Settlement and Release Agreement between Southern California Logo, Inc., Rick and Judy Songer, and Freestar Technologies, Inc.

Summary

This agreement, dated April 30, 2001, is between Southern California Logo, Inc. (dba Sew Cal Logo), Rick and Judy Songer, and Freestar Technologies, Inc. It confirms that Freestar defaulted on a prior asset purchase agreement, releasing Sew Cal Logo and the Songers from further obligations. The Songers retain a total of 900,000 shares of Freestar stock, which are protected from reverse splits for three years. Sew Cal Logo keeps a $500,000 deposit as liquidated damages, and an $800,000 promissory note owed to the Songers is cancelled. All parties agree to these terms as a final settlement.

EX-10.1 2 ex_10-1.txt EXHIBIT 10.1 SOUTHERN CALIFORNIA LOGO, INC. dba: SEW CAL LOGO ###-###-#### 207 W. 138th STREET FAX: (310) 352-3370 LOS ANGELES, CA 90061 Website: www.sewcal.com April 30, 2001 Board of Directors Freestar Technologies, Inc. 43430 E. Florida Ave. Suite F-319 Hemet, CA 92544 Gentlemen: This letter shall outline the status, based on our prior written agreements with Freedom Surf, Inc. (renamed Freestar Technologies, Inc.) and the Board of Directors' contact with its former management, in respect to the matters set forth below: 1. Freestar Technologies, Inc. acknowledges it's default of the Asset Purchase Agreement of May 12, 2000 and the extensions thereof. Sew Cal Logo and Rick and Judy Songer have no further obligations under the agreement. 2. The 250,000 shares of common stock of Freedom Surf, Inc. issued on May 2, 2000 to July Songer were non-refundable and Freestar Technologies, Inc. acknowledges that Judy Songer is entitled to retain such shares in consideration for execution of the agreement and extensions thereof. 3. The 650,000 shares of common stock issued on May 2, 2000 to Rick Songer are to be retained by him in consideration for his working with the new Board of Freestar Technologies, Inc. and his extension to complete the transaction with Freestar to April 30, 2001. The parties acknowledge that valid consideration has been paid for these shares and that Rick Songer has no further obligation to Freestar with respect to these shares. 4. It is our mutual understanding that the 250,000 shares held by Judy Songer and the 650,000 shares held by Rick Songer were issued by the prior board on a non-dilutive basis and for a period of 3 years from the date of this letter shall not be subject to any reverse stock split effected by the company. 5. $500,000.00 was paid to Sew Cal Logo on August 22, 2000 as a deposit for operating capital pursuant to the Asset Purchase Agreement of May 2, 2000. As agreed with management, this shall be retained by Sew Cal Logo as liquidated damages in consideration of Sew Cal Logo's services rendered, extension of the agreement, and the breach of the agreement by Freestar Technologies, Inc. Neither Sew Cal Logo nor the Songers shall have any obligation to repay such amount. 6. The $800,000.00 Promissory Note payale to Rick and Judy Songer shall be cancelled and returned to Freestar Technologies, Inc. This letter, when signed, shall constitute the approval of the board of directors of Freestar Technologies, Inc. to all of the terms of this agreement. Agreed to this 30th day of April, 2001. /s/ Rick Songer ---------------------------------------- RICK SONGER, Individually and on behalf of Southern California Logo, Inc. /s/ Judy Songer ---------------------------------------- JUDY SONGER, Individually and on behalf of Southern California Logo, Inc. /s/ Charles C. Hooper ---------------------------------------- CHARLES C. HOOPER, Chairman, CEO FREESTAR TECHNOLOGIES, INC.