STOCK CANCELLATION AGREEMENT

 

This Stock Cancellation Agreement (the “Agreement”) is made and entered into as
of this 31st day of July, 2007, by and among Rubicon Financial Incorporated, a
Delaware corporation, (hereinafter referred to as “Rubicon”), Timothy McDermott,
an individual, (hereinafter referred to as “McDermott”), and Dial-A-Cup Inc., a
Nevada corporation, (hereinafter referred to as “DAC”).

 

 

RECITALS

 

WHEREAS, McDermott currently holds 10,000,100 shares of Rubicon common stock;

 

WHEREAS, Rubicon is a 34 Act reporting company in the financial services
industry with its common stock currently publicly traded on the OTC:BB under the
symbol RBCF;

 

WHEREAS, DAC is a wholly owned subsidiary of Rubicon and owns all right title
and interest in a patented beverage dispenser;

 

WHEREAS, Rubicon has expanded its operations in the financial services industry
and has deemed the operations of DAC to be incompatible with Rubicon’s current
business plan;

 

WHEREAS, Rubicon and DAC have entered into a Separation and Distribution
Agreement of an even date herewith, whereby Rubicon will spin-out DAC through
the distribution of a minimum of 50% of the outstanding DAC shares held by
Rubicon to Rubicon’s stockholders;

 

WHEREAS, McDermott received his shares of Rubicon common stock as part of the
original acquisition of DAC by Rubicon; and

 

WHEREAS, a condition to the Rubicon spin-out of DAC is that McDermott transfer
3,100,000 shares to certain individuals affiliated with Rubicon and McDermott
cancel 6,000,000 shares.

 

 

AGREEMENT

 

NOW THEREFORE, in consideration of the Recitals and the mutual covenants,
conditions, representations and warranties hereinafter set forth, the parties
agree as follows:

 

 

1.

Cancellation and Transfer of Common Stock. Effective as of the Closing (as
defined below) McDermott will surrender to Rubicon, Stock Certificate No. 6241
(the “Certificate”) in the amount of 10,000,000 shares of Common Stock together
with a stock power, with medallion signature guaranty, fully endorsed for
transfer. Rubicon will (i) immediately cancel 6,000,000 shares of Common Stock,
(ii) have issued 3,100,000 shares of Common Stock to the individuals and in the
amounts set forth on Exhibit A attached hereto, and (iii) return a certificate
for 900,000 shares of Common Stock to McDermott.

 

 

EXECUTION COPY

 

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2.

Waiver and Release. In consideration of the foregoing undertakings by Rubicon
and DAC, McDermott forever waives and releases any and all claims, liens,
charges, or encumbrances of any kind whatsoever (collectively, the “Claims”)
against Rubicon, DAC and any of its directors, officers, employees, agents,
subsidiaries and/or affiliates including, without limitation, any Claims related
to the Stock cancelled and/or transferred pursuant to Paragraph 1 above, or
otherwise in connection with any agreement, arrangement or understanding, actual
or alleged, between McDermott and Rubicon and/or DAC from now until the end of
the world, provided, however, that the foregoing waiver and release shall
neither apply to nor affect McDermott’s rights and obligations with respect to
the 900,000 shares of Rubicon Common Stock to be retained by McDermott. Upon
reasonable request by Rubicon and/or DAC, McDermott agrees to execute any
acknowledgement of the foregoing waiver and release in form reasonably
satisfactory to counsel for Rubicon or DAC.

 

 

3.

Closing. The Closing under this Agreement shall be held on July 31, 2007 at the
offices of Rubicon or at such other time or place as the parties shall
designate. At the Closing, McDermott will deliver the Certificate. Within five
(5) business days of Closing, Rubicon shall deliver McDermott’s Certificate to
its common stock transfer agent and thereafter (i) deliver a certificate for
900,000 shares of Rubicon Common Stock to McDermott, (ii) cancel 6,000,000
shares of Rubicon Common Stock, and (iii) transfer the 3,100,000 shares of
Rubicon Common Stock to the individuals listed on Exhibit A.

 

 

4.

Entire Agreement; Modification. This Agreement constitutes the entire, final and
complete agreement between McDermott, Rubicon and DAC and supersedes and
replaces all prior or existing written and oral agreements between McDermott,
Rubicon and DAC with respect to the subject matter hereof, and may only be
modified in writing by the agreement of all parties.

 

 

5.

Applicable Law; Dispute Resolution. This Agreement shall be governed by and
construed in accordance with the law of the State of California without regard
to the conflicts of law provisions thereof. Any dispute arising under this
Agreement shall be settled by binding arbitration before a single arbitrator
under the Commercial Arbitration Rules of the American Arbitration Association.
The arbitrator shall award the prevailing party its costs and expenses, together
with reasonable attorneys’ fees (including the allocable share, if any, of
in-house counsel fees) and, accountants’ and expert witness fees, if any. The
award of the arbitrator may be entered in and enforced by any court of competent
jurisdiction.

 

 

6.

Notice. Each notice, instruction or other certificate required or permitted by
the terms hereof shall be in writing and shall be communicated by personal
delivery, fax or registered or certified mail, return receipt requested, to the
parties hereto at their respective addresses, or at such other address as any of
them may designate by notice to each of the others.

 

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

 

MCDERMOTT:

Timothy McDermott

 

 

/s/ Timothy McDermott

 

 

Rubicon:

Rubicon Financial Incorporated, a Delaware corporation

 

 

By: /s/ Joseph Mangiapane, Jr.

 

Joseph Mangiapane, Jr., CEO

 

 

DAC:

Dial-A-Cup Inc. a Nevada corporation

 

 

By: /s/ Terence Davis

 

Terence Davis, President

 

 

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