Settlement Agreement And Release

EXHIBIT 10.13


SETTLEMENT AGREEMENT AND RELEASE
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This Settlement Agreement and Release (the "Agreement") is made and entered into on May _____, 1998, by and between BioShield Technologies, Inc. ("BioShield" or the "Company") and Stephen M. Dale (the "Investor") (collectively, the "Parties");


W I T N E S S E T H :


WHEREAS, pursuant to a Confidential Private Placement Memorandum, dated January 15, 1998, as supplemented on February 11, 1998, Company offered to sell Investor on a private placement basis (the "Private Placement") up to 200 units (the "Units") at a purchase price of $5,000.00 per Unit. Each Unit was to consist of a Non-Negotiable Interest Bearing Promissory Note and warrants ("Unit Warrants") to purchase up to 5,000 shares of Company's common stock, no par value per share (the"Common Stock");


WHEREAS, Investor delivered to Company a Subscription Agreement dated March 5, 1998 (the "Subscription Agreement") to purchase 50 Units for an aggregate of $250,000.00 and in consideration therefor received from Company a Non-Negotiable Interest Bearing Promissory Note in the form attached hereto as Exhibit "A" (the
----------- "Investment Note") for $250,000.00 and Company's agreement to deliver, as soon as practicable following delivery of the Investment Note, Unit Warrants to purchase 250,000 shares of Common Stock in the form attached hereto as Exhibit
------- "B" (the "Subscription Amount"); - ---


WHEREAS, Investor desires to cancel the purchase of the 50 Units and Company is willing to cooperate in the cancellation of such purchase in connection with the full accord, satisfaction, settlement and release of all potential claims and counterclaims which the Parties have or may have against each other arising prior to the date hereof;


WHEREAS, the Parties have agreed that, simultaneously with the Parties' execution and delivery of this Agreement, (i) Company will deliver to Investor (a) a check of even date hereof in good funds, payable to Investor in the sum of One Hundred Twenty-Five Thousand and no/100 Dollars ($125,000.00) (the "Initial Payment); and (b) a promissory note of even date hereof, substantially in the form attached hereto as Exhibit "C", on which Company will be obligated as the
----------- borrower, in the aggregate principal amount of One Hundred Twenty Five Thousand and no/100 Dollars ($125,000.00), with interest payable on such note in the annual amount of ten percent (10%) (the


"New Note"; the Initial Payment and the New Note are collectively referred to herein as the "Settlement Payment"), (ii) Investor will deliver to Company the Investment Note, and (iii) without any action on the part of either Investor or Company, the Investment Note will be immediately cancelled and rendered null and void, and Company's obligation to deliver the Unit Warrants shall be null and void; and


WHEREAS, the Parties agree to keep this Agreement and its terms confidential, except to the extent required by law;


NOW, THEREFORE, for and in consideration of the mutual agreement hereinafter made, the payment of good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, BioShield and Investor hereby agree as follows:
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