SETTLEMENT
      AGREEMENT AND RELEASE

    


    This
      Settlement Agreement and Release (the “Agreement”), dated as of March 15, 2007,
      is made by and between Crescent International, Ltd., (“Crescent”) and Power 3
      Medical Products, Inc., a New York corporation (“Power 3”).

    


    WHEREAS,
      on
      October 28, 2004 Power 3 issued to Crescent a $200,000 principal amount
      convertible debenture (the “Debenture”), a common stock purchase warrant (the
“Warrant”), and an additional investment right (the “Rights Agreement”)(the
      Debenture, Warrant, and Rights Agreement shall collectively be referred to
      as
      the “Transaction Documents”); 

    


    WHEREAS,
      Power 3
      desires to issue, and Crescent desires to accept, three million (3,000,000)
      shares of common stock in full satisfaction of the Debenture and all obligations
      arising pursuant to the Transaction Documents; 

    


    NOW,
      THEREFORE,
      in
      consideration of the mutual conditions and covenants contained in this
      Agreement, and for other good and valuable consideration, the sufficiency and
      receipt of which is hereby acknowledged, it is hereby stipulated, consented
      to
      and agreed by and among Power 3 and Crescent as follows:

    


    1. Power
      3
      shall issue three million (3,000,000) shares of common stock (the “Common
      Stock”) to Crescent in full satisfaction of the Debenture and all obligations
      arising pursuant to the Transaction Documents. Upon issuance of the Common
      Stock, Crescent shall return, via overnight delivery, the original Debenture
      to
      Power 3. Notwithstanding the foregoing, if Crescent does not receive gross
      proceeds of at least three hundred thousand ($300,000) dollars from the sale
      of
      all of the Common Stock, Power 3 shall pay to Crescent an amount equal to the
      difference between such gross proceeds and $300,000 (the “Make-Up Payment”). As
      collateral for the Make-Up Payment, the Company shall deposit one million shares
      of common stock in escrow (the “Escrow Stock”) pursuant to the escrow agreement
      attached hereto as Exhibit A. 

    


    2. Crescent
      shall provide Power3 with an accounting of Crescent’s sales of the Common Stock.
      In the event that Crescent is entitled to a Make-Up Payment, Crescent shall
      be
      entitled to receive gross proceeds from the sale of the Escrow Stock in an
      amount equal to the Make-Up Payment and shall provide Power3 with an accounting
      of such Escrow Stock sales. Once Crescent has received gross proceeds from
      the
      sale of the Escrow Stock equal to the Make-Up Payment, Crescent shall return
      any
      excess proceeds and the remaining unsold Escrow Shares to Power3 within three
      (3) business days.

    


    3. Crescent
      will not directly or indirectly sell an amount of the Common Stock or Escrow
      Stock exceeding fifteen percent (15%) of the average daily trading volume of
      Power3’s common stock on the OTC Bulletin Board, as reported by Bloomberg L.P.
      However, said restriction shall not apply on any trading day during which the
      average daily trading volume exceeds 500,000 shares. 

    


    4. In
      consideration of the foregoing, Crescent releases and discharges Power 3, Power
      3’s officers, directors, principals, control persons, past and present
      employees, insurers, successors, and assigns (“Power 3 Parties”) from all
      actions, cause of action, suits, debts, dues, sums of money, accounts,
      reckonings, bonds, bills, specialties, covenants, contracts, controversies,
      agreements, promises, variances, trespasses, damages, judgments, extents,
      executions, claims, and demands whatsoever, in law, admiralty or equity, which
      against Power 3 Parties ever had, now have or hereafter can, shall or may,
      have
      for, upon, or by reason of any matter, cause or thing whatsoever, whether or
      not
      known or unknown, from the beginning of the world to the day of the date of
      this
      Release arising under the Debenture and the Transaction Documents.

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    5.
       In
      consideration of the foregoing, Power 3 releases and discharges Crescent,
      Crescent’s officers, directors, principals, managers, control persons, past and
      present employees, insurers, successors, and assigns (“Crescent Parties”) from
      all actions, cause of action, suits, debts, dues, sums of money, accounts,
      reckonings, bonds, bills, specialties, covenants, contracts, controversies,
      agreements, promises, variances, trespasses, damages, judgments, extents,
      executions, claims, and demands whatsoever, in law, admiralty or equity, which
      against Crescent Parties ever had, now have or hereafter can, shall or may,
      have
      for, upon, or by reason of any matter, cause or thing whatsoever, whether or
      not
      known or unknown, from the beginning of the world to the day of the date of
      this
      Release arising under the Debenture and the Transaction Documents.

    


    6. Power
      3
      and Crescent each understand and agree that this Agreement (including all of
      its
      terms) is forever deemed confidential between them. Except as required under
      the
      statutes, rules or regulations of any federal or state government, government
      agency or court of competent jurisdiction, each of Power 3 and Crescent, and
      their respective counsel, shall not disclose or divulge any of the matters
      underlying this Agreement, or any of the terms or substance of this Agreement
      to
      others. 

    


    7. All
      parties acknowledge and represent that: (a) they have read the Agreement; (b)
      they clearly understand the Agreement and each of its terms; (c) they fully
      and
      unconditionally consent to the terms of this Agreement; (d) they have had the
      benefit and advice of counsel of their own selection; (e) they have executed
      this Agreement, freely, with knowledge, and without influence or duress; (f)
      they have not relied upon any other representations, either written or oral,
      express or implied, made to them by any person; and (g) the consideration
      received by them has been actual and adequate.

    


    8. This
      Agreement contains the entire agreement and understanding concerning the subject
      matter hereof between the parties and supersedes and replaces all prior
      negotiations, proposed agreement and agreements, written or oral. Each of the
      parties hereto acknowledges that neither any of the parties hereto, nor agents
      or counsel of any other party whomsoever, has made any promise, representation
      or warranty whatsoever, express or implied, not contained herein concerning
      the
      subject hereto, to induce it to execute this Agreement and acknowledges ands
      warrants that it is not executing this Agreement in reliance on any promise,
      representation or warranty not contained herein.

    


    9. This
      Agreement may not be modified or amended in any manner except by an instrument
      in writing specifically stating that it is a supplement, modification or
      amendment to the Agreement and signed by each of the parties
      hereto.

    


    10. Should
      any provision of this Agreement be declared or be determined by any court or
      tribunal to be illegal or invalid, the validity of the remaining parts, terms
      or
      provisions shall not be affected thereby and said illegal or invalid part,
      term
      or provision shall be severed and deemed not to be part of this
      Agreement.

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    

    11. This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York, without regard to principles of 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 parties
      and
      the individuals executing this Agreement and other agreements on behalf of
      the
      Company agree 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. 

    


    12. This
      Agreement may be executed in counterparts, each of which, when all parties
      have
      executed at least one such counterpart, shall be deemed an original, with the
      same force and effect as if all signatures were appended to one instrument,
      but
      all of which together shall constitute one and the same
      Agreement.


    
      
         

      

      
         

        
          

        

      

      
         

      

    


    IN
      WITNESS WHEREOF,
      the
      parties have duly executed this Agreement as of the date first indicated
      above.

    


    


    
      	
              CRESCENT
                INTERNATIONAL, LTD.

              By: 
                

               

              By:
                /s/
                Maxi Brezzi 

              Name:
                Maxi Brezzi

              Title:
                Authorized Signatory

            	
              Cantara
                (Switzerland) SA

              84,
                Av. Louis-Casaï

              CH
                1216 COINTRIN

              Switzerland

              Tel.:
                +41 22 791 7256

              Fax:
                +41 22 791 7171

              Email:
                cantara@dmitrust.com

               

               

            
	
              POWER3
                MEDICAL PRODUCTS, INC.

               

               

              By:
                /s/
                Steven B. Rash

              Name:
                Steven B. Rash

              Title:
                Chief Executive Officer

            	
              3400
                Research Forest Drive, Suite B2-3

              Woodlands,
                Texas 77381

              Tel:
                (281) 466-1600

              Fax:
                (281) 466-1481

              Email:
                srash@power3medical.com