Document:

Exhibit 4.2

 

THIS WARRANT AND THE SHARES OF
COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS.
THIS WARRANT AND THE COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT
BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT UNDER SAID ACT AND ANY
APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO CORGENIX MEDICAL CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED.

 

Right to Purchase 552,380 Shares of the Common Stock of

CORGENIX MEDICAL CORPORATION

(subject to adjustment as provided herein)

 

(Form of)
COMMON STOCK PURCHASE WARRANT

 

	
  No.                      
  

  	
   

  	
  Issue Date:
  December 28, 2005

  

 

CORGENIX MEDICAL CORPORATION a
corporation organized under the laws of the State of Nevada (“Corgenix”),
hereby certifies that, for value received, Ascendiant Securities LLC, or
assigns (the “Holder”), is entitled, subject to the terms set forth below, to
purchase from the Company (as defined herein) from and after the Issue Date of
this Warrant and at any time or from time to time before 5:00 p.m., New
York time, through the close of business on December 28, 2010 (the “Expiration
Date”), up to 552,380 fully paid and
nonassessable shares of Common Stock (as hereinafter defined), $0.001 par value
per share, at the applicable Exercise Price per share (as defined below).  The number and character of such shares of Common
Stock and the applicable Exercise Price per share are subject to adjustment as
provided herein.

 

As used herein the following
terms, unless the context otherwise requires, have the following respective
meanings:

 

(a)           The
term “Company” shall include Corgenix and any corporation which shall succeed,
or assume the obligations of, Corgenix hereunder.

 

(b)           The
term “Common Stock” includes (i) the Company’s Common Stock, par value
$0.001 per share; and (ii) any other securities into which or for which
any of the securities described in (i) may be converted or exchanged
pursuant to a plan of recapitalization, reorganization, merger, sale of assets
or otherwise.

 

(c)           The term “Other
Securities” refers to any stock (other than Common Stock) and other securities
of the Company or any other person (corporate or otherwise) which the holder of
the Warrant at any time shall be entitled to receive, or shall have received,
on the exercise of the Warrant, in lieu of or in addition to Common Stock, or
which at any time shall be issuable or shall have been issued in exchange for
or in replacement of Common Stock or Other Securities pursuant to Section 4
or otherwise.

 

(d)          The “Exercise Price”
applicable under this Warrant shall be $          .

 

 

1.             Exercise
of Warrant.

 

1.1           Number
of Shares Issuable upon Exercise. 
From and after the date hereof through and including the Expiration
Date, the Holder shall be entitled to receive, upon exercise of this Warrant in
whole or in part, by delivery of an original or fax copy of an exercise notice
in the form attached hereto as Exhibit A (the “Exercise Notice”), shares
of Common Stock of the Company, subject to adjustment pursuant to Section 4.

 

1.2           Fair
Market Value.  For purposes hereof,
the “Fair Market Value” of a share of Common Stock as of a particular date (the
“Determination Date”) shall mean:

 

(a)           If
the Company’s Common Stock is traded on the American Stock Exchange or another
national exchange or is quoted on the National or SmallCap Market of The Nasdaq
Stock Market, Inc. (“Nasdaq”), then the closing or last sale price,
respectively, reported for the last business day immediately preceding the
Determination Date.

 

(b)           If
the Company’s Common Stock is not traded on the American Stock Exchange or
another national exchange or on the Nasdaq but is traded on the OTC Bulletin
Board or is listed on the “pink sheets”, then the mean of the average of the
closing bid and asked prices reported for the last business day immediately
preceding the Determination Date.

 

(c)           Except
as provided in clause (d) below, if the Company’s Common Stock is not
publicly traded, then as the Holder and the Company agree or in the absence of
agreement by arbitration in accordance with the rules then in effect of
the American Arbitration Association, before a single arbitrator to be chosen
by the Holder and the Company from a panel of persons qualified by education
and training to pass on the matter to be decided.

 

(d)           If
the Determination Date is the date of a liquidation, dissolution or winding up,
or any event deemed to be a liquidation, dissolution or winding up pursuant to
the Company’s charter, then all amounts to be payable per share to holders of
the Common Stock pursuant to the charter in the event of such liquidation,
dissolution or winding up, plus all other amounts to be payable per share in
respect of the Common Stock in liquidation under the charter, assuming for the
purposes of this clause (d) that all of the shares of Common Stock then
issuable upon exercise of the Warrant are outstanding at the Determination
Date.

 

1.3           Company
Acknowledgment.  The Company will, at
the time of the exercise of the Warrant, upon the request of the holder hereof
acknowledge in writing its continuing obligation to afford to such holder any
rights to which such holder shall continue to be entitled after such exercise
in accordance with the provisions of this Warrant. If the holder shall fail to
make any such request, such failure shall not affect the continuing obligation
of the Company to afford to such holder any such rights.

 

1.4           Trustee
for Warrant Holders.  In the event
that a bank or trust company shall have been appointed as trustee for the
holders of the Warrant pursuant to Subsection 3.2, 

 

2

 

such
bank or trust company shall have all the powers and duties of a warrant agent
(as hereinafter described) and shall accept, in its own name for the account of
the Company or such successor person as may be entitled thereto, all amounts
otherwise payable to the Company or such successor, as the case may be, on
exercise of this Warrant pursuant to this Section 0.

 

2.             Procedure for
Exercise.

 

2.1           Delivery
of Stock Certificates, Etc., on Exercise. 
The Company agrees that the shares of Common Stock purchased upon
exercise of this Warrant shall be deemed to be issued to the Holder as the
record owner of such shares as of the close of business on the date on which
this Warrant shall have been surrendered and payment made for such shares in
accordance herewith.  As soon as practicable
after the exercise of this Warrant in full or in part, and in any event within
three (3) business days thereafter, the Company at its expense (including
the payment by it of any applicable issue taxes) will cause to be issued in the
name of and delivered to the Holder, or as such Holder (upon payment by such
Holder of any applicable transfer taxes) may direct in compliance with
applicable securities laws, a certificate or certificates for the number of
duly and validly issued, fully paid and nonassessable shares of Common Stock
(or Other Securities) to which such Holder shall be entitled on such exercise,
plus, in lieu of any fractional share to which such holder would otherwise be
entitled, cash equal to such fraction multiplied by the then Fair Market Value
of one full share, together with any other stock or other securities and
property (including cash, where applicable) to which such Holder is entitled
upon such exercise pursuant to Section 0 or otherwise.

 

2.2           Exercise.  (a) Payment may be made either (i) in
cash or by certified or official bank check payable to the order of the Company
equal to the applicable aggregate Exercise Price, (ii) by delivery of the
Warrant, or shares of Common Stock and/or Common Stock receivable upon exercise
of the Warrant in accordance with Section (b) below, or (iii) by
a combination of any of the foregoing methods, for the number of Common Shares
specified in such Exercise Notice (as such exercise number shall be adjusted to
reflect any adjustment in the total number of shares of Common Stock issuable
to the Holder per the terms of this Warrant) and the Holder shall thereupon be
entitled to receive the number of duly authorized, validly issued, fully-paid
and non-assessable shares of Common Stock (or Other Securities) determined as
provided herein.  (b) Notwithstanding
any provisions herein to the contrary, if the Fair Market Value of one share of
Common Stock is greater than the Exercise Price (at the date of calculation as
set forth below), in lieu of exercising this Warrant for cash, the Holder may
elect to receive shares equal to the value (as determined below) of this
Warrant (or the portion thereof being exercised) by surrender of this Warrant
at the principal office of the Company together with the properly endorsed
Exercise Notice in which event the Company shall issue to the Holder a number
of shares of Common Stock computed using the following formula:

 

	
   

  	
  X=Y

  	
    (A-B)  

  	
   

  
	
   

  	
   

  	
  A

  

 

 

	
  Where X =

  	
   

  	
  the number
  of shares of Common Stock to be issued to the Holder

  

 

3

 

	
  Y =

  	
   

  	
  the number
  of shares of Common Stock purchasable under the Warrant or, if only a portion
  of the Warrant is being exercised, the portion of the Warrant being exercised
  (at the date of such calculation)

  
	
   

  	
   

  	
   

  
	
  A =

  	
   

  	
  the Fair
  Market Value of one share of the Company’s Common Stock (at the date of such
  calculation)

  
	
   

  	
   

  	
   

  
	
  B =

  	
   

  	
  Exercise
  Price (as adjusted to the date of such calculation)

  

 

3.             Effect of
Reorganization, Etc.; Adjustment of Exercise Price.

 

3.1           Reorganization,
Consolidation, Merger, Etc.  In case
at any time or from time to time, the Company shall (a) effect a
reorganization, (b) consolidate with or merge into any other person, or (c) transfer
all or substantially all of its properties or assets to any other person under
any plan or arrangement contemplating the dissolution of the Company, then, in
each such case, as a condition to the consummation of such a transaction,
proper and adequate provision shall be made by the Company whereby the Holder
of this Warrant, on the exercise hereof as provided in Section 0 at any
time after the consummation of such reorganization, consolidation or merger or
the effective date of such dissolution, as the case may be, shall receive, in
lieu of the Common Stock (or Other Securities) issuable on such exercise prior
to such consummation or such effective date, the stock and other securities and
property (including cash) to which such Holder would have been entitled upon
such consummation or in connection with such dissolution, as the case may be,
if such Holder had so exercised this Warrant, immediately prior thereto, all
subject to further adjustment thereafter as provided in Section 4.

 

3.2           Dissolution.  In the event of any dissolution of the
Company following the transfer of all or substantially all of its properties or
assets, the Company, concurrently with any distributions made to holders of its
Common Stock, shall at its expense deliver or cause to be delivered to the
Holder the stock and other securities and property (including cash, where
applicable) receivable by the Holder of the Warrant pursuant to Section 3.1,
or, if the Holder shall so instruct the Company, to a bank or trust company
specified by the Holder and having its principal office in New York, NY as
trustee for the Holder of the Warrant.

 

3.3           Continuation
of Terms.  Upon any reorganization,
consolidation, merger or transfer (and any dissolution following any transfer)
referred to in this Section 3, this Warrant shall continue in full force
and effect and the terms hereof shall be applicable to the shares of stock and
other securities and property receivable on the exercise of this Warrant after
the consummation of such reorganization, consolidation or merger or the
effective date of dissolution following any such transfer, as the case may be,
and shall be binding upon the issuer of any such stock or other securities,
including, in the case of any such transfer, the person acquiring all or
substantially all of the properties or assets of the Company, whether or not
such person shall have expressly assumed the terms of this Warrant as provided
in Section 4.  In the event this
Warrant does not continue in full force and effect after the consummation of
the transactions described in this Section 3, then the Company’s
securities and property (including cash, where applicable) receivable by the
Holders of the Warrant will be delivered to the Holder or the Trustee as
contemplated by Section 3.2.

 

4

 

4.             (a)           Extraordinary
Events Regarding Common Stock.  In
the event that the Company shall (a) issue additional shares of the Common
Stock as a dividend or other distribution on outstanding Common Stock, (b) subdivide
its outstanding shares of Common Stock, or (c) combine its outstanding
shares of the Common Stock into a smaller number of shares of the Common Stock,
then, in each such event, the Exercise Price shall, simultaneously with the
happening of such event, be adjusted by multiplying the then Exercise Price by
a fraction, the numerator of which shall be the number of shares of Common
Stock outstanding immediately prior to such event and the denominator of which
shall be the number of shares of Common Stock outstanding immediately after
such event, and the product so obtained shall thereafter be the Exercise Price
then in effect. The Exercise Price, as so adjusted, shall be readjusted in the
same manner upon the happening of any successive event or events described
herein in this Section 4.  The
number of shares of Common Stock that the holder of this Warrant shall
thereafter, on the exercise hereof as provided in Section 0, be entitled
to receive shall be increased to a number determined by multiplying the number
of shares of Common Stock that would otherwise (but for the provisions of this Section 4)
be issuable on such exercise by a fraction of which (a) the numerator is
the Exercise Price that would otherwise (but for the provisions of this Section 4)
be in effect, and (b) the denominator is the Exercise Price in effect on the
date of such exercise.

 

(b)           Share
Issuances.  Subject to the provisions
of this Section 3.3, if the Company shall at any time prior to the
exercise in full of this Warrant issue any shares of Common Stock or securities
convertible into Common Stock to a person other than the Holder (except (i) pursuant
to subsection 4(a) above; (ii) pursuant to options, warrants, or
other obligations to issue shares outstanding on the date hereof as disclosed
to Holder in writing or in the Company’s Exchange Act Filings; (iii) for
the sale of the shares of Common Stock listed on Schedule A to the Secured
Convertible Term Notes; or (iv) pursuant to options that may be issued as
of the date hereof under any employee incentive stock option adopted by the
Company) for a consideration per share (the “Offer Price”) less than any
Exercise Price in effect at the time of such issuance, then such Exercise Price
shall be immediately reset to such lower Exercise Price pursuant to the formula
below. For purposes hereof, the issuance of any security of the Borrower
convertible into or exercisable or exchangeable for Common Stock shall result
in an adjustment to the applicable Exercise Price at the time of issuance of
such securities.

 

If the Company issues any
additional shares in the manner referred to above in this subsection 4(b) then,
and thereafter successively upon each such issue, each Exercise Price shall be
adjusted by multiplying the each then applicable Exercise Price by the
following fraction:

 

	
  (A x C) + (B x D)

  
	
  (A + B) x C

  

 

5

 

	
  A =

  	
  Total number
  of shares outstanding or deemed to be outstanding immediately prior to such
  issuance.

  
	
   

  	
   

  
	
  B =

  	
  Number of
  shares issued (or deemed to have been issued).

  
	
   

  	
   

  
	
  C =

  	
  Exercise
  Price in effect immediately prior to such issuance.

  
	
   

  	
   

  
	
  D =

  	
  Consideration
  received by the Company upon such issuance.

  

 

5.             Certificate as to
Adjustments.  In each case of any
adjustment or readjustment in the shares of Common Stock (or Other Securities)
issuable on the exercise of the Warrant, the Company at its expense will
promptly cause its Chief Financial Officer or other appropriate designee to
compute such adjustment or readjustment in accordance with the terms of the
Warrant and prepare a certificate setting forth such adjustment or readjustment
and showing in detail the facts upon which such adjustment or readjustment is
based, including a statement of (a) the consideration received or
receivable by the Company for any additional shares of Common Stock (or Other
Securities) issued or sold or deemed to have been issued or sold, (b) the
number of shares of Common Stock (or Other Securities) outstanding or deemed to
be outstanding, and (c) the Exercise Price and the number of shares of
Common Stock to be received upon exercise of this Warrant, in effect
immediately prior to such adjustment or readjustment and as adjusted or
readjusted as provided in this Warrant. 
The Company will forthwith mail a copy of each such certificate to the holder
of the Warrant and any Warrant agent of the Company (appointed pursuant to Section 11
hereof).

 

6.             Reservation of
Stock, Etc., Issuable on Exercise of Warrant.  The Company will at all times reserve and
keep available, solely for issuance and delivery on the exercise of the
Warrant, shares of Common Stock (or Other Securities) from time to time
issuable on the exercise of the Warrant. 
The Company does not currently have enough common shares authorized to
satisfy the exercise of this Warrant. 
Within 90 days after the date hereof, the Company will call a special
meeting of the shareholders of the Company to approve an amendment to the
Articles of Incorporation increasing the number of authorized shares of common
stock from the current 40,000,000 to 100,000,000 (the “Share Increase Amendment”).  Pending adoption of the Share Increase
Amendment, the Holder hereby covenants and agrees that under no circumstances
will it seek to exercise any of the Warrants. 
The Holder acknowledges and agrees that the shareholders of the Company
have no obligation, legal or otherwise, to approve or adopt the Share Increase
Amendment, and the Holder hereby expressly assumes the risk of such failure to
approve or adopt by the shareholders.  In
no event will the Company be liable to the Investor for any claim, demand,
loss, cost, expense, obligation, liability, or damage arising from, related to,
or resulting from the failure of the Company’s shareholders to approve or adopt
the Share Increase Amendment.

 

7.             Assignment;
Exchange of Warrant.  Subject to
compliance with applicable securities laws, this Warrant, and the rights
evidenced hereby, may be transferred by any registered holder hereof (a “Transferor”)
in whole or in part.  On the surrender
for exchange of this Warrant, with the Transferor’s endorsement in the form of Exhibit B
attached hereto (the

 

6

 

“Transferor Endorsement Form”) and together with
evidence reasonably satisfactory to the Company demonstrating compliance with
applicable securities laws, which shall include, without limitation, a legal
opinion from the Transferor’s counsel that such transfer is exempt from the
registration requirements of applicable securities laws, the Company at its
expense but with payment by the Transferor of any applicable transfer taxes)
will issue and deliver to or on the order of the Transferor thereof a new
Warrant of like tenor, in the name of the Transferor and/or the transferee(s)
specified in such Transferor Endorsement Form (each a “Transferee”),
calling in the aggregate on the face or faces thereof for the number of shares
of Common Stock called for on the face or faces of the Warrant so surrendered
by the Transferor.

 

8.             Replacement of
Warrant.  On receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant and, in the case of any such loss, theft or
destruction of this Warrant, on delivery of an indemnity agreement or security
reasonably satisfactory in form and amount to the Company or, in the case of
any such mutilation, on surrender and cancellation of this Warrant, the Company
at its expense will execute and deliver, in lieu thereof, a new Warrant of like
tenor.

 

9.             Registration
Rights.  The Holder of this Warrant
has been granted certain piggyback registration rights by the Company.

 

10.           Maximum Exercise.
Notwithstanding anything contained herein to the contrary, the Holder shall not
be entitled to exercise this Warrant for, or be required to receive pursuant to
the terms of this Warrant, that number of shares of Common Stock which, when
added to the number of shares of Common Stock otherwise beneficially owned by
such Holder including those issuable upon conversion of notes held by such
Holder would exceed 4.99% of the outstanding shares of Common Stock of the
Company at the time of exercise.  For the
purposes of the immediately preceding sentence, beneficial ownership shall be
determined in accordance with Section 13(d) of the Exchange Act and
Regulation 13d-3 thereunder.  The
conversion limitation described in this Section 3.2 shall automatically
become null and void without any notice to the Company upon the occurrence and
during the continuance beyond any applicable grace period of an Event of
Default, or upon 75 days prior notice to the Company.

 

11.           Warrant Agent.  The Company may, by written notice to the
each Holder of the Warrant, appoint an agent for the purpose of issuing Common
Stock (or Other Securities) on the exercise of this Warrant pursuant to Section 0,
exchanging this Warrant pursuant to Section 7, and replacing this Warrant
pursuant to Section 8, or any of the foregoing, and thereafter any such
issuance, exchange or replacement, as the case may be, shall be made at such
office by such agent.

 

12.           Transfer on the
Company’s Books.  Until this Warrant
is transferred on the books of the Company, the Company may treat the
registered holder hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary.

 

13.           Notices, Etc.  All notices and other communications from the
Company to the Holder of this Warrant shall be mailed by first class registered
or certified mail, postage prepaid, at such address as may have been furnished
to the Company in writing by such Holder or, until 

 

7

 

any such Holder furnishes to the Company an address,
then to, and at the address of, the last Holder of this Warrant who has so
furnished an address to the Company.

 

14.           Miscellaneous.  This Warrant and any term hereof may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought. This Warrant shall be governed by and construed in
accordance with the laws of State of New York without regard to principles of
conflicts of laws.  Any action brought
concerning the transactions contemplated by this Warrant shall be brought only
in the state courts of New York or in the federal courts located in the state
of New York; provided, however, that the Holder may choose to waive this
provision and bring an action outside the state of New York.  The Company agrees to submit to the
jurisdiction of such courts and waive trial by jury.  The prevailing party shall be entitled to
recover from the other party its reasonable attorney’s fees and costs.  In the event that any provision of this
Warrant is invalid or unenforceable under any applicable statute or rule of
law, then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform with such statute or
rule of law.  Any such provision
which may prove invalid or unenforceable under any law shall not affect the
validity or enforceability of any other provision of this Warrant.  The headings in this Warrant are for purposes
of reference only, and shall not limit or otherwise affect any of the terms
hereof.  The invalidity or
unenforceability of any provision hereof shall in no way affect the validity or
enforceability of any other provision. 
The Company acknowledges that legal counsel participated in the
preparation of this Warrant and, therefore, stipulates that the rule of
construction that ambiguities are to be resolved against the drafting party
shall not be applied in the interpretation of this Warrant to favor any party
against the other party.

 

[BALANCE
OF PAGE INTENTIONALLY LEFT BLANK;

SIGNATURE PAGE FOLLOWS.]

 

8

 

IN WITNESS
WHEREOF, the Company has executed this Warrant as of the date first written
above. 

 

	
   

  	
  CORGENIX
  MEDICAL CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Douglass T. Simpson

  	
   

  
	
   

  	
  Name:

  	
  Douglass T. Simpson

  
	
   

  	
  Title:

  	
  President and CEO

  

 

9

 

EXHIBIT A

 

FORM OF
SUBSCRIPTION

(To Be Signed Only On Exercise Of Warrant)

 

TO:         Corgenix
Medical Corporation

 

Attention:              Chief Financial Officer

 

The undersigned, pursuant to
the provisions set forth in the attached Warrant (No.        ),
hereby irrevocably elects to purchase (check applicable box):

 

	
  o

  	
   

  	
   

  	
  shares of
  the Common Stock covered by such Warrant; or

  
	
   

  	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  the maximum
  number of shares of Common Stock covered by such Warrant pursuant to the
  cashless exercise 

  
	
   

  	
   

  	
  procedure
  set forth in Section 2.

  

 

The undersigned herewith makes
payment of the full Exercise Price for such shares at the price per share
provided for in such Warrant, which is $                      .  Such payment takes the form of (check
applicable box or boxes):

 

	
  o

  	
   

  	
  $                   in lawful money of the United States; and/or

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  the
  cancellation of such portion of the attached Warrant as is exercisable for a
  total of              shares
  of 

  
	
   

  	
   

  	
  Common Stock
  (using a Fair Market Value of $                 per
  share for purposes of this calculation); and/or

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  the cancellation
  of such number of shares of Common Stock as is necessary, in accordance with
  the formula 

  
	
   

  	
   

  	
  set forth in
  Section 2.2, to exercise this Warrant with respect to the maximum number
  of shares of Common Stock purchasable pursuant to the cashless exercise
  procedure set forth in Section 2.

  

 

The undersigned requests that
the certificates for such shares be issued in the name of, and delivered to                                   
                                                          
whose address is
                                                                                                                               .

 

The undersigned represents and
warrants that all offers and sales by the undersigned of the securities
issuable upon exercise of the within Warrant shall be made pursuant to
registration of the Common Stock under the Securities Act of 1933, as amended
(the “Securities Act”) or pursuant to an exemption from registration under the
Securities Act.

 

	
   

  	
   

  
	
  Dated:

  	
  (Signature must
  conform to name of holder as

  specified on the face of the Warrant)

  
	
   

  	
   

  
	
   

  	
    Address:

  	
   

  
	
   

  	
   

  	
   

  

 

A-1

 

EXHIBIT B

 

FORM OF TRANSFEROR ENDORSEMENT

(To Be Signed Only On Transfer Of Warrant)

 

For value received, the undersigned
hereby sells, assigns, and transfers unto the person(s) named below under the
heading “Transferees” the right represented by the within Warrant to purchase
the number of shares of Common Stock of Corgenix Medical Corporation into which
the within Warrant relates specified under the heading “Number Transferred”
opposite the name(s) of such person(s) and appoints each such person Attorney
to transfer its respective right on the books of Corgenix Medical Corporation
with full power of substitution in the premises.

 

	
  Transferees

  	
   

  	
  Address

  	
   

  	
  Number

  Transferred

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Signature
  must conform to name of holder as

  specified on the face of the Warrant)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SIGNED IN
  THE PRESENCE OF:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Name)

  
	
  ACCEPTED AND
  AGREED:

  [TRANSFEREE]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Name)

  	
   

  	
   

  
							

 

B-1Exhibit 4.3

 

 THIS TERM NOTE AND THE COMMON SHARES ISSUABLE
UPON CONVERSION OF THIS TERM NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS.  THIS TERM NOTE AND THE COMMON SHARES ISSUABLE
UPON CONVERSION OF THIS TERM NOTE MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
AS TO THIS TERM NOTE UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR
AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO CORGENIX MEDICAL CORPORATION
THAT SUCH REGISTRATION IS NOT REQUIRED.

 

SECURED
CONVERTIBLE TERM NOTE

 

FOR VALUE RECEIVED, CORGENIX
MEDICAL CORPORATION, a Nevada corporation (the “Borrower”),
hereby promises to pay to [NAME], [ADDRESS] (the “Holder”)
or its registered assigns or successors in interest, or order, the sum of                                             Dollars
($                  )
(the “Principal Amount”), together with any
accrued and unpaid interest thereon, on December 28, 2008 (the “Maturity Date”)
if not sooner paid.

 

Capitalized terms used herein
without definition shall have the meanings ascribed to such terms in that
certain Securities Purchase Agreement dated as of the date hereof between the
Borrower, the Holder,                             
(“                ”)
and                       
(“                        ”)
(the “Purchase Agreement”).

 

On the date hereof, the
Borrower is issuing to                             
and                           
pursuant to the Purchase agreement an identical secured convertible term note
in the original principal amount of                               
Dollars ($                ).

 

The following terms shall apply
to this Term Note:

 

ARTICLE I

INTEREST & AMORTIZATION

 

1.1                                 (a)                                  Interest
Rate.  Subject to Sections 1.1(b),
4.12 and 5.6 hereof, interest payable on this Term Note shall accrue for the
Principal Amount at a rate per annum (the “Interest Rate”)
equal to the greater of (x) the “prime rate” published in The Wall
Street Journal from time to time (the “Prime Rate”),
plus three percent (3%), or (y) twelve percent (12%).  The Prime Rate shall be increased or
decreased as the case may be for each increase or decrease in the prime rate in
an amount equal to such increase or decrease in the prime rate; each change to
be effective as of the day of the change in such rate.  Interest shall accrue from the date hereof
and shall be calculated on the basis of a 360 day year.  Interest shall be payable monthly, in
arrears, commencing on January 1,
2006 and on the first day of each consecutive calendar month thereafter (each,
a “Repayment Date”) and on the Maturity
Date, whether by acceleration or otherwise.

 

 

(b)                                 Interest
Rate Adjustment.  The Interest Rate
shall be subject to adjustment on the last business day of each month hereafter
until the Maturity Date (each a “Determination Date”).  If on any Determination Date (i) the
Borrower shall have registered under the Securities Act of 1933, as amended
(the “Securities Act”), the shares of Common
Stock underlying each of the conversion of this Term Note and the exercise of
the Warrant on a registration statement declared effective by the Securities
and Exchange Commission (the “SEC”), and (ii) the
market price (the “Market Price”)
of the Common Stock as reported by Bloomberg, L.P. on the Principal Market (as
defined below) for the five (5) consecutive trading days immediately preceding
such Determination Date exceeds the then applicable Fixed
Conversion Price by at least twenty five percent (25%), the Interest Rate for
the succeeding calendar month shall automatically be reduced by 25 basis points
(25 b.p.) (0.25%) for each incremental twenty five percent (25%) increase in
the Market Price of the Common Stock above the then applicable Fixed Conversion
Price.  Notwithstanding the foregoing
(and anything to the contrary contained herein), in no event shall the Interest
Rate be less than zero percent (0%).

 

1.2                                 Minimum
Monthly Principal Payments.  Payments
of the Principal Amount shall begin on June 1, 2006 and shall recur on
each succeeding Repayment Date thereafter until the Principal Amount has been
repaid in full, whether by the payment of cash or by the conversion of such
principal into Common Stock pursuant to the terms hereof.  Subject to Section 2.1 and Article III
below, on each Repayment Date, the Borrower shall make payments to the Holder
in the amount of $32,954.53 (the “Monthly Principal Amount”),
together with any accrued and unpaid interest then due on the Principal Amount
plus any and all other amounts which are then owing under this Term Note that
have not been paid (the Monthly Principal Amount, together with such accrued
and unpaid interest and such other amounts, collectively, the “Monthly Amount”). Any Principal Amount that remains
outstanding on the Maturity Date shall be due and payable on the Maturity Date.

 

ARTICLE II

CONVERSION REPAYMENT

 

2.1                                 (a)                                  Payment
of Monthly Amount in Cash or Common Stock. 
If the Monthly Amount (or a portion of such Monthly Amount if such
portion of the Monthly Amount would have been converted into shares of Common Stock
but for Section 3.2) is required to be paid in cash pursuant to Section 2.1(b),
then the Borrower shall pay the Holder an amount equal to 110% of the Monthly
Amount due and owing to the Holder on the Repayment Date in cash.  If the Monthly Amount (or a portion of such
Monthly Amount if not all of the Monthly Amount may be converted into shares of
Common Stock pursuant to Section 3.2) is required to be paid in shares of
Common Stock pursuant to Section 2.1(b), the number of such shares to be
issued by the Borrower to the Holder on such Repayment Date (in respect of such
portion of the Monthly Amount converted into shares of Common Stock pursuant to
Section 2.1(b)), shall be the number determined by dividing (x) the
portion of the Monthly Amount converted into shares of Common

 

2

 

Stock, by (y) the then
applicable Fixed Conversion Price.  For
purposes hereof, the initial “Fixed Conversion Price”
means $0.30.

 

(b)                                 Monthly
Amount Conversion Guidelines. 
Subject to Sections 2.1(a), 2.2 and 3.2 hereof, the Holder shall convert
into shares of Common Stock all or a portion of the Monthly Amount due on each
Repayment Date according to the following guidelines (collectively, the “Conversion Criteria”): (i) the average closing price of
the Common Stock as reported by Bloomberg, L.P. on the Principal Market for the
five (5) consecutive trading days immediately preceding such
Repayment Date shall be greater than or equal to 115% of the Fixed Conversion
Price and (ii) the amount of such conversion does not exceed twenty five
percent (25%) of the aggregate dollar trading volume of the Common Stock for
the twenty two (22) trading day period immediately preceding the applicable
Repayment Date.  If the Conversion
Criteria are not met, the Holder shall convert only such part of the Monthly
Amount that meets the Conversion Criteria. Any part of the Monthly Amount due
on a Repayment Date that the Holder has not been able to convert into shares of
Common Stock due to failure to meet the Conversion Criteria, shall be paid by
the Borrower in cash at the rate of 110% of the Monthly Amount otherwise due on
such Repayment Date, within three (3) business days of the applicable
Repayment Date.

 

(c)                                  Application
of Conversion Amounts.  Any amounts
converted by the Holder pursuant to Section 2.1(b) shall be deemed to
constitute payments of, or applied against, (i) first, outstanding fees, (ii) second,
accrued interest on the Principal Amount, and (iii) third, the Principal
Amount.

 

2.2                                 No
Effective Registration. 
Notwithstanding anything to the contrary herein, no amount payable
hereunder may be converted into Common Stock unless (a) either (i) an
effective current Registration Statement (as defined in the Registration Rights
Agreement) covering the shares of Common Stock to be issued in satisfaction of
such obligations exists, or (ii) an exemption from registration of the
Common Stock is available pursuant to Rule 144(k) of the Securities Act,
and (b) no Event of Default hereunder exists and is continuing, unless
such Event of Default is cured within any applicable cure period or is
otherwise waived in writing by the Holder in whole or in part at the Holder’s
option.

 

2.3                                 Optional
Redemption of Principal Amount.  The
Borrower will have the option of prepaying the outstanding Principal Amount (“Optional Redemption”), in whole or in part, by paying to the
Holder a sum of money equal to one hundred twenty five percent (125%) of the
portion of the Principal Amount to be redeemed, together with accrued but
unpaid interest thereon and any and all other sums due, accrued or payable to
the Holder arising under this Term Note, the Purchase Agreement or any Related
Agreement (the “Redemption Amount”) on the
Redemption Payment Date (as defined below). 
The Borrower shall deliver to the Holder a notice of redemption (the “Notice of Redemption”) specifying the date for such Optional
Redemption (the “Redemption Payment Date”), which
date shall be not less than ten (10) business days after the date of the
Notice of Redemption (the “Redemption Period”).  A Notice of Redemption shall

 

3

 

not be effective with
respect to any portion of the Principal Amount for which the Holder has a
pending election to convert pursuant to Section 3.1, or for conversions
initiated or made by the Holder pursuant to Section 3.1 during the
Redemption Period.  The Redemption Amount
shall be determined as if such Holder’s conversion elections had been completed
immediately prior to the date of the Notice of Redemption.  On the Redemption Payment Date, the
Redemption Amount shall be paid in good funds to the Holder.  In the event the Borrower fails to pay the
Redemption Amount on the Redemption Payment Date as set forth herein, then such
Notice of Redemption will be null and void.

 

ARTICLE III

CONVERSION RIGHTS

 

3.1                                 Holder’s
Conversion Rights.  Subject to Section 2.2,
the Holder shall have the right, but not the obligation, to convert all or any
portion of the then aggregate outstanding Principal Amount of this Term Note,
together with interest and fees due hereon, into shares of Common Stock,
subject to the terms and conditions set forth in this Article III.  The Holder may exercise such right by
delivery to the Borrower of a written Notice of Conversion pursuant to Section 3.3.  The shares of Common Stock to be issued upon
such conversion are herein referred to as the “Conversion
Shares.”

 

3.2                                 Conversion
Limitation.  Notwithstanding anything
contained herein to the contrary, the Holder shall not be entitled to convert
pursuant to the terms of this Term Note an amount that would be convertible
into that number of Conversion Shares which would exceed the difference between
4.99% of the issued and outstanding shares of Common Stock and the number of
shares of Common Stock beneficially owned by such Holder or issuable upon
exercise of Warrants held by such Holder. 
For the purposes of the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the
Exchange Act and Regulation 13d-3 thereunder. The Holder may void the
Conversion Share limitation described in this Section 3.2 upon 75 days
prior notice to the Borrower or without any notice requirement upon an Event of
Default.

 

3.3                                 Mechanics
of Holder’s Conversion.  (a) In
the event that the Holder elects to convert any amounts outstanding under this
Term Note into Common Stock, the Holder shall give notice of such election by
delivering an executed and completed notice of conversion (a “Notice of Conversion”) to the Borrower, which Notice of
Conversion shall provide a breakdown in reasonable detail of the Principal
Amount, accrued interest and fees being converted.  On each Conversion Date (as hereinafter
defined) and in accordance with its Notice of Conversion, the Holder shall make
the appropriate reduction to the Principal Amount, accrued interest and fees as
entered in its records and shall provide written notice thereof to the Borrower
within two (2) business days after the Conversion Date.  Each date on which a Notice of Conversion is
delivered or telecopied to the Borrower in accordance with the provisions
hereof shall be deemed a “Conversion Date”.  A form of Notice of Conversion to be employed
by the Holder is annexed hereto as Exhibit A.

 

4

 

(b)                                 Pursuant
to the terms of a Notice of Conversion, the Borrower will issue instructions to
the transfer agent accompanied by an opinion of counsel, if so required by the
Borrower’s transfer agent, within one (1) business day of the date of
the delivery to the Borrower of the Notice of Conversion and shall cause the
transfer agent to transmit the certificates representing the Conversion Shares
to the Holder by crediting the account of the Holder’s designated broker with
The Depository Trust Company (“DTC”) through
its Deposit Withdrawal Agent Commission (“DWAC”) system
within three (3) business days after receipt by the Borrower of the
Notice of Conversion (the “Delivery Date”).  In the case of the exercise of the conversion
rights set forth herein the conversion privilege shall be deemed to have been
exercised and the Conversion Shares issuable upon such conversion shall be
deemed to have been issued upon the date of receipt by the Borrower of the
Notice of Conversion.  The Holder shall
be treated for all purposes as the record holder of such shares of Common
Stock, unless the Holder provides the Borrower written instructions to the
contrary.

 

3.4                                 Late
Payments.  The Borrower understands
that a delay in the delivery of the shares of Common Stock in the form required
pursuant to this Article beyond the Delivery Date could result in economic
loss to the Holder.  As compensation to
the Holder for such loss, the Borrower agrees to pay late payments to the
Holder for late issuance of such shares in the form required pursuant to this Article III
upon conversion of the Note, in the amount equal to $250 per business day after
the Delivery Date.  The Borrower shall
pay any payments incurred under this Section in immediately available
funds upon demand.

 

3.5                                 Conversion
Mechanics.

 

(a)                                  The
number of shares of Common Stock to be issued upon each conversion of this Term
Note pursuant to this Article III shall be determined by dividing that
portion of the Principal Amount and interest and fees to be converted, if any,
by the then applicable Fixed Conversion Price. 
In the event of any conversions of outstanding obligations under this
Term Note in part pursuant to this Article III, such conversions shall be
deemed to constitute conversions (i) first, of the Monthly Amount for the
current calendar month, (ii) then of any accrued interest on the Principal
Amount and (iii) then of outstanding Principal Amount, by applying the
conversion amount to Monthly Principal Amounts for the remaining Repayment
Dates in chronological order.

 

(b)                                 The
Fixed Conversion Price and number and kind of shares or other securities to be
issued upon conversion are subject to adjustment from time to time upon the
occurrence of certain events, as follows:

 

A.                                   Stock
Splits, Combinations and Dividends. 
If the shares of Common Stock are subdivided or combined into a greater
or smaller number of shares of Common Stock, or if a dividend is paid on the
Common Stock in shares of Common Stock, the Fixed Conversion Price or the
Conversion Price, as the case may be, shall be proportionately reduced in case
of subdivision of shares or stock dividend or

 

5

 

proportionately
increased in the case of combination of shares, in each such case by the ratio
which the total number of shares of Common Stock outstanding immediately after
such event bears to the total number of shares of Common Stock outstanding
immediately prior to such event.

 

B.                                     During
the period the conversion right exists, the Borrower will reserve from its
authorized and unissued Common Stock a sufficient number of shares to provide
for the issuance of Common Stock upon the full conversion of this Term Note.  The Borrower represents that upon issuance
and receipt of adequate consideration, such shares will be duly authorized and
validly issued, fully paid and non-assessable. 
The Borrower agrees that its issuance of this Term Note shall constitute
full authority to its officers, agents, and transfer agents who are charged
with the duty of executing and issuing stock certificates to execute and issue
the necessary certificates for shares of Common Stock upon the conversion of
this Term Note.

 

C.                                     Share
Issuances.  Subject to the provisions
of this Section 3.5, if the Borrower shall at any time prior to the
conversion or repayment in full of the Principal Amount issue any shares of
Common Stock or securities convertible into Common Stock to a person other than
the Holder (except (i) pursuant to Subsections A or B above; (ii) pursuant
to options, warrants or other obligations to issue shares outstanding on the
date hereof as disclosed to the Holder in writing or in the Borrower’s Exchange
Act filings (iii) for the sale of the shares of Common Stock listed on Schedule A
hereto; and (iv) pursuant to options that are issuable as of the date
hereof under any employee incentive stock option plan adopted by the Borrower)
for a consideration per share (the “Offer Price”)
less than the Fixed Conversion Price in effect at the time of such issuance,
then the Fixed Conversion Price shall be immediately reset to such lower Offer
Price at the time of issuance of such securities.  For purposes hereof, the issuance of any
security of the Borrower convertible into or exercisable or exchangeable for
Common Stock shall result in an adjustment to the Fixed Conversion Price at the
time of issuance of such securities.

 

D.                                    Reclassification,
etc.  If the Borrower at any time
shall, by reclassification or otherwise, change the Common Stock into the same
or a different number of securities of any class or classes, this Term Note, as
to the unpaid Principal Amount and accrued interest thereon, shall thereafter
be deemed to evidence the right to purchase an adjusted number of such
securities and kind of securities as would have been issuable as the result of
such change with respect to the Common Stock immediately prior to such
reclassification or other change.

 

6

 

3.6                                 Issuance
of Replacement Note.  Upon any
partial conversion of this Term Note, a replacement Note containing the same
date and provisions of this Term Note shall, at the written request of the
Holder, be issued by the Borrower to the Holder for the outstanding Principal
Amount of this Term Note and accrued interest which shall not have been
converted or paid. Subject to the provisions of Article IV, the Borrower
will pay no costs, fees or any other consideration to the Holder for the
production and issuance of a replacement Note.

 

ARTICLE IV

EVENTS OF DEFAULT

 

Upon the occurrence and
continuance of an Event of Default beyond any applicable grace period, the
Holder may make all sums of principal, interest and other fees then remaining
unpaid hereon and all other amounts payable hereunder immediately due and
payable.  In the event of such an
acceleration, the amount due and owing to the Holder shall be 125% of the
outstanding principal amount of the Note (plus accrued and unpaid interest and
fees, if any) (the “Default Payment”).  The Default Payment shall be applied first to
any fees due and payable to the Holder pursuant to this Term Note, the Purchase
Agreement or the Related Agreements, then to accrued and unpaid interest due on
the Note and then to the outstanding principal balance of the Note.

 

The occurrence of any of the
following events set forth in Sections 4.1 through 4.10, inclusive, is an “Event of Default”:

 

4.1                                 Failure
to Pay Principal, Interest or other Fees. 
The Borrower fails to pay when due any installment of principal,
interest or other fees hereon in accordance herewith, or the Borrower fails to
pay when due any amount due under any other promissory note issued by the
Borrower, and in any such case, such failure shall continue for a period of
three (3) days following the date upon which any such payment was due.

 

4.2                                 Breach
of Covenant.  The Borrower breaches
any covenant or any other term or condition of this Term Note or the Purchase
Agreement in any material respect, or the Borrower or any of its Subsidiaries
breaches any covenant or any other term or condition of any Related Agreement
in any material respect and, in any such case, such breach, if subject to cure,
continues for a period of fifteen (15) days after the occurrence thereof.

 

4.3                                 Breach
of Representations and Warranties. 
Any representation or warranty made by the Borrower in this Term Note or
the Purchase Agreement, or by the Borrower or any of its Subsidiaries in any
Related Agreement, shall, in any such case, be false or misleading in any
material respect on the date that such representation or warranty was made or
deemed made.

 

4.4                                 Receiver
or Trustee.  The Borrower or any of
its Subsidiaries shall make an assignment for the benefit of creditors, or
apply for or consent to the appointment of a receiver or trustee for it or for
a substantial part of its property or business; or such a receiver or trustee
shall otherwise be appointed.

 

7

 

4.5                                 Judgments.  Any money judgment, writ or similar final
process shall be entered or filed against the Borrower or any of its
Subsidiaries or any of their respective property or other assets for more than
$50,000, and shall remain unvacated, unbonded or unstayed for a period of
thirty (30) days.

 

4.6                                 Bankruptcy.  Bankruptcy, insolvency, reorganization or
liquidation proceedings or other proceedings or relief under any bankruptcy law
or any law for the relief of debtors shall be instituted by or against the
Borrower or any of its Subsidiaries and not stayed within 30 days.

 

4.7                                 Stop
Trade.  An SEC stop trade order or
Principal Market trading suspension of the Common Stock shall be in effect for
five (5) consecutive days or five (5) days during a period
of ten (10) consecutive days, excluding in all cases a suspension of
all trading on a Principal Market, provided that the Borrower shall not have
been able to cure such trading suspension within thirty (30) days of the
notice thereof or list the Common Stock on another Principal Market within sixty (60)
days of such notice.  The “Principal
Market” for the Common Stock shall include the OTC Bulletin Board, NASDAQ
SmallCap Market, NASDAQ National Market System, American Stock Exchange, or New
York Stock Exchange (whichever of the foregoing is at the time the principal
trading exchange or market for the Common Stock).

 

4.8                                 Failure
to Deliver Common Stock or Replacement Note.  The Borrower shall fail (i) to timely
deliver Common Stock to the Holder pursuant to and in the form required by this
Term Note, and Section 9 of the Purchase Agreement, if such failure to
timely deliver Common Stock shall not be cured within two (2) business
days or (ii) to deliver a replacement Note to the Holder within
seven (7) business days following the required date of such issuance
pursuant to this Term Note, the Purchase Agreement or any Related Agreement (to
the extent required under such agreements).

 

4.9                                 Default
Under Related Agreements or Other Agreements.  The occurrence and continuance of any Event
of Default (as defined in the Purchase Agreement or any Related Agreement) or
any event of default (or similar term) under any other indebtedness.

 

4.10                           Change
in Control.  Any “Person” (as defined
in Section 13(d)(3) under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)), not including Dr. Luis R. Lopez or the
Purchasers shall become the beneficial owner (as defined in Rule 13d-3
under the Exchange Act) of more than 25% of the total voting power attached to
all outstanding equity securities of the Borrower.

 

DEFAULT RELATED PROVISIONS

 

4.11                           Default
Interest Rate.  Following the
occurrence and during the continuance of an Event of Default, the Borrower
shall pay additional interest on this Term Note in an amount equal to two
percent (2%) per month (twenty-four percent (24%) per annum), and all
outstanding obligations under this Term Note, including

 

8

 

unpaid interest, shall
continue to accrue such additional interest from the date of such Event of
Default until the date such Event of Default is cured or waived.

 

4.12                           Conversion
Privileges.  The conversion
privileges set forth in Article III shall remain in full force and effect
immediately from the date hereof and until this Term Note is paid in full.

 

4.13                           Cumulative
Remedies.  The remedies under this
Term Note shall be cumulative.

 

ARTICLE V

MISCELLANEOUS

 

5.1                                 Failure
or Indulgence Not Waiver.  No failure
or delay on the part of the Holder hereof in the exercise of any power, right
or privilege hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such power, right or privilege preclude other or
further exercise thereof or of any other right, power or privilege.  All rights and remedies existing hereunder
are cumulative to, and not exclusive of, any rights or remedies otherwise
available.

 

5.2                                 Notices.  Any notice herein required or permitted to be
given shall be in writing and shall be deemed effectively given:  (a) upon personal delivery to the party
notified, (b) when sent by confirmed telex or facsimile if sent during
normal business hours of the recipient, if not, then on the next business day, (c) five
days after having been sent by registered or certified mail, return receipt
requested, postage prepaid, or (d) one day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written
verification of receipt.  All
communications shall be sent to the Borrower at the address provided in the Purchase
Agreement executed in connection herewith, and to the Holder at the address
provided in the Purchase Agreement for such Holder, or at such other address as
the Borrower or the Holder may designate by ten days advance written notice to
the other parties hereto.  A Notice of
Conversion shall be deemed given when made to the Borrower pursuant to the
Purchase Agreement.

 

5.3                                 Amendment
Provision.  The term “Term Note” and
all reference thereto, as used throughout this instrument, shall mean this
instrument as originally executed, or if later amended or supplemented, then as
so amended or supplemented, and any successor instrument issued pursuant to Section 3.6
hereof, as it may be amended or supplemented.

 

5.4                                 Assignability.  This Term Note shall be binding upon the
Borrower and its successors and assigns, and shall inure to the benefit of the
Holder and its successors and assigns, and may be assigned by the Holder in
accordance with the requirements of the Purchase Agreement.  This Term Note shall not be assigned by the
Borrower without the consent of the Holder.

 

5.5                                 Governing
Law.  This Term Note shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to principles of

 

9

 

conflicts of laws.  Any action brought by either party against
the other concerning the transactions contemplated by this Agreement shall be
brought only in the state courts of New York or in the federal courts located
in the state of New York.  Both the
Borrower and the Holder agree to submit to the jurisdiction of such
courts.  The prevailing party shall be
entitled to recover from the other party its reasonable attorney’s fees and
costs.  In the event that any provision
of this Term Note is invalid or unenforceable under any applicable statute or rule of
law, then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform with such statute or
rule of law. Any such provision which may prove invalid or unenforceable
under any law shall not affect the validity or unenforceability of any other
provision of this Term Note.  Nothing
contained herein shall be deemed or operate to preclude the Holder from
bringing suit or taking other legal action against the Borrower in any other
jurisdiction to collect on the Borrower’s obligations to the Holder, to realize
on any collateral or any other security for such obligations, or to enforce a
judgment or other court order in favor of the Holder.

 

5.6                                 Maximum
Payments.  Nothing contained herein
shall be deemed to establish or require the payment of a rate of interest or
other charges in excess of the maximum permitted by applicable law.  In the event that the rate of interest
required to be paid or other charges hereunder exceed the maximum permitted by
such law, any payments in excess of such maximum shall be credited against
amounts owed by the Borrower to the Holder and thus refunded to the Borrower.

 

5.7                                 Security
Interest and Guarantee.  The Holder
has been granted a security interest (i) in certain assets of the Borrower
and its Subsidiaries as more fully described in the Term Note Security
Agreement dated as of the date hereof and (ii) pursuant to the Stock
Pledge Agreement dated as of the date hereof. 
The obligations of the Borrower under this Term Note are guaranteed by
certain Subsidiaries and a shareholder of the Borrower pursuant to the
Subsidiary Guaranty and Guaranty dated as of the date hereof, respectively.

 

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

 

5.9                                 Cost
of Collection.  If default is made in
the payment of this Term Note, the Borrower shall pay to the Holder reasonable
costs of collection, including reasonable attorney’s fees.

 

10

 

IN WITNESS
WHEREOF, the Borrower has caused this Term Note to be
signed in its name effective as of this         
day of December, 2005.

 

	
   

  	
  CORGENIX MEDICAL CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
  WITNESS:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
				

 

11

 

EXHIBIT A

 

NOTICE OF
CONVERSION

 

(To be executed by the Holder
in order to convert all or part of the Note into Common Stock

 

[Name and Address of Holder]

 

The Undersigned hereby converts
$                  
of the principal and $                          
of the interest due on [specify applicable Repayment Date] under the
Convertible Term Note issued by CORGENIX MEDICAL CORPORATION dated December     ,
2005 by delivery of Shares of Common Stock of CORGENIX MEDICAL CORPORATION on
and subject to the conditions set forth in Article III of such Note.

 

1.                                       Date
of Conversion

 

2.                                       Shares
To Be Delivered: 

 

 

	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title

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