Exhibit 10.4

 

ESCROW AGREEMENT

 

THIS ESCROW AGREEMENT (“Agreement”) is made as of December 28, 2005 by and
between Corgenix Medical Corporation, a Nevada corporation (the “Company”);
Barron Partners L.P. (“Barron”); and Epstein, Becker & Green, P.C. (the “Escrow
Agent”).

 

WHEREAS, Barron is purchasing from the Company Two Million shares of Series A
Preferred Stock of the Company (“Preferred Stock”), with an aggregate purchase
price of $2,000,000 (the “Funds”), pursuant to the terms of that certain
Preferred Stock Purchase Agreement of even date herewith; and

 

WHEREAS, in connection with the closing of the Preferred Stock Purchase
Agreement, the Company will also issue to Barron three common stock purchase
warrants to purchase up to an additional 15,000,000 shares of the Company’s
common stock at exercise prices stated in the warrants (“Warrants”); and

 

WHEREAS, the Company does not currently have enough shares of common stock
authorized to satisfy the exercise of the warrants or conversion of the
preferred stock issued pursuant to the Preferred Stock Purchase Agreement; and

 

WHEREAS, the Company has committed to call a special meeting of the shareholders
of the Company to vote upon an amendment to the Articles of Incorporation to
increase the number of authorized shares of common Stock from the current
40,000,000 to 100,000,000 (the “Share Increase Amendment”); and

 

WHEREAS, the Company and Barron desire to enter into this Agreement to provide
that (i) the Company shall deliver the Preferred Stock Certificates and Barron
shall wire the Funds to the Escrow Agent on the date of this Agreement, and (ii)
the Escrow Agent shall thereafter hold the Funds and the Preferred Stock
Certificates pending the adoption of, or failure to adopt, the Share Increase
Amendment by the Company’s shareholders.

 

NOW, THEREFORE, in consideration of the covenants and mutual promises contained
herein and other good and valuable consideration, the receipt and legal
sufficiency of which are hereby acknowledged and intending to be legally bound
hereby, the parties agree as follows:

 

ARTICLE 1

 

TERMS OF THE ESCROW

 

1.1           The parties hereby agree to have the law firm of Epstein Becker &
Green, P.C. act as Escrow Agent whereby the Escrow Agent shall receive the Funds
and the Preferred Stock Certificates in escrow and distribute the same as set
forth in this Agreement.  Any capitalized terms not defined herein shall have
the meaning ascribed to them in the Preferred Stock Purchase Agreement, dated an
even date herewith between the Company and Barron

 

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(the “Preferred Stock Purchase Agreement”), and the documents related thereto,
with this Agreement being an exhibit to such Preferred Stock Purchase
Agreement.  The various documents and instruments to be delivered to the Escrow
Agent and thereby to the parties in order to close the transaction are set forth
in Section 3.2 and 3.3 of the Purchase Agreement.  The Escrow Agent hereby
acknowledges that it is familiar with the terms and provisions of the Purchase
Agreement.

 

1.2           Upon the execution of this Agreement, the Company and Barron shall
submit a wire transfer of immediately available funds in the amount of the Funds
to the Escrow Agent.  The Escrow Agent shall thereafter hold the Funds and the
Preferred Stock Certificates until the first to occur of (a) such time that the
Escrow Agent has received evidence from either Barron or the Company indicating
that the Share Increase Amendment has or has not been approved or adopted by the
Company’s shareholders and indicating whether to release the Funds from Escrow
to the Company or return them to Barron, or (b) July 1, 2006 (the “Outside
Date”).  Upon receipt of such evidence from either Barron or the Company that
the Share Increase Amendment has been adopted and approved by shareholders, then
the Escrow Agent shall send the Preferred Stock Certificates to the Investor and
the Funds and the interest accrued on the Funds while held in escrow to the
Company.  If by the Outside Date, neither the Company nor Barron has provided
evidence that the Share Increase Amendment has been adopted or approved by the
Company’s shareholders, then the Escrow Agent shall return the Funds to Barron,
the Preferred Stock Certificates shall be canceled, and the Company, within five
(5) business days after the Outside Date, shall pay Barron an amount equal to
one percent (1%) of the Funds, or $20,000, for each thirty (30) day period
during which the Funds were held in Escrow.

 

1.3           Upon the completion by the Escrow Agent of its obligations under
Section 1.2, this Agreement shall terminate and the Escrow Agent shall have no
further liability hereunder.

 

1.4           This Agreement may be altered or amended only with the written
consent of all of the parties hereto.  In the event the Company or Barron
attempts to change this Agreement in a manner, which, in the Escrow Agent’s
discretion, shall be undesirable, the Escrow Agent may resign as Escrow Agent by
notifying the Company and Barron in writing.  In the case of the Escrow Agent’s
resignation, the only duty of the Escrow Agent, until receipt of a joint written
notice from the Company and Barron (the “Transfer Instructions”) that a
successor escrow agent has been appointed, shall be to hold and preserve the
Funds and the Preferred Stock Certificates that are in its possession.  Upon
receipt by the Escrow Agent of said notice from the Company and Barron of the
appointment of a successor escrow agent, the name of a successor escrow account
and a direction to transfer the Funds to such successor escrow account to be
thereafter held by such successor escrow agent, the Escrow Agent shall promptly
thereafter transfer the Funds and deliver the Preferred Stock Certificates to
said successor escrow agent.  Immediately after said transfer of the Funds and
delivery of the Preferred Stock Certificates to said successor escrow agent, the
Escrow Agent shall furnish the Company and Barron with proof of such transfer. 
The Escrow Agent is authorized to disregard any notices, requests, instructions
or demands received by it from the Company and Barron after notice of
resignation has been given, except only for the Transfer Instructions.

 

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1.5           The Company shall pay the Escrow Agent a fee of $2,500 in
consideration of the Escrow Agent’s services hereunder.  In addition, the Escrow
Agent shall be reimbursed one-half by the Company and one-half by Barron for any
reasonable expenses incurred in the event there is a conflict between the
parties and the Escrow Agent shall deem it necessary to retain counsel, upon
whose advice the Escrow Agent may rely.  The Escrow Agent shall not be liable
for any action taken or omitted by the Escrow Agent in good faith and in no
event shall the Escrow Agent be liable or responsible except for the Escrow
Agent’s own gross negligence or willful misconduct.  The Escrow Agent has made
no representations or warranties to the Company or Barron in connection with
this transaction. The Escrow Agent has no liability hereunder to either party
other than to hold the Funds and Preferred Stock Certificates received from
Barron and the Company and to deliver the Funds and Preferred Stock Certificates
pursuant to the terms hereof.  The Company and Barron each agrees, severally and
not jointly, to indemnify and hold harmless the Escrow Agent from and with
respect to any suits, claims, actions or liabilities arising in any way out of
this transaction, including the obligation to defend any legal action brought
which in any way arises out of or is related to this Agreement.

 

1.6           The Escrow Agent shall be obligated only for the performance of
such duties as are specifically set forth herein and may rely and shall be
protected in relying or refraining from acting on any instrument reasonably
believed by the Escrow Agent to be genuine and to have been signed or presented
by the proper party or parties.  The Escrow Agent shall not be personally liable
for any act the Escrow Agent may do or omit to do hereunder as the Escrow Agent
while acting in good faith, and any act done or omitted by the Escrow Agent
pursuant to the advice of the Escrow Agent’s attorneys-at-law shall be
conclusive evidence of such good faith.

 

1.7           The Escrow Agent is hereby expressly authorized to disregard any
and all warnings or orders given by any of the parties hereto or by any other
person or corporation, excepting only the Transfer Instructions, any joint
written notice or instruction from Barron and the Company, and/or orders or
process of courts of law and is hereby expressly authorized to comply with and
obey orders, judgments or decrees of any court.  In case the Escrow Agent obeys
or complies with any such order, judgment or decree, including but not limited
to the Transfer Instructions, then the Escrow Agent shall not be liable to any
of the parties hereto or to any other person, firm or corporation by reason of
such decree or orders being subsequently reversed, modified, annulled, set
aside, vacated or found to have been entered without jurisdiction.

 

1.8           The Escrow Agent shall not be liable in any respect on account of
the identity, authorities or rights of the parties executing or delivering or
purporting to execute or deliver the Agreement, Transfer Instructions, or any
other documents or papers deposited or called for hereunder.

 

1.9           If the Escrow Agent reasonably requires other or further documents
in connection with this Agreement, the necessary parties hereto shall join in
furnishing such documents.

 

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1.10         It is understood and agreed that should any dispute arise with
respect to the delivery and/or ownership or right of possession of the Funds
and/or the Transaction Documents held by the Escrow Agent hereunder, the Escrow
Agent is authorized and directed in the Escrow Agent’s sole discretion (a) to
retain the Funds and the Preferred Stock Certificates in the Escrow Agent’s
possession, without liability to anyone, until such disputes shall have been
settled either by mutual written agreement of the parties concerned or by a
final order, decree or judgment of a court of competent jurisdiction after the
time for appeal has expired and no appeal has been perfected, but the Escrow
Agent shall be under no duty whatsoever to institute or defend any such
proceedings or (b) to deliver the Funds and the Preferred Stock Certificates
held by the Escrow Agent hereunder to a state or federal court having competent
subject matter jurisdiction and located in the State of Colorado or New York in
accordance with the applicable procedure therefor.

 

ARTICLE 2

 

MISCELLANEOUS

 

2.1           No waiver of any breach of any covenant or provision herein
contained shall be deemed a waiver of any preceding or succeeding breach
thereof, or of any other covenant or provision herein contained.  No extension
of time for performance of any obligation or act shall be deemed any extension
of the time for performance of any other obligation or act.

 

2.2           This Agreement shall be binding upon and shall inure to the
benefit of the permitted successors and assigns of the parties hereto.

 

2.3           This Agreement is the final expression of, and contains the entire
agreement between, the parties with respect to the subject matter hereof and
supersedes all prior understandings with respect thereto.  This Agreement may
not be modified, changed, supplemented or terminated, nor may any obligations
hereunder be waived, except by written instrument signed by the parties to be
charged or by its agent duly authorized in writing or as otherwise expressly
permitted herein.

 

2.4           Whenever required by the context of this Agreement, the singular
shall include the plural and masculine shall include the feminine.  This
Agreement may be executed in two or more counterparts, all of which taken
together shall constitute one instrument.  Execution and delivery of this
Agreement by exchange of facsimile copies bearing the facsimile signature of a
party shall constitute a valid and binding execution and delivery of this
Agreement by such party.  Such facsimile copies shall constitute enforceable
original documents.

 

2.5           (a)           This Agreement shall be governed and construed in
accordance with the laws of the State of New York without regard to any
applicable principles of conflicts of law.

 

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(b)           ANY ACTION OR PROCEEDING SEEKING TO ENFORCE ANY PROVISION OF, OR
BASED ON ANY RIGHT ARISING OUT OF, THIS AGREEMENT SHALL BE BROUGHT AGAINST ANY
OF THE PARTIES HERETO IN THE APPROPRIATE FEDERAL OR STATE COURT LOCATED IN THE
STATE OF NEW YORK, WITH EACH PARTY HERETO AGREEING TO SUBJECT MATTER
JURISDICTION, PERSONAL JURISDICTION AND VENUE IN SUCH COURT.  EACH OF THE
PARTIES HERETO CONSENTS TO THIS JURISDICTION PROVISION IN ANY SUCH ACTION OR
PROCEEDING AND WAIVES ANY OBJECTION TO VENUE LAID THEREIN.  PROCESS IN ANY
ACTION OR PROCEEDING REFERRED TO IN THE PRECEDING SENTENCE MAY BE SERVED ON ANY
PARTY HERETO ANYWHERE IN THE WORLD.  EACH OF THE PARTIES HERETO IRREVOCABLY
WAIVES ITS RIGHTS TO TRIAL BY JURY.

 

2.6           All notices and other communications hereunder shall be in writing
(and shall be deemed given upon receipt) if delivered personally, telecopied
(which is confirmed), mailed by registered or certified mail (return receipt
requested), or delivered by a national overnight delivery service (e.g., Federal
Express) to the parties at the following addresses (or at such other address for
a party as shall be specified by like notice):

 

If to the Company, to:

If to Barron, to:

 

 

Corgenix Medical Corporation

Barron Partners L.P.

12061 Tejon Street

c/o Barron Capital Advisors LLC

Westminster, Colorado 80234

730 Fifth Avenue

Attention: Chief Financial Officer

9th Floor

Facsimile: (303) 252-9212

New York, New York

 

Facsimile: (646) 607-2223

With a copy to:

Attn: Andrew Barron Worden

 

 

Otten, Johnson, Robinson, Neff & Ragonetti,
P.C.

With a copy to:

950 17th Street, Suite 1600

John H. Heuberger

Denver, Colorado 80202

DLA Piper Rudnick Gray Cary US LLP

Facsimile: (303) 825-6525

203 North LaSalle Street, Suite 1900

Attn: Robert Attai, Esq.

Chicago, Illinois 60601

 

Facsimile: (312) 630-5322

 

 

 

If to the Escrow Agent:

 

 

 

Epstein, Becker & Green, P.C.

 

150 N. Michigan Avenue, Suite 3500

 

Chicago, Illinois 60601

 

Facsimile: (312) 845-1998
Attn. Stephen R. Drake, Esq.

 

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2.7           By signing this Agreement, the Escrow Agent becomes a party hereto
only for the purpose of this Agreement; the Escrow Agent does not become a party
to the Transaction Documents.

 

2.8           Each party acknowledges and agrees that this Agreement shall not
be deemed prepared or drafted by any one party.  In the event of any dispute
between the parties concerning this Agreement, the parties agree that any rule
of construction, to the effect that any ambiguity in the language of the
Agreement is to be resolved against the drafting party, shall not apply.

 

2.9           This Agreement may be executed in counterparts, each one of which
will constitute an original and all of which taken together will constitute one
document.  This Agreement may be executed by delivery of a signed signature page
by fax to the other parties hereto and such fax execution and delivery will be
valid in all respects.

 

[Signatures appear on the following page]

 

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

 

CORGENIX MEDICAL CORPORATION

 

 

By:

/s/ Douglass T. Simpson

 

 

Douglass T. Simpson, Chief Executive Officer

 

 

BARRON PARTNERS L.P.

 

By:

Barron Capital Advisors LLC,

General Partner

 

 

By:

/s/ Andrew Barron Worden

 

Andrew Barron Worden

Managing Member

 

 

ESCROW AGENT:

 

EPSTEIN BECKER & GREEN, P.C.

 

 

BY:

/S/ STEPHEN R. DRAKE

 

 

STEPHEN R. DRAKE, PARTNER

 

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