$TXHD now accrues $93,500 interest per year in cash, assuming the interest is paid in full annually, and not compounded.
Try thinking about how the settlement was split.
The next lawyers handling the next three pieces of litigation should be emboldened to use 22% default interest as a base line. They could use the penalty rates charged on credit cards of 29%+.
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11. Pursuant to the Agreements, inter alia, the Defendant agreed to authorize and reserve Five Hundred – Fifty Million (550,000,000) shares (hereinafter the Settlement Shares”) of the Company’s common stock (hereinafter the “Common Stock”) for issuance upon full conversion of the outstanding obligations of TXHD, in accordance with the terms of the Agreements, a certain Securities Purchase Agreement (hereinafter the “Purchase Agreement”) and a certain Convertible Promissory Note (hereinafter the “Note”, collectively, inter alia, with the Purchase Agreement, as the “Transaction Documents”), in the forms attached, restated and incorporated by reference hereto as Exhibits 3 and 4.
12. As a material part of the Agreements, the Defendant agreed that an Agreement for Judgment in the amount of Four Hundred – Twenty – Five Thousand and 00/100 ($425,000.00) Dollars (U.S.) (hereinafter the “Default Sum”) was to be held in escrow, pending the authorization, reservation, issuance, and liquidation of the Settlement Shares during the term of the Leak-Out Agreement, in the form attached, restated and incorporated by reference hereto as Exhibit 5. By the Agreement for Judgment and as provided in the Transaction Documents, the Defendant further agreed that until paid, the Default Sum shall continue to accrue the default interest rate of Twenty-Two and 00/100 (22.00%) percent per year.
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