SETTLEMENT AGREEMENT
THIS SETTLEMENT AGREEMENT is entered into as of this 29th day of
September, 2004 by and between Transax International Limited, a Colorado
corporation (the "Company") and Xxxxxxx Xxxxxx ("Xxxxxx").
RECITALS:
WHEREAS, the Company has incurred substantial monetary obligations
concerning its business operations and the development and marketing of its
products;
WHEREAS, Xxxxxx has made monetary advances to the Company in the
aggregate amount of $87,500.00 in order to assist the Company in financing its
contractual debts and ongoing business expenses;
WHEREAS, Xxxxxx has provided financial services to the Company regarding
the procurement of additional cash advances and/or loans from third-parties in
order to assist the Company in financing its contractual debts and ongoing
business expenses;
WHEREAS, the Company has incurred an aggregate of $88,700.00 to Xxxxxx
relating to the principal amount of $87,500.00 advanced by Xxxxxx and the
accrual of interest thereon in the amount of $1,200.00 (the "Debt");
WHEREAS, the Company has incurred an aggregate of $12,500.00 to Xxxxxx
relating to the financial services provided by Xxxxxx to the Company (the
"Finders' Fee Debt");
WHEREAS, the Company and Xxxxxx have settled their differences regarding
the Debt and the Finders' Fee Debt and wish to set forth their settlement
agreement;
WHEREAS, the Company desires to settle the Debt by issuing to Xxxxxx
and/or its designates: (i) 1,182,666 shares of its restricted common stock, par
value $0.00001 (the "Common Stock") at the rate of $0.075 per share (which
amount is based upon the average of the open and close price of $0.08 of the
Company's shares of Common Stock traded on the OTC Bulletin Board between
September 19 2004 and September 29, 2004); and (ii) 1,166,667 warrants (the
"Warrants") entitling Xxxxxx and/or its designates to purchase a share of the
Company's restricted Common Stock at $0.20 per share expiring September 29,
2009;
WHEREAS, the Company desires to settle the Finders' Fee Debt by issuing
to Xxxxxx and/or its designates 166,667 shares of its restricted Common Stock
at the rate of $0.075 per share (which amount is based upon the average of the
open and close price of $0.08 of the Company's shares of Common Stock traded on
the OTC Bulletin Board between September 19, 2004 and September 29, 2004;
WHEREAS, Xxxxxx desires to convert the Debt and accept the issuance of
1,182,666 shares of restricted Common Stock of the Company and 1,166,667
Warrants of the Company as full and complete satisfaction of the Debt;
WHEREAS, Xxxxxx desires to convert the Finders' Fee Debt and accept the
issuance of 166,667 shares of restricted Common Stock of the Company as full
and complete satisfaction of the Finders' Fee Debt;
WHEREAS, the Company and Xxxxxx desire to release one another from any
and all further liability as related to the aforesaid Debt and Finders' Fee
Debt.
WHEREAS, the Board of Directors of the Company by unanimous written
consent dated September 29, 2004 has approved: (i) the execution of this
Settlement Agreement; (ii) the issuance of the 1,182,666 shares of restricted
Common Stock and 1,166,667 Warrants to Xxxxxx as settlement of the Debt; and
(iii) the issuance of the 166,667 shares of restricted Common Stock to Xxxxxx
as settlement of the Finders' Fee Debt.
NOW, THEREFORE, in consideration of the aforesaid recitals and mutual
promises contained herein, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
AGREEMENT
1. The Company agrees to issue to Xxxxxx 1,182,666 shares of its
restricted Common Stock, at $0.075 per share and 1,166,667 Warrants, as of
September 29, 2004, as full and complete satisfaction and payment of the Debt.
2. The Company agrees to issue to Xxxxxx 166,667 shares of its
restricted Common Stock, at $0.075 per share, as of September 29, 2004, as full
and complete satisfaction and payment of the Finders' Fee Debt.
3. Xxxxxx agrees to accept the issuance of 1,182,666 shares of the
restricted Common Stock of the Company and 1,166,667 Warrants of the Company as
full and complete satisfaction and payment of the Debt.
4. Xxxxxx agrees to accept the issuance of 166,667 shares of the
restricted Common Stock of the Company as full and complete satisfaction and
payment of the Finders' Fee Debt.
5. The Company and Xxxxxx shall agree to release each other and forever
discharge any and all claims, manner of actions, whether at law or in equity
suits, judgments, debts, liens, liabilities, demands, damages, losses, sums of
money, expenses or disputes, known or unknown, fixed or contingent, which it
now has or may have hereafter, directly or indirectly, individually or in any
capacity against each other, their successors and assigns, as well as its
present or former owners, directors, officers, stockholders, employees, agents,
heirs, by reason of any act, omission, matter, cause, or thing whatsoever, from
the beginning of time to, and including the date of the execution of this
Agreement, relating to the aforesaid Debt and Finders' Fee Debt.
6. Xxxxxx acknowledges that the issuance of the 1,182,666 shares of
restricted Common Stock, the issuance of the 1,166,667 Warrants, and the
issuance of the 166,667 shares of restricted Common Stock: (i) have not been
registered under the Securities Act of 1933, as amended (the "1933 Securities
Act"); (ii) is in reliance on the exemption provided by Section 4(2) and/or
Regulation S of the 1933 Securities Act; (iii) are being acquired solely for
Xxxxxx'x own account without any present intention for resale or distribution,
with the exception of those shares of Common Stock and/or Warrants to be
transferred to designates of Xxxxxx in accordance with that certain Letter of
Instruction from Xxxxxx; (iv) will not be resold without registration under the
1933 Securities Act or in compliance with an available exemption from
registration, unless the shares of Common Stock are registered under the 1933
Securities Act and under any applicable state securities law or an opinion of
counsel satisfactory to the Company is delivered to the Company to the effect
that any proposed distribution of the shares of Common Stock will not violate
the registration requirements of the 1933 Securities Act and any applicable
state securities laws; and (v) that Xxxxxx understands the economic risk of an
investment in the Common Stock and has had the opportunity to ask questions of
and receive answers from the Company's management concerning any and all
matters related to the acquisition of the Common Stock.
7. This Settlement Agreement shall be effective as of September 29,
2004 and shall be binding upon and insure to the benefit of the parties hereto
and their respective successors.
Transax International Limited
Date:_____________ By:__________________________
Xxxxxxx Xxxxxxx, President and
Chief Executive Officer
Xxxxxxx Xxxxxx
Date:______________ By: __________________________
President
