Exhibit 10.5

 

CORGENIX MEDICAL CORPORATION

 

SECURITIES PURCHASE AGREEMENT

 

DECEMBER 28, 2005

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

1.

AGREEMENT TO SELL AND PURCHASE

2

 

 

 

2.

FEES AND WARRANTS

2

 

 

 

3.

CLOSING, DELIVERY, PAYMENT AND CERTAIN CONDITIONS

3

 

 

 

 

3.1

Closing

3

 

 

 

 

 

3.2

Delivery

3

 

 

 

 

 

3.3

Conversion and Lockup

3

 

 

 

 

 

3.4

Optional Redemption of Principal Amount

3

 

 

 

 

 

3.5

[Reserved.]

3

 

 

 

 

4.

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

3

 

 

 

 

4.1

Organization, Good Standing and Qualification

3

 

 

 

 

 

4.2

Subsidiaries

4

 

 

 

 

 

4.3

Capitalization; Voting Rights

4

 

 

 

 

 

4.4

Authorization; Binding Obligations

5

 

 

 

 

 

4.5

Liabilities

6

 

 

 

 

 

4.6

Agreements; Action

6

 

 

 

 

 

4.7

Obligations to Related Parties

7

 

 

 

 

 

4.8

Changes

7

 

 

 

 

 

4.9

Title to Properties and Assets; Liens, Etc

8

 

 

 

 

 

4.10

Intellectual Property

9

 

 

 

 

 

4.11

Compliance with Other Instruments

9

 

 

 

 

 

4.12

Litigation

10

 

 

 

 

 

4.13

Tax Returns and Payments

10

 

 

 

 

 

4.14

Employees

10

 

 

 

 

 

4.15

Registration Rights and Voting Rights

11

 

 

 

 

 

4.16

Compliance with Laws; Permits

11

 

 

 

 

 

4.17

Environmental and Safety Laws

11

 

 

 

 

 

4.18

Valid Offering

12

 

 

 

 

 

4.19

Full Disclosure

12

 

 

 

 

 

4.20

Insurance

12

 

 

 

 

 

4.21

SEC Reports

12

 

i

--------------------------------------------------------------------------------

 

 

 

Page

 

 

 

 

4.22

Listing

12

 

 

 

 

 

4.23

No Integrated Offering

12

 

 

 

 

 

4.24

Stop Transfer

13

 

 

 

 

 

4.25

Dilution

13

 

 

 

 

 

4.26

Patriot Act

13

 

 

 

 

5.

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

13

 

 

 

 

5.1

No Shorting

14

 

 

 

 

 

5.2

Organization, Good Standing and Qualification

14

 

 

 

 

 

5.3

Requisite Power and Authority

14

 

 

 

 

 

5.4

Investment Representations

15

 

 

 

 

 

5.5

The Purchasers Bear Economic Risk

15

 

 

 

 

 

5.6

Acquisition for Own Account

15

 

 

 

 

 

5.7

The Purchasers Can Protect Their Interest

15

 

 

 

 

 

5.8

Accredited Investor

15

 

 

 

 

 

5.9

Legends

15

 

 

 

 

6.

COVENANTS OF THE COMPANY

16

 

 

 

 

6.1

Stop-Orders

16

 

 

 

 

 

6.2

Authorization and Listing

17

 

 

 

 

 

6.3

Market Regulations

17

 

 

 

 

 

6.4

Reporting Requirements

17

 

 

 

 

 

6.5

Use of Funds

17

 

 

 

 

 

6.6

Access to Facilities

17

 

 

 

 

 

6.7

Taxes

18

 

 

 

 

 

6.8

Insurance

18

 

 

 

 

 

6.9

Intellectual Property

19

 

 

 

 

 

6.10

Properties

19

 

 

 

 

 

6.11

Confidentiality

19

 

 

 

 

 

6.12

Required Approvals

20

 

 

 

 

 

6.13

Repayment of Indebtedness

21

 

 

 

 

 

6.14

Reissuance of Securities

21

 

ii

--------------------------------------------------------------------------------

 

 

 

Page

 

 

 

 

6.15

Opinion

21

 

 

 

 

 

6.16

Margin Stock

21

 

 

 

 

 

6.17

[Reserved.]

21

 

 

 

 

 

6.18

Financing Right of First Refusal

21

 

 

 

 

 

6.19

[Reserved.]

22

 

 

 

 

 

6.20

Net Worth

22

 

 

 

 

 

6.21

Retention of Investor Relations/Public Relations Firm and Program

22

 

 

 

 

7.

COVENANTS OF THE PURCHASERS

22

 

 

 

 

7.1

Confidentiality

22

 

 

 

 

 

7.2

Non-Public Information

22

 

 

 

 

 

7.3

Amendment to Articles of Incorporation

23

 

 

 

 

8.

COVENANTS OF THE COMPANY AND THE PURCHASERS REGARDING INDEMNIFICATION

23

 

 

 

 

8.1

Company Indemnification

23

 

 

 

 

 

8.2

The Purchasers’ Indemnification

23

 

 

 

 

9.

CONVERSION OF CONVERTIBLE TERM NOTES

23

 

 

 

 

9.1

Mechanics of Conversion

23

 

 

 

 

10.

REGISTRATION RIGHTS

25

 

 

 

 

10.1

Registration Rights Granted

25

 

 

 

 

 

10.2

Offering Restrictions

25

 

 

 

 

11.

MISCELLANEOUS

25

 

 

 

 

11.1

Governing Law

25

 

 

 

 

 

11.2

Survival

25

 

 

 

 

 

11.3

Successors

26

 

 

 

 

 

11.4

Entire Agreement

26

 

 

 

 

 

11.5

Amendment and Waiver

26

 

 

 

 

 

11.6

Delays or Omissions

26

 

 

 

 

 

11.7

Notices

26

 

 

 

 

 

11.8

Attorneys’ Fees

27

 

 

 

 

 

11.9

Titles and Subtitles

28

 

iii

--------------------------------------------------------------------------------

 

 

 

Page

 

 

 

 

11.10

Facsimile Signatures; Counterparts

28

 

 

 

 

 

11.11

Broker’s Fees

28

 

 

 

 

 

11.12

Construction

28

 

iv

--------------------------------------------------------------------------------

 

SECURITIES PURCHASE AGREEMENT

 

THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”) is made and entered into
as of December 28, 2005, by and among Corgenix Medical Corporation, a Nevada
corporation (the “Company”), and Truk Opportunity Fund, LLC, a Delaware company
(“Truk Opportunity”), Truk International Fund, LP, a Cayman Islands company
(“Truk International”), and CAMOFI Master LDC, a Cayman Islands company,
formerly named DCOFI Master LDC, (“CAMOFI”) (Truk Opportunity, Truk
International and CAMOFI, each a “Purchaser” and together the “Purchasers”).

 

RECITALS

 

WHEREAS, Section 6.19 of that certain Securities Purchase Agreement between the
Purchasers and the Company dated as of May 19, 2005 granted the Purchasers an
additional investment right;

 

WHEREAS, the Purchasers wish to exercise such additional investment right and
the Company has authorized the sale to the Purchasers of Convertible Term Notes
in the aggregate principal amount of One Million Five Hundred Thousand Dollars
($1,500,000) (each as amended, modified or supplemented from time to time, a
“Term Note”), which Term Notes are convertible into shares of the Company’s
common stock, $0.001 par value per share (the “Common Stock”) at an initial
fixed conversion price of $0.30 per share of Common Stock (“Fixed Conversion
Price”);

 

WHEREAS, the Company wishes to issue warrants to the Purchasers to purchase in
the aggregate up to 60% of the number of shares of the Company’s Common Stock
issuable through the conversion of the total amount being invested by the
Purchasers, or One Million Five Hundred Thousand Dollars ($1,500,000) (the
“Total Investment Amount”) (subject to adjustment as set forth therein) in
connection with the Purchasers’ purchase of the Term Notes;

 

WHEREAS, the Purchasers desire to purchase the Term Notes and the Warrants (as
defined in Section 2) on the terms and conditions set forth herein;

 

WHEREAS, the Company desires to issue and sell the Term Notes and the Warrants
to the Purchasers on the terms and conditions set forth herein; and

 

WHEREAS, the Company has entered into a definitive Preferred Stock Purchase
Agreement and related transaction documents with Barron Partners LP (“Barron”)
and Barron has funded the full consideration owed to the Company thereby into an
escrow account (the “Barron Financing”).

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises, representations, warranties and covenants hereinafter set forth and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

 

--------------------------------------------------------------------------------

 

1.                                       Agreement to Sell and Purchase.

 

(a)                                  Pursuant to the terms and conditions set
forth in this Agreement, on the Closing Date (as defined in Section 3), the
Company agrees to sell to the Purchasers, and the Purchasers, severally and not
jointly, hereby agree to purchase from the Company, Term Note in the principal
amount and at the purchase price set forth opposite such Purchaser’s name on
Schedule I hereto convertible in accordance with the terms thereof into shares
of the Company’s Common Stock in accordance with the terms of such Term Note and
this Agreement. It is understood and agreed that the purchases by the Purchasers
are to be separate transactions. The purchase of the Term Notes on the Closing
Date shall be known as the “Offering.” A form of the Term Notes are annexed
hereto as Exhibit A. The Term Notes will mature on the Maturity Date (as defined
in the Term Notes). Collectively, the Term Notes, the Warrants and Common Stock
issuable upon conversion of the Term Notes and upon exercise of the Warrants are
referred to as the “Securities.”

 

2.                                       Fees and Warrants.  On the Closing
Date:

 

(a)                                  The Company will issue and deliver to each
Purchaser a Warrant to purchase up to that number of shares of the Company’s
Common Stock set forth opposite the name of such Purchaser on Schedule I hereto
(as amended, modified or supplemented from time to time, a “Warrant”). The
Warrants must be delivered on the Closing Date. A form of Warrant is annexed
hereto as Exhibit B. All the representations, covenants, warranties,
undertakings, and indemnification, and other rights made or granted to or for
the benefit of the Purchasers by the Company are hereby also made and granted in
respect of the Warrants and shares of the Company’s Common Stock issuable upon
exercise of the Warrants (the “Warrant Shares”).

 

(b)                                 The Company shall pay (i) to RAM Capital
Resources, LLC, the manager of Truk Opportunity and Truk International, a
closing payment in an amount equal to three and one half percent (3.5%) of
34.09090909% of the Total Investment Amount and (ii) to Centrecourt Asset
Management LLC, the manager of CAMOFI, a closing payment in an amount equal to
three and one half percent (3.5%) of 65.90909090% of the Total Investment
Amount. The foregoing fees are referred to herein as the “Closing Payment.”

 

(c)                                  The Company shall pay to Ascendiant
Securities, LLC an agent fee of 10% of the Total Investment Amount.

 

(d)                                 The Company shall reimburse the Purchasers
for their reasonable expenses (including legal fees and expenses) incurred in
connection with the preparation and negotiation of this Agreement and the
Related Agreements (as hereinafter defined), and expenses incurred in connection
with the Purchasers’ due diligence review of the Company and its Subsidiaries
(as defined in Section 4.2) and all related matters. Amounts required to be paid
under this Section 2(d), will be paid on the Closing Date.

 

(e)                                  The Closing Payment and the expenses
referred to in the preceding clauses (c) and (d) (net of deposits previously
paid by the Company) shall be paid at closing out

 

2

--------------------------------------------------------------------------------

 

of funds held pursuant to an Escrow Agreement (as defined below) and a
disbursement letter (the “Disbursement Letter”).

 

3.                                       Closing, Delivery, Payment and Certain
Conditions.

 

3.1                                 Closing.  Subject to the terms and
conditions herein, the closing of the Offering (the “Closing”), shall take place
on the date hereof, at such time or place as the Company and the Purchasers may
mutually agree (such date is hereinafter referred to as the “Closing Date”).

 

3.2                                 Delivery.  Pursuant to the Escrow Agreement,
at the Closing on the Closing Date, the Company will deliver to the Purchasers,
among other things, Term Notes in the form attached as Exhibit A representing
the aggregate principal amount of $1,500,000 and Warrants in the form attached
as Exhibit B in each Purchaser’s name representing in the aggregate 60% of the
number of shares of the Company’s Common Stock issuable through conversion of
the Total Investment Amount, and each Purchaser will deliver to the Company,
among other things, the amounts set forth to be delivered by it in the
Disbursement Letter by certified funds or wire transfer.

 

3.3                                 Conversion and Lockup.  Prior to the Closing
Date, the Company shall have caused its directors, controlling shareholders and
certain other persons requested by the Purchasers to agree to “lockup” and not
sell their shares of Common Stock of the Company, pursuant to documentation, and
on terms and conditions, acceptable to the Purchasers.

 

3.4                                 Optional Redemption of Principal Amount.
 The Company covenants that should it exercise its right of optional redemption
of the principal amounts under the Term Notes and/or those certain secured
convertible term notes dated as of May 19, 2005 (the “May 19th Notes”), it shall
repay the Term Notes in their entirety before it repays the May 19th Notes.

 

3.5                                 [Reserved.]

 

4.                                       Representations and Warranties of the
Company.  The Company hereby represents and warrants to the Purchasers as
follows (which representations and warranties are supplemented by the Company’s
filings under the Securities Exchange Act of 1934, as amended, made prior to the
date of this Agreement (collectively, the “Exchange Act Filings”), copies of
which have been provided to the Purchasers):

 

4.1                                 Organization, Good Standing and
Qualification.  Each of the Company 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.  Each of the Company and each of its Subsidiaries
has the corporate, partnership or limited liability company, as the case may be,
power and authority to own and operate its properties and assets, to execute and
deliver (i) this Agreement, (ii) the Term Notes and the Warrants to be issued in
connection with this Agreement, (iii) the Registration Rights Agreement relating
to the Securities dated as of the date hereof among the Company and the
Purchasers (as amended, modified or supplemented from time to time, the
“Registration Rights Agreement”), (iv) the Escrow Agreement dated as of the date
hereof among the Company, the Purchasers and the escrow agent referred to
therein, substantially in the form of Exhibit D hereto (as amended,

 

3

--------------------------------------------------------------------------------

 

modified or supplemented from time to time, the “Escrow Agreement”), and (v) all
other agreements related to this Agreement and the Term Note and referred to
herein (the preceding clauses (ii) through (iv), the Subsidiary Guaranty dated
as of May 19, 2005 made by certain Subsidiaries of the Company (as amended,
modified or supplemented from time to time, the “Subsidiary Guaranty”), the
Stock Pledge Agreement dated as of May 19, 2005 among the Company, certain
Subsidiaries of the Company and the Purchasers (as amended, modified or
supplemented from time to time, the “Stock Pledge Agreement”), and the
Subordination Agreement dated as of May 19, 2005 among the Purchasers and the
subordinated creditors party thereto, and acknowledged and agreed to by the
Company (as amended, modified or supplemented from time to time, the
Subordination Agreement”), collectively, the “Related Agreements”), to issue and
sell the Term Notes and the shares of Common Stock issuable upon conversion of
the Term Notes (other than the shares of Common Stock issuable upon conversion
of the Term Note that will be issuable upon approval and adoption of the Share
Increase Amendment), as defined below (the “Note Shares”), to issue and sell the
Warrants and the Warrant Shares (other than the Warrant Shares that will be
issuable upon approval and adoption of the Share Increase Amendment), and to
carry out the provisions of this Agreement and the Related Agreements and to
carry on its business as presently conducted.  Each of the Company 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 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, or would not reasonably be expected to have, individually or in the
aggregate, a material adverse effect on the business, assets, liabilities,
condition (financial or otherwise), properties, operations or prospects of the
Company and its Subsidiaries, taken individually and as a whole (a “Material
Adverse Effect”).  Corgenix (UK) Ltd. owns no material assets in the United
States.

 

4.2                                 Subsidiaries.  Each direct and indirect
Subsidiary of the Company, the direct owner of such Subsidiary and its
percentage ownership thereof, is set forth on Schedule 4.2.  For the purpose of
this Agreement, a “Subsidiary” of any person or entity means (i) a corporation
or other entity whose shares of stock or other ownership interests having
ordinary voting power (other than stock or other ownership interests having such
power only by reason of the happening of a contingency) to elect a majority of
the directors of such corporation, or other persons or entities performing
similar functions for such person or entity, are owned, directly or indirectly,
by such person or entity or (ii) a corporation or other entity in which such
person or entity owns, directly or indirectly, more than 50% of the equity
interests at such time.

 

4.3                                 Capitalization; Voting Rights.

 

(a)                                  The authorized capital stock of the
Company, as of the date hereof consists of 45,000,000 shares, of which
40,000,000 are shares of Common Stock, par value $0.001 per share, 9,325,305
shares of which are issued and outstanding, and 5,000,000 are shares of
preferred stock, par value $0.001 per share, 2,000,000 of which are issued and
outstanding.  The authorized capital stock of each Subsidiary of the Company is
set forth on Schedule 4.3.

 

(b)                                 Except as disclosed on Schedule 4.3, other
than:  (i) the shares reserved for issuance under the Company’s stock option
plans; and (ii) shares which may be

 

4

--------------------------------------------------------------------------------

 

granted pursuant to this Agreement and the Related 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 Company of
any of its securities. Except as disclosed on Schedule 4.3, neither the offer,
issuance or sale of any of the Term Notes or the Warrants, or the issuance of
any of the Note Shares or 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 Company outstanding, under anti-dilution or other
similar provisions contained in or affecting any such securities.

 

(c)                                  All issued and outstanding shares of the
Company’s Common Stock:  (i) have been duly authorized and validly issued and
are fully paid and nonassessable; and (ii) were issued in compliance in all
material respects with all applicable state and federal laws concerning the
issuance of securities.

 

(d)                                 The rights, preferences, privileges and
restrictions of the shares of the Common Stock are as stated in the Company’s
Articles of Incorporation (the “Charter”).  The Note Shares and Warrant Shares
have been duly and validly reserved for issuance (other than the Note Shares and
Warrant Shares that will be issuable only after approval, adoption and
effectiveness of the Share Increase Amendment, such Note Shares and Warrant
Shares to be duly and validly reserved for issuance upon effectiveness of the
Share Increase Amendment). When issued in compliance with the provisions of this
Agreement and the Company’s Charter (and to the extent the Note Shares and
Warrant Shares are not presently authorized, subject to and conditioned on the
approval, adoption and effectiveness of the Share Increase Amendment with
respect to the Note Shares and Warrant Shares) 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.

 

4.4                                 Authorization; Binding Obligations.  All
corporate, partnership or limited liability company, as the case may be, action
on the part of the Company and each of its Subsidiaries (including the
respective officers and directors) necessary for the authorization of this
Agreement and the Related Agreements, the performance of all obligations of the
Company and its Subsidiaries hereunder and under the other Related Agreements at
the Closing and, the authorization, sale, issuance and delivery of the Term
Notes and the Warrants has been taken or will be taken prior to the Closing
except with respect to the Share Increase Amendment and actions related thereto
or thereunder.  This Agreement and the Related Agreements, when executed and
delivered and to the extent it is a party thereto, will be valid and binding
obligations of each of the Company and each of its Subsidiaries, enforceable
against each such person 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;

 

5

--------------------------------------------------------------------------------

 

(b)                                 general principles of equity that restrict
the availability of equitable or legal remedies; and

 

(c)                                  as to that portion of the Note Shares and
the Warrant Shares that is presently not authorized, the issuance of such Note
Shares and such Warrant Shares is subject to and conditioned upon the approval,
adoption and effectiveness of the Share Increase Amendment.

 

The sale of the Term Notes and the subsequent conversion of the Term Notes 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.

 

4.5                                 Liabilities.  Neither the Company nor any of
its Subsidiaries has any contingent liabilities in excess of $25,000, except
current liabilities incurred in the ordinary course of business and liabilities
disclosed in any Exchange Act Filings.

 

4.6                                 Agreements; Action.  Except as set forth on
Schedule 4.6 or as disclosed in any Exchange Act Filings:

 

(a)                                  there are no agreements, understandings,
instruments, contracts, proposed transactions, judgments, orders, writs or
decrees to which the Company or any of its Subsidiaries is a party or by which
it is bound which may involve: (i) obligations (contingent or otherwise) of, or
payments to, the Company in excess of $50,000 (other than obligations of, or
payments to, the Company 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 the
Company (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 the Company’s products or services; or (iv)
indemnification by the Company with respect to infringements of proprietary
rights.

 

(b)                                 Since June 30, 2005, neither the Company 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 in excess, individually or in the aggregate, of $100,000,
other than ordinary course 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.

 

(c)                                  For the purposes of subsections (a) and (b)
above, all indebtedness, liabilities, agreements, understandings, instruments,
contracts and proposed transactions involving the same person or entity
(including persons or entities the Company has

 

6

--------------------------------------------------------------------------------

 

reason to believe are affiliated therewith) shall be aggregated for the purpose
of meeting the individual minimum dollar amounts of such subsections.

 

4.7                                 Obligations to Related Parties.  Except as
set forth on Schedule 4.7, there are no obligations of the Company or any of its
Subsidiaries to officers, directors, stockholders or employees of the Company or
any of its Subsidiaries other than:

 

(a)                                  for payment of salary for services rendered
and for bonus payments;

 

(b)                                 reimbursement for reasonable expenses
incurred on behalf of the Company and its Subsidiaries;

 

(c)                                  for other standard employee benefits made
generally available to all employees (including stock option agreements
outstanding under any stock option plan approved by the Board of Directors of
the Company); and

 

(d)                                 obligations listed in the Company’s
financial statements or disclosed in any of its Exchange Act Filings.

 

Except as described above or set forth on Schedule 4.7, none of the officers,
directors or, to the best of the Company’s knowledge, key employees or
stockholders of the Company or any members of their immediate families, are
indebted to the Company, individually or in the aggregate, in excess of $50,000
or have any direct or indirect ownership interest in any firm or corporation
with which the Company is affiliated or with which the Company has a business
relationship, or any firm or corporation which competes with the Company, other
than passive investments in publicly traded companies (representing less than
one percent (1%) of such company) which may compete with the Company. Except as
described above, no officer, director or stockholder, or any member of their
immediate families, is, directly or indirectly, interested in any material
contract with the Company and no agreements, understandings or proposed
transactions are contemplated between the Company and any such person.  Except
as set forth on Schedule 4.7, the Company is not a guarantor or indemnitor of
any indebtedness of any other person, firm or corporation.

 

4.8                                 Changes.  Since June 30, 2005, except as
disclosed in any Exchange Act Filing or in any Schedule to this Agreement or in
any of the Related Agreements, there has not been:

 

(a)                                  any change in the business, assets,
liabilities, condition (financial or otherwise), properties, operations or
prospects of the Company or any of its Subsidiaries, which individually or in
the aggregate has had, or would reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect;

 

(b)                                 any resignation or termination of any
officer, key employee or group of employees of the Company or any of its
Subsidiaries;

 

(c)                                  any material change, except in the ordinary
course of business, in the contingent obligations of the Company or any of its
Subsidiaries by way of guaranty, endorsement, indemnity, warranty or otherwise;

 

7

--------------------------------------------------------------------------------

 

(d)                                 any damage, destruction or loss, whether or
not covered by insurance, which has had, or would reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect;

 

(e)                                  any waiver by the Company or any of its
Subsidiaries of a material right under a written contract or of a material debt
owed to it;

 

(f)                                    any direct or indirect loans made by the
Company or any of its Subsidiaries to any stockholder, employee, officer or
director of the Company or any of its Subsidiaries, other than advances made in
the ordinary course of business;

 

(g)                                 any material change in any compensation
arrangement or agreement with any employee, officer, director or stockholder of
the Company or any of its Subsidiaries;

 

(h)                                 any labor organization activity related to
the Company or any of its Subsidiaries;

 

(i)                                     any debt, obligation or liability
incurred, assumed or guaranteed by the Company or any of its Subsidiaries,
except those for immaterial amounts and for current liabilities incurred in the
ordinary course of business;

 

(j)                                     any sale, assignment or transfer of any
patents, trademarks, copyrights, trade secrets or other intangible assets owned
by the Company or any of its Subsidiaries;

 

(k)                                  any change in any material agreement to
which the Company or any of its Subsidiaries is a party or by which either the
Company or any of its Subsidiaries is bound which either individually or in the
aggregate has had, or would reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect;

 

(l)                                     any other event or condition of any
character that, either individually or in the aggregate, has had, or would
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect; or

 

(m)                               any arrangement or commitment by the Company
or any of its Subsidiaries to do any of the acts described in subsection (a)
through (m) above.

 

4.9                                 Title to Properties and Assets; Liens, Etc. 
Except as set forth on Schedule 4.9, each of the Company and each of its
Subsidiaries has good and valid title to its properties and assets, and good
title to its leasehold estates, in each case subject to no mortgage, pledge,
lien, lease, encumbrance or charge, other than:

 

(a)                                  those resulting from taxes which have not
yet become delinquent;

 

(b)                                 minor liens and encumbrances which do not
materially detract from the value of the property subject thereto or materially
impair the operations of the Company or any of its Subsidiaries; and

 

(c)                                  those that have otherwise arisen in the
ordinary course of business.

 

8

--------------------------------------------------------------------------------

 

All facilities, machinery, equipment, fixtures, vehicles and other properties
owned, leased or used by the Company and 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 4.9, the Company and
its Subsidiaries are in compliance with all material terms of each lease to
which any of them is a party or is otherwise bound.

 

4.10                           Intellectual Property.

 

Except as set forth on Schedule 4.10:

 

(a)                                  Each of the Company and each of its
Subsidiaries owns or possesses sufficient legal rights to all patents,
trademarks, service marks, trade names, copyrights, trade secrets, licenses,
information and other proprietary rights and processes necessary for its
business as now conducted and to the Company’s knowledge, as presently proposed
to be conducted (the “Intellectual Property”), without any known infringement of
the rights of others.  There are no outstanding options, licenses or agreements
of any kind relating to the foregoing proprietary rights, nor is the Company or
any of its Subsidiaries bound by or a party to any options, licenses or
agreements of any kind with respect to the patents, trademarks, service marks,
trade names, copyrights, trade secrets, licenses, information and other
proprietary rights and processes of any other person or entity other than such
licenses or agreements arising from the purchase of “off the shelf” or standard
products.

 

(b)                                 Neither the Company nor any of its
Subsidiaries has received any communications alleging that the Company or any of
its Subsidiaries has violated any of the patents, trademarks, service marks,
trade names, copyrights or trade secrets or other proprietary rights of any
other person or entity, nor is the Company or any of its Subsidiaries aware of
any basis therefor.

 

(c)                                  The Company does not believe 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 the Company or any of
its Subsidiaries, except for inventions, trade secrets or proprietary
information that have been rightfully assigned to the Company or any of its
Subsidiaries.

 

4.11                           Compliance with Other Instruments.  Neither the
Company nor any of its Subsidiaries is in violation or default of (x) any term
of its Charter or Bylaws, or (y) of 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 Related Agreements to which it is a party, and the issuance and sale of the
Term Note by the Company and the other Securities by the Company each pursuant
hereto and thereto, will not, with or 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 mortgage, pledge, lien, encumbrance or charge upon any of the properties
or assets of the Company or any of its

 

9

--------------------------------------------------------------------------------

 

Subsidiaries or the suspension, revocation, impairment, forfeiture or nonrenewal
of any permit, license, authorization or approval applicable to the Company, its
business or operations or any of its assets or properties; provided, that as to
those Note Shares and Warrant Shares that are presently not authorized, the
issuance of such Note Shares and such Warrant Shares is subject to and
conditioned upon approval, adoption and effectiveness of the Share Increase
Amendment.

 

4.12                           Litigation.  Except as set forth on Schedule 4.12
hereto, there is no action, suit, proceeding or investigation pending or, to the
Company’s knowledge, currently threatened against the Company or any of its
Subsidiaries that prevents the Company or any of its Subsidiaries from entering
into this Agreement or the other Related Agreements, or from consummating the
transactions contemplated hereby or thereby, or which has had, or would
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect or any change in the current equity ownership of the
Company or any of its Subsidiaries, nor is the Company aware that there is any
basis to assert any of the foregoing. Neither the Company nor any of its
Subsidiaries is a party 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 the
Company or any of its Subsidiaries currently pending or which the Company or any
of its Subsidiaries intends to initiate.

 

4.13                           Tax Returns and Payments.  Each of the Company
and 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 the
Company or any of its Subsidiaries on or before the Closing, have been paid or
will be paid prior to the time they become delinquent.  Except as set forth on
Schedule 4.13, neither the Company nor any of its Subsidiaries has been advised:

 

(a)                                  that any of its returns, federal, state or
other, have been or are being audited as of the date hereof; or

 

(b)                                 of any deficiency in assessment or proposed
judgment to its federal, state or other taxes.

 

The Company has no knowledge of any liability for any tax to be imposed upon its
properties or assets as of the date of this Agreement that is not adequately
provided for.

 

4.14                           Employees.  Except as set forth on Schedule 4.14,
neither the Company 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 the Company’s knowledge, threatened with respect to the
Company or any of its Subsidiaries.  Except as disclosed in the Exchange Act
Filings or on Schedule 4.14, neither the Company 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 the
Company’s knowledge, no employee of the Company or any of its Subsidiaries, nor
any consultant with whom the Company 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, the Company or any of its Subsidiaries
because of the nature of the business

 

10

--------------------------------------------------------------------------------

 

to be conducted by the Company or any of its Subsidiaries; and to the Company’s
knowledge the continued employment by the Company or any of its Subsidiaries of
its present employees, and the performance of the Company’s and its
Subsidiaries’ contracts with its independent contractors, will not result in any
such violation.  Neither the Company nor any of its Subsidiaries is aware that
any of its 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 in any material respect with their duties to the Company or any of its
Subsidiaries.  Neither the Company 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 the Company or any of its
Subsidiaries, no employee of the Company or any of its Subsidiaries has been
granted the right to continued employment by the Company or any of its
Subsidiaries or to any material compensation following termination of employment
with the Company or any of its Subsidiaries.  Except as set forth on
Schedule 4.14, the Company is not aware that any officer, key employee or group
of employees intends to terminate his, her or their employment with the Company
or any of its Subsidiaries, nor does the Company or any of its Subsidiaries have
a present intention to terminate the employment of any officer, key employee or
group of employees.

 

4.15                           Registration Rights and Voting Rights.  Except as
set forth on Schedule 4.15 or except as disclosed in Exchange Act Filings,
neither the Company nor any of its Subsidiaries is presently under any
obligation, and neither the Company nor any of its Subsidiaries has granted any
rights, to register any of the Company’s or its Subsidiaries’ presently
outstanding securities or any of its securities that may hereafter be issued. 
Except as set forth on Schedule 4.15 or except as disclosed in Exchange Act
Filings, neither the Company nor any of its Subsidiaries has entered into any
agreement with respect to the voting of equity securities of the Company or any
of its Subsidiaries.

 

4.16                           Compliance with Laws; Permits.  Neither the
Company nor any of its Subsidiaries is in violation of any 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 would 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 other Related Agreement and the issuance of any of the
Securities, except such as has been duly and validly obtained or filed, or with
respect to any filings that must be made after the Closing, as will be filed in
a timely manner.  Each of the Company and 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 would,
either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

 

4.17                           Environmental and Safety Laws.  Neither the
Company 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.

 

11

--------------------------------------------------------------------------------

 

4.18                           Valid Offering.  Assuming the accuracy of the
representations and warranties of the Purchasers contained in this Agreement,
the offer, sale 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.

 

4.19                           Full Disclosure.  Each of the Company and each of
its Subsidiaries has provided the Purchasers with all information requested by
the Purchasers in connection with their decision to purchase the Term Note and
the Warrant, including all information the Company and its Subsidiaries believe
is reasonably necessary to make such investment decision.  Neither this
Agreement, the Related Agreements, or the exhibits and schedules hereto and
thereto 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 the Purchasers by the
Company or any of its Subsidiaries were based on the Company’s and its
Subsidiaries’ experience in the industry and on assumptions of fact and opinion
as to future events which the Company or any of its Subsidiaries, at the date of
the issuance of such projections or estimates, believed to be reasonable.

 

4.20                           Insurance.  Each of the Company and each of its
Subsidiaries has general commercial, product liability, fire and casualty
insurance policies with coverages which the Company believes are customary for
companies similarly situated to the Company and its Subsidiaries in the same or
similar business.

 

4.21                           SEC Reports.  Except as set forth on
Schedule 4.21, the Company has filed all reports and other documents required to
be filed by it under the Securities Exchange Act 1934, as amended (the “Exchange
Act”).  The Company has furnished the Purchasers with copies of:  (i) its Annual
Reports on Form 10-KSB for its fiscal year ended June 30, 2005; and (ii) its
Quarterly Reports on Form 10-QSB for its fiscal quarter ended September 30, 2005
and the Form 8-K filings which it has made during the fiscal year 2006 to date
(collectively, the “SEC Reports”). Except as set forth on Schedule 4.21, each
SEC Report was, at the time of its filing, in substantial compliance with the
requirements of its respective form and none of the SEC Reports, nor the
financial statements (and the notes thereto) included in the SEC Reports, 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 therein, in light of the circumstances under which they
were made, not misleading.

 

4.22                           Listing.  The Company’s Common Stock is listed
for trading on the Over the Counter Bulletin Board (“OTCBB”) and satisfies all
requirements for the continuation of such trading.  The Company has not received
any notice that its Common Stock will not be eligible to be traded on the OTCBB
or that its Common Stock does not meet all requirements for such trading.

 

4.23                           No Integrated Offering.  Neither the Company, nor
any of its Subsidiaries or 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 under circumstances that

 

12

--------------------------------------------------------------------------------

 

would cause the Offering to be integrated with prior offerings by the Company
for purposes of the Securities Act and which would prevent the Company from
selling the Securities 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 Securities to be integrated with other
offerings.

 

4.24                           Stop Transfer.  The Securities are restricted
securities as of the date of this Agreement.  Neither the Company 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.

 

4.25                           Dilution.  The Company specifically acknowledges
that, its obligation to issue the shares of Common Stock upon conversion of the
Term Notes and exercise of the Warrants 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.

 

4.26                           Patriot Act.  The Company certifies that, to the
best of Company’s knowledge, neither the Company nor any of its Subsidiaries has
been designated, and is not owned or controlled, by a “suspected terrorist” as
defined in Executive Order 13224.  The Company hereby acknowledges that the
Purchasers seek to comply with all applicable laws concerning money laundering
and related activities.  In furtherance of those efforts, the Company hereby
represents, warrants and agrees that:  (i) none of the cash or property that the
Company or any of its Subsidiaries will pay or will contribute to the Purchasers
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 the
Company or any of its Subsidiaries to the Purchasers, to the extent that they
are within the Company’s and/or its Subsidiaries’ control shall cause the
Purchasers 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.  The Company shall promptly notify the Purchasers if any of these
representations ceases to be true and accurate regarding the Company or any of
its Subsidiaries.  The Company agrees to provide the Purchasers any additional
information regarding the Company or any of its Subsidiaries that the Purchasers
deem necessary or convenient to ensure compliance with all applicable laws
concerning money laundering and similar activities.  The Company 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 or similar activities, the Purchasers may
undertake appropriate actions to ensure compliance with such applicable law or
regulation, including but not limited to segregation and/or redemption of the
Purchasers’ investment in the Company.  The Company further understands that the
Purchasers may release confidential information about the Company and its
Subsidiaries and, if applicable, any underlying beneficial owners, to proper
authorities if the Purchasers, in their sole reasonable discretion, after
consultation with legal counsel, determine that it is in the best interests of
the Purchasers in light of relevant rules and regulations under the laws set
forth in subsection (ii) above.

 

5.                                       Representations and Warranties of the
Purchaser.  Each Purchaser, severally and not jointly, hereby represents and
warrants to the Company as follows (such representations and

 

13

--------------------------------------------------------------------------------

 

warranties do not lessen or obviate the representations and warranties of the
Company set forth in this Agreement):

 

5.1                                 No Shorting.  Such Purchaser or any of its
affiliates and investment partners have not, will not and will not cause any
person or entity to directly engage in “short sales” of the Company’s Common
Stock as long as the Term Notes or any Warrants shall be outstanding.

 

5.2                                 Organization, Good Standing and
Qualification.  Each of the Purchasers is a corporation, partnership, limited
duration company 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. Each of the Purchasers has the corporate,
partnership, limited duration company or limited liability company, as the case
may be, power and authority to own and operate its properties and assets, to
execute and deliver (i) this Agreement, (ii) the Term Notes and the Warrants to
be issued in connection with this Agreement, (iii) the Registration Rights
Agreement relating to the Securities dated as of the date hereof among the
Company and the Purchasers (as amended, modified or supplemented from time to
time, the “Registration Rights Agreement”), (iv) the Escrow Agreement dated as
of the date hereof among the Company, the Purchasers and the escrow agent
referred to therein, substantially in the form of Exhibit D hereto (as amended,
modified or supplemented from time to time, the “Escrow Agreement”), and (v) all
other agreements related to this Agreement and the Term Note and referred to
herein (the preceding clauses (ii) through (iv), the Subsidiary Guaranty dated
as of May 19, 2005 made by certain Subsidiaries of the Company (as amended,
modified or supplemented from time to time, the “Subsidiary Guaranty”), the
Stock Pledge Agreement dated as of May 19, 2005 among the Company, certain
Subsidiaries of the Company and the Purchasers (as amended, modified or
supplemented from time to time, the “Stock Pledge Agreement”), and the
Subordination Agreement dated as of May 19, 2005 among the Purchasers and the
subordinated creditors party thereto, and acknowledged and agreed to by the
Company (as amended, modified or supplemented from time to time, the
Subordination Agreement”), collectively, the “Related Agreements”), to purchase
the Term Notes and the shares of Common Stock issuable upon conversion of the
Term Notes (the “Note Shares”), to purchase the Warrants and the Warrant Shares,
and, to carry out the provisions of this Agreement and the Related Agreements. 
Each of the Purchasers is duly qualified and is authorized to do business and is
in good standing as a foreign corporation, partnership, limited duration company
or limited liability company, as the case may be, in such Purchasers
jurisdictions of organization.

 

5.3                                 Requisite Power and Authority.  Such
Purchaser has all necessary power and authority under all applicable provisions
of law to execute and deliver this Agreement and the Related Agreements and to
carry out their provisions.  All company action on such Purchaser’s part
required for the lawful execution and delivery of this Agreement and the Related
Agreements has been or will be effectively taken prior to the Closing. Upon
their execution and delivery, this Agreement and the Related Agreements will be
valid and binding obligations of such Purchaser, 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

 

14

--------------------------------------------------------------------------------

 

(b)                                 as limited by general principles of equity
that restrict the availability of equitable and legal remedies.

 

5.4                                 Investment Representations.  Such Purchaser
understands that the Securities are being offered and sold pursuant to an
exemption from registration contained in the Securities Act based in part upon
such Purchaser’s representations contained in this Agreement, including, without
limitation, that such Purchaser is an “accredited investor” within the meaning
of Regulation D under the Securities Act. Such Purchaser confirms that it 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 Term
Note and the Warrant to be purchased by it under this Agreement and the Note
Shares and the Warrant Shares acquired by it upon the conversion of such Term
Note and the exercise of such Warrant, respectively. Such Purchaser further
confirms that it has had an opportunity to ask questions and receive answers
from the Company regarding the Company’s and its Subsidiaries’ business,
management and financial affairs and the terms and conditions of the Offering,
the Term Notes, the Warrants and the Securities.

 

5.5                                 The Purchasers Bear Economic Risk.  Such
Purchaser has substantial experience in evaluating and investing in private
placement transactions of securities in companies similar to the Company so that
it is capable of evaluating the merits and risks of its investment in the
Company and has the capacity to protect its own interests. Such Purchaser
acknowledges and agrees that it 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 applicable exemption from
registration with respect to such sale.

 

5.6                                 Acquisition for Own Account.  Such Purchaser
is acquiring its Term Notes and Warrant and the Note Shares and the Warrant
Shares for such Purchaser’s 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.

 

5.7                                 The Purchasers Can Protect Their Interest. 
Such Purchaser represents that by reason of its, or of its management’s,
business and financial experience, such Purchaser has the capacity to evaluate
the merits and risks of its investment in its Term Notes, Warrant and the
Securities and to protect its own interests in connection with the transactions
contemplated in this Agreement and the Related Agreements.  Further, such
Purchaser is aware of no publication of any advertisement in connection with the
transactions contemplated in this Agreement or the Related Agreements.

 

5.8                                 Accredited Investor.  Such Purchaser
represents that it is an accredited investor within the meaning of Regulation D
under the Securities Act.

 

5.9                                 Legends.

 

(a)                                  The Term Notes shall bear substantially the
following legend:

 

“THIS TERM NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS TERM NOTE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
APPLICABLE STATE SECURITIES LAWS.

 

15

--------------------------------------------------------------------------------

 

THIS TERM NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS TERM NOTE
MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THIS TERM NOTE OR SUCH SHARES UNDER SAID
ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO CORGENIX MEDICAL CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED.”

 

(b)                                 The Note Shares and the Warrant Shares,
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
Securities and Exchange Commission (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 LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
CORGENIX MEDICAL CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

(c)                                  The Warrant 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
CORGENIX MEDICAL CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

6.                                       Covenants of the Company.  The Company
covenants and agrees with the Purchasers as follows:

 

6.1                                 Stop-Orders.  The Company will advise the
Purchasers, 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

 

16

--------------------------------------------------------------------------------

 

securities of the Company, or of the suspension of the qualification of the
Common Stock of the Company for offering or sale in any jurisdiction, or the
initiation of any proceeding for any such purpose.

 

6.2                                 Authorization and Listing.  The Company does
not currently have enough shares of Common Stock authorized to provide in full
for the exercise of the Warrants or the conversion of the Term Notes.  The
Company covenants that it shall use its best efforts to prepare and file a proxy
statement with the SEC as soon as possible after the date of this Agreement,
with respect to a special meeting of its stockholders (the “Special Meeting”) to
consider the Share Increase Amendment (as hereinafter defined).  If the Company
receives any SEC comments on such proxy statement, it will use its best efforts
to resolve all comments as soon as possible after receipt thereof.  The Company
will promptly mail the proxy statement and notice of meeting to its stockholders
as soon as practicable.  The Company will hold the Special Meeting as soon as
practicable thereafter, but in any event within 90 days after the date of this
Agreement, to authorize a sufficient number of shares to include that number of
shares issuable upon conversion of the Term Notes and upon the exercise of
Warrants by voting upon an amendment to the Articles of Incorporation increasing
the number of authorized shares of Common Stock from the current 40,000,000 to
100,000,000 (the “Share Increase Amendment”).  The proxy statement describing
the Share Increase Amendment will be provided to the Purchasers in advance of
filing for review and comment, and the Company will consider in good faith any
reasonable revisions suggested by the Purchasers.  The Company’s shares of
Common Stock issuable upon conversion of the Term Notes and upon the exercise of
the Warrants will be listed on the OTCBB (the “Principal Market”) within 90 days
after the date of this Agreement and the Company shall maintain such listing on
the Principal Market so long as any other shares of Common Stock shall be so
listed. The Company will maintain the listing of its Common Stock on the
Principal Market, and will comply in all material respects with its reporting,
filing and other obligations.

 

6.3                                 Market Regulations.  The Company 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 the Purchasers and promptly provide copies thereof to the
Purchasers.

 

6.4                                 Reporting Requirements.  The Company will
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.

 

6.5                                 Use of Funds.  The Company agrees that it
will use the proceeds of the sale of the Term Notes and the Warrants for the
purposes specified on Schedule 6.5 only.

 

6.6                                 Access to Facilities.  The Company and each
of its Subsidiaries will permit any representatives designated by any Purchaser
(or any successor of such Purchaser), upon reasonable notice and during normal
business hours, at such person’s expense and accompanied by a representative of
the Company, to:

 

17

--------------------------------------------------------------------------------

 

(a)                                  visit and inspect any of the properties of
the Company or any of its Subsidiaries;

 

(b)                                 examine the corporate and financial records
of the Company or any of its Subsidiaries (unless such examination is not
permitted by federal, state or local law or by contract) and make copies thereof
or extracts therefrom; and

 

(c)                                  discuss the affairs, finances and accounts
of the Company or any of its Subsidiaries with the directors, officers and
independent accountants of the Company or any of its Subsidiaries.

 

Notwithstanding the foregoing, neither the Company nor any of its Subsidiaries
will provide any material, non-public information to any Purchaser unless such
Purchaser signs a confidentiality agreement and otherwise complies with
Regulation FD under the federal securities laws.

 

6.7                                 Taxes.  Each of the Company and each of its
Subsidiaries will 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 the income, profits, property or business of the
Company and its Subsidiaries; provided, however, that any such tax, assessment,
charge or levy need not be paid if the validity thereof shall be contested in
good faith by appropriate proceedings and if the Company and/or such Subsidiary
shall have set aside on its books adequate reserves with respect thereto, and
provided, further, that the Company and its Subsidiaries will 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.

 

6.8                                 Insurance.  Each of the Company and its
Subsidiaries will 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
businesses similarly situated as the Company and its Subsidiaries; and the
Company and its Subsidiaries will 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 the Company reasonably believes
is customary for companies in similar businesses similarly situated as the
Company and its Subsidiaries and to the extent available on commercially
reasonable terms. The Company 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 the Purchaser as security for their obligations
hereunder and under the Related Agreements. At the Company’s and each of its
Subsidiaries’ joint and several cost and expense in amounts and with carriers
reasonably acceptable to the Purchasers, the Company 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 the Company’s 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 the
Company’s or the respective Subsidiary’s insuring against larceny, embezzlement
or other criminal misappropriation of insured’s officers and employees who may
either singly or jointly with

 

18

--------------------------------------------------------------------------------

 

others at any time have access to the assets or funds of the Company or any of
its Subsidiaries 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 the Company or the respective Subsidiary is engaged in
business; and (v) furnish the Purchasers 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 the Company’s workers’ compensation policy,
endorsements to such policies naming the Purchasers as “co-insured” or
“additional insured” and appropriate loss payable endorsements in form and
substance satisfactory to the Purchasers, naming the Purchasers as loss payees,
and (z) evidence that as to the Purchasers the insurance coverage shall not be
impaired or invalidated by any act or neglect of the Company or any Subsidiary
and the insurer will provide the Purchasers with at least thirty (30) days
notice prior to cancellation.  The Company and each Subsidiary shall instruct
the insurance carriers that in the event of any loss thereunder, the carriers
shall make payment for such loss to the Company and/or the Subsidiary and the
Purchasers jointly.  In the event that as of the date of receipt of each loss
recovery upon any such insurance, the Purchasers have not declared an event of
default with respect to this Agreement or any of the Related Agreements, then
the Company and/or such Subsidiary shall be permitted to direct the application
of such loss recovery proceeds toward investment in property, plant and
equipment that would comprise “Collateral” secured by the Purchasers’ security
interest pursuant to its security agreement, with any surplus funds to be
applied toward payment of the obligations of the Company to the Purchasers.  In
the event that the Purchasers have properly declared an event of default with
respect to this Agreement or any of the Related Agreements, then all loss
recoveries received by the Purchasers upon any such insurance thereafter may be
applied to the obligations of the Company hereunder and under the Related
Agreements, in such order as the Purchasers may determine. Any surplus
(following satisfaction of all Company obligations to the Purchasers) shall be
paid by the Purchasers to the Company or applied as may be otherwise required by
law.  Any deficiency thereon shall be paid by the Company or the Subsidiary, as
applicable, to the Purchasers, on demand.

 

6.9                                 Intellectual Property.  Each of the Company
and each of its Subsidiaries shall maintain in full force and effect its
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.

 

6.10                           Properties.  Each of the Company and each of its
Subsidiaries will 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 each of the Company and each of its Subsidiaries will 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 would, either individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

6.11                           Confidentiality.  The Company agrees that it will
not disclose, and will not include in any public announcement, the names of the
Purchasers, unless expressly agreed to by the Purchasers or unless and until
such disclosure is required by law or applicable regulation, and

 

19

--------------------------------------------------------------------------------

 

then only to the extent of such requirement.  Notwithstanding the foregoing, the
Company may disclose the Purchasers’ identity and the terms of this Agreement to
its current and prospective debt and equity financing sources.  Notwithstanding
the provisions of this section, the Purchasers consent to the Company’s filing
of this Agreement and the Related Agreements as exhibits to its Form 8-K.

 

6.12                           Required Approvals.  For so long as twenty-five
percent (25%) of the aggregate principal amount of the Term Notes and the Term
Notes dated as of May 19, 2005 are outstanding, the Company, without the prior
written consent of the Purchasers, shall not, and shall not permit any of its
Subsidiaries to:

 

(a)                                  (i) directly or indirectly declare or pay
any dividends, other than dividends paid to the Company or any of its
wholly-owned Subsidiaries, (ii) issue any preferred stock that is mandatorily
redeemable prior to the one year anniversary of Maturity Date (as defined in the
Term Notes) or (iii) redeem any of its preferred stock or other equity
interests;

 

(b)                                 liquidate, dissolve or effect a material
reorganization (it being understood that in no event shall the Company dissolve,
liquidate or merge with any other person or entity (unless the Company is the
surviving entity);

 

(c)                                  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 the
Company’s or any of its Subsidiaries’ right to perform the provisions of this
Agreement, any Related Agreement or any of the agreements contemplated hereby or
thereby;

 

(d)                                 materially alter or change the scope of the
business of the Company and its Subsidiaries taken as a whole;

 

(e)                                  (i) create, incur, assume or suffer to
exist any indebtedness (exclusive of debt incurred to finance the purchase of
equipment not in excess of five percent (5%) of the fair market value of the
Company’s and its Subsidiaries’ assets) whether secured or unsecured other than
(x) the Company’s indebtedness to the Purchasers, (y) indebtedness set forth on
Schedule 6.12(e) attached hereto and made a part hereof and any refinancings or
replacements thereof on terms no less favorable to the Company than the
indebtedness being refinanced or replaced, and (z) any debt incurred in
connection with the purchase of assets in the ordinary course of business, or
any refinancings or replacements thereof on terms no less favorable to the
Company than the indebtedness being refinanced or replaced; (ii) cancel any debt
owing to it in excess of $50,000 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 the
endorsement of negotiable instruments by the Company for deposit or collection
or similar transactions in the ordinary course of business or guarantees of
indebtedness otherwise permitted to be outstanding pursuant to this clause (e);
and

 

20

--------------------------------------------------------------------------------

 

(f)                                    create or acquire any Subsidiary after
the date hereof unless (i) such Subsidiary is a wholly-owned Subsidiary of the
Company and (ii) such Subsidiary becomes party to the Term Note Security
Agreement, the Stock Pledge Agreement and the Subsidiary Guaranty (either by
executing a counterpart thereof or an assumption or joinder agreement in respect
thereof) and, to the extent required by the Purchasers, satisfies each condition
of this Agreement and the Related Agreements as if such Subsidiary were a
Subsidiary on the Closing Date.

 

6.13                           Repayment of Indebtedness.  The Company agrees
that if and for so long as it shall have less than $500,000 in cash, it shall
not make any payments of principal or interest on any indebtedness other than
the Company’s indebtedness to the Purchasers.

 

6.14                           Reissuance of Securities.  The Company agrees to
reissue certificates representing the Securities without the legends set forth
in Section 5.8 above at such time as:

 

(a)                                  the holder thereof is permitted to dispose
of such Securities pursuant to Rule 144(k) under the Securities Act; or

 

(b)                                 upon resale subject to an effective
registration statement after such Securities are registered under the Securities
Act.

 

The Company agrees to cooperate with the Purchasers 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 Company and its counsel receive
reasonably requested representations from the selling Purchaser and the broker,
if any.

 

6.15                           Opinion.  On the Closing Date, the Company will
deliver to the Purchasers an opinion acceptable to the Purchasers from the
Company’s external legal counsel. The Company will provide, at the Company’s
expense, such other legal opinions in the future as are deemed reasonably
necessary by any Purchaser (and acceptable to such Purchaser) in connection with
the conversion of the Term Notes and exercise of the Warrants.

 

6.16                           Margin Stock.  The Company will not permit any of
the proceeds of the Term Note or the Warrant 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.

 

6.17                           [Reserved.]

 

6.18                           Financing Right of First Refusal.  (a)  The
Company hereby grants to the Purchasers a right of first refusal to provide any
Additional Financing (as defined below) to be issued by the Company and/or any
of its Subsidiaries, subject to the following terms and conditions. From and
after the date hereof, prior to the incurrence of any additional indebtedness
and/or the sale or issuance of any equity interests of the Company or any of its
Subsidiaries (other than pursuant to employee benefit plans or the exercise or
conversion of securities outstanding on the date hereof) (an “Additional
Financing”), the Company and/or any Subsidiary of the Company, as the case may
be, shall notify the Purchasers of its intention to enter into such

 

21

--------------------------------------------------------------------------------

 

Additional Financing. In connection therewith, the Company and/or the applicable
Subsidiary thereof shall submit a term sheet (a “Proposed Term Sheet”) to the
Purchasers setting forth the terms, conditions and pricing of any such
Additional Financing (such financing to be negotiated on “arm’s length” terms
and the terms thereof to be negotiated in good faith) proposed to be entered
into by the Company and/or such Subsidiary. The Purchasers (or one or more
thereof) shall have the right, but not the obligation, to deliver their own
proposed term sheet (the “Purchasers Term Sheet”) setting forth the terms and
conditions upon which the Purchasers (or one or more thereof) would be willing
to provide such Additional Financing to the Company and/or such Subsidiary. The
Purchasers Term Sheet shall contain terms no less favorable to the Company
and/or such Subsidiary than those outlined in the Proposed Term Sheet. The
Purchasers (or one or more thereof) shall deliver such Purchasers Term Sheet
within ten business days of receipt of each such Proposed Term Sheet.  If the
provisions of the Purchasers Term Sheet are at least as favorable to the Company
and/or such Subsidiary, as the case may be, as the provisions of the Proposed
Term Sheet, the Company and/or such Subsidiary shall enter into and consummate
the Additional Financing transaction outlined in the Purchasers Term Sheet.

 

(b)                                 The Company will not, and will not permit
its Subsidiaries to, agree, directly or indirectly, to any restriction with any
person or entity which limits the ability of the Purchasers to consummate an
Additional Financing with the Company or any of its Subsidiaries.

 

6.19                           [Reserved.]

 

6.20                           Net Worth.  The Company shall maintain a minimum
tangible net worth in accordance with generally accepted accounting principles
in effect from time to time in the United States of America (“GAAP”) of $0 for
so long as it has obligations to the Purchasers under this Agreement and the
Related Agreements.

 

6.21                           Retention of Investor Relations/Public Relations
Firm and Program.  The Company shall retain an investor relations firm/public
relations firm approved by the Purchasers for so long as the Company has
obligations to the Purchasers under this Agreement and the Related Agreements. 
Such investor relations firm’s/public relations firm’s budget and program must
be approved in advance by the Purchasers for so long as the Company has
obligations to the Purchasers under this Agreement and the Related Agreements.

 

7.                                       Covenants of the Purchasers.  Each
Purchaser, severally and not jointly, covenants and agrees with the Company as
follows:

 

7.1                                 Confidentiality.  Such Purchaser agrees that
it will not disclose, and will not include in any public announcement, the name
of the Company, unless expressly agreed to by the Company or unless and until
such disclosure is required by law or applicable regulation, and then only to
the extent of such requirement.

 

7.2                                 Non-Public Information.  Such Purchaser
agrees not to effect any sales of the shares of the Company’s Common Stock while
in possession of material, non-public information regarding the Company if such
sales would violate applicable securities law.

 

22

--------------------------------------------------------------------------------

 

7.3                                 Amendment to Articles of Incorporation.  The
Purchasers hereby agree to vote any shares of capital stock of the Company that
they may own, directly or beneficially, for the Share Increase Amendment
referenced in Section 6.2.  To the extent that the shares of Common Stock
issuable upon a Purchaser’s request to convert any portion of a Term Note or to
exercise any portion of a Warrant would exceed the number of shares of
authorized and unissued Common Stock, until approval, adoption and effectiveness
of the Share Increase Amendment by the Company’s shareholders, any such
attempted conversion or exercise shall be null and void.

 

8.                                       Covenants of the Company and the
Purchasers Regarding Indemnification.

 

8.1                                 Company Indemnification.  The Company agrees
to indemnify, hold harmless, reimburse and defend the Purchasers and each of the
Purchasers’ officers, directors, agents, affiliates, control persons, and
principal shareholders, against any claim, cost, expense, liability, obligation,
loss or damage (including reasonable legal fees) of any nature, incurred by or
imposed upon the Purchasers which results, arises out of or is based upon: (i)
any misrepresentation by the Company or any of its Subsidiaries or breach of any
warranty by the Company or any of its Subsidiaries in this Agreement, any other
Related Agreement or in any exhibits or schedules attached hereto or thereto; or
(ii) any breach or default in performance by the Company or any of its
Subsidiaries of any covenant or undertaking to be performed by the Company or
any of its Subsidiaries hereunder, under any other Related Agreement or any
other agreement entered into by the Company and/or any of its Subsidiaries and
the Purchasers relating hereto or thereto.

 

8.2                                 The Purchasers’ Indemnification.  Each
Purchaser agrees to indemnify, hold harmless, reimburse and defend the Company
and each of the Company’s officers, directors, agents, affiliates, control
persons and principal shareholders, against any claim, cost, expense, liability,
obligation, loss or damage (including reasonable legal fees) of any nature,
incurred by or imposed upon the Company which results, arises out of or is based
upon:  (i) any misrepresentation by such Purchaser or breach of any warranty by
such Purchaser in this Agreement or in any exhibits or schedules attached hereto
or any Related Agreement; or (ii) any breach or default in performance by such
Purchaser of any covenant or undertaking to be performed by such Purchaser
hereunder, or under any other Related Agreement.

 

9.                                       Conversion of Convertible Term Notes.

 

9.1                                 Mechanics of Conversion.

 

(a)                                  Provided any Purchaser has notified the
Company of such Purchaser’s intention to sell the Note Shares and the Note
Shares are included in an effective registration statement or are otherwise
exempt from registration when sold:  (i) upon the conversion of a Term Note or
part thereof, the Company shall, at its own cost and expense, take all necessary
action (including the issuance of an opinion of counsel reasonably acceptable to
such Purchaser following a request by such Purchaser) to assure that the
Company’s transfer agent shall issue shares of the Company’s Common Stock in the
name of such Purchaser (or its nominee) or such other persons as designated by
such Purchaser in accordance with Section 9.1(b) hereof and in such
denominations to be specified representing the number of Note Shares issuable
upon such conversion; and

 

23

--------------------------------------------------------------------------------

 

(ii) the Company warrants that no instructions other than these instructions
have been or will be given to the transfer agent of the Company’s Common Stock
and that after the Effectiveness Date (as defined in the Registration Rights
Agreement) the Note Shares issued will be freely transferable subject to the
prospectus delivery requirements of the Securities Act and the provisions of
this Agreement, and will not contain a legend restricting the resale or
transferability of the Note Shares.

 

(b)                                 Each Purchaser will give notice of its
decision to exercise its right to convert its Term Note or part thereof by
telecopying or otherwise delivering an executed and completed notice of the
number of shares to be converted to the Company (the “Notice of Conversion”).
Such Purchaser will not be required to surrender its Term Note until such
Purchaser receives a credit to the account of the Purchaser’s prime broker
through the DWAC system (as defined below), representing the Note Shares or
until its Term Note has been fully satisfied.  Each date on which a Notice of
Conversion is telecopied or delivered to the Company in accordance with the
provisions hereof shall be deemed a “Conversion Date.”  Pursuant to the terms of
the Notice of Conversion, the Company will issue instructions to the transfer
agent accompanied by an opinion of counsel within two (2) business days of the
date of the delivery to the Company of the Notice of Conversion and shall cause
the transfer agent to transmit the certificates representing the Conversion
Shares to the Holder by crediting the account of such Purchaser’s prime broker
with The Depository Trust Company (“DTC”) through its Deposit Withdrawal Agent
Commission (“DWAC”) system within three (3) business days after receipt by the
Company of the Notice of Conversion (the “Delivery Date”).

 

(c)                                  The Company understands that a delay in the
delivery of the Note Shares in the form required pursuant to Section 9 hereof
beyond the Delivery Date could result in economic loss to the Purchasers.  In
the event that the Company fails to direct its transfer agent to deliver the
Note Shares to any Purchaser via the DWAC system within the time frame set forth
in Section 9.1(b) above and the Note Shares are not delivered to such Purchaser
by the Delivery Date, as compensation to such Purchaser for such loss, the
Company agrees to pay late payments to such Purchaser for late issuance of the
Note Shares in the form required pursuant to Section 9 hereof upon conversion of
its Term Note in the amount equal to the greater of:  (i) $250 per business day
after the Delivery Date; or (ii) such Purchaser’s actual damages from such
delayed delivery. Notwithstanding the foregoing, the Company will not owe a
Purchaser any late payments if the delay in the delivery of the Note Shares
beyond the Delivery Date is solely out of the control of the Company and the
Company is actively trying to cure the cause of the delay.  The Company shall
pay any payments incurred under this Section in immediately available funds upon
demand and, in the case of actual damages, accompanied by reasonable
documentation of the amount of such damages.  Such documentation shall show the
number of shares of Common Stock such Purchaser is forced to purchase (in an
open market transaction) which such Purchaser anticipated receiving upon such
conversion, and shall be calculated as the amount by which (A) such Purchaser’s
total purchase price (including customary brokerage commissions, if any) for the
shares of Common Stock so purchased exceeds (B) the aggregate principal and/or
interest amount of its Term Note, for which such Conversion Notice was not
timely honored.

 

24

--------------------------------------------------------------------------------

 

Nothing contained herein 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 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 amount permitted by such
law, any payments in excess of such maximum shall be credited against amounts
owed by the Company to the Purchasers and thus refunded to the Company.

 

10.                                 Registration Rights.

 

10.1                           Registration Rights Granted.  The Company hereby
grants registration rights to the Purchasers pursuant to the Registration Rights
Agreement dated as of even date herewith among the Company and the Purchasers.

 

10.2                           Offering Restrictions.  Except as previously
disclosed in the SEC Reports or in the Exchange Act Filings, or stock or stock
options granted to employees or directors of the Company (these exceptions
hereinafter referred to as the “Excepted Issuances”), neither the Company nor
any of its Subsidiaries will issue any securities with a continuously
variable/floating conversion feature which are or could be (by conversion or
registration) free-trading securities (i.e. common stock subject to a
registration statement) prior to the full repayment or conversion of the Term
Note (together with all accrued and unpaid interest and fees related thereto)
(the “Exclusion Period”).

 

11.                                 Miscellaneous.

 

11.1                           Governing Law.  THIS AGREEMENT AND EACH RELATED
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.  ANY
ACTION BROUGHT BY EITHER PARTY AGAINST THE OTHER CONCERNING THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT AND EACH RELATED AGREEMENT SHALL BE BROUGHT ONLY
IN THE STATE COURTS OF NEW YORK OR IN THE FEDERAL COURTS LOCATED IN THE STATE OF
NEW YORK.  BOTH PARTIES AND THE INDIVIDUALS EXECUTING THIS AGREEMENT AND THE
RELATED AGREEMENTS ON BEHALF OF THE COMPANY AGREE TO SUBMIT TO THE JURISDICTION
OF SUCH COURTS AND WAIVE TRIAL BY JURY.  IN THE EVENT THAT ANY PROVISION OF THIS
AGREEMENT OR ANY RELATED AGREEMENT DELIVERED IN CONNECTION HEREWITH IS INVALID
OR UNENFORCEABLE UNDER ANY APPLICABLE STATUTE OR RULE OF LAW, THEN SUCH
PROVISION SHALL BE DEEMED INOPERATIVE TO THE EXTENT THAT IT MAY CONFLICT
THEREWITH AND SHALL BE DEEMED MODIFIED TO CONFORM WITH SUCH STATUTE OR RULE OF
LAW.  ANY SUCH PROVISION WHICH MAY PROVE INVALID OR UNENFORCEABLE UNDER ANY LAW
SHALL NOT AFFECT THE VALIDITY OR ENFORCEABILITY OF ANY OTHER PROVISION OF THIS
AGREEMENT OR ANY RELATED AGREEMENT.

 

11.2                           Survival.  The representations, warranties,
covenants and agreements made herein shall survive any investigation made by the
Purchasers and the closing of the transactions contemplated hereby to the extent
provided therein. All statements as to factual

 

25

--------------------------------------------------------------------------------

 

matters contained in any certificate or other instrument delivered by or on
behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.

 

11.3                           Successors.  Except as otherwise expressly
provided herein, the provisions hereof shall inure to the benefit of, and be
binding upon, the successors, heirs, executors and administrators of the parties
hereto and shall inure to the benefit of and be enforceable by each person who
shall be a holder of the Securities from time to time, other than the holders of
Common Stock which has been sold by such Purchaser pursuant to Rule 144 or an
effective registration statement. The Purchasers may not assign their rights
hereunder to a competitor of the Company.

 

11.4                           Entire Agreement.  This Agreement, the Related
Agreements, the exhibits and schedules hereto and thereto and the other
documents delivered pursuant hereto constitute the full and entire understanding
and agreement between the parties with regard to the subjects hereof and no
party shall be liable or bound to any other in any manner by any
representations, warranties, covenants and agreements except as specifically set
forth herein and therein.

 

11.5                           Amendment and Waiver.

 

(a)                                  This Agreement may be amended or modified
only upon the written consent of the Company and each of the Purchasers.

 

(b)                                 The obligations of the Company and the
rights of the Purchasers under this Agreement may be waived only with the
unanimous written consent of the Purchasers.

 

(c)                                  The obligations of the Purchasers and the
rights of the Company under this Agreement may be waived only with the written
consent of the Company.

 

11.6                           Delays or Omissions.  It is agreed that no delay
or omission to exercise any right, power or remedy accruing to any party, upon
any breach, default or noncompliance by another party under this Agreement or
the Related Agreements, shall impair any such right, power or remedy, nor shall
it be construed to be a waiver of any such breach, default or noncompliance, or
any acquiescence therein, or of or in any similar breach, default or
noncompliance thereafter occurring.  All remedies, either under this Agreement
or the Related Agreements, by law or otherwise afforded to any party, shall be
cumulative and not alternative.

 

11.7                           Notices.  All notices required or permitted
hereunder shall be in writing and shall be deemed effectively given:

 

(a)                                  upon personal delivery to the party to be
notified;

 

(b)                                 when sent by confirmed facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day;

 

(c)                                  three (3) business days after having been
sent by registered or certified mail, return receipt requested, postage prepaid;
or

 

26

--------------------------------------------------------------------------------

 

(d)                                 one (1) day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written
verification of receipt.

 

All communications shall be sent as follows:

 

If to the Company, to:

 

Corgenix Medical Corporation
12061 Tejon Street
Westminster, CO 80234
Attention:  Chief Financial Officer
Facsimile:

 

 

 

With a copy to:

 

Otten, Johnson, Robinson, Neff &
Ragonetti, P.C.
950 Seventeenth Street, Suite 1600
Denver, CO80202
Attention: Robert Attai and Steven Segal

 

 

 

If to a Truk Opportunity or Truk International:

 

c/o RAM Capital Resources, LLC
One East 52nd Street
Sixth Floor
New York, NY 10022
Facsimile:(212) 888-0334

 

 

 

If to CAMOFI:

 

350 Madison Avenue
New York, NY 10017

 

 

 

 

 

for Truk Opportunity, Truk International and
CAMOFI with a copy to:

 

 

 

 

 

Torys LLP
237 Park Avenue, 20th Floor
New York, NY 10017
Attention:Andrew J. Beck, Esq.
Facsimile:  (212) 682-0200
E-mail:       abeck@torys.com

 

or at such other address as the Company or such Purchaser may designate by
written notice to the other parties hereto given in accordance herewith.

 

11.8                           Attorneys’ Fees.  In the event that any suit or
action is instituted to enforce any provision in this Agreement, the prevailing
party in such dispute shall be entitled to recover from the losing party all
fees, costs and expenses of enforcing any right of such prevailing party under
or with respect to this Agreement, including, without limitation, such
reasonable fees and expenses of attorneys and accountants, which shall include,
without limitation, all fees, costs and expenses of appeals.

 

27

--------------------------------------------------------------------------------

 

11.9                           Titles and Subtitles.  The titles of the sections
and subsections of this Agreement are for convenience of reference only and are
not to be considered in construing this Agreement.

 

11.10                     Facsimile Signatures; Counterparts.  This Agreement
may be executed by facsimile signatures and in any number of counterparts, each
of which shall be an original, but all of which together shall constitute one
instrument.

 

11.11                     Broker’s Fees.  Other than Ascendiant, each party
hereto represents and warrants that no agent, broker, investment banker, person
or firm acting on behalf of or under the authority of such party hereto is or
will be entitled to any broker’s or finder’s fee or any other commission
directly or indirectly in connection with the transactions contemplated herein. 
Each party hereto further agrees to indemnify each other party for any claims,
losses or expenses incurred by such other party as a result of the
representation in this Section 11.11 being untrue.

 

11.12                     Construction.  Each party acknowledges that its legal
counsel participated in the preparation of this Agreement and the Related
Agreements and, therefore, stipulates that the rule of construction that
ambiguities are to be resolved against the drafting party shall not be applied
in the interpretation of this Agreement to favor any party against the other.

 

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

 

28

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have executed this SECURITIES PURCHASE
AGREEMENT as of the date set forth in the first paragraph hereof.

 

COMPANY:

PURCHASERS:

 

 

 

 

CORGENIX MEDICAL CORPORATION

TRUK OPPORTUNITY FUND, LLC

 

 

 

 

 

By:

Atoll Asset Management, LLC

 

 

 

By:

  /s/ Douglass T. Simpson

 

By:

  /s/Stephen E. Saltzstein

 

Name:

Douglass T. Simpson

Name:

Stephen E. Saltzstein

Title

President & CEO

Title:

Principal

 

 

 

TRUK INTERNATIONAL FUND, LP

 

 

 

 

 

By:

Atoll Asset Management, LLC

 

 

 

 

By:

  /s/Stephen E. Saltzstein

 

 

Name:

Stephen E. Saltzstein

 

Title:

Principal

 

 

 

CAMOFI MASTER LDC

 

 

 

 

 

By:

  /s/ Jeffrey M. Haas

 

 

Name:

Jeffrey M. Haas

 

Title:

Authorized Signatory

 

29

--------------------------------------------------------------------------------

 

EXHIBIT A

 

FORM OF CONVERTIBLE TERM NOTE

 

A-1

--------------------------------------------------------------------------------

 

EXHIBIT B

 

FORM OF WARRANT

 

B-1

--------------------------------------------------------------------------------

 

EXHIBIT C

 

FORM OF OPINION

 

C-1

--------------------------------------------------------------------------------

 

EXHIBIT D

 

FORM OF ESCROW AGREEMENT

 

D-1

--------------------------------------------------------------------------------

 

SCHEDULE I

 

Additional Investment Rights Term Notes:

 

Purchaser

 

Principal Amount

 

Purchase Price

 

 

 

 

 

 

 

Truk Opportunity & Truk International

 

$

511,364

 

$

464,876

 

 

 

 

 

 

 

CAMOFI

 

$

988,636

 

$

898,759

 

 

Warrants:

 

Holder

 

Number of Shares of
the Company’s Common Stock

 

 

 

 

 

Truk Opportunity & Truk International

 

1,022,727

 

 

 

 

 

CAMOFI

 

1,977,273

 

 

--------------------------------------------------------------------------------

 

SCHEDULE 6.5

 

Legal Fees and Amounts listed on the
Disbursement Letter to the Escrow Agent

 

--------------------------------------------------------------------------------