Document:

Exhibit
10.1

 

Financing Agreement

 

This Financing Agreement is made and entered into by
and between Summit Financial Resources, L.P., 2455 East Parley’s Way, Suite 200,
Salt Lake City, Utah 84109, Attention: 
Senior Portfolio Manager, and CORGENIX MEDICAL CORPORATION, a Nevada
corporation, and CORGENIX, INC., a Delaware corporation, each at 11575 Main
Street, #400, Broomfield, Colorado 80020, Attention:  President.

 

For good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

 

1.             Definitions. 
Terms defined in the singular shall have the same meaning when used in
the plural and vice versa.  Terms defined
in the UCC shall have the meanings set forth in the UCC, except as otherwise
defined herein.  As used herein, the
term:

 

“Acceptable Account” means an Account of Client
conforming to the representations, warranties, and requirements of Section 15,
Acceptable Accounts.

 

“Accounts” shall have the meaning set forth in the
definition of Collateral.

 

“Account Debtor” means any person or entity obligated
for payment of an Account.

 

“Account Due Date” means Ninety (90) days from the
date of the invoice evidencing the Account.

 

“Administrative Fee” means One and Forty-Five
Hundredths Percent (1.45%) of the average monthly balance of Outstanding
Advances for each calendar month, or portion thereof, due and payable monthly
in arrears.

 

“Advance” means an advance of any portion of the
Purchase Price to or on behalf of Client.

 

“Advance Rate” means, (i) during the Initial
Funding Period, Ninety Percent (90%), or such other Percent as may be
determined from time to time by Summit in its sole discretion, and, (ii) at
all times after the expiration of the Initial Funding Period, Eighty-Five
Percent (85%), or such other Percent as may be determined from time to time by
Summit in its sole discretion.

 

“Agreement” means this Financing Agreement, together
with any amendments, addenda, and modifications.

 

“Authorized Overadvance” means an Overadvance
authorized in writing by Summit.

 

“Banking Business Day” means any day not a Saturday,
Sunday, legal holiday in the State of Utah, or day on which national banks in
the State of Utah are closed.

 

“Chargeback Account” means an outstanding Purchased
Account which is past the Account Due Date or is determined to no longer be an
Acceptable Account.

 

“Client” means, individually and collectively, jointly
and severally, CMC and CORGENIX, or either of them.

 

“CMC” means CORGENIX MEDICAL CORPORATION, a
corporation organized and existing under the laws of the State of Nevada, its
successors and, if permitted, assigns.

 

“Collateral” means the following personal property of
Client, wherever located, now owned or existing or hereafter acquired or
created, all additions and accessions thereto, all replacements, insurance or
condemnation proceeds, all documents covering any of the Collateral, all leases
of any of the Collateral, all rents, revenues, issues, profits and proceeds
arising from the sale, lease, license, encumbrance, collection, or any other
temporary or permanent disposition of any of the Collateral or any interest
therein, all amendments, modifications, renewals,

 

 

extensions, and
replacements thereof, and all products and proceeds thereof: (a) all
inventory (the “Inventory”); (b) all accounts (the “Accounts”); (c) all
equipment, goods and motor vehicles (collectively, the “Equipment”); (d) all
general intangibles, including any and all patents, trademarks and copyrights
(registered or unregistered), trade secrets, domain names and addresses, and
intellectual property licenses; (e) any and all promissory notes and
instruments payable to or owing to Client or held by Client; any and all leases
under which Client is the lessor; any and all chattel paper in favor of, owing
to, or held by Client, including, without limitation, any and all conditional
sale contracts or other sales agreements, whether Client is the original party
or the assignee; and any and all security agreements, collateral and titles to
motor vehicles which secure any of the foregoing obligations; (f) all
deposit accounts, including without limitation, all interest, dividends or
distributions accrued or to accrue thereon, whether or not due; (g) all
investment property, including all interest, dividends or distributions accrued
or to accrue thereon, whether or not due; (h) all documents; (i) all
letter-of-credit rights; (j) all supporting obligations; and (k) all
balances, deposits, debts or any other amounts or obligations of Summit owing
to Client, including, without limitation, any Reserve, whether or not due.

 

“Collected Payments” means collections and payments
received by Summit on Accounts of Client, less all interest, Fees and Charges,
amounts due and payable to Summit by Client, deductions and setoffs.  Credits for Collected Payments shall be
provisional and subject to final payment and collection of the deposited
item.  For purposes of calculating
interest owing, Collected Payments delivered to a bank or other agent on behalf
of Summit shall be deemed received Three (3) Banking Business Days after
the date of receipt of advice by Summit from the bank or agent that the
Collected Payments have been credited to the account of Summit.

 

“CORGENIX” means CORGENIX, INC., a corporation
organized and existing under the laws of the State of Delaware, its successors
and, if permitted, assigns.

 

“Daily Funds Rate” means the prime rate as announced
in the Wall Street Journal plus One and Five-Tenths Percent (1.5%) divided by
360.  The initial prime rate shall be the
prime rate in effect on the date of this Agreement.  The Daily Funds Rate may be adjusted from
time to time as of the date of any change in the prime rate.

 

“Default Rate” means the Daily Funds Rate plus Ten
Percent (10%) per annum.

 

“Equipment” shall have the meaning set forth in the
definition of Collateral.

 

“Event of Default” shall have the meaning set forth in
Section 27, Default and Remedies.

 

“Fees and Charges” means the Administrative Fee and
the Other Charges.

 

“Financing Period” means an initial period of Three (3) years  commencing on the date of this Agreement
and thereafter successive periods of One (1) year each commencing upon
completion of each prior Financing Period.

 

“Initial Funding Period” means a period commencing on
the date of this Agreement and ending upon the earlier of (i) One Hundred
Twenty (120) days from the date hereof, or (ii) the date on which Summit
makes the Second Loan Advance; provided, however, that in the event the Second
Loan Advance is less than One Hundred Twenty-Five Thousand Dollars ($125,000),
the Initial Funding Period shall end One Hundred Twenty (120) days from the
date hereof.

 

“Inventory” shall have the meaning set forth in the
definition of Collateral.

 

“Loan and Security Agreement” means that certain Loan
and Security Agreement, and all amendments, modifications, and addenda thereto,
by and between Summit, as lender, and Client, as borrower, of approximate even
date herewith.

 

“Maximum Credit Line” means One Million Seven Hundred
Fifty Thousand Dollars ($1,750,000) or such other amount as may be determined
from time to time by Summit in its sole discretion.

 

“Other Charges” means the following fees and charges:

 

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a.             Any Payment Conversion Fees.

 

b.             All other charges and fees which may be
charged by Summit pursuant to this Agreement, other than the Administrative
Fee.

 

“Outstanding Advances” means Advances for which Summit
has not received Collected Payments in full and includes Advances against
Chargeback Accounts for which Collected Payments in full have not been received
and the full re-purchase price has not been paid.

 

“Overadvance” means (a) the amount by which the
Outstanding Advances exceed the Maximum Credit Line, or (b) the amount by
which the Outstanding Advances exceed Purchased Accounts which are not
Chargeback Accounts multiplied by the Advance Rate.

 

“Payment Conversion Fee” means Ten Percent (10%) of
any payment received by Client on a Purchased Account which is not tendered to
Summit as required in this Agreement.

 

“Purchase Price” of an Account means the face amount
of the Account less all interest and Fees and Charges.

 

“Purchased Account” means an Account that has been
purchased by Summit pursuant to Section 2, Purchase of Accounts.

 

“Qualified Bank Financing” means financing provided
directly by a full service commercial bank whose deposits are insured by the
Federal Deposit Insurance Corporation in the form of a revolving line of credit
for which the primary collateral is Client’s Accounts.  Financing provided by a subsidiary, affiliate
or division of such a bank does not qualify as Qualified Bank Financing.

 

“Reserve” means such amount as may be determined from
time to time by Summit in its sole discretion.

 

“Second Loan Advance” means the second loan advance
made by Summit to Client pursuant to the terms and conditions of the Loan and
Security Agreement.

 

“Settlement Date” means dates set by Summit, which
dates shall be at least weekly.

 

“Summit” means Summit Financial Resources, L.P., a
Hawaii limited partnership, its successors and assigns.

 

“UCC” means the Uniform Commercial Code, as adopted
now or in the future in the State of Utah.

 

2.             Purchase of Accounts.

 

Client shall request purchase of Accounts by
submitting to Summit a Schedule of Accounts and Bill of Sale, copies of the
invoices listed on the Schedule of Accounts and Bill of Sale, supporting
documentation for such invoices as requested by Summit, and such other
documentation as required by Summit.  Summit
shall notify Client which Accounts are purchased by providing reports to
Client.

 

Unless otherwise agreed in writing by Summit, upon
purchase by Summit of any Account, Client shall thereafter offer all Accounts
owing by that Account Debtor for purchase by Summit.  Summit may also require that all Accounts
owing by that Account Debtor which Summit declines to purchase nonetheless be
subject to Section 14 Collection Procedures and be paid to Summit.

 

Summit may purchase from Client such Acceptable
Accounts as Summit elects.  All purchases
shall be subject to the terms and conditions of this Agreement.  THE OBLIGATION OF SUMMIT TO PURCHASE ACCOUNTS
FROM CLIENT IS DISCRETIONARY AND SUMMIT SHALL HAVE NO OBLIGATION TO PURCHASE
ANY ACCOUNT FROM CLIENT, NOTWITHSTANDING ANYTHING TO THE CONTRARY IN

 

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THIS AGREEMENT.  Summit may decline to purchase any Account
submitted by Client for any reason or for no reason, without notice, regardless
of any course of conduct or past purchases of Accounts by Summit.  Each purchase by Summit shall be a true
purchase with transfer of all legal and equitable title and shall not be deemed
to be a loan agreement or secured transaction. 
Client shall thereafter have no right, title or interest in or to
Purchased Accounts.  Client shall make
appropriate entries on its books and records disclosing the sale of Purchased
Accounts to Summit.

 

Summit shall be the sole and exclusive purchaser of
Client’s Accounts.  Client will not sell,
factor or otherwise finance its Accounts and shall not grant any other security
interest in its Accounts or Inventory.

 

3.             Purchase Price of Accounts.

 

The Purchase Price shall be payable as follows:  (i) an amount equal to the face amount
of the Account multiplied by the Advance Rate shall be payable upon purchase of
the Account by Summit; and (ii) the balance of the Purchase Price shall be
payable after receipt of Collected Payments in full for the Purchased Account,
such balance to be paid on the next Settlement Date; provided, however, that
notwithstanding anything to the contrary in this Agreement, Summit shall not be
obligated to make any Advance if, after making the Advance, the amount of all
Outstanding Advances will exceed the Maximum Credit Line.

 

Payment shall be made in accordance with any written
instructions of Client which are agreed to by Summit.  Absent other instructions, payment shall be
made by mailing a check to Client.

 

4.             Interest, Fees and Charges.

 

Interest shall accrue on Outstanding Advances, both
before and after judgment, from the date of disbursement until receipt of
Collected Payments, at the Daily Funds Rate. 
Upon occurrence of an Event of Default, interest on Outstanding Advances
shall thereafter accrue, both before and after judgment, at the Default Rate
until receipt of Collected Payments.

 

In addition, Client shall pay Summit the Fees and
Charges.  The Administrative Fees are for
monitoring of the Collateral, collection of the Accounts, and administration of
this Agreement.  The Administrative Fees
are not intended to be and shall not be construed to be interest.

 

Interest and Fees and Charges may be deducted from
Advances or from Collected Payments.

 

5.             Recourse Purchases.

 

Unless specifically designated otherwise in writing by
Summit, all Accounts shall be purchased with recourse and shall become a
Chargeback Account if not paid in full by (i) One Hundred Twenty (120)
days from the date of the invoice evidencing the Account during the Initial
Funding Period, or (ii) the Account Due Date at all times after the
expiration of the Initial Funding Period.

 

6.             Re-Purchase Obligation and Chargeback
Accounts.

 

If (i) a Purchased Account is not paid in full by
(A) One Hundred Twenty (120) days from the date of the invoice evidencing
the Account during the Initial Funding Period, or (B) the Account Due Date
at all times after the expiration of the Initial Funding Period, or (ii) if
at any time Summit determines that the Purchased Account is no longer an
Acceptable Account, then the Purchased Account shall thereupon automatically be
a Chargeback Account without any action by Summit.

 

Client shall immediately re-purchase all Chargeback
Accounts by paying Summit the amount of the outstanding Advance against the
Chargeback Account, plus all accrued interest thereon.

 

Interest shall accrue on Chargeback Accounts at the
Default Rate until the re-purchase amount is paid in full.

 

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7.             Overadvance.

 

Authorized Overadvances shall be due upon demand by
Summit.  Authorized Overadvances shall
accrue interest at the Daily Funds Rate plus Three Percent (3%) per annum.

 

If at any time an Overadvance exists which is not an
Authorized Overadvance, Client shall immediately make payment to Summit of an
amount equal to the Overadvance.  If such
payment is not immediately made, interest shall accrue on the Overadvance at
the Default Rate regardless of whether Summit waives the Event of Default
caused by such non-payment.

 

8.             Reserve.

 

Summit may fund the Reserve by withholding amounts
owing to Client for Advances or deducting amounts from Collected Payments.

 

Upon non-renewal of the Financing Period, termination
of the right of Client to submit Accounts to Summit as provided in Section 20, Renewal
of Financing Period and Termination of Financing,
and payment of all amounts owing to Summit by Client, any balance of the
Reserve shall be paid to Client, provided that if Summit has reasonable grounds
to believe that any collections or other payments received by Summit may be
dishonored, voided, or preferential, or claims may be made against Summit for
which Client would be liable, Summit may continue to hold the Reserve so long
as such matters are outstanding and unresolved.

 

Summit shall be free to use the Reserve as working
capital or as Summit otherwise determines. 
Summit shall have no obligation to segregate, not commingle, or
otherwise account for the use of the Reserve. 
Client shall not be entitled to any interest on the Reserve.  The Reserve shall be a debt owed to Client by
Summit, payable in accordance with the terms and conditions of this Agreement.

 

9.             Conditions to Advances.

 

Summit shall not consider purchasing any Account or
otherwise making any Advance under this Agreement until, at a minimum, all of
the conditions set forth below have been satisfied.  All of the documents referred to below must
be in a form and substance reasonably acceptable to Summit.

 

a.             This Agreement and all other documents
contemplated to be executed and delivered to Summit in connection with this
Agreement prior to making any Advances have been fully executed and delivered
to Summit.

 

b.             All of the documents contemplated by this
Agreement which require filing or recording have been properly filed and
recorded so that all of the liens and security interests granted to Summit in
connection with this Agreement will be properly created and perfected and will
have a priority acceptable to Summit.

 

c.             A Payoff Agreement has been executed and
delivered by Summit, Client, and Benefactor Funding Corp.

 

d.             That certain UCC financing statement
filed in favor of Marlin Leasing Corp. with the Nevada Secretary of State on July 27,
2006, File No. 2006023876-6, has been terminated.

 

All conditions precedent to Advances set forth in this
Agreement are set for the sole benefit of Summit and may be waived unilaterally
by Summit.

 

10.           Application of Payments and Collections.

 

Summit may apply payments and recoveries first to Fees
and Charges, second to outstanding and accrued interest, and third to
Outstanding Advances.

 

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11.           Setoff and Deduction by Summit.

 

As to all amounts owing to Summit by Client,
including, without limitation, any amounts owing under this Agreement or under
the Loan and Security Agreement, Summit may (i) deduct such amount from Collected
Payments received on Accounts, (ii) setoff and deduct such amount against
Advances or any amount owing by Summit to Client, (iii) demand payment
from Client whereupon Client shall promptly pay such amount to Summit, or (iv) exercise
any combination of the alternatives set forth in this Section or available
under this Agreement, at law, or in equity.

 

12.           Excess Interest.

 

It is the intent of the parties to comply with any
usury law applicable to this Agreement and to all amounts owing pursuant to this
Agreement and it is understood and agreed that in no event and upon no
contingency shall Client be required to pay interest in excess of the rate
allowed by any laws of any state which are determined to be applicable and
governing.  The intention of the parties
being to conform strictly to any applicable usury laws, this Agreement shall be
held to be subject to reduction to the amount allowed under any applicable and
governing usury laws as now or hereafter construed by the courts having
jurisdiction.  In the event Summit
receives any interest under this Agreement in excess of any highest permissible
rate under any applicable and governing law, such excess interest (including
simple interest thereon at the highest permissible rate which is applicable and
governing) shall be promptly applied to the amounts owing by Client hereunder
and then to Outstanding Advances.  To the
extent such excess interest is greater than such amounts, Summit shall promptly
remit such overage to Client.

 

13.           Reports and Audits.

 

Upon request, which request may be made as reasonably
as determined by Summit, Client will promptly submit to Summit a current
Account Debtor list, which shall include the name, address, contact person
name, phone number and fax number for each active Account Debtor and such other
records and reports concerning its Accounts, Inventory, the Collateral, and
operations as may be requested by Summit.

 

Client shall, at any reasonable time and from time to
time, permit Summit or any representative of Summit to conduct field audits,
examine, audit, and make copies of and extracts from the records and books of,
and visit and inspect the Collateral, properties and assets of, Client, and to
discuss the affairs, finances, and Accounts of Client with any of Client’s officers,
directors, and partners and with Client’s independent accountants.

 

14.           Collection Procedures.

 

a.             Unless directed otherwise in writing by
Summit, Client shall promptly mail an invoice to each Account Debtor on each
Purchased Account, which invoice shall be stamped or printed with a notice, in
a form acceptable to Summit, stating that the Account is payable to Summit and
providing payment instructions.  Except
as agreed otherwise in writing by Summit, Summit shall have the exclusive right
to collect and to receive all payments on all Purchased Accounts.  Client shall not otherwise bill for, submit
any invoice, or otherwise attempt to collect any Purchased Account, except as
authorized in writing by Summit; provided, however, until Summit otherwise notifies
Client in writing, Client is authorized to bill for, submit invoices for, make
collection calls, place accounts with Account Debtors on credit hold, and take
other actions as Client deems necessary to collect payments on Accounts so long
as Client directs all Account Debtors to make payment directly to Summit.  Summit is authorized to notify Account
Debtors of the assignment and purchase of Client’s Accounts and to direct
Account Debtors to make all payments on Purchased Accounts directly to Summit.

 

b.             Client authorizes Summit to contact
Account Debtors concerning verification and payment of Accounts and to settle
or compromise any Account, in the sole discretion of Summit subject only to
acting in good faith.  Client hereby
waives and releases any and all claims relating to or arising out of any act or
omission by Summit in the verification and collection of the Accounts,
excluding those based on gross negligence or intentional misconduct.  Notwithstanding the foregoing, so long as no
event of default has occurred, Summit will not contact Account Debtors for
purposes of collecting past due accounts.

 

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c.             All collections of Purchased Accounts
shall be handled by Summit.  Collection
of Accounts in a commercially reasonable manner does not require, and Summit is
not obligated, to commence any legal action, including the sending of an
attorney’s demand letter, to collect any Account.  Client acknowledges and agrees that Summit is
not a collection agency and will not provide debt collection services for
Client’s Accounts.  If any Purchased
Account is not timely paid, Summit may, but is not obligated to, engage a
collection agency, attorney or other service provider to collect Purchased
Accounts.  All commissions, fees and
charges of any such collection agency, attorney or other service provider shall
be paid by Client.  CLIENT HEREBY WAIVES
AND RELEASES ANY AND ALL CLAIMS RELATING TO OR ARISING OUT OF ANY ACT OR
OMISSION BY SUMMIT IN THE COLLECTION OF PURCHASED ACCOUNTS, GROSS NEGLIGENCE
AND INTENTIONAL MISCONDUCT EXCEPTED.

 

d.             Client shall promptly and completely
respond to all requests from Summit for any information or records requested to
assist in collection of Accounts.  If
Client fails to respond to any request within Fifteen (15) days, Summit may
deem the Account to no longer be an Acceptable Account.

 

e.             Upon inquiry from an Account Debtor or
upon request of Summit, Client shall notify the Account Debtor to make payment
directly to Summit.

 

f.              Any payments received by Client on
Purchased Accounts shall be held in trust by Client for Summit.  In the event an Account Debtor makes payment
to Client on any Purchased Account, Client shall immediately notify Summit of the
payment and deliver the payment to Summit. 
If payment is made in cash, such payment shall be immediately delivered
to Summit.  If payment is made by check
or similar instrument, such instrument shall be immediately delivered to Summit
in the form received without negotiation. 
If payment is made by electronic funds transfer, Client shall
immediately forward such payment to Summit by electronic funds transfer.

 

If any payment received by Client on any Account is
deposited or negotiated by Client, or if Client fails to tender the payment to
Summit within Five (5) Banking Business Days of receipt by Client, Client
shall promptly pay Summit the Payment Conversion Fee.

 

Client acknowledges and agrees that it has no right,
title or interest whatsoever in the funds constituting payment of Purchased Accounts,
that said funds are the sole and exclusive property of Summit, and that any use
of or interference with said funds by Client will result in civil and criminal
liability.

 

g.             Client shall immediately notify Summit of
any dispute concerning any Purchased Account and of any bankruptcy filing,
lien, garnishment or other legal action concerning any Purchased Account or
Account Debtor.

 

h.             Summit may, but has no duty to, and
Client hereby authorizes Summit to, execute and file, on behalf of Client
or in Summit’s name, mechanic’s liens and all other notices and documents
to create, perfect, preserve, foreclose and/or release any lien for
work performed or materials provided to improve real property. 
Except as otherwise instructed by Summit, Client is authorized to file any such
mechanic’s liens and other notices and documents in Client’s discretion.

 

15.           Acceptable Accounts.

 

An Acceptable Account must meet all of the following
requirements and conditions unless waived in writing by Summit.

 

a.             Client has sole and unconditional good
title to the Account and the Account and any goods sold to create the Account
are free from any other security interest, assignment, lien or other
encumbrance of any type.

 

b.             The Account is a bona fide obligation of
the Account Debtor for the amount identified on the records of Client and there
have been no payments, deductions, credits, payment terms, or other
modifications or

 

7

 

reductions in the
amount owing on such Account except as reported to Summit in writing prior to
making an Advance based on the Account.

 

c.             The Account must be submitted to Summit
within Sixty (60) days of the date the goods are sold or the services performed
giving rise to the Account are completed.

 

d.             There are no defenses or setoffs to
payment of the Account which can be asserted by way of defense or counterclaim
against Client or Summit.

 

e.             The Account will be timely paid in full
by the Account Debtor.

 

f.              There have been no extensions,
modifications, or other agreements relating to payment of such Account except
as reported to Summit in writing prior to making an Advance and except those
agreements with Benefactor Funding Corp. that shall be terminated by Client
prior to or immediately in connection with Summit making the first Advance
under this Agreement.

 

g.             Any services performed or goods sold
which give rise to the Account have been completed and delivered and have been
rendered or sold in compliance with all applicable laws, ordinances, rules and
regulations and were performed or sold in the ordinary course of Client’s
business.

 

h.             The Account Debtor is located or
authorized to do business within the United States or Canada (excluding the
province of Newfoundland, the Northwest Territories, and the Territory of
Nunavit) or the Account has been insured under a policy of credit insurance
from an insurer and upon terms acceptable to Summit.

 

i.              No proceeding has been commenced or
petition filed under any bankruptcy or insolvency law by or against the Account
Debtor; no receiver, trustee or custodian has been appointed for any part of
the property of the Account Debtor; and no property of the Account Debtor has
been assigned for the benefit of creditors.

 

j.              Neither the Account, nor any invoice,
credit application, bill, billing memorandum, correspondence, or any other
document relating to an Account, contracts for or charges interest or any other
charge in excess of the maximum non-usurious rate allowed pursuant to
applicable law.

 

k.             The Account is not past the Account Due
Date; provided, however, that during the Initial Funding Period Summit shall
consider up to a maximum outstanding amount of Two Hundred Thousand Dollars
($200,000) of Accounts that are past the Account Due Date but are less than One
Hundred Twenty (120) days from the date of the invoice evidencing such Accounts
as Acceptable Accounts.

 

l.              If the total of the outstanding Purchased
Accounts owing by any single Account Debtor equals Sixty Percent (60%) or more
of the total outstanding Purchased Accounts owing by all Account Debtors, the
portion of the Purchased Accounts owing by that single Account Debtor in excess
of this limit shall not be Acceptable Accounts.

 

m.            If Twenty-Five Percent (25%) or more of
the outstanding Accounts owing by an Account Debtor are (i) past One
Hundred Twenty (120) days from the date of the invoice evidencing the Account
during the Initial Funding Period, or (ii) past the Account Due Date at
all times after the expiration of the Initial Funding Period, then none of the
Accounts owing by that Account Debtor shall be Acceptable Accounts.

 

16.           Grant of Security Interest.

 

Client hereby grants Summit a security interest in the
Collateral. Client and Summit acknowledge their mutual intent that all security
interests contemplated herein are given as a contemporaneous exchange for new
value to Client, regardless of when Advances to Client are actually made or
when the Collateral is acquired.

 

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The Collateral shall secure all of Client’s present
and future debts, obligations, and liabilities of whatever nature to Summit,
including, without limitation, (a) all obligations of Client under this
Agreement, (b) all obligations of Client owing under the Loan and Security
Agreement, and (c) transactions in which the documents evidencing the
indebtedness refer to this grant of security interest as providing security
therefore.

 

Client’s obligations under this Agreement may also be
secured by other collateral as may be evidenced by other documentation apart
from this Agreement.

 

17.           Representations, Warranties and Covenants
of Client.

 

Client represents, warrants, and covenants that:

 

a.             CMC is a corporation organized and
existing in good standing under the laws of the State of Nevada.

 

b.             The complete and exact name of CMC is
CORGENIX MEDICAL CORPORATION.  The
organizational number of CMC assigned by its state of organization is
C6200-1994.  During the Five (5) years
preceding the date of this Agreement:  (a) CMC
has not been known by or used any legal, fictitious or trade name, except that
CMC currently uses the trade name REAADS Medical Products, Inc.; (b) CMC
has not changed its name in any respect; (c) CMC has not been the
surviving entity of a merger or consolidation; and (d) CMC has not
acquired all or substantially all of the assets of any person or entity.

 

c.             CORGENIX is a corporation organized and
existing in good standing under the laws of the State of Delaware.

 

d.             The complete and exact name of CORGENIX
is CORGENIX, INC.  The organizational
number of CORGENIX assigned by its state of organization is 2235854.  During the Five (5) years preceding the
date of this Agreement:  (a) CORGENIX
has not been known by or used any legal, fictitious or trade name, except that
CORGENIX currently uses the trade name REAADS Medical Products, Inc.; (b) CORGENIX
has not changed its name in any respect; (c) CORGENIX has not been the
surviving entity of a merger or consolidation; and (d) CORGENIX has not
acquired all or substantially all of the assets of any person or entity.

 

e.             The execution, delivery and performance
by Client of this Agreement have been duly authorized by all necessary action
on the part of Client, and are not inconsistent with any organizational
documents of Client, do not and will not contravene any provision of, or
constitute a default under, any indenture, mortgage, contract or other
instrument to which Client is a party or by which it is bound, and that by the
execution and delivery hereof, Client intends that this Agreement will
constitute a legal, valid and binding agreement and obligation of Client,
enforceable in accordance with its terms.

 

f.              All financial statements of Client, fully
and fairly present the financial condition of Client as of the date thereof and
the results of operations for the period or periods covered thereby.  Since the date of such financial statements
there has been no material adverse change in the financial condition of Client.  Client agrees to submit financial statements
for Client to Summit as may be reasonably requested by Summit, all such
financial statements to fully and fairly present the financial condition of
Client and to be in a form and from a firm acceptable to Summit.

 

g.             Client shall conduct its business in a
lawful manner and in compliance with all applicable federal, state, and local
laws, ordinances, rules, regulations, and orders and shall pay when due all
lawfully imposed taxes upon its property, business and income.  No later than the fifth day of each month,
Client shall certify in writing to Summit, in a form reasonably acceptable to
Summit, that all federal, state, and other taxes and assessments owing during
the prior month have been paid in full. 
Such certification shall be accompanied by proof of payment in a form
reasonably acceptable to Summit.

 

h.             This Agreement, the financial statements
referred to herein, and all other statements furnished by Client to Summit in
connection herewith contain no untrue statement of a material fact and omit no

 

9

 

material fact
necessary to make the representations and warranties contained in this Section 17
not misleading.  Client represents and
warrants that, to the best of its knowledge, it has not failed to disclose in
writing to Summit any fact that materially and adversely affects, or is
reasonably likely to materially and adversely affect, Client’s business,
operations, properties, prospects, profits, condition (financial or otherwise),
or ability to perform this Agreement.

 

18.           Representations, Warranties and Covenants
Concerning Collateral.

 

Client represents, warrants, and covenants concerning
the Collateral as follows:

 

a.             All Purchased Accounts are Acceptable
Accounts.

 

b.             Client is the sole owner of the
Collateral.

 

c.             The Inventory and Accounts are not
subject to, and will be kept free and clear of, any security interest, lien,
assignment, or other encumbrance of any nature whatsoever except for current
taxes and assessments which are not delinquent, the security interests created
by this Agreement, the security interests created by the Loan and Security
Agreement, the security interests granted in favor of Benefactor Funding Corp.
that shall be terminated by Client prior to or immediately in connection with
Summit making the first Advance under this Agreement, and assignments and
security interests created and disclosed in writing to Summit prior to
execution of this Agreement.

 

d.             Summit is authorized to file UCC
Financing Statements concerning the Collateral. 
Client agrees to execute any notices of assignment and other documents
reasonably requested by Summit for perfection or enforcement of the rights and
interests of Summit, and to give good faith, diligent cooperation to Summit,
and to perform such other acts reasonably requested by Summit for perfection
and enforcement of the rights and interests of Summit.  Summit is authorized to file, record, or
otherwise utilize such documents as it deems necessary to perfect and/or
enforce any security interest or lien granted hereunder.

 

e.             The place of business of Client, or, if
Client has more than one place of business, the location of its chief executive
office, is located in the State of Colorado. 
During the Five (5) years preceding the date of this Agreement,
this location has not been located outside the State of Colorado.  This location will not be moved from the
State of Colorado without at least Thirty (30) days prior written notice to
Summit.

 

f.              The Collateral and all records of Client
pertaining to the Collateral are located in the State of Colorado and the
United Kingdom.  During the Five (5) years
preceding the date of this Agreement, the Collateral and all records of Client
pertaining to the Collateral have not been located outside the State of
Colorado and the United Kingdom.

 

g.             Client shall keep the Equipment, if any,
in good repair and be responsible for any loss or damage to the Equipment.  Client shall pay when due all taxes, license
fees and other charges on the Equipment. 
Client shall not sell, misuse, conceal, or in any way dispose of the
Equipment or permit it to be used unlawfully or for hire or contrary to the
provisions of any insurance coverage. 
Risk of loss of the Equipment shall be on Client at all times unless
Summit takes possession of the Equipment. 
Loss of or damage to the Equipment or any part thereof shall not release
Client from any of the obligations secured by the Equipment.

 

h.             Client agrees to (i) insure the
Equipment and Inventory, at Client’s expense, against loss, damage, theft, and
such other risks as Summit may request to the full insurable value thereof and (ii) maintain
general business liability insurance and product liability insurance, at
Client’s expense, to such extent and against such hazards and liabilities as
are commonly maintained by companies engaged in the same or a similar business
and similarly situated as Client with insurance companies and policies
reasonably satisfactory to Summit. 
Summit shall be named as an additional insured and loss payee under such
policies. All such policies shall provide for a minimum Ten (10) days
written cancellation notice to Summit. 
Upon request, policies or certificates attesting to such coverage shall
be delivered to Summit.  Insurance
proceeds may be applied by Summit toward payment of any obligation secured by
this Agreement, whether or not due, in such order of application as Summit may
elect.

 

10

 

i.              So long as no Event of Default has
occurred, Client shall have the right to sell or otherwise dispose of the
Inventory in the ordinary course of business. 
No other disposition of the Inventory may be made without the prior
written consent of Summit.

 

19.           Assignment of Rights Concerning
Collateral.

 

Client hereby assigns to Summit all of its interest in
and rights to any Inventory which may be returned by Account Debtors, all
rights as an unpaid vendor or lienor, all rights of stoppage in transit,
repletion and reclamation relating thereto, all rights in and to all security
therefor and guarantees thereof, all rights against third parties with respect
thereto, and all rights under the UCC and any other law, statute, regulation or
agreement.

 

20.           Renewal of Financing Period and
Termination of Financing.

 

Each Financing Period shall automatically renew for an
additional Financing Period unless Client or Summit provides written notice of
non-renewal at least Sixty (60) days prior to the end of the current Financing
Period.

 

If Client elects to terminate a Financing Period at
any time other than the last day of a Financing Period, except to replace this
financing and the financing provided under the Loan and Security Agreement with
Qualified Bank Financing as provided herein during the first Twelve (12) months
from the date hereof, or if an Event of Default terminates the financing of
Client’s Accounts, Client shall pay Summit an early termination fee equal to
One Percent (1%) of the Maximum Credit Line, which fee shall be due and payable
in full upon such termination.

 

Client must provide at least Sixty (60) days written
notice to Summit of intent to replace this financing and the financing provided
under the Loan and Security Agreement with Qualified Bank Financing, which
notice shall itemize the material financial terms of the Qualified Bank
Financing.  Within Thirty (30) days of
receipt of such notice, Summit may provide written notice to Client that Summit
will match the material financial terms of the Qualified Bank Financing
whereupon Summit and Client shall amend this Agreement and the Loan and
Security Agreement, as necessary, to match the material financial terms of the
Qualified Bank Financing and this Agreement and the Loan and Security Agreement
shall remain in force.

 

Upon such non-renewal or termination, all other terms
and provisions of this Agreement, including, without limitation, the security
interests granted in favor of Summit, shall remain in full force and effect
until all amounts owing to Summit hereunder have been finally paid in full,
except that Client shall be excused from the covenants herein providing that
Summit shall be the sole and exclusive purchaser and source of financing for
Client’s Accounts.

 

Upon expiration of the final Financing Period or any
other termination, at the election of Summit, all outstanding Purchased
Accounts will immediately be Chargeback Accounts and all amounts owing to
Summit by Client pursuant to this Agreement shall, without notice of such
election, accelerate and become immediately due and payable in full.

 

21.           Right to Perform for Client.

 

Summit may, in its sole discretion, elect to discharge
any security interest, lien or other encumbrance upon any Accounts, elect to
pay any subcontractor, vendor, materialman, laborer, or other person to whom
Client is obligated, whether or not any mechanic’s lien or other encumbrance
has been asserted, and elect to pay any insurance charges payable by Client or
provide insurance as required herein if Client fails to do so.  Any such payments and all expenses incurred
in connection therewith shall be immediately due and payable by Client.  Summit shall have no obligation to discharge
any such security interest, lien or other encumbrance or pay such insurance
charges or provide such insurance.

 

11

 

22.           Power of Attorney to Endorse Checks.

 

Client does hereby make, constitute and appoint
Summit, and its designees, as its true and lawful attorneys-in-fact, with full
power of substitution, with full power to endorse the name of Client upon any
checks or other forms of payment on Accounts and to effect the deposit and
collection thereof.  This power of
attorney is irrevocable and coupled with an interest.  Such power may be exercised at any time.  Client does hereby make, constitute, and
appoint Summit, and its designees, as Client’s true and lawful attorneys in
fact, with full power of substitution, such power to be exercised only upon the
occurrence of an Event of Default, to:  (a) receive,
open, and dispose of all mail addressed to Client that relates to Accounts of
Client; (b) cause mail relating to Accounts of Client to be delivered to a
designated address of Summit where Summit may open all such mail and remove
therefrom any payment of such Accounts; and (c) Summit may do any and all
other things necessary or proper to carry out the intent of this Agreement and
to perfect and protect the rights of Summit created under this Agreement.  This power of attorney is irrevocable and coupled
with an interest.  Exercise of any of the
foregoing powers shall be in the sole discretion of Summit without any duty to
do so.

 

23.           Disclosure of Information.

 

Client hereby consents to Summit disclosing to any
financial institution or investor providing financing for Summit or
participating in this financing, any and all information, knowledge, reports
and records, including, without limitation, financial statements, concerning
Client.

 

24.           Interest on Unpaid Amounts and Late Fees.

 

In the event Client fails to pay any amount owing to
Summit when due, Client agrees to pay interest on such amount from the due date
until paid, both before and after judgment, at the Default Rate.

 

25.           No Third Party Beneficiary.

 

This Agreement is made for the sole and exclusive
benefit of Summit and Client and is not intended to benefit any third
party.  No such third party may claim any
right or benefit or seek to enforce any term or provision of this Agreement.

 

26.           Indemnification.

 

CLIENT AGREES TO INDEMNIFY SUMMIT FOR ANY AND ALL
CLAIMS WHICH MAY BE ASSERTED AND FOR LIABILITIES AND DAMAGES WHICH MAY BE
AWARDED AGAINST SUMMIT, AND FOR ALL REASONABLE ATTORNEYS FEES, LEGAL EXPENSES
AND OTHER EXPENSES INCURRED IN DEFENDING SUCH CLAIMS, ARISING FROM OR RELATING
IN ANY MANNER TO THE PURCHASE, FINANCING AND/OR COLLECTION OF ACCOUNTS PURSUANT
TO THE TERMS OF THIS AGREEMENT, EXCLUDING CLAIMS BASED ON THE GROSS NEGLIGENCE
OR WILLFUL MISCONDUCT OF SUMMIT.  SUMMIT
SHALL HAVE SOLE AND COMPLETE CONTROL OF THE DEFENSE OF ANY SUCH CLAIMS, AND IS
HEREBY GIVEN AUTHORITY TO SETTLE OR OTHERWISE COMPROMISE ANY SUCH CLAIMS AS
SUMMIT, IN GOOD FAITH, DETERMINES SHALL BE IN ITS BEST INTERESTS.

 

27.           Default and Remedies.

 

Time is of the essence of this Agreement.  The occurrence of any of the following events
shall constitute a default under this Agreement and be termed an “Event of
Default”:

 

a.             Failure by Client to pay any amount to
Summit when due.

 

b.             Client fails in the payment or
performance of any obligation, covenant, agreement, or liability created by
this Agreement.

 

12

 

c.             Any material representation, warranty, or
financial statement made by or on behalf of Client, proves to have been false
or misleading when made or furnished.

 

d.             Any default or event which, with the
giving of notice or the passage of time or both, would constitute a default,
occurs on any indebtedness of Client which results in a material adverse effect
on Client’s financial condition, conduct of its business, or ability to perform
under this Agreement.

 

e.             Any default or event which, with the
giving of notice or the passage of time or both, would constitute a default,
occurs under the Loan and Security Agreement.

 

f.              Client becomes dissolved or terminated,
dies, or goes out of business.

 

g.             A receiver, trustee, or custodian is
appointed for any part of Client’s property, or any part of Client’s property
is assigned for the benefit of creditors.

 

h.             Any proceeding is commenced or petition
filed under any bankruptcy or insolvency law by or against Client.

 

i.              Any judgment is entered against Client
which may materially affect Client’s financial condition.

 

j.              Client becomes insolvent or unable to pay
its debts as they mature.

 

k.             The Purchased Accounts become, for any
reason whatsoever, substantially delinquent or uncollectible.

 

l.              Corgenix UK Ltd., without the prior
written consent of Summit, (i) creates, incurs, assumes, or suffers to
exist any pledge, lien, or security interest on any of its accounts receivable,
now owned or hereafter acquired.

 

Waiver of any Event of Default shall not constitute a
waiver of any subsequent Event of Default.

 

Upon the occurrence of any Event of Default and at any
time thereafter, at the election of Summit and with notice of such election,
which notice shall not be required to be in writing, Summit may immediately
terminate the right of Client to request Advances, treat all outstanding
Purchased Accounts as Chargeback Accounts, and all obligations of Client to
Summit shall accelerate and become immediately due and payable in full and
Summit shall have all rights and remedies created by or arising from this
Agreement and the following rights and remedies, in addition to all other
rights and remedies existing at law, in equity, or by statute:

 

a.             Summit shall have all the rights and
remedies available under the UCC.

 

b.             Summit shall have the right to enter upon
any premises where the Collateral or records pertaining thereto may be and take
possession of the Collateral and records relating thereto.

 

c.             Upon request of Summit, Client shall, at
the expense of Client, assemble the Collateral and records relating thereto at
a place designated by Summit and tender the Collateral and records to Summit.

 

d.             Without notice to Client, Summit may
obtain the appointment of a receiver of the business, property and assets of
Client and Client hereby consents to the appointment of Summit or such person
as Summit may designate as such receiver.

 

e.             Summit may sell, lease or otherwise
dispose of any or all of the Collateral and, after deducting the reasonable
costs and out-of-pocket expenses incurred by Summit, including, without
limitation, (i) reasonable attorneys fees and legal expenses, (ii) transportation
and storage costs, (iii) costs of advertising sale of the Collateral, (iv) sale
commissions, (v) sales tax, (vi) costs for improving or repairing the
Collateral, and (vii) costs for

 

13

 

preservation and
protection of the Collateral, and apply the remainder against, or to hold as a
reserve against, the obligations secured by this Agreement.

 

f.              Summit shall have all the rights and
remedies available under the Loan and Security Agreement.

 

Client shall be liable for all deficiencies owing on
any obligations secured by the Collateral after liquidation of the Collateral.

 

Upon occurrence of an Event of Default, the interest
rate on obligations of Client owing to Summit shall be increased to the Default
Rate.  After the occurrence of an Event
of Default, Summit shall retain the exclusive right to collect outstanding
Chargeback Accounts, regardless of whether the Chargeback Account has been
repurchased by Client, until all obligations owing to Summit by Client have
been paid in full.

 

The rights and remedies herein conferred are
cumulative and not exclusive of any other rights or remedies and shall be in
addition to every other right, power and remedy herein specifically granted or
existing at law, in equity, or by statute which Summit might otherwise have and
may be exercised from time to time and as often and in such order as may be
deemed expedient by Summit.  No delay or
omission by Summit in the exercise of any such right, power or remedy or in the
pursuance of any remedy shall impair any such right, power or remedy or be
construed to be a waiver of any Event of Default or to be an acquiescence
therein.

 

28.           Payment of Expenses and Attorneys Fees.

 

Client shall pay all reasonable expenses of Summit
relating to the negotiation, documentation, and administration of this
Agreement, including, without limitation, title insurance, recording fees,
filing fees, fees of collection services, reasonable attorneys fees and legal
expenses, returned check fees, photocopies, postage, audit and field
examination fees and costs, inspection fees, wire transfer fees, and overnight
delivery expenses, whether incurred in making Advances, in future amendments or
modifications to this Agreement, or in ongoing administration of this
financing.

 

Upon occurrence of an Event of Default, Client agrees
to pay all costs and expenses, including reasonable attorney fees and legal
expenses, incurred by Summit in enforcing or exercising any remedies under this
Agreement or any other rights and remedies.

 

Client agrees to pay all expenses, including reasonable
attorney fees and legal expenses, incurred by Summit in any bankruptcy
proceedings of any type involving Client, this Agreement, the Purchased
Accounts, or the Collateral, including, without limitation, expenses incurred
in modifying or lifting the automatic stay, determining adequate protection,
use of cash collateral or relating to any plan of reorganization.

 

29.           Bankruptcy Considerations.

 

Client covenants that it will notify Summit of any
voluntary or involuntary bankruptcy petition under the United States Bankruptcy
Code filed by or against Client, or any assignment for the benefit of creditors
by Client, within Twenty-Four (24) hours of any such filing or assignment.  Failure to notify Summit of any such bankruptcy
filing or assignment within Twenty-Four (24) hours shall constitute an Event of
Default.

 

Client acknowledges that this Agreement is a contract
to extend debt financing or financial accommodations to or for the benefit of
Client within the meaning of 11 U.S.C. §365(c)(2) and, as such, may not be
assumed or assigned.  Summit shall be
under no obligation to provide any financing under this Agreement from and
after the filing of any voluntary or involuntary petition against Client.

 

30.           Limitation of Consequential Damages.

 

Summit and its general and limited partners, the
partners, members, officers and directors thereof, and the employees,
representatives, agents, and attorneys of Summit, shall not be liable to Client
for consequential damages

 

14

 

arising from or relating
to any breach of contract, tort, or other wrong in connection with the
negotiation, documentation, administration of this Agreement or collection of
the Accounts.

 

31.           Force Majeure.

 

In the event Summit is unable to carryout its
obligations under this Agreement due to reasons beyond its reasonable control,
it is agreed that the obligations of Summit hereunder shall be suspended during
the continuance of such inability, Summit shall not be liable for damages, and
Client shall not be entitled to any refund of amounts paid, provided that such
cause shall be remedied as far as reasonably possible with all reasonable
dispatch.

 

32.           Revival Clause.

 

If the incurring of any debt by Client or the payment
of any money or transfer of property to Summit by or on behalf of Client
(including collection of any Account) should for any reason subsequently be
determined to be “voidable” or “avoidable” in whole or in part within the
meaning of any state or federal law (collectively “voidable transfers”),
including, without limitation, fraudulent conveyances or preferential transfers
under the United States Bankruptcy Code or any other federal or state law, and
Summit is required to repay or restore any voidable transfers or the amount or
any portion thereof, or upon the advice of counsel for Summit is advised to do
so, then, as to any such amount or property repaid or restored, including all
reasonable costs, expenses, and attorneys fees of Summit related thereto, the
liability of Client shall automatically be revived, reinstated and restored and
shall exist as though the voidable transfers had never been made.

 

33.           Nature of Client’s Obligations.

 

a.             All obligations pursuant to this
Agreement shall be the joint and several obligations of each Client.  Each reference to “Client” hereunder shall be
deemed to refer to each Client individually and collectively and each
obligation to be performed by “Client” hereunder shall be performed by each
Client.  Summit shall have no
responsibility to inquire into the apportionment, allocation, or disposition of
any Advances or other payments made under this Agreement.  Each Client hereby irrevocably appoints the
other as its agent and attorney-in-fact for all purposes of the related
documents, including, without limitation, the giving and receiving of notices
and other communications and the making of all certifications and reports
required pursuant to this Agreement.  The
action of any Client with respect to any Advance or other payment made under
this Agreement and the requests, notices, reports, and other materials
submitted by any Client shall bind each Client.

 

b.             Each Client hereby agrees to indemnify
Summit and hold Summit harmless from and against any and all liabilities,
expenses, losses, damages and/or claims of any damage or injury asserted
against Summit by Client or any other person arising from or incurred by reason
of the joint nature of the financing hereunder or any action taken by Summit
pursuant hereto.

 

c.             Each Client represents and warrants to
Summit that each request for the purchase of any Account was and is made by
each Client and that each Client is engaged in operations that require
financing on such a joint basis.  Each
Client will and expects to derive benefit, directly or indirectly, from
Summit’s purchase of Acceptable Accounts.

 

d.             Each Client shall be a direct, primary,
and independent obligor and shall not be deemed to be a guarantor,
accommodation party, or other person secondarily liable for the
Obligations.  “Obligations” as used in
this Section means, as the context requires, all duties and obligations
from time to time arising under this Agreement and under all agreements and
documents related hereto.  Without
limiting the foregoing, however, each Client represents, warrants, covenants,
and agrees as follows:

 

(i)            Summit may enforce this Agreement against any
property, interests in property, and rights to property securing any or all
Obligations without first having sought enforcement of this Agreement and any
related documents against Client or any Collateral.

 

15

 

(ii)           Such Obligations shall not be affected by any of the
following:  (A) the bankruptcy,
disability, dissolution, incompetence, insolvency, liquidation, or
reorganization of any Client; (B) any defense of any Client to payment or
performance of any or all Obligations or enforcement of any and all liens and
encumbrances; (C) the discharge, modification of the terms of, reduction
in the amount of, or stay of enforcement of any or all liens and encumbrances
or any or all Obligations in any bankruptcy, insolvency, reorganization, or
other legal proceeding or by law, ordinance, regulation, or rule (federal,
state, province, territory, or local); (D) the cessation of liability of
any Client or any or all Obligations; and (E) any claim or dispute by any
other Client concerning the occurrence of any default in performance of any
Obligations, or any other matter.

 

(iii)          Summit may do the following acts or omissions from
time to time with notice to Client, which notice shall not be required to be in
writing, but without the consent of any Client and without receiving payment or
other value, nor shall the following acts or omissions affect, delay, or impair
any of such Obligations or any or all liens and encumbrances:  (A) Summit may obtain Collateral or
additional Collateral; (B) with the agreement of one Client, Summit may
substitute for any or all Collateral regardless of whether the same type or
greater or lesser value; (C) Summit may release any or all Collateral; (D) Summit
may compromise, delay enforcement, fail to enforce, release, settle or waive
any rights or remedies of Summit as to any or all Collateral; (E) Summit
may sell or otherwise dispose of any Collateral in accordance with this
Agreement and in such manner or order as Summit determines; (F) Summit may
fail to perfect, fail to protect the priority of, and fail to ensure an or all
liens or encumbrances; (G) Summit may fail to inspect, insure, maintain,
preserve or protect any of the Collateral; (H) Summit may obtain
additional obligors for any or all such Obligations; (I) with the
agreement of one Client, Summit may increase or decrease any or all Obligations
or otherwise change terms of any or all Obligations; (J) Summit may
release any Client; (K) Summit may compromise, delay enforcement, fail to
enforce, release, settle, or waive any Obligation of any Client with the
agreement of that Party; (L) Summit may make Advances to, or grant other
financial accommodations for any Client; (M) Summit may fail to file or
pursue a claim in any bankruptcy, insolvency, reorganization or other
proceeding as to any or all liens and encumbrances or any or all Obligations; (N) Summit
may amend, modify, extend, renew, restate, supplement, or terminate in whole or
in part the obligation of any Party with the agreement of that Party; (O) Summit
may take or fail to take any other action with respect to this agreement or any
Party; and (P) Summit may do any other acts or make any other omission that
result in the extinguishment of the obligation of any Party.  As used herein, “Party” means Client and each
other person that from time to time is or becomes obligated to Summit under
this Agreement or any guarantee or grants any lien or encumbrance to Summit
with respect to any Collateral.

 

(iv)          Each Client waives any and all rights and benefits
under any laws that limit the liability or exonerate guarantors or sureties now
or hereafter in effect and any other statutes or rules now or hereafter in
effect that purport to confer specific rights upon or make specific defenses or
procedures available to any Client.

 

(v)           Each Client waives any rights that require Summit, and
Summit shall have no obligation to, provide to Client any information
concerning the performance of any other Client, the Obligations of Client
hereunder, or under any related documents, or the ability of the other to
perform the Obligations or any other matter, regardless of what information
Summit may from time to time have.  Each
Client waives any and all present and future claims, remedies and rights
against the other or any other Client, the Collateral and any other property,
interest in property or rights to property of any other Party (A) arising
from any performance hereunder, (B) arising from any application of any
Collateral, or any other property, interest in property or rights to property
of any other Client, or (C) otherwise arising in respect of this
Agreement, regardless of whether such claims, remedies and rights arise under
any present or future agreement, document or instrument or are provided by any
law, ordinance, regulation or rule (federal, state, province, territory,
or local) (including, without limitation, any and all rights of contribution,
exoneration, indemnity, reimbursement, and subrogation and any and all rights
to participate in the rights and remedies of Summit, against any Client).  To the fullest extent that rights of
contribution, exoneration, indemnity, reimbursement, and subrogation are not
waivable, such rights are hereby subordinate and subject to all rights, liens,
and claims of Summit.

 

e.             Each Client hereby represents and
warrants to Summit that:

 

16

 

(i)            As of the date of this Agreement and after giving
effect to the execution and delivery of this Agreement and the obligations
hereby assumed, the sum of each Client’s debts is less than all of such
Client’s assets at fair valuation.

 

(ii)           Client is not entering into this Agreement, granting
any security in connection with this Agreement, or otherwise making any
transfer in connection with this Agreement, with actual intent to hinder,
delay, or defraud any creditor of Client, whether such creditor now exists or
may hereafter arise.

 

(iii)          Client acknowledges that Summit’s agreement to
consider purchasing Acceptable Accounts pursuant to this Agreement constitutes
reasonably equivalent value in exchange for the execution and delivery by
Client of this Agreement, the granting of security in connection with this
Agreement, and all transfers made by Client in connection with this
Agreement.  Client agrees that the
execution of this Agreement, the joint financing contemplated by this
Agreement, and other related documents, and the other terms and conditions of
this Agreement, even though entailing some risks, have been determined by
Client to be the most desirable form of financing for Client’s operations and
to provide to Client more availability of funds and flexibility in satisfying
Client’s needs for funds.

 

(iv)          Client is not engaged or about to be engaged in a
business or transaction for which the assets of Client (after giving effect to
the granting of any security in connection with the execution and delivery of
this Agreement and any other transfer made or contemplated to be made in
connection with the execution and delivery of this Agreement) would be
unreasonably small in relation to the business or transaction.

 

(v)           Client does not intend to incur, or believe that it
will incur, debts beyond its ability to pay such debts as they become due.

 

(vi)          As used in this Section, the term “transfer” shall
include every mode, direct or indirect, absolute or conditional, voluntary or
involuntary of disposing of or parting with an asset or an interest in an asset
and includes payment of money, release, lease, and creation of a lien or other
encumbrance.

 

f.              Indemnity Obligations:

 

(i)            Each Client acknowledges that pursuant to the terms of
this Agreement and all other agreements and documents related hereto, each
Client is jointly and severally liable for all of the Obligations, whether or
not the Obligations represent amounts actually advanced to an individual
Client.  Accordingly, each Client has
expressly assumed the risk that such Client may be held liable for, and such
Client’s property may be applied to payment of, amounts advanced pursuant to
this Agreement to or for the benefit of another Client.  Nothing contained in this Agreement shall in
any way limit the obligations of any Client to Summit or otherwise limit the
joint and several nature of all of the obligations of each Client.  Each Client shall be fully liable to Summit
pursuant to this Agreement without regard to any allocation of losses and
liabilities by virtue of such indemnity provisions or otherwise.

 

(ii)           In any action or proceeding involving any state or
local law, or any state, local, or federal bankruptcy, insolvency,
reorganization, or other law affecting the rights of creditors generally, if
the obligations of any Client would otherwise, taking into account the
provisions of this Section, be held or determined to be void, invalid, or
unenforceable, or subordinated to the claims of any of their creditors, on
account of the amount of its liability under this Agreement and all other
related documents, then, notwithstanding any other provision hereof to the
contrary, the amount of such liability shall, without any further action by
such Client, Summit, or any other person, be automatically limited and reduced
to the highest amount which is valid and enforceable and not subordinated to
the claims of other creditors as determined in such action or proceeding.

 

34.           Severability of Invalid Provisions,
Headings, Interpretations of Agreement.

 

Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining

 

17

 

provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.

 

All references in this Agreement to the singular shall
be deemed to include the plural when the context so requires, and visa versa.  References in the collective or conjunctive
shall also include the disjunctive unless the context otherwise clearly
requires a different interpretation.

 

35.           Notices.

 

All notices which are expressly required to be in
writing may be mailed, postage prepaid, addressed to the address stated at the
beginning of this Agreement, or to such other address which is provided in
accordance with this Section.  Any notice
so mailed shall be deemed given Three (3) days after mailing.  Any notice otherwise delivered shall be
deemed given when received by the addressee. 
Any notice which is not expressly required to be given in writing may be
given orally.

 

36.           Survival of Representations, Warranties
and Covenants.

 

All agreements, representations, warranties and covenants
made herein by Client shall survive the execution and delivery of this
Agreement and any bankruptcy proceedings involving Client and shall continue in
effect so long as any obligation to Summit contemplated by this Agreement is
outstanding and unpaid, notwithstanding any termination of this Agreement.

 

37.           Jury Waiver, Exclusive Jurisdiction of
Utah Courts.

 

THE PARTIES HEREBY IRREVOCABLY WAIVE ALL RIGHTS TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN
CONTRACT OR IN TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED
TO THIS AGREEMENT.

 

The parties each acknowledge that by execution and
delivery of this Agreement, they have transacted business in the State of Utah
and the parties hereby voluntarily submit to, consent to, and waive any defense
to the jurisdiction of courts located in the State of Utah as to all matters
relating to or arising from this Agreement.

 

EXCEPT AS EXPRESSLY AGREED IN WRITING BY THE PARTIES,
THE STATE AND FEDERAL COURTS LOCATED IN THE STATE OF UTAH SHALL HAVE SOLE AND
EXCLUSIVE JURISDICTION OF ANY AND ALL CLAIMS, DISPUTES, AND CONTROVERSIES
ARISING UNDER OR RELATING TO THIS AGREEMENT. 
NO LAWSUIT, PROCEEDING, ALTERNATIVE DISPUTE RESOLUTION, OR ANY OTHER
ACTION RELATING TO OR ARISING UNDER THIS AGREEMENT MAY BE COMMENCED OR
PROSECUTED IN ANY OTHER FORUM, EXCEPT AS EXPRESSLY AGREED IN WRITING BY EACH
PARTY.

 

38.           Assignability.

 

This Agreement is not assignable or transferable by
Client without Summit’s prior written consent and any such purported assignment
or transfer is void.  This Agreement
shall be binding upon the successors of Client. 
Client acknowledges and agrees that Summit may assign all or any portion
of this Agreement, including, without limitation, assignment of the rights,
benefits and remedies of Summit hereunder without any assignment of the duties,
obligations or liabilities of Summit hereunder, and may sell participations in
this financing.

 

39.           Integrated Agreement, Amendment,
Headings, Governing Law.

 

This Agreement replaces and supersedes any prior
agreement between Client and Summit. 
This Agreement and the documents identified or contemplated herein
constitute the entire agreement between Summit and Client as to the subject
matter hereof and may not be altered or amended except by written agreement
signed by Summit and Client.  No
provision hereof may be waived by Summit except upon written waiver executed by
Summit.  This Agreement

 

18

 

shall be governed by and
construed in accordance with the laws of the State of Utah and this Agreement
shall be deemed to have been executed by the parties in the State of Utah.  This Agreement shall not be deemed to have
been entered into until accepted by Summit at its chief executive office in
Salt Lake City, Utah and shall be performed by Summit and the financing
administered by Summit in Salt Lake City, Utah.

 

Dated:  September 30,
2009.

 

	
   

  	
  Summit Financial
  Resources, L.P.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CORGENIX MEDICAL
  CORPORATION, a Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  William Critchfield

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CORGENIX, INC., a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  William Critchfield

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

19Exhibit
10.2

 

Addendum to Financing
Agreement

(Inventory Financing)

 

Summit Financial Resources, L.P. (“Summit”),
CORGENIX MEDICAL CORPORATION (“CMC”), and CORGENIX, INC. (“CORGENIX”), (CMC and
CORGENIX are collectively and jointly and severally referred to as “Client”)
have entered into a Financing Agreement dated September 30, 2009 (the “Financing
Agreement”).  Summit and Client desire to
modify the Financing Agreement as set forth herein and agree as follows:

 

1.             Definitions.  Except as otherwise expressly provided
herein, terms assigned defined meanings in the Financing Agreement shall have
the same defined meanings in this Addendum. 
As used herein, the term:

 

“Acceptable Inventory” means Inventory located
at Client’s chief executive office which consists of finished goods that have
been approved for their intended use by the Food and Drug Administration and/or
all other applicable regulatory agencies, that are packaged in unopened
packaging, that do not in any manner constitute private label or customer
specific products, and which are subject to no security interest, lien, or
encumbrance of any nature whatsoever with priority over the security interest
created by the Financing Agreement and the Loan and Security Agreement, except
any liens for current taxes which are not delinquent; but excluding Inventory
which, in the sole discretion of Summit, is damaged, out-dated, obsolete, or
otherwise unacceptable to Summit.

 

2.             Inventory Advances.  Summit may, in its sole discretion and
without any duty to do so, elect from time to time to make advances based upon
Acceptable Inventory.  Advances based
upon Acceptable Inventory shall be made only in accordance with the below
formula, which formula may be changed or modified at any time in the sole discretion
of Summit without the consent or approval of Client:

 

Advances based upon Acceptable Inventory
may be made upon request of Client so long as the aggregate amount of all
advances based upon Acceptable Inventory outstanding and unpaid does not exceed
the lesser of (a) Fifty Percent (50%) of the lower of book value, as
determined in accordance with generally accepted accounting principles, of the
Acceptable Inventory, (b) Four Hundred Fifty Thousand Dollars ($450,000), (c) Fifty
Percent (50%) of Client’s outstanding Acceptable Accounts, and (d) together
with the aggregate amount of all other outstanding Advances, the Maximum Credit
Line.

 

Summit may decline to make advances based
upon Acceptable Inventory for any reason or for no reason, without notice,
regardless of any course of conduct or past advances based upon Acceptable Inventory
by Summit.

 

3.             Terms of Inventory Advance.  Advances based upon Acceptable Inventory
shall be subject to the interest, Fees and Charges, and all terms and
conditions applicable to an Advance under the Financing Agreement, including,
without limitation, the Administrative Fee, except that the “Daily Funds Rate”
for purposes of calculating interest owing on outstanding advances based upon
Acceptable Inventory shall mean the prime rate as announced in the Wall Street
Journal plus Two and Seventy-Five Hundredths Percent (2.75%) divided by 360, as
may be adjusted from time to time as of the date of any change in the prime
rate.  All interest accrued on outstanding
advances based upon Acceptable Inventory shall be due and payable monthly in
arrears.

 

4.             Sale of Inventory and Tender of
Account.  Client shall diligently
sell and ship the Acceptable Inventory upon which an advance has been made.  Upon shipment and delivery of such Acceptable
Inventory, the account created thereby shall be promptly submitted to Summit
for purchase.  If such Acceptable Inventory
is not promptly and diligently sold and shipped, or the account created thereby
does not meet all requirements of an Acceptable Account, or Summit declines for
any reason to purchase the account created thereby, the advance based upon
Acceptable Inventory may be treated as a Chargeback Account under the Financing
Agreement.

 

5.             Disbursement of Advance.  Upon purchase by Summit of an Account for
which there has been an underlying advance based upon Acceptable Inventory, the
Advance shall be disbursed to Summit to repay the underlying advance based upon
Acceptable Inventory and all interest and Fees and Charges owing in connection
therewith.  The remainder, if any, shall
be disbursed in accordance with the terms and conditions of the Financing
Agreement.

 

 

6.             Secured by Collateral.  The Collateral shall secure all obligations
of Client to Summit arising under or relating to this Addendum.

 

7.             Rights and Remedies.  Summit shall be entitled to all rights and
remedies concerning an advance based upon Acceptable Inventory as are provided
for Advances under the Financing Agreement.

 

8.             Integrated Agreements.  This Addendum, together with the Financing
Agreement, any other addenda to the Financing Agreement, and the documents
identified or contemplated therein, constitute the entire agreement between
Summit and Client and may not be altered or amended except by written agreement
signed by Summit and Client.  No
provision hereof or thereof may be waived by Summit except upon written waiver
executed by Summit.  The Financing
Agreement, this Addendum, and all other addenda to the Financing Agreement shall
be read and construed together as one agreement.  This Addendum shall be governed by and
construed in accordance with the laws of the State of Utah and shall be deemed
to have been executed by the parties in the State of Utah.

 

9.             Financing Agreement Remains in
Full Force and Effect.  Except as
expressly modified by this Addendum, the Financing Agreement remains in full
force and effect.

 

Dated:  September 30,
2009.

 

	
   

  	
  Summit Financial
  Resources, L.P.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  William
  Critchfield

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CORGENIX MEDICAL
  CORPORATION, a Nevada corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  William
  Critchfield

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CORGENIX, INC.,
  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

2

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