Exhibit 5.1
AMY TROMBLY, ESQ.
1320 Centre St. Suite 202
Newton, Massachusetts 02459
(617) 243-00600
May 25, 2006
Payment Data Systems, Inc.
12500 San Pedro, Suite 120
San Antonio, Texas 78216
Gentlemen:
I have acted as counsel to Payment Data Systems, Inc., a Nevada corporation (the
"Company"), in connection with the preparation and filing with the Securities
and Exchange Commission (the "Commission") of a Registration Statement on Form
S-8 (the "Registration Statement"), pursuant to which the Company is registering
under the Securities Act of 1933, as amended (the "Securities Act"), up to
20,000,000 shares of its common stock, $.001 par value per share (the "Shares")
which may be issued from time to time on a delayed or continuous basis pursuant
to Rule 415 under the Securities Act. This opinion is being rendered in
connection with the filing of the Registration Statement. All capitalized terms
used herein and not otherwise defined shall have the respective meanings given
to them in the Registration Statement.
In connection with this opinion, I have examined the Company's Articles of
Incorporation, as amended, and Bylaws, as amended; and such other records of the
corporate proceedings of the Company and certificates of the Company's officers
as I deemed relevant; and the Registration Statement and the exhibits filed with
the Commission.
In my examination, I have assumed the genuineness of all signatures, the legal
capacity of natural persons, the authenticity of all documents submitted to me
as originals, the conformity to original documents of all documents submitted to
me as certified or photostatic copies and the authenticity of the originals of
such copies.
Based upon the foregoing, and subject to the limitations set forth below, I am
of the opinion that, once (i) the Registration Statement, as amended, has become
effective under the Securities Act, (ii) the Shares have been issued as
contemplated by the Registration Statement, and (iii) the Company has received
the consideration in the manner described in the Registration Statement, the
Shares will be duly and validly issued, fully paid and non-assessable shares of
the Common Stock.
No opinion is expressed herein with respect to the qualification of the
Shares under the securities or blue sky laws of any state or any
foreign jurisdiction.
This opinion is based upon currently existing statutes, rules, regulations and
judicial decisions, and I disclaim any obligation to advise you of any change in
any of these sources of law or subsequent legal or factual developments which
might affect any matters or opinions set forth herein.
I understand that you wish to file this opinion as an exhibit to the
Registration Statement, and I hereby consent thereto.
Very truly yours,
/s/ Amy Trombly, Esq.
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Amy Trombly, Esq.