Exhibit 10.5


 


MANAGEMENT AGREEMENT


 


This Management Agreement (“Agreement”)
is made and entered into as of May 1, 2010 between Corgenix Medical
Corporation, a Nevada corporation (the “Company”), and Taryn G. Reynolds (the “Executive”).


 


The Company currently
employs or intends to employ the Executive in the position of Vice President Facilities
and Information Technology. The Company and the Executive desire to enter into
an agreement setting forth the terms of the Executive’s employment in such
capacities by the Company. In consideration of the mutual promises contained
herein, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:


 


Now, therefore, in
consideration of the rights and obligations contained in this Agreement, and
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged by the Executive and the Company, the parties agree as
follows:


 


1.                    Replacement of
Existing Management Agreement. This Agreement terminates
and replaces any prior agreement between the Executive and the Company with
respect to the terms of the Executive’s employment, including the Management
Agreement dated June 16, 2005. The Executive recognizes that it is in the
best interests of the Executive and the Company to modify the Management
Agreement as set forth in this Agreement.


 


2.                    Employment;
Position; Term. The Company and the Executive hereby agree to the
Executive’s employment by the Company in the position of Vice President
Facilities and Information Technology (the “Position”). Subject to earlier
termination pursuant to the terms of Section 5, the initial term of this
Agreement shall be for thirty-six (36) months, beginning May 1, 2010 and
ending at 5:00 Mountain Time on April 30, 2013. Beginning on May 1,
2013 and on each May 1st thereafter (any such day being referred to herein
as a “Renewal Date”) the term of this Agreement shall be extended automatically
for one additional year unless the Company has provided Executive with written
notice at least 120 days in advance of the next Renewal Date that the term of
this Agreement shall not be so extended.


 


3.                    Duties,
Responsibilities and Authority. In his capacities in the
Position, the Executive shall direct Company facility and information technology
(IT) functions and activities worldwide. 
The Executive shall devote his full professional and managerial time and
effort to the performance of the duties of the Position and he shall not engage
in any other business activity or activities which, in the mutual judgment of
the Executive and the President/CEO, do, in fact, conflict with the performance
of his duties under this Agreement, unless agreed to in writing by the President/CEO
and attached to this Agreement. Both the Company and the Executive acknowledge
that the services to be provided by Executive are critical to the Company’s
business.


 


4.                    Compensation.


 


(a)                 Salary and Incentive Compensation. For services rendered under this Agreement, the Company
shall pay the Executive a monthly salary of $10,307.50 paid semi-monthly in
accordance with the Company’s customary payroll practice.


 

















 


(b)                 Automobile expense reimbursement. The Company shall reimburse the Executive in the amount of
$500.00 per month for reasonable and necessary automobile expenses to be
incurred by the Executive in connection with his employment by the Company.


 


(c)                 Benefits and Vacation.
The Executive shall be eligible to participate in such insurance programs
(health, disability, or life) or such other employee benefits programs as the
Board may approve, on a basis at least as favorable, as well as comparable, to
that available to other officers and executive employees of the Company. The
Executive may participate in stock option programs of the Company upon such
terms as the Board may approve.  The
Executive shall be entitled to paid time off from work at the discretion of the
President/CEO. The value of any unused vacation time shall not be paid to the
Executive upon termination of his employment for any reason.


 


(d)                 Reimbursement of Expenses.
The Company shall reimburse the Executive for all reasonable out-of pocket
expenses incurred by the Executive in connection with the business of the
Company and in the performance of his duties under this Agreement upon the
Executive’s presentation to the Company of an itemized accounting of such
expenses with reasonable supporting data. If the Board adopts business
reimbursement expense policies, then reimbursement will be made consistent with
those policies, which will take priority over this Section 4(e).


 


5.                    Termination.


 


(a)                 Termination for Cause.
Notwithstanding any provision in this Agreement to the contrary, the Company
may terminate the Executive’s employment for “Cause” (as hereinafter defined)
immediately upon written notice stating the basis for such termination. “Cause”
for termination of the Executive’s employment shall only be deemed to exist if
the Executive has breached this Agreement, exhibited willful disobedience of
directions of the President/CEO, or committed gross malfeasance in performance
of his duties hereunder or acts resulting in an indictment charging the
Executive with commission of a felony; provided that the commission of acts
resulting in such an indictment shall constitute Cause only if a majority of
the directors who are not also subject to any such indictment determine that
the Executive’s conduct has substantially and adversely affected the Company or
its reputation. A material failure to perform his duties hereunder that results
from the Disability (defined below) of the Executive shall not be considered
Cause.


 


(b)                 Termination Without Cause.
Notwithstanding any provision in this Agreement to the contrary, the Company
may terminate the Executive’s employment without Cause and for any or no
reason, upon 30 days written notice to the Executive. For the avoidance of
doubt, the Company’s election not to renew the term of this Agreement beyond
the next applicable Renewal Date will not constitute a termination and will not
create any rights in favor of the Executive.


 

















 


(c)                 Death or Disability.


 


(i)                   In
the event of the death of the Executive, except with respect to any benefits
which have accrued and have not been paid to the Executive hereunder, the
provisions of this Agreement shall terminate immediately. However, the
Executive’s estate shall have the right to receive compensation due to the
Executive as of and to the date of his death and, furthermore, to receive an
additional amount equal to one twelfth (1/12) of the Executive’s annual
compensation then in effect as specified in Section 4(a) above.


 


(ii)                 If,
during the term of this Agreement, the Executive, in the reasonable judgment of
the Board, has failed to perform his duties under this Agreement on account of
Executive’s “Disability” (as hereinafter defined), the Company shall have the
right to terminate the Executive’s employment hereunder by written notification
to the Executive.  Executive’s Disability
means his incapacity due to physical or mental illness such that he is unable
to perform his previously assigned duties where (1) such incapacity has
been determined to exist by either (x) the Company’s disability insurance
carrier or (y) by the concurring opinions of two licensed physicians (one
selected by the Company and one by Executive), and (2) the Company has
determined, based on competent medical advice, that such incapacity is likely
to continue for at least six continuous months. 
Any such termination for disability shall be only as permitted by the
Americans with Disabilities Act.


 


(d)                 Severance Pay.
In the event that the Executive’s employment is terminated by the Company other
than for Cause, death, or Disability, the Executive shall be entitled to
receive twelve (12) additional months of his then current monthly compensation
as specified in Section 4(a), payable on the Company’s normal payroll
schedule.  If the Executive voluntarily
terminates his employment hereunder, or if his employment is terminated for
Cause or due to death or Disability, or if this Agreement is not extended
beyond the next applicable Renewal Date, then the Executive shall not be
entitled to any severance pay other than as provided in clause (c) of this
Section 4, if applicable.


 


6.                    Change of
Control Payment.


 


(a)                 In
the event of a Termination Upon a Change in Control, as set forth in this Section 6,
the Executive shall be entitled to receive a lump sum payment equal to
twenty-four (24) months of his then current monthly compensation as specified
in Section 4(a).


 


(b)                 “Change
in Control” shall mean a change in ownership or control of the Company effected
through any of the following transactions:


 


(i)                   The
date any one person, or more than one person acting as a group, acquires (or
has acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) ownership of stock of the Company
possessing 50 percent or more of the total voting power of the stock;


 

















 


(ii)                 The
date a majority of members of the Company’s board of directors is replaced
during any 12-month period by directors whose appointment or election is not
endorsed by a majority of the members of the Company’s board of directors
before the date of the appointment or election; or


 


(iii)                the
date that any one person, or more than one person acting as a group, acquires
(or has acquired during the 12-month period ending on the date of the most
recent acquisition by such person or persons) assets from the Company that have
a total gross fair market value equal to or more than 50 percent of the total
gross fair market value of all of the assets of the Company immediately before
such acquisition or acquisitions.  For
this purpose, gross fair market value means the value of the assets of the
Company, or the value of the assets being disposed of, determined without
regard to any liabilities associated with such assets.


 


The forgoing provisions are intended to meet the
definition of “change in control” of the regulations issued under Section 409A
of the Internal Revenue Code of 1986, as amended, and shall be interpreted in
accordance with such regulations.


 


(c)                 “Termination
Upon a Change in Control” shall mean a termination of the Executive,  within twenty-four (24) months after the
first date on which a Change in Control occurs (the “Effective Date”), without
Cause or a termination by the Executive for “Good Reason” within eighteen (18)
months after the Effective Date.


 


(d)                 For
purpose of this Agreement “Good Reason” shall include, but not be limited to,
any of the following (without the Executive’s express written consent):


 


(i)                   the
assignment to the Executive by the Company of duties inconsistent with, or a
substantial diminution in the nature or status of, the Executive’s
responsibilities;


 


(ii)                 a
reduction of more than 20% by the Company in the Executive’s compensation or the
Company-funded benefits as in effect on the Effective Date;


 


(iii)                a
relocation of the location of the Executive’s work assignment outside the
Denver or Boulder, Colorado metropolitan area;


 


(iv)               any
material breach by the Company of any provision of this Agreement, if such
material breach has not been cured within thirty (30) days following written
notice of such breach by the Executive to the Company setting forth with
specificity the nature of the breach; or


 


(v)                 any
failure by the Company to obtain the assumption and performance of this
Agreement by any successor (by merger, consolidation or otherwise) of the
Company.


 

















 


(e)                 Executive
will not be entitled to terminate employment and receive the payments and
benefits set forth in Section 6 as the result of a Termination Upon a
Change in Control for Good Reason (each such event, a “Good Reason Event”)
unless, within 90 days following the occurrence of such event, Executive
provides written notice to the Company of the occurrence of such event, which
notice sets forth the exact nature of the event and the conduct required to
cure such event.  The Company will have
30 days from the receipt of such notice within which to cure (such period, the “Cure
Period”). If, during the Cure Period, such event is remedied, then Executive will
not be permitted to terminate employment and receive the payments and benefits
as a result of such Good Reason Event. 
If, at the end of the Cure Period, the Good Reason Event has not been
remedied, Executive will be entitled to terminate employment as a result of
such Good Reason Event during the 30 day period that follows the end of the
Cure Period.  If Executive terminates
employment during such 30 day period, so long as Executive delivered the
written notice to the Company of the occurrence of the Good Reason Event at any
time prior to the expiration of this Agreement, for purposes of the payments,
benefits and other entitlements set forth in Section 6 of this Agreement,
the termination of Executive’s employment pursuant thereto shall be deemed to be
a termination before the expiration of this Agreement.  If Executive does not terminate employment
during such 30 day period, Executive will not be permitted to terminate
employment and receive the payments and benefits set forth in Section 6 as
a result of such Good Reason Event.


 


(f)                  Anything
in this Agreement to the contrary notwithstanding, if a Change in Control
occurs and if the Executive’s employment with the Company is terminated prior
to the Effective Date, and if it is reasonably demonstrated by the Executive
that such termination of employment (a) was at the request of a third
party who has taken steps reasonably calculated to effect a Change in Control
or (b) otherwise arose in connection with or anticipation of a Change in
Control, then for all purposes of this Agreement the Effective Date shall mean
the date immediately prior to the date of such termination of employment.


 


(g)                 Notwithstanding
anything else in this Agreement, solely in the event of a Termination Upon a
Change in Control, the aggregate of the amount of severance compensation
payable to the Executive under this Agreement, plus any other payments or
awards which would constitute a “parachute payment” for purposes of Section 280G(b)(2) of
the Internal Revenue Code, shall be reduced by any amount that the Company is
prohibited from deducting for federal income tax purposes by virtue of Section 280G
of the Internal Revenue Code or any successor provision.  The reduction shall apply first to parachute
payment amounts related to any incentive stock plan, then to severance
compensation hereunder, then to any other amounts as determined by the Company.


 


(h)                 If the
Executive elects to continue group health insurance coverage under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (COBRA)
following a Termination Upon a Change in Control or termination by the
Company without Cause, then the Company shall pay the difference 


 

















 


between:
(a) the monthly group health insurance premium the Executive was
paying immediately prior to such termination and (b) the total
monthly COBRA premium in relation to the continuation of the Executive’s
group health insurance coverage only. 
Payments made pursuant to the immediately preceding sentence will be
made for a period of time equal to eighteen (18) months in the event of a
termination without Cause; and twenty-four (24) months in the event of a
Termination Upon a Change in Control; provided, however, if COBRA is not
available, payments made during the final six (6) months of said twenty-four
(24) month period shall be equal to the difference between: (a) the
monthly group health insurance premium the Executive was paying
immediately prior to such termination and (b) the total monthly
premium of an insurance policy comparable to the policy provided by the Company
immediately prior to termination. 
Notwithstanding the foregoing, payments under this paragraph shall cease
if the Executive becomes re-employed with another employer and is eligible to
receive medical or other welfare benefits under another employer provided plan,
or if the Executive’s COBRA coverage would otherwise terminate in accordance
with Treasury Regulation § 54.4980B-7, Q/A-1.


 


7.                    Covenant Not to
Compete. During the continuance of his employment hereunder and for a period equal
to the greater of (a) eighteen (18) months after termination of employment
hereunder, or (b) the period of time for which severance is received, the
Executive shall not, anywhere in the United States, engage in any business
which competes directly with the Company. The Company and the Executive both
acknowledge the importance and value of the Executive’s services to the
Company.


 


8.                    Acceleration of
Vesting.


 


(a)                 Subject
to any other provision of this Agreement, in the event of a Change in Control
of the Company, all awards due to the Executive outstanding under any of the
Company’s incentive stock plans as of the day before the consummation of such
Change in Control shall automatically accelerate so that each stock option
shall become fully exercisable with respect to the total number of shares
subject to such stock option and may be exercised for any or all of those
shares as fully-vested shares of common stock as of such date, without regard
to the conditions expressed in the agreements relating to such stock option.


 


(b)                 In
the event that the Executive’s employment is terminated by the Company other
than for Cause, all awards due to the Executive outstanding under any of the
Company’s incentive stock plans shall automatically accelerate so that each stock
option shall become fully exercisable with respect to the total number of
shares subject to such stock option and may be exercised for any or all of
those shares as fully-vested shares of common stock as of such date, without
regard to the conditions expressed in the agreements relating to such stock
option. The Executive’s rights and obligations (or those of his estate) with
respect to any incentive stock award will be governed by the terms of the
applicable plan in case of Executive’s death or disability.


 


9.                    Trade Secrets
and Confidential Information. During his employment by
the Company and thereafter, the Executive shall not, directly or indirectly,
use, disseminate, or 


 

















 


disclose for any purpose
other than for the purposes of the Company’s business, any of the Company’s
confidential information or trade secrets, unless such disclosure is compelled
in a judicial proceeding. The Executive acknowledges access to, and receipt of,
such confidential information. Upon termination of his employment, all
documents, records, notebooks, and similar repositories of records containing
information relating to any trade secrets or confidential information then in
the Executive’s possession or control, whether prepared by him or by others,
shall be left with the Company or returned to the Company upon request. The
Executive shall notify future employers of the existence of this
confidentiality provision.


 


10.                 Severability. It is the
desire and intent of the parties that the provisions of Sections 7 and 9 shall
be enforced to the fullest extent permissible under the laws and public
policies applied in each jurisdiction in which enforcement is sought.
Accordingly, if any particular sentence or portion of either Section 7 or 9
shall be adjudicated to be invalid or unenforceable, the remaining portions of
such section nevertheless shall continue to be valid and enforceable as though
the invalid portions were not a part thereof. In the event that any of the
provisions of Section 7 relating to the geographic areas of restriction or
the period of restriction shall be deemed to exceed the maximum area or period
of time which a court of competent jurisdiction would deem enforceable, the
geographic areas and times shall, for the purposes of this Agreement, be deemed
to be the maximum areas of time periods which a court of competent jurisdiction
would deem valid and enforceable in any state in which such court of competent
jurisdiction shall be convened.


 


11.                 Injunctive Relief. The Executive
agrees that any violation by him of the agreements contained in sections 7 and 9
are likely to cause irreparable damage to the Company, and therefore agrees
that if there is a breach or threatened breach by the Executive of the
provisions of said sections, the Company shall be entitled to an injunction
restraining the Executive from such breach. Nothing herein shall be construed
as prohibiting the Company from pursuing any other remedies for such breach or
threatened breach.


 


12.                 Section 409A of the
Internal Revenue Code.


 


(a)                 It
is intended that the provisions of this Agreement comply with Section 409A
of the Internal Revenue Code of 1986, as amended, and the regulations and other
guidance issued thereunder (“Section 409A”), and all provisions of this
Agreement shall be construed and interpreted in a manner consistent with the
requirements for avoiding taxes or penalties under Section 409A.


 


(b)                 For
purposes of determining whether any payment made pursuant to this Agreement
results in a “deferral of compensation” within the meaning of Section 409A,
the Company shall maximize the exemptions described in Treasury Regulation §
1.409A-1(b), as applicable.


 


(c)                 Neither
Executive nor any of Executive’s creditors or beneficiaries shall have the
right to subject any deferred compensation (within the meaning of Section 409A)
payable under this Agreement or under any other plan, policy, arrangement or
agreement of or with the Company or any of its affiliates (this Agreement and
such other plans, policies, arrangements and agreements, the “Company Plans”) to
any anticipation, alienation, sale, transfer, assignment, 


 

















 


pledge,
encumbrance, attachment or garnishment. 
Except as permitted under Section 409A, any deferred compensation
(within the meaning of Section 409A) payable to Executive or for Executive’s
benefit under any Company Plan may not be reduced by, or offset against, any
amount owing by Executive to the Company or any of its affiliates.


 


(d)                 If,
at the time of Executive’s separation from service (within the meaning of Section 409A),
(i) Executive shall be a specified employee (within the meaning of Section 409A
and using the identification methodology selected by the Company from time to
time) and (ii) the Company shall make a good faith determination that an
amount payable under a Company Plan constitutes deferred compensation (within
the meaning of Section 409A) the payment of which is required to be
delayed pursuant to the six-month delay rule set forth in Section 409A
in order to avoid taxes or penalties under Section 409A, then the Company
(or its affiliate, as applicable) shall not pay such amount on the otherwise
scheduled payment date but shall instead accumulate such amount and pay it,
without interest, on the first business day after such six-month period.


 


(e)                 Any
reimbursements, gross-ups or in-kind benefits to be provided pursuant to this
Agreement that are taxable to the Executive shall be subject to the following
restrictions; (a) each reimbursement or gross-up must be paid no later
than the last day of the calendar year following the Executive’s tax year
during which the expense was incurred or tax was remitted, as the case may be; (b) the
amount of expenses or taxes eligible for reimbursement, or in-kind benefits or
gross-ups provided, during a tax year of the Executive may not affect the
expenses or taxes eligible for reimbursement, or in-kind benefits or gross-ups
to be provided, in any other tax year of the Executive; (c) the period
during which any reimbursement or gross-up may be paid or in-kind benefit may
be provided shall end one year after the Executive’s separation from service;
and (d) the right to reimbursement, gross-up or in-kind benefits is not
subject to liquidation or exchange for another benefit.


 


(f)                  Notwithstanding
any provision of this Agreement or any Company Plan to the contrary, in light
of the uncertainty with respect to the proper application of Section 409A,
the Company reserves the right to make amendments to this Agreement and any
Company Plan as the Company deems necessary or desirable to avoid the imposition
of taxes or penalties under Section 409A. 
Executive is solely responsible and liable for the satisfaction of all
taxes and penalties that may be imposed on Executive or for Executive’s account
in connection with any Company Plan (including any taxes and penalties under Section 409A),
and neither the Company nor any affiliate shall have any obligation to
indemnify or otherwise hold Executive harmless from any or all of such taxes or
penalties.


 


13.                 Miscellaneous.


 


(a)                 Notices.
Any notice required or permitted to be given under this Agreement shall be directed
to the appropriate party in writing and mailed or delivered,


 

















 


to the Company:


11575 Main Street, Suite 400


Broomfield, CO 80020-2782


Attn: President/CEO


 


to the Executive:


Taryn G. Reynolds


11575 Main Street, Suite 400


Broomfield, CO 80020-2782


 


(b)                 Binding Effect.
This Agreement is a personal service agreement and may not be assigned by the
Company or the Executive, except that the Company may assign this Agreement to
a successor by merger, consolidation, sale of assets or other reorganization.
Subject to the forgoing, this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors, assigns, and
legal representatives.


 


(c)                 Amendment.
This Agreement may not be amended except by an instrument in writing executed
by each of the parties hereto.


 


(d)                 Applicable Law.
This Agreement shall be governed by the laws of the State of Colorado, and the
venue of any action or proceeding under this Agreement shall take place in the
City and County of Denver, Colorado.


 


(e)                 Counterparts.
This instrument may be executed in one or more counterparts, each of which
shall be deemed as original.


 


(f)                  Entire Agreement.
This Agreement supersedes and replaces all prior agreements between the parties
related to the employment of the Executive by the Company.


 


(g)                 Advice of Counsel.
Executive acknowledges that he has had the opportunity to seek the advice of
counsel relating to this Agreement prior to execution of this Agreement.


 


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


 


	
  Corgenix Medical
  Corporation

  	
   

  	
  Executive

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
  Taryn G. Reynolds

  
	
  Title: