 
  
 “License” means any
rights under any written agreement now or hereafter acquired by any Person to use any trademark, trademark registration, copyright, copyright registration or invention for which a patent is in existence or other license of rights or interests now
held or hereafter acquired by any Person. 
  

 7 

 “Lien” means any mortgage, security deed, deed of trust, pledge, hypothecation,
assignment, security interest, lien (whether statutory or otherwise), charge, claim or encumbrance, or preference, priority or other security agreement or preferential arrangement held or asserted in respect of any asset of any kind or nature
whatsoever including any conditional sale or other title retention agreement, any lease having substantially the same economic effect as any of the foregoing, and the filing of, or agreement to give, any financing statement under the UCC or
comparable law of any jurisdiction. 
  
 “Loans”
has the meaning given such term in Section 2(a)(i) and shall include all other extensions of credit hereunder and under any Ancillary Agreement. 
  
 “Lockboxes” has the meaning given such term in Section 8(a). 
  
 “Material Adverse Effect” means a material adverse effect on (a) the business, assets, liabilities,
condition (financial or otherwise), properties, operations or prospects of any Company or any of its Subsidiaries (taken individually and as a whole), (b) any Company’s or any of its Subsidiary’s ability to pay or perform the
Obligations in accordance with the terms hereof or any Ancillary Agreement, (c) the value of the Collateral, the Liens on the Collateral or the priority of any such Lien or (d) the practical realization of the benefits of Laurus’
rights and remedies under this Agreement and the Ancillary Agreements. 
  
 “McKesson” means the McKesson Corporation, a Delaware corporation. 
  
 “McKesson Restructuring Agreement” shall mean the agreement dated as of February 9, 2005 between the Parent and McKesson addressing the (i) repayment of all obligations owing to McKesson,
(ii) the termination of the Biologics Distribution Agreement, dated as of February 27, 2004 between the Parent and McKesson (the “BD Agreement”) and settle the $3,000,000 deposit (the “McKesson Deposit”)
held by the Parent in connection the BD Agreement and (iii) redemption and/or repurchase of all shares of the Parent’s Series E preferred stock held by McKesson at the time of such redemption/repurchase. 
  
 “McKesson Restructuring Payment” shall mean the maximum
amount required to be paid pursuant to the terms of the McKesson Restructuring Agreement to (i) repay all indebtedness owed by the Parent and its Subsidiaries to McKesson, (ii) terminate the BD Agreement and settle the McKesson Deposit and
(iii) redeem and/or repurchase all shares of the Parent’s Series E preferred stock held by McKesson at the time of such redemption/ repurchase, which amount shall not exceed $14,200,000. 
  
 “McKesson Subordination Agreement” has the meaning given
such term in Section 5(b)(vi). 
  
 “Minimum Borrowing
Note” means that certain Secured Convertible Minimum Borrowing Note dated as of the Closing Date made by the Companies in favor of Laurus in the original principal amount of $2,500,000, as the same may be amended and restated, further
amended, supplemented, restated and/or otherwise modified from time to time. 
  
 “MSB” has the meaning given such term in Section 5(b)(vii). 
  

 8 

 “NASD” has the meaning given such term in Section 13(b). 
  
 “Note Shares” has the meaning given such term in
Section 12(a). 
  
 “Notes” means the Minimum
Borrowing Note and the Revolving Note made by Companies in favor of Laurus in connection with the transactions contemplated hereby, as each of the same may be amended, supplemented, restated and/or otherwise modified from time to time. 

 
 “Obligations” means all Loans, all advances, debts,
liabilities, obligations, covenants and duties owing by each Company and each of its Subsidiaries to Laurus (or any corporation that directly or indirectly controls or is controlled by or is under common control with Laurus) of every kind and
description (whether or not evidenced by any note or other instrument and whether or not for the payment of money or the performance or non-performance of any act), direct or indirect, absolute or contingent, due or to become due, contractual or
tortious, liquidated or unliquidated, whether existing by operation of law or otherwise now existing or hereafter arising including any debt, liability or obligation owing from any Company and/or each of its Subsidiaries to others which Laurus may
have obtained by assignment or otherwise and further including all interest (including interest accruing at the then applicable rate provided in this Agreement after the maturity of the Loans and interest accruing at the then applicable rate
provided in this Agreement after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, whether or not a claim for post-filing or post-petition interest is allowed or allowable in such
proceeding), charges or any other payments each Company and each of its Subsidiaries is required to make by law or otherwise arising under or as a result of this Agreement, the Ancillary Agreements or otherwise, together with all reasonable expenses
and reasonable attorneys’ fees chargeable to the Companies’ or any of their Subsidiaries’ accounts or incurred by Laurus in connection therewith. 
  

“O’Donnell Stock Pledge Agreement” has the meaning given such term in Section 5(b)(vi). 
  
 “O’Donnell Trust” has the meaning given such term in
Section 5(b)(vi). 
  
 “Payment Intangibles”
means all “payment intangibles” as such term is defined in the UCC, now owned or hereafter acquired by any Person, including, a General Intangible under which the Account Debtor’s principal obligation is a monetary obligation.

  
 “Permitted Liens” means (a) Liens of
carriers, warehousemen, artisans, bailees, mechanics and materialmen incurred in the ordinary course of business securing sums not overdue; (b) Liens incurred in the ordinary course of business in connection with worker’s compensation,
unemployment insurance or other forms of governmental insurance or benefits, relating to employees, securing sums (i) not overdue or (ii) being diligently contested in good faith provided that adequate reserves with respect thereto are
maintained on the books of the Companies and their Subsidiaries, as applicable, in conformity with GAAP; (c) Liens in favor of Laurus; (d) Liens for taxes (i) not yet due or (ii) being diligently contested in good faith by
appropriate proceedings, provided that adequate reserves with respect thereto are maintained on the books of the Companies and their Subsidiaries, as applicable, in conformity with GAAP; and 

  

 9 

 
which have no effect on the priority of Liens in favor of Laurus or the value of the assets in which Laurus has a Lien; (e) Purchase Money Liens
securing Purchase Money Indebtedness to the extent permitted in this Agreement and (f) Liens specified on Schedule 2 hereto. 
  
 “Person” means any individual, sole proprietorship, partnership, limited liability partnership, joint venture, trust, unincorporated
organization, association, corporation, limited liability company, institution, public benefit corporation, entity or government (whether federal, state, county, city, municipal or otherwise, including any instrumentality, division, agency, body or
department thereof), and shall include such Person’s successors and assigns. 
  
 “Principal Market” means the NASD Over The Counter Bulletin Board, NASDAQ SmallCap Market, NASDAQ National Market System, American Stock Exchange or New York Stock Exchange (whichever of the foregoing
is at the time the principal trading exchange or market for the Common Stock). 
  
 “Proceeds” means “proceeds”, as such term is defined in the UCC and, in any event, shall include: (a) any and all proceeds of any insurance, indemnity, warranty or guaranty payable to
any Company or any other Person from time to time with respect to any Collateral; (b) any and all payments (in any form whatsoever) made or due and payable to any Company from time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of any Collateral by any governmental body, governmental authority, bureau or agency (or any person acting under color of governmental authority); (c) any claim of any Company against third parties
(i) for past, present or future infringement of any Intellectual Property or (ii) for past, present or future infringement or dilution of any trademark or trademark license or for injury to the goodwill associated with any trademark,
trademark registration or trademark licensed under any trademark License; (d) any recoveries by any Company against third parties with respect to any litigation or dispute concerning any Collateral, including claims arising out of the loss or
nonconformity of, interference with the use of, defects in, or infringement of rights in, or damage to, Collateral; (e) all amounts collected on, or distributed on account of, other Collateral, including dividends, interest, distributions and
Instruments with respect to Investment Property and pledged Stock; and (f) any and all other amounts, rights to payment or other property acquired upon the sale, lease, license, exchange or other disposition of Collateral and all rights arising
out of Collateral. 
  
 “Purchase Money
Indebtedness” means (a) any indebtedness incurred for the payment of all or any part of the purchase price of any fixed asset, including indebtedness under capitalized leases, (b) any indebtedness incurred for the sole purpose of
financing or refinancing all or any part of the purchase price of any fixed asset, and (c) any renewals, extensions or refinancings thereof (but not any increases in the principal amounts thereof outstanding at that time). 
  
 “Purchase Money Lien” means any Lien upon any fixed assets
that secures the Purchase Money Indebtedness related thereto but only if such Lien shall at all times be confined solely to the asset the purchase price of which was financed or refinanced through the incurrence of the Purchase Money Indebtedness
secured by such Lien and only if such Lien secures only such Purchase Money Indebtedness. 
  

 10 

 “Registration Rights Agreements” means that certain Minimum Borrowing Note Registration
Rights Agreement dated as of the Closing Date by and between the Parent and Laurus and each other registration rights agreement by and between the Parent and Laurus, as each of the same may be amended, modified and supplemented from time to time.

  
 “Revolving Note” means that certain Amended
and Restated Secured Non-Convertible Revolving Note dated as of the Closing Date made by the Companies in favor of Laurus in the original principal amount of $5,000,000, without duplication of amounts outstanding under the Minimum Borrowing Note, as
the same may be amended and restated, further amended, supplemented and/or otherwise modified from time to time. 
  
 “SEC” means the Securities and Exchange Commission. 
  
 “Securities” means the Notes and the Warrants and the shares of Common Stock which may be issued pursuant
to conversion of the Minimum Borrowing Note in whole or in part or exercise of such Warrants. 
  
 “Securities Act” has the meaning given such term in Section 12(r). 
  
 “Securities Act Filings” means the Parent’s filings under the Securities Act made prior to the date of this Agreement. 

 
 “Securities Purchase Agreement” has the meaning provided
in Section 5(b)(iv). 
  
 “Security
Documents” means all security agreements, mortgages, cash collateral deposit letters, pledges and other agreements which are executed by any Company, any of its Subsidiaries or the O’Donnell Trust in favor of Laurus. 
  
 “Software” means all “software” as such term is
defined in the UCC, now owned or hereafter acquired by any Person, including all computer programs and all supporting information provided in connection with a transaction related to any program. 
  
 “Stock” means all certificated and uncertificated shares,
options, warrants, membership interests, general or limited partnership interests, participation or other equivalents (regardless of how designated) of or in a corporation, partnership, limited liability company or equivalent entity whether voting
or nonvoting, including common stock, preferred stock, or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the SEC under the Securities Exchange Act of 1934).

  
 “Stock Availability” means the amount of
Loans against Eligible Stock that Laurus may from time to time make available to the Companies up to fifty percent (50%) of the value of the O’Donnell Trust’s Eligible Stock as determined by reference at such time to the most recent
closing market price of the Eligible Stock on the NASDAQ National Market as reported by Bloomberg, L.P. 
  
 “Subordinated Debt Documentation” means, collectively, the “Accentia Assumption of Debt and Security Agreement” dated as of
December 31, 2003 between the Parent, certain of its Subsidiaries and McKesson, together with all other documentation entered into in connection therewith or related thereto, each as amended, modified, restated and/or supplemented from time to
time. 
  

 11 

 “Subsidiary” means, with respect to any Person, (i) any other Person whose shares
of stock or other ownership interests having ordinary voting power (other than stock or other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the directors or other governing body of
such other Person, are owned, directly or indirectly, by such Person or (ii) any other Person in which such Person owns, directly or indirectly, more than 50% of the equity interests at such time; provided that (x) for so long as each of
Accent RX, Inc., a Florida corporation ( “Accent”) and Biovax, Inc, a Delaware corporation (“Biovax” and, together with Accent, the “Inactive Subsidiaries” and each an “Inactive
Subsidiary”) holds no significant assets or liabilities and does not engage in any business activities, the defined term “Subsidiary” as used in this Agreement and the Ancillary Agreements shall not include such Inactive
Subsidiary; (it being understood and agreed that if such Inactive Subsidiary shall at any time after the date hereof hold significant assets or liabilities or engage in any business activities, such Inactive Subsidiary shall thereafter be deemed a
Subsidiary hereunder and shall otherwise be subject to all terms, agreements, representations, warranties and covenants otherwise applicable to Subsidiaries under this Agreement and the Ancillary Agreements) and (y) the defined term
“Subsidiary” as used in this Agreement and the Ancillary Agreements shall not include each of Biovest and IMOR-Analytica. 
  
 “Supporting Obligations” means all “supporting obligations” as such term is defined in the UCC. 
  
 “TEAMM” means TEAMM Pharmaceuticals, Inc., a Florida
corporation and wholly-owned subsidiary of the Parent. 
  
 “Term” means the Closing Date through the close of business on the day immediately preceding the third anniversary of the Closing Date, subject to acceleration at the option of Laurus upon the occurrence of an Event of
Default hereunder or other termination hereunder. 
  
 “UCC” means the Uniform Commercial Code as the same may, from time to time be in effect in the State of New York; provided, that in the event that, by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of, or remedies with respect to, Laurus’ Lien on any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, the term “UCC” shall mean the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the provisions of this Agreement relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions; provided further, that
to the extent that UCC is used to define any term herein or in any Ancillary Agreement and such term is defined differently in different Articles or Divisions of the UCC, the definition of such term contained in Article or Division 9 shall govern.

  
 “Warrant Shares” has the meaning given such
term in Section 12(a). 
  

 12 

 “Warrants” means that certain Common Stock Purchase Warrant dated as of the Closing Date
made by the Parent in favor of Laurus and each other warrant made by the Parent in favor Laurus, as each of the same may be amended, restated, modified and/or supplemented from time to time. 
  

 13 

 Exhibit A 
  

Eligible Subsidiaries 
  
 The Analytica Group, Inc. 

 Exhibit B 
  

Borrowing Base Certificate 
  
 [To be inserted]Amended and Restated Reistration Rights Agreement (Laurus) February 13, 2006)

 Exhibit 10.5 
  
 AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT 
  
 This Amended and Restated Registration Rights Agreement (this “Agreement”) is made and entered into as of
April 29, 2005, and amended and restated as of February 13, 2006, by and between Accentia Biopharmaceuticals, Inc., a Florida corporation (the “Company”), and Laurus Master Fund, Ltd. (the “Purchaser”). 
  
 This Agreement is made pursuant to (i) the Securities Purchase
Agreement, dated as of the date hereof, by and between the Purchaser and the Company (as amended, modified and/or supplemented from time to time, the “Securities Purchase Agreement”), and pursuant to the Note and the Warrants referred to
therein and (ii) the Security Agreement, dated as of the date hereof, by and among the Purchaser, the Company and various subsidiaries of the Company (as amended, modified or supplemented from time to time, the “Security Agreement”),
and pursuant to the Notes and the Warrants referred to therein. 
  
 The Company and the Purchaser hereby agree as follows: 
  
 1. Definitions. Capitalized terms used and not otherwise defined herein that are defined in the Securities Purchase Agreement or the Security Agreement, as applicable, shall have the meanings given such terms in the Securities
Purchase Agreement or the Security Agreement, as applicable. As used in this Agreement, the following terms shall have the following meanings: 
  
 “Amendment Date” shall have the same meaning ascribed to the term “Amendment Effective Date” in Section 3 of the Second
Omnibus Amendment and Waiver, dated as of February 13, 2006 amongst the Company, Analytica and the Purchaser. 
  
 “Analytica” shall mean The Analytica Group, Inc., a Florida corporation. 
  
 “Commission” means the Securities and Exchange Commission. 
  
 “Common Stock” means shares of the Company’s common
stock, par value $0.001 per share. 
  
 “Effectiveness
Date” means, (i) with respect to the initial Registration Statement required to be filed in connection with the Note, the Minimum Borrowing Note, and the Warrants, a date no later than April 28, 2006 and (ii) with respect to
each additional Registration Statement required to be filed hereunder, a date no later than thirty (30) days following the applicable Filing Date. 
  
 “Effectiveness Period” has the meaning set forth in Section 2(a). 
  
 “Exchange Act” means the Securities Exchange Act of 1934, as amended, and any successor statute.

  

			
	 A&R Registration Rights Agreement
	  	 

 “Filing Date” means, with respect to (1) the initial Registration Statement which
is required to be filed in connection with the shares of Common Stock issuable upon (A) conversion of the Note, (B) conversion of the Minimum Borrowing Note and (C) exercise of all Warrants issued on or prior to the Amendment Date, a
date no later than February 28, 2006, (2) the Registration Statement required to be filed in connection with the shares of Common Stock issuable to the Holder upon exercise of a Warrant issued after the Amendment Date, the date which is
thirty (30) days after the issuance of such Warrant and (4) the Registration Statement required to be filed in connection with the shares of Common Stock issuable to the Holder as a result of adjustments to the Fixed Conversion Price (as
defined in each of the Note and the Minimum Borrowing Note, as applicable) or the Exercise Price (as defined in the Warrants), as the case may be, thirty (30) days after the occurrence of such event or the date of the adjustment of the Fixed
Conversion Price or Exercise Price, as the case may be. 
  
 “Holder” or “Holders” means the Purchaser or any of its affiliates or transferees to the extent any of them hold Registrable Securities, other then those purchasing Registrable Securities in a market
transaction. 
  
 “Indemnified Party” has the
meaning set forth in Section 5(c). 
  
 “Indemnifying
Party” has the meaning set forth in Section 5(c). 
  
 “Minimum Borrowing Note” shall mean the Second Amended and Restated Secured Convertible Minimum Borrowing Note, initially issued by the Company and The Analytica Group, Inc. to the Purchaser on April 29, 2005 and
amended and restated as of August 16, 2005 and February 13, 2006, in the original principal amount of Five Million Dollars ($5,000,000), as amended and restated, further amended, modified and/or supplemented from time to time. 

 
 “Note” shall mean the Second Amended and Restated Secured
Convertible Term Note, initially issued by the Company to the Purchaser on April 29, 2005 and amended and restated as of August 16, 2005 and February 13, 2006, in the original principal amount of Ten Million Dollars ($10,000,000), as
amended and restated, further amended, modified and/or supplemented from time to time. 
  
 “Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an investigation or partial proceeding, such as a deposition), whether commenced or threatened.

  
 “Prospectus” means the prospectus included in
a Registration Statement (including, without limitation, a prospectus that includes any information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated under the Securities
Act), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities covered by such Registration Statement, and all other amendments and supplements to the Prospectus,
including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus. 
  

			
	 A&R Registration Rights Agreement
	  	2

 “Registrable Securities” means the shares of Common Stock issued upon the conversion of
the Note (as defined in the Securities Purchase Agreement), the Minimum Borrowing Note (as defined in the Security Agreement) and issuable upon exercise of the Warrants. 
  
 “Registration Statement” means each registration statement required to be filed hereunder, including the
Prospectus therein, amendments and supplements to such registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated by reference or deemed to be incorporated by reference in
such registration statement. 
  
 “Rule 144” means
Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

  
 “Rule 415” means Rule 415 promulgated by the
Commission pursuant to the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule. 
  
 “Securities Act” means the Securities Act of 1933, as
amended, and any successor statute. 
  
 “Securities
Purchase Agreement” has the meaning given to such term in the Preamble hereto. 
  
 “Security Agreement” has the meaning given to such term in the Preamble hereto. 
  
 “Trading Market” means any of the NASD Over The Counter Bulletin Board, NASDAQ SmallCap Market, the NASDAQ National Market, the American
Stock Exchange or the New York Stock Exchange 
  
 “Warrants” shall mean (i) the Amended and Restated Common Stock Purchase Warrant, issued on April 29, 2005 and amended and restated as of August 16, 2005 and February 13, 2006, by the Company to the
Purchaser, (ii) the Common Stock Purchase Warrant, issued on August 16, 2005 by the Company to the Purchaser and (iii) Common Stock purchase warrants issued in connection with the Securities Purchase Agreement and/or Security
Agreement, after the Amendment Date, each as amended, modified and/or supplemented from time to time. 
  
 2. Registration. 
  
 (a) On or prior to each Filing Date, the Company shall prepare and file with the Commission a Registration Statement covering the Registrable Securities
for a selling stockholder resale offering to be made on a continuous basis pursuant to Rule 415. Each Registration Statement shall be on Form S-3 (except if the Company is not then eligible to register for resale the Registrable Securities on Form
S-3, in which case such registration shall be on another appropriate form in accordance herewith). The Company shall (i) with respect to the Registration Statement required to be filed in connection with the Note, the Minimum Borrowing Note,
and the Warrants, use its best efforts to cause such Registration Statement to become 

  

			
	 A&R Registration Rights Agreement
	  	3

 
effective as provided herein; provided that, such Registration Statement shall be required to remain effective as provided herein notwithstanding the use of
best efforts by the Company and (ii) in respect of each other Registration Statement, cause each such Registration Statement to become effective and remain effective as provided herein notwithstanding the use of best efforts by the Company. The
Company shall use its reasonable commercial efforts to cause each Registration Statement to be declared effective under the Securities Act as promptly as possible after the filing thereof, but in any event no later than the Effectiveness Date. The
Company shall use its reasonable commercial efforts to keep each Registration Statement continuously effective under the Securities Act until the date which is the earlier date of when (i) all Registrable Securities covered by such Registration
Statement have been sold or (ii) all Registrable Securities covered by such Registration Statement may be sold immediately without registration under the Securities Act and without volume restrictions pursuant to Rule 144(k), as determined by
the counsel to the Company pursuant to a written opinion letter to such effect, addressed and acceptable to the Company’s transfer agent and the affected Holders (each, an “Effectiveness Period”). 
  
 (b) Within three business days of the Effectiveness Date, the Company shall
cause its counsel to issue a blanket opinion in the form attached hereto as Exhibit A, to the transfer agent stating that the shares are subject to an effective registration statement and can be reissued free of restrictive legend upon notice of a
sale by the Purchaser and confirmation by the Purchaser that it has complied with the prospectus delivery requirements, provided that the Company has not advised the transfer agent orally or in writing that the opinion has been withdrawn. Copies of
the blanket opinion required by this Section 2(b) shall be delivered to the Purchaser within the time frame set forth above. 
  
 3. Registration Procedures. If and whenever the Company is required by the provisions hereof to effect the registration of any Registrable
Securities under the Securities Act, the Company will, as expeditiously as possible: 
  
 (a) prepare and file with the Commission a Registration Statement with respect to such Registrable Securities, respond as promptly as possible to any comments received from the Commission, and use its best efforts to
cause such Registration Statement to become and remain effective for the Effectiveness Period with respect thereto, and promptly provide to the Purchaser copies of all filings and Commission letters of comment relating thereto; 
  
 (b) prepare and file with the Commission such amendments and supplements to
such Registration Statement and the Prospectus used in connection therewith as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities covered by such Registration Statement
and to keep such Registration Statement effective until the expiration of the Effectiveness Period applicable to such Registration Statement; 
  
 (c) furnish to the Purchaser such number of copies of the Registration Statement and the Prospectus included therein (including each preliminary
Prospectus) as the Purchaser reasonably may request to facilitate the public sale or disposition of the Registrable Securities covered by such Registration Statement; 
  

			
	 A&R Registration Rights Agreement
	  	4

 (d) use its best efforts to register or qualify the Purchaser’s Registrable Securities covered by
such Registration Statement under the securities or “blue sky” laws of such jurisdictions within the United States as the Purchaser may reasonably request, provided, however, that the Company shall not for any such purpose be required to
qualify generally to transact business as a foreign corporation in any jurisdiction where it is not so qualified or to consent to general service of process in any such jurisdiction; 
  
 (e) list the Registrable Securities covered by such Registration Statement with any securities exchange on which the Common
Stock of the Company is then listed; 
  
 (f) immediately notify
the Purchaser at any time when a Prospectus relating thereto is required to be delivered under the Securities Act, of the happening of any event of which the Company has knowledge as a result of which the Prospectus contained in such Registration
Statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing; and

  
 (g) make available for inspection by the Purchaser and any
attorney, accountant or other agent retained by the Purchaser, all publicly available, non-confidential financial and other records, pertinent corporate documents and properties of the Company, and cause the Company’s officers, directors and
employees to supply all publicly available, non-confidential information reasonably requested by the attorney, accountant or agent of the Purchaser. 
  
 4. Registration Expenses. All expenses relating to the Company’s compliance with Sections 2 and 3 hereof, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of counsel and independent public accountants for the Company, fees and expenses (including reasonable counsel fees) incurred in connection with complying with state securities
or “blue sky” laws, fees of the NASD, transfer taxes, fees of transfer agents and registrars, fees of, and disbursements incurred by, one counsel for the Holders are called “Registration Expenses”. All selling commissions
applicable to the sale of Registrable Securities, including any fees and disbursements of any special counsel to the Holders beyond those included in Registration Expenses, are called “Selling Expenses.” The Company shall only be
responsible for all Registration Expenses. 
  
 5.
Indemnification. 
  
 (a) In the event of a registration of
any Registrable Securities under the Securities Act pursuant to this Agreement, the Company will indemnify and hold harmless each Holder, and its officers, directors and each other person, if any, who controls such Holder within the meaning of the
Securities Act, against any losses, claims, damages or liabilities, joint or several, to which such Holder, or such persons may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in any Registration Statement under which such Registrable Securities were registered under the Securities Act
pursuant to this Agreement, any preliminary Prospectus or final Prospectus contained therein, or any amendment or supplement thereof, or arise out of or 

  

			
	 A&R Registration Rights Agreement
	  	5

 
are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein
not misleading, and will reimburse such Holder, and each such person for any reasonable legal or other expenses incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided,
however, that the Company will not be liable in any such case if and to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission
so made in conformity with information furnished by or on behalf of the Purchaser or any such person in writing specifically for use in any such document. 
  
 (b) In the event of a registration of the Registrable Securities under the Securities Act pursuant to this Agreement, the Purchaser will indemnify and
hold harmless the Company, and its officers, directors and each other person, if any, who controls the Company within the meaning of the Securities Act, against all losses, claims, damages or liabilities, joint or several, to which the Company or
such persons may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any
material fact which was furnished in writing by the Purchaser to the Company expressly for use in (and such information is contained in) the Registration Statement under which such Registrable Securities were registered under the Securities Act
pursuant to this Agreement, any preliminary Prospectus or final Prospectus contained therein, or any amendment or supplement thereof, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and will reimburse the Company and each such person for any reasonable legal or other expenses incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action, provided, however, that the Purchaser will be liable in any such case if and only to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission so made in conformity with information furnished in writing to the Company by or on behalf of the Purchaser specifically for use in any such document. Notwithstanding the provisions of this
paragraph, the Purchaser shall not be required to indemnify any person or entity in excess of the amount of the aggregate net proceeds received by the Purchaser in respect of Registrable Securities in connection with any such registration under the
Securities Act. 
  
 (c) Promptly after receipt by a party entitled
to claim indemnification hereunder (an “Indemnified Party”) of notice of the commencement of any action, such Indemnified Party shall, if a claim for indemnification in respect thereof is to be made against a party hereto obligated to
indemnify such Indemnified Party (an “Indemnifying Party”), notify the Indemnifying Party in writing thereof, but the omission so to notify the Indemnifying Party shall not relieve it from any liability which it may have to such
Indemnified Party other than under this Section 5(c) and shall only relieve it from any liability which it may have to such Indemnified Party under this Section 5(c) if and to the extent the Indemnifying Party is prejudiced by such
omission. In case any such action shall be brought against any Indemnified Party and it shall notify the Indemnifying Party of the commencement thereof, the Indemnifying Party shall be entitled to participate in and, to the extent it shall wish, to
assume and undertake the defense thereof with counsel satisfactory to such Indemnified Party, and, after notice from the Indemnifying Party to such Indemnified Party of its election so to assume and undertake the 

  

			
	 A&R Registration Rights Agreement
	  	6

 
defense thereof, the Indemnifying Party shall not be liable to such Indemnified Party under this Section 5(c) for any legal expenses subsequently
incurred by such Indemnified Party in connection with the defense thereof; if the Indemnified Party retains its own counsel, then the Indemnified Party shall pay all fees, costs and expenses of such counsel, provided, however, that, if
the defendants in any such action include both the Indemnified Party and the Indemnifying Party and the Indemnified Party shall have reasonably concluded that there may be reasonable defenses available to it which are different from or additional to
those available to the Indemnifying Party or if the interests of the Indemnified Party reasonably may be deemed to conflict with the interests of the Indemnifying Party, the Indemnified Party shall have the right to select one separate counsel and
to assume such legal defenses and otherwise to participate in the defense of such action, with the reasonable expenses and fees of such separate counsel and other expenses related to such participation to be reimbursed by the Indemnifying Party as
incurred. 
  
 (d) In order to provide for just and equitable
contribution in the event of joint liability under the Securities Act in any case in which either (i) the Purchaser, or any officer, director or controlling person of the Purchaser, makes a claim for indemnification pursuant to this
Section 5 but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Section 5 provides for indemnification in such case, or (ii) contribution under the Securities Act may be required on the part of the Purchaser or such officer, director or
controlling person of the Purchaser in circumstances for which indemnification is provided under this Section 5; then, and in each such case, the Company and the Purchaser will contribute to the aggregate losses, claims, damages or liabilities
to which they may be subject (after contribution from others) in such proportion so that the Purchaser is responsible only for the portion represented by the percentage that the public offering price of its securities offered by the Registration
Statement bears to the public offering price of all securities offered by such Registration Statement, provided, however, that, in any such case, (A) the Purchaser will not be required to contribute any amount in excess of the
public offering price of all such securities offered by it pursuant to such Registration Statement; and (B) no person or entity guilty of fraudulent misrepresentation (within the meaning of Section 10(f) of the Act) will be entitled to
contribution from any person or entity who was not guilty of such fraudulent misrepresentation. 
  
 6. Representations and Warranties. 
  
 (a) Upon consummation of the Initial Public Offering, the Common Stock shall be registered pursuant to Section 12(b) or 12(g) of the Exchange Act
and, except with respect to certain matters which the Company has disclosed to the Purchaser on Schedule 12(u) to the Security Agreement, the Company shall timely filed all proxy statements, reports, schedules, forms, statements and other
documents required to be filed by it under the Exchange Act. The Company has furnished the Purchaser with copies of: (i) its annual audited financial statements for its fiscal year ended September 30, 2004; and (ii) its quarterly
unaudited financial statements for its fiscal quarter ended December 31, 2004 (collectively, the “Financial Statements”). Each Financial Statement was, at the time of its filing, in substantial compliance with the requirements
of its respective form and none of the Financial Statements (and the notes thereto), as of their respective filing dates, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or
necessary to make the statements 

  

			
	 A&R Registration Rights Agreement
	  	7

 
therein, in light of the circumstances under which they were made, not misleading. The Financial Statements comply as to form in all material respects with
applicable accounting requirements and the published rules and regulations of the Commission or other applicable rules and regulations with respect thereto. Such Financial Statements have been prepared in accordance with generally accepted
accounting principles (“GAAP”) applied on a consistent basis during the periods involved (except (i) as may be otherwise indicated in such Financial Statements or the notes thereto or (ii) in the case of unaudited interim
statements, to the extent they may not include footnotes or may be condensed) and fairly present in all material respects the financial condition, the results of operations and the cash flows of the Company and its subsidiaries, on a consolidated
basis, as of, and for, the periods presented in each such Financial Statement. 
  
 (b) The Company has prepared in all material respects the listing application in respect of its Common Stock to be, upon consummation of the Initial Public Offering, listed on the NASDAQ National Market and the
Company reasonably believes that it and such listing application shall satisfy all requirements for such listing on the NASDAQ National Market, and once listed on the NASDAQ National Market, the Company shall do all things necessary for the
continuation of such listing. The Company has not received any notice that its Common Stock will not be listed on the NASDAQ National Market upon consummation of the Initial Public Offering or that its Common Stock shall not meet all requirements
for such listing. 
  
 (c) Neither the Company, nor any of its
affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales of any security or solicited any offers to buy any security (other than an offering to the Holder under the Securities Purchase Agreement)
under circumstances that would cause the offering of the Securities pursuant to the Security Agreement to be integrated with prior offerings by the Company for purposes of the Securities Act which would prevent the Company from selling the Common
Stock pursuant to Rule 506 under the Securities Act, or any applicable exchange-related stockholder approval provisions, nor will the Company or any of its affiliates or subsidiaries take any action or steps that would cause the offering of the
Common Stock to be integrated with other offerings (other than such concurrent offering to the Purchaser). 
  
 (d) The Warrants, the Notes and the shares of Common Stock which the Purchaser may acquire pursuant to the Warrants and the Notes are all restricted
securities under the Securities Act as of the date of this Agreement. The Company will not issue any stop transfer order or other order impeding the sale and delivery of any of the Registrable Securities at such time as such Registrable Securities
are registered for public sale or an exemption from registration is available, except as required by federal or state securities laws. 
  
 (e) The Company understands the nature of the Registrable Securities issuable upon the conversion of each Note and the exercise of each Warrant and
recognizes that the issuance of such Registrable Securities may have a potential dilutive effect. The Company specifically acknowledges that its obligation to issue the Registrable Securities is binding upon the Company and enforceable regardless of
the dilution such issuance may have on the ownership interests of other shareholders of the Company. 
  

			
	 A&R Registration Rights Agreement
	  	8

 (f) Except for agreements made in the ordinary course of business, there is no agreement that has not
been filed with the Commission as an exhibit to a registration statement or to a form required to be filed by the Company under the Exchange Act, the breach of which could reasonably be expected to have a Material Adverse Effect or would prohibit or
otherwise interfere with the ability of the Company to enter into this Agreement in any material respect. 
  
 (g) The Company will at all times have authorized and reserved a sufficient number of shares of Common Stock for the full conversion of each Note and
exercise of the Warrants. 
  
 7. Miscellaneous. 

 
 (a) Remedies. In the event of a breach by the Company or by a
Holder, of any of their respective obligations under this Agreement, each Holder or the Company, as the case may be, in addition to being entitled to exercise all rights granted by law and under this Agreement, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. 
  
 (b) No Piggyback on Registrations. Except as and to the extent set forth on Schedule 7(b) hereto, neither the Company nor any of its security holders (other than the Holders in such capacity pursuant hereto) may include securities of
the Company in any Registration Statement other than the Registrable Securities, and the Company shall not after the date hereof enter into any agreement providing any such right for inclusion of shares in the Registration Statement to any of its
security holders. Except as and to the extent specified in Schedule 7(b) hereto, the Company has not previously entered into any agreement granting any registration rights with respect to any of its securities to any Person that have not been
fully satisfied. 
  
 (c) Compliance. Each Holder covenants
and agrees that it will comply with the prospectus delivery requirements of the Securities Act as applicable to it in connection with sales of Registrable Securities pursuant to any Registration Statement. 
  
 (d) Discontinued Disposition. Each Holder agrees by its acquisition of
such Registrable Securities that, upon receipt of a notice from the Company of the occurrence of a Discontinuation Event (as defined below), such Holder will forthwith discontinue disposition of such Registrable Securities under the applicable
Registration Statement until such Holder’s receipt of the copies of the supplemented Prospectus and/or amended Registration Statement or until it is advised in writing (the “Advice”) by the Company that the use of the applicable
Prospectus may be resumed, and, in either case, has received copies of any additional or supplemental filings that are incorporated or deemed to be incorporated by reference in such Prospectus or Registration Statement. The Company may provide
appropriate stop orders to enforce the provisions of this paragraph. For purposes of this Section 7(d), a “Discontinuation Event” shall mean (i) when the Commission notifies the Company whether there will be a “review”
of such Registration Statement and whenever the Commission comments in writing on such Registration Statement (the Company shall provide true and complete copies thereof and all written responses thereto to each of the Holders); (ii) any
request by the Commission or any other Federal or state governmental authority for amendments or supplements to such Registration Statement or Prospectus or for additional information; (iii) the issuance by the 

  

			
	 A&R Registration Rights Agreement
	  	9

 
Commission of any stop order suspending the effectiveness of such Registration Statement covering any or all of the Registrable Securities or the initiation
of any Proceedings for that purpose; (iv) the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction, or
the initiation or threatening of any Proceeding for such purpose; and/or (v) the occurrence of any event or passage of time that makes the financial statements included in such Registration Statement ineligible for inclusion therein or any
statement made in such Registration Statement or Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any material respect or that requires any revisions to such Registration Statement, Prospectus or
other documents so that, in the case of such Registration Statement or Prospectus, as the case may be, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were made, not misleading. 
  
 (e) Amendments and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the same shall be in writing and signed by the Company and the Holders of the then outstanding Registrable Securities. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of certain Holders and that does not directly or indirectly affect the rights of other Holders may be given by
Holders of at least a majority of the Registrable Securities to which such waiver or consent relates; provided, however, that the provisions of this sentence may not be amended, modified, or supplemented except in accordance with the
provisions of the immediately preceding sentence. 
  
 (f)
Notices. Any notice or request hereunder may be given to the Company or the Purchaser at the respective addresses set forth below or as may hereafter be specified in a notice designated as a change of address under this Section 7(g). Any
notice or request hereunder shall be given by registered or certified mail, return receipt requested, hand delivery, overnight mail, Federal Express or other national overnight next day carrier (collectively, “Courier”) or telecopy
(confirmed by mail). Notices and requests shall be, in the case of those by hand delivery, deemed to have been given when delivered to any party to whom it is addressed, in the case of those by mail or overnight mail, deemed to have been given three
(3) business days after the date when deposited in the mail or with the overnight mail carrier, in the case of a Courier, the next business day following timely delivery of the package with the Courier, and, in the case of a telecopy, when
confirmed. The address for such notices and communications shall be as follows: 
  

					
	 If to the Company:
	  	Accentia Biopharmaceuticals, Inc.
	 	  	324 South Hyde Park Ave., Suite 350
	 	  	Tampa, Florida 33606
	 	  	Attention:	  	Chief Financial Officer
	 	  	Facsimile:	  	813-258-1659
		
	 with a copy to:
	  	Alan Pearce fax 941-308-4400 and Sam Duffey 941-918-2841

  

			
	 A&R Registration Rights Agreement
	  	10

					
	 If to a Purchaser:
	 	 	  	To the address set forth under such Purchaser name on the signature pages hereto.
			
	 If to any other Person who is
 then the registered Holder:
	 	 	  	To the address of such Holder as it appears in the stock transfer books of the Company

  
 or
such other address as may be designated in writing hereafter in accordance with this Section 7(g) by such Person. 
  
 (g) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the
parties and shall inure to the benefit of each Holder. The Company may not assign its rights or obligations hereunder without the prior written consent of each Holder. Each Holder may assign their respective rights hereunder in the manner and to the
Persons as permitted under the Notes and the Securities Purchase Agreement. 
  
 (h) Execution and Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and, all of which taken together shall constitute
one and the same agreement. In the event that any signature is delivered by facsimile transmission, such signature shall create a valid binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same
force and effect as if such facsimile signature were the original thereof. 
  
 (i) Governing Law, Jurisdiction and Waiver of Jury Trial. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND
PERFORMED IN SUCH STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. The Company hereby consents and agrees that the state or federal courts located in the County of New York, State of New York shall have exclusion jurisdiction to hear and
determine any Proceeding between the Company, on the one hand, and the Purchaser, on the other hand, pertaining to this Agreement or to any matter arising out of or related to this Agreement; provided, that the Purchaser and the Company
acknowledge that any appeals from those courts may have to be heard by a court located outside of the County of New York, State of New York, and further provided, that nothing in this Agreement shall be deemed or operate to preclude
the Purchaser from bringing a Proceeding in any other jurisdiction to collect the obligations, to realize on the Collateral or any other security for the obligations, or to enforce a judgment or other court order in favor of the Purchaser. The
Company expressly submits and consents in advance to such jurisdiction in any Proceeding commenced in any such court, and the Company hereby waives any objection which it may have based upon lack of personal jurisdiction, improper venue or forum
non conveniens. The Company hereby waives personal service of the summons, complaint and other process issued in any such Proceeding and agrees that service of such summons, complaint and other process may be made by registered or certified mail
addressed to the Company at the address set forth in Section 7(g) and that service so made shall be deemed completed upon the earlier of the Company’s actual receipt thereof or three (3) days after deposit in the U.S. mails, proper
postage prepaid. The parties hereto desire that their disputes be resolved by a judge applying such applicable laws. Therefore, to achieve 

  

			
	 A&R Registration Rights Agreement
	  	11

 
the best combination of the benefits of the judicial system and of arbitration, the parties hereto waive all rights to trial by jury in any Proceeding
brought to resolve any dispute, whether arising in contract, tort, or otherwise between the Purchaser and/or the Company arising out of, connected with, related or incidental to the relationship established between then in connection with this
Agreement. If either party hereto shall commence a Proceeding to enforce any provisions of this Agreement, the Securities Purchase Agreement, any Related Agreement, the Security Agreement or any other Ancillary Agreement, then the prevailing party
in such Proceeding shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Proceeding. 
  
 (j) Cumulative Remedies. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law. 
  
 (k)
Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set
forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their reasonable efforts to find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions
without including any of such that may be hereafter declared invalid, illegal, void or unenforceable. 
  
 (l) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

  
 [Balance of page intentionally left blank; signature page
follows] 
  

			
	 A&R Registration Rights Agreement
	  	12

 IN WITNESS WHEREOF, the parties have executed this Amended and Restated Registration Rights Agreement as
of the date first written above. 
  

			
	ACCENTIA BIOPHARMACEUTICALS, INC.
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	LAURUS MASTER FUND, LTD.
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	Address for Notices:
	
	825 Third Avenue, 14th Floor
	New York, New York 10022
	Attention: John Tucker, Esq.
	Facsimile: 212-541-4434

  

			
	 A&R Registration Rights Agreement
	  	13

 EXHIBIT A 
  

            , 200   
  
 Wachovia Equity Services 
 1525 West W.T. Harris Blvd. (3C3)
 Charlotte, North Carolina 28288 
 Attn:
                                        

 Tel: (800) 829-8432 
  
 Re:  Accentia Biopharmaceuticals, Inc. Registration Statement on Form [S-3] 
  
 Ladies and Gentlemen: 
  
 As in-house counsel to Accentia Biopharmaceuticals, Inc., a Florida corporation (the “Company”), I have been
requested to render my opinion to you in connection with the resale by the individuals or entities listed on Schedule A attached hereto (the “Selling Stockholders”), of an aggregate of
                     shares (the “Shares”) of the Company’s Common Stock. 
  
 A Registration Statement on Form [S-3] under the Securities Act of 1933, as
amended (the “Act”), with respect to the resale of the Shares was declared effective by the Securities and Exchange Commission on [date]. Enclosed is the Prospectus dated [date]. I understand that the Shares are to be offered and sold in
the manner described in the Prospectus. 
  
 Based upon the
foregoing, upon request by the Selling Stockholders at any time while the registration statement remains effective, it is my opinion that the Shares have been registered for resale under the Act and new certificates evidencing the Shares upon their
transfer or re-registration by the Selling Stockholders may be issued without restrictive legend. I will advise you if the registration statement is not available or effective at any point in the future. 
  

	
	Very truly yours,
	
	 [Company counsel]

  

			
	 A&R Registration Rights Agreement
	  	 

 Schedule A to Exhibit A 
  

					
	 Selling Stockholder

	 	 R/N/O

	 	 Shares
Being Offered

  

			
	 A&R Registration Rights Agreement
	  	 

 SCHEDULE 7(b) 
  

			
	 A&R Registration Rights Agreement

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