Exhibit 10.1

 

SETTLEMENT AGREEMENT AND STIPULATION

  

THIS SETTLEMENT AGREEMENT and STIPULATION is dated as of May 31, 2016 by and
between InCapta, Inc. (“INCAPTA” or the “Company”), a corporation formed under
the laws of the State of Nevada, and Rockwell Capital Partners, Inc., (“RCP”), a
Delaware corporation.

 

BACKGROUND:

 

WHEREAS, there are bona fide outstanding liabilities of the Company in the
principal amount of not less than $50,861.25 and

 

WHEREAS, these liabilities are past due; and

 

WHEREAS, RCP acquired such liabilities on the terms and conditions set forth in
the annexed Claim Purchase Agreement(s), subject however to the agreement of the
Company and compliance with the provisions hereof; and

 

WHEREAS, RCP and INCAPTA desire to resolve, settle, and compromise among other
things the liabilities as more particularly set forth on Schedule A and the
Claims Purchase Agreements and debt instruments attached and annexed thereto and
incorporated herein (hereinafter collectively referred to as the “Claims”).

 

NOW, THEREFORE, the parties hereto agree as follows:

 

I.  Defined Terms. As used in this Agreement, the following terms shall have the
following meanings specified or indicated (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):

 

“AGREEMENT” shall have the meaning specified in the preamble hereof. "CLAIM
AMOUNT" shall mean $50,861.25

 

“COMMON STOCK” shall mean the Company’s common stock, $0.001 par value per
share, and any shares of any other class of common stock whether now or
hereafter authorized, having the right to participate in the distribution of
dividends (as and when declared) and assets (upon liquidation of the Company).

 

“COURT” shall mean Circuit Court within Sarasota County, Florida.

 

“DISCOUNT” shall mean Fifty (50%) percent.

 

“SALE PRICE” shall mean the Sale Price of the Common Stock on the Principal
Market.

 

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“MARKET PRICE” on any given date shall mean the lowest Sale Price during the
Valuation Period.

 

“PRINCIPAL MARKET” shall mean the Nasdaq National Market, the Nasdaq SmallCap
Market, the Over the Counter Bulletin Board, QB marketplace, QX Marketplace, OTC
Pink, the American Stock Exchange or the New York Stock Exchange, whichever is
at the time the principal trading exchange or market for the Common Stock.

 

“PURCHASE PRICE” shall mean the Market Price during the Valuation Period (or
such other date on which the Purchase Price is calculated in accordance with the
terms and conditions of this Agreement) less the product of the Discount and the
Market Price.

 

“SELLER” shall mean any individual or entity listed on Schedule A, who
originally owned the Claims.

 

“TRADING DAY” shall mean any clay during which the Principal Market shall be
open for business.

 

“TRADING PERIOD” shall mean Trading Days during the Valuation Period.

 

“TRANSFER AGENT” shall mean the transfer agent for the Common Stock (and to any
substitute or replacement transfer agent for the Common Stock upon the Company’s
appointment of any such substitute or replacement transfer agent).

 

“VALUATION PERIOD” shall mean the fifteen (15) day trading period preceding the
share request inclusive of the day of any Share Request pursuant to this
agreement (the “trading period”); provided that the Valuation Period shall be
extended as necessary in the event that (1) the Initial Issuance is delivered in
more than one tranche pursuant to Sections 3(a) and 3(e); and/or (2) one or more
Additional Issuances is required to be made pursuant to Section 3(d) below, in
which case the Valuation Period for each issuance shall be extended to include
additional trading days pursuant to such issuance. The Valuation Period shall
begin on the elate of any Share Request pursuant to this Agreement, but shall be
suspended to the extent that any subsequent Initial Issuance tranche and/or
Additional Issuance is due to be made until such date as such Initial Issuance
tranche and/or Additional Issuance is delivered to RCP pursuant to Section
3(b)(iii). Any period of suspension of the Valuation Period shall be established
by means of a written notice from RCP to the Company.

 

2.  Fairness Hearing. Upon the execution hereof, Company and RCP agree, pursuant
to Section 3(a)(10) of the Securities Act of 1933 (the “Act”), to immediately
submit the terms and conditions of this Agreement to the Court for a hearing on
the fairness of such terms and conditions, and the issuance exempt from
registration of the Settlement Shares. This Agreement shall become binding upon
the parties only upon entry of an order by the Court substantially in the form
annexed hereto as Exhibit A (the “Order”).

 

3.  Settlement Shares. Following entry of an Order by the Court in accordance
with Paragraph 2 herein and the execution by RCP and Company of the Stipulation
and Order of Dismissal (as defined below) subject to paragraph 7 herein, Company
shall issue and deliver to RCP shares of its Common Stock (the “Settlement
Shares”) as follows:

 

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(a) In settlement of the Claims, Company shall initially issue and deliver to
RCP, in one or more tranches as necessary subject to paragraph 3(f) herein,
shares of Common Stock (the “Initial Issuance”), subject to adjustment and
ownership limitations as set forth below, sufficient to satisfy the compromised
amount at a fifty percent (50%) discount to market (the total amount of the
claims divided by 50%) based on the market price during the valuation period as
defined herein through the issuance of freely trading securities issued pursuant
to Section 3(a)(l0) of the Securities Act (the “Settlement Shares”). The Company
shall also issue to RCP, on the issuance date(s), Five Million (5,000,000) free
trading shares pursuant to Section 3(a)(10) of the Securities Act in accordance
herewith as a settlement fee.

 

(b) No later than the first business day following the date that the Court
enters the Order, time being of the essence, Company shall: (i) cause its legal
counsel to issue an opinion to Company’s transfer agent, in form and substance
reasonably acceptable to RCP and such transfer agent, that the shares of Common
Stock to be issued as the Initial Issuance and Additional Issuance (as defined
below) and shares issued as a settlement fee are legally issued, fully paid and
non-assessable, are exempt from registration under the Securities Act, may be
issued without restrictive legend, and may be resold by RCP without restriction;
(ii) transmit via email, facsimile and overnight delivery an irrevocable and
unconditional instruction to Company’s stock transfer agent in the form annexed
hereto as Exhibit B; and (iii) within three (3) days thereof, issue and deliver
to RCP Settlement Shares and settlement fee shares in one or more tranches as
necessary, without any legends or restrictions on transfer, sufficient to
satisfy the compromised amount along with settlement fee shares, through the
issuance of freely trading securities issued pursuant to Section 3(a)(10) of the
Securities Act. Pursuant to this agreement, RCP may deliver a request to
INCAPTA, either directly or through Company’s Transfer Agent pursuant to Exhibit
“B” which states the dollar amount (designated in U.S. dollars) of Common Stock
to be issued to RCP (the “Share Request”). The date upon which the first tranche
of the Initial Issuance shares along with any shares issued as a settlement fee
have been received into RCP’s account and are available for sale by RCP shall be
referred to as the “Issuance Date”. In the event that Company is delinquent on
issuance of shares of stock to RCP pursuant to the terms and conditions of this
Section 3 within five (5) business days of a request for issuance of shares
pursuant to Court Order Granting Approval of this Settlement Agreement, then the
Discount shall be increased by five percent (5%), as well as an additional five
percent (5%) for each additional delinquency of five (5) Trading Days up to a
maximum Discount of ninety percent (90%) until all Settlement Shares and
settlement fee shares have been received by RCP and Company has fully complied
with all terms and conditions and obligations pursuant to this Settlement
Agreement and Stipulation.

 

(c) During the Valuation Period, the Company shall deliver to RCP, through the
Initial Issuance and any required Additional Issuance subject to paragraph 3(f)
herein that number of shares (the “Final Amount”) with an aggregate value equal
to (A) the sum of the Claim Amount, divided by (B) the Purchase Price. The
parties acknowledge that the number of Settlement Shares along with any
settlement fee shares to be issued pursuant to this Agreement is indeterminable
as of the date of its execution, and could well exceed the current existing
number of shares outstanding as of the date of its execution.

 

(d) If at any time during the Valuation Period the Market Price is below ninety
percent (90%) of the Market Price on the day before the Issuance Date, Company
shall immediately cause to be issued and delivered to RCP in accordance with the
provisions of Section 3(b) herein, such additional shares as may be required to
effect the purposes of this Settlement Agreement (each, an “Additional
Issuance”), subject to the limitation in the paragraph below. At the end of the
Valuation Period, if the sum of the Initial Issuance and any Additional Issuance
is greater than the Final Amount, RCP shall promptly deliver any remaining
shares to Company or its transfer agent for cancellation.

 

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(e) Notwithstanding anything to the contrary contained herein, it is the
intention of the parties that the Settlement Shares along with settlement fee
shares beneficially owned by RCP at any given time shall not exceed the number
of such shares that, when aggregated with all other shares of Company then
beneficially owned by RCP, or deemed beneficially owned by RCP, would result in
RCP owning more than four and ninety-nine tenths (4.99%) of all of such Common
Stock as would be outstanding on such date, as determined in accordance with
Section 16 of the Exchange Act and the regulations promulgated thereunder. In
compliance therewith, the Company agrees to deliver the Initial Issuance and any
Additional Issuances in one or more tranches.

 

(f) For the avoidance of doubt, the price used to determine the number of shares
of Common Stock to be delivered pursuant to any Share Request shall be rounded
up to the nearest decimal place of 0.00001.

 

4.  Necessary Action. At all times after the execution of this Agreement and
entry of the Order by the Court, each party hereto agrees to take or cause to be
taken all such necessary action including, without limitation, the execution and
delivery of such further instruments and documents, as may be reasonably
requested by any party for such purposes or otherwise necessary to effect and
complete the transactions contemplated hereby.

 

5.  Releases. Upon receipt of all of the Settlement Shares and settlement fee
shares for and in consideration of the terms and conditions of this Agreement,
and except for the obligations, representations, indemnifications pursuant to
paragraph 15 herein and covenants arising or made hereunder or a breach hereof,
the parties hereby release, acquit and forever discharge the other and each,
every and all of their current and past officers, directors, shareholders,
affiliated corporations, subsidiaries, agents, employees, representatives,
attorneys, predecessors, successors and assigns (the “Released Parties”), of and
from any and all claims, damages, cause of action, suits and costs, of whatever
nature, character or description, whether known or unknown, anticipated or
unanticipated, which the parties may now have or may hereafter have or claim to
have against each other with respect to the Claims. Nothing contained herein
shall be deemed to negate or affect RCP' s right and title to any securities
heretofore issued to it by Company or any subsidiary of Company.

 

6.  Representations. Company hereby represents, warrants and covenants to RCP as
follows:

 

(a) There are Five Billion (5,000,000,000) shares of Common Stock of the Company
authorized, of which approximately Forty Four Million Three Hundred Sixty Seven
Thousand Seven Hundred and Nine (44,367,709) as of September 30, 2015 Shares of
Common Stock are issued and outstanding; and approximately Four Billion Nine
Hundred Fifty Five Million Six Hundred Thirty Two Thousand Two Hundred Ninety
One (4,955,632,291) Shares of Common Stock are available for issuance pursuant
hereto;

 

(b) The shares of Common Stock to be issued pursuant to the Order are duly
authorized, and when issued will be duly and validly issued, fully paid and
non-assessable, free and clear of all liens, encumbrances and preemptive and
similar rights to subscribe for or purchase securities;

 

(c) The shares will be exempt from registration under the Securities Act and
issuable without any restrictive legend;

 

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(d) The Company shall reserve from its duly authorized capital stock a number of
shares of Common Stock at least equal to the greater of the number of shares
that could be issued pursuant to the terms of the Order and that Company shall
reserve at its transfer agent, at a minimum. Two Hundred Thirty Million
(230,000,000) shares during the Valuation Period in order to ensure that it can
properly carry out the terms of this agreement, which may only be released to
Company once all of the Settlement Shares and settlement fee shares have been
delivered and converted pursuant to this agreement and Company’s obligations are
otherwise fully satisfied or there has otherwise been a default pursuant to the
terms of this Agreement;

 

(e) If at any time it appears reasonably likely that there may be insufficient
authorized shares to fully comply with the Order, Company shall promptly
increase its authorized shares to ensure its ability to timely comply with the
Order;

 

(f) The execution of this Agreement and performance of the Order by Company and
RCP will not (1) conflict with, violate or cause a breach or default under any
agreements between Company and any creditor (or any affiliate thereof) related
to the account receivables comprising the Claims, or (2) require any waiver,
consent, or other action of the Company or any creditor, or their respective
affiliates, that has not already been obtained;

 

(g) Without limitation, the Company hereby waives any provision in any agreement
related to the account receivables comprising the Claims requiring payments to
be applied in a certain order, manner, or fashion, or providing for exclusive
jurisdiction in any court other than this Court;

 

(h) The Company has all necessary power and authority to execute, deliver and
perform all of its obligations under this Agreement;

 

(i) The execution, delivery and performance of this Agreement by Company has
been duly authorized by all requisite action on the part of Company and its
Board of Directors (including a majority of its independent directors), and this
Agreement has been duly executed and delivered by Company;

 

(j) Company did not enter into the transaction giving rise to the Claims in
contemplation of any sale or distribution of Company’s common stock or other
securities;

 

(k) There has been no modification, compromise, forbearance, or waiver entered
into or given with respect to the Claims. There is no action based on the Claims
that is currently pending in any court or other legal venue, and no judgments
based upon the Claims have been previously entered in any legal proceeding;

 

(l) There are no taxes due, payable or withholdable as an incident of Seller's
provision of goods and services, and no taxes will be due, payable or
withholdable as a result of settlement of the Claims;

 

(m) Seller was not and within the past ninety (90) days has not been directly or
indirectly through one or more intermediaries in control, controlled by, or
under common control with, the Company and is not an affiliate of the Company as
defined in Rule 144 promulgated under the Act;

 

(n) Company is operational and is a non-shell company within the meaning of Rule
405 and all applicable Securities Rules and Registration pertaining thereto;

 

(o) Company represents that Seller is not, directly or indirectly, utilizing any
of the proceeds received from RCP for selling the Claims to provide any
consideration to or invest in any manner in the Company or any affiliate of the
Company;

 

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(p) Company has not received any notice (oral or written) from the SEC or
Principal Market regarding a halt, limitation or suspension of trading in the
Common Stock;

 

(q) Seller will not, directly or indirectly, receive any consideration from or
be compensated in any manner by, Company, or any affiliate of Company, in
exchange for or in consideration of selling the Claims;

 

(r) Company represents that none of the services provided or to be provided
which gave rise to the Claims were or are services related to promoting the
Company's Securities or that may be considered investor relations services;

 

(s) Company represents that each Claim being purchased pursuant hereto is a
bona-fide Claim against the Company and that the invoices or written
contract(s)/promissory notes underlying each Claim are accurate representations
of the nature of the debt and the amounts owed by the Company to Seller and that
the goods or services which are the subject of the Claims being purchased have
been received or rendered;

 

(t) Company acknowledges that RCP or its affiliates may from time to time, hold
outstanding securities of the Company which may be convertible in shares of the
Company's common stock at a floating conversion rate tied to the current market
price for the stock. The number of shares of Common Stock issuable pursuant to
this Agreement may increase substantially in certain circumstances, including,
but not necessarily limited to the circumstance wherein the trading price of the
Common Stock declines during the Valuation Period. The Company’s executive
officers and directors have studied and fully understand the nature of the
transaction contemplated by this Agreement and recognize that they have a
potential dilutive effect. The board of directors of the Company has concluded
in its good faith business judgment that such transaction is in the best
interests of the Company. The Company specifically acknowledges that its
obligation to issue the Settlement Shares along with settlement fee shares is
binding upon the Company and enforceable regardless of the dilution such
issuance may have on the ownership interests of other shareholders of the
Company. The Board of Directors of the Company has further given its consent for
each conversion of shares of stock pursuant to this agreement and agrees and
consents that same may occur below the par value of the Company’s Common Stock
if applicable.

 

(u) None of the transactions, agreements or proceedings described above is part
of a plan or scheme to evade the registration requirements of the Securities Act
and INCAPTA and RCP are acting and have acted in an arms length capacity.

 

7.  Continuing Jurisdiction. Simultaneously with the execution of this
Agreement, the attorneys representing the parties hereto will execute a
stipulation of dismissal substantially in the form annexed hereto as Exhibit C
(the “Stipulation of Dismissal”). The parties hereto expressly agree that said
Stipulation of Dismissal shall not be filed, but shall be held in escrow by
counsel for RCP, until such time that Company has fully complied with all of its
obligations pursuant to this Settlement Agreement and Stipulation. In order to
enable the Court to grant specific enforcement or other equitable relief in
connection with this Agreement, (a) the parties consent to the jurisdiction of
the Court for purposes of enforcing this Agreement, and (b) each party to this
Agreement expressly waives any contention that there is an adequate remedy at
law or any like doctrine that might otherwise preclude injunctive relief to
enforce this Agreement.

 

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8.  Conditions Precedent/ Default.

 

(a) If Company shall default in promptly delivering the Settlement Shares to RCP
in the form and mode of delivery as required by Paragraphs 2, 3, 4 and 6 herein
or otherwise fail in any way to fully comply with the provisions thereof;

 

(b) If the Order shall not have been entered by the Court on or prior to ninety
(90) days after execution of this Agreement;

 

(c) If the Company shall fail to comply with the Covenants set forth in
Paragraph 14 hereof;

 

(d) If Bankruptcy, dissolution, receivership, reorganization, insolvency or
liquidation proceedings or other proceedings for relief under any bankruptcy law
or any law for the relief of debtors or other legal proceedings for any reason
shall be instituted by or against the Company; or if the trading of the Common
Stock shall have been halted, limited, or suspended by the SEC or on the
Principal Market; or trading in securities generally on the Principal Market
shall have been suspended or limited; or, minimum prices shall been established
for securities traded on the Principal Market; or the Common Stock is not
eligible or unable to be deposited for trade on the Principal Market; or the
Company is delinquent or has not made its required Securities and Exchange
Commission filings; or if any time, the Market Price for the Company’s Common
Stock drops to at or below $0.001; or there shall have been any material adverse
change (i) in the Company’s finances or operations, or (ii ) in the financial
markets such that, in the reasonable judgment of the RCP, makes it impracticable
or inadvisable to trade the Settlement Shares along with any settlement fee
shares; and such suspension, limitation or other action is not cured within five
(5) Trading Days; then the Company shall be deemed in default of the Agreement
and Order and this Agreement and/or any remaining obligations of RCP pursuant to
this Agreement shall be voidable in the sole discretion of RCP, unless otherwise
agreed by written agreement of the parties;

 

(e) In the event that the Company fails to fully comply with the conditions
precedent as specified in paragraph 8a. through d. herein, then the Company
shall be deemed in default of the agreement and RCP, at its option and in its
sole discretion, may declare Company to be in default of the Agreement and
Order, and this Agreement and/or any remaining obligations of RCP pursuant to
this Agreement shall be voidable in the sole discretion of RCP, unless otherwise
agreed by written agreement of the parties. In said event, RCP shall have no
further obligation to comply with the terms of this agreement and can thus opt
out of making any remaining payments, if applicable, not previously made to
creditors as contemplated by the Claims Purchase Agreement as referenced in
schedule A. ln the event Company is declared to be in default, Company shall
remain fully obligated to comply with the terms of this Settlement Agreement and
Stipulation for issuance of shares of stock to RCP for any amount of debt
previously purchased and paid for by RCP pursuant to the terms of this
Settlement Agreement and Stipulation, Schedule A, as well as Order Approving
same along with all settlement fee shares required hereby. In the event that
Company is declared to be in default of this Agreement prior to successful
deposit and clearance of the Settlement Shares and/or settlement fee shares,
Company shall further remain fully obligated for issuance of all settlement fee
shares pursuant to paragraph 3(a) herein.

 

9.  Information. Company and RCP each represent that prior to the execution of
this Agreement, they have fully informed themselves of its terms, contents,
conditions and effects, and that no promise or representation of any kind has
been made to them except as expressly stated in this Agreement.

 

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10.  Ownership and Authority. Company and RCP represent and warrant that they
have not sold, assigned, transferred, conveyed or otherwise disposed of any or
all of any claim, demand, right, or cause of action, relating to any matter
which is covered by this Agreement, that each is the sole owner of such claim,
demand, right or cause of action, and each has the power and authority and has
been duly authorized to enter into and perform this Agreement and that this
Agreement is the binding obligation of each, enforceable in accordance with its
terms.

 

11.  No Admission. This Agreement is contractual and it has been entered into in
order to compromise disputed claims and to avoid the uncertainty and expense of
the litigation. This Agreement and each of its provisions in any orders of the
Court relating to it shall not be offered or received in evidence in any action,
proceeding or otherwise used as an admission or concession as to the merits of
the Action or the liability of any nature on the part of any of the parties
hereto except to enforce its terms.

 

12.  Binding Nature. This Agreement shall be binding on all parties executing
this Agreement and their respective successors, assigns and heirs.

 

13.  Authority to Bind. Each party to this Agreement represents and warrants
that the execution, delivery and performance of this Agreement and the
consummation of the transactions provided in this Agreement have been duly
authorized by all necessary action of the respective entity and that the person
executing this Agreement on its behalf has the full capacity to bind that
entity. Each party further represents and warrants that it has been represented
by independent counsel of its choice in connection with the negotiation and
execution of this Agreement, and that counsel has reviewed this Agreement.
Company farther represents and warrants that they have had corporate legal
counsel review and agree to the terms of this Agreement independent of counsel
of their choosing to represent Company at any fairness hearing or hearings to
approve this Agreement.

 

14.  Covenants.

 

(a) For so long as RCP or any of its affiliates holds any shares of Common
Stock, neither Company nor any of its affiliates shall vote any shares of Common
Stock owned or controlled by it (unless voting in favor of a proposal approved
by a majority of Company's Board of Directors), or solicit any proxies or seek
to advise or influence any person with respect to any voting securities of
Company; in favor of (1) an extraordinary corporate transaction, such as a
reorganization, or liquidation, involving Company or any of its subsidiaries,
(2) a sale or transfer of a material amount of assets of Company or any of its
subsidiaries, (3) any material change in the present capitalization or dividend
policy of Company, (4) any other material change in Company’s business or
corporate structure, (5) a change in Company’s charter, bylaws or instruments
corresponding thereto (6) causing a class of securities of Company to be
delisted from a national securities exchange or to cease to be authorized to be
quoted in an inter-dealer quotation system of a registered national securities
association, (7) causing a class of equity securities of Company to become
eligible for termination of registration pursuant to Section 12(g)(4) of the
Securities Exchange Act of 1934, as amended, (8) terminating its Transfer Agent,
(9) taking any action which would impede the purposes and objects of this
Settlement Agreement, or (10) taking any action, intention, plan or arrangement
similar to any of those enumerated above. Nothing in this section shall be
deemed to exclude strategic decisions by Company made in an effort to expand the
Company except as expressly stated herein. The provisions of this paragraph may
not be modified or waived without further order of the Court.

 

(b) Immediately upon the signing of the Settlement Order by the Court, the
Company shall cause to be filed a Form 8-K with the Securities and Exchange
Commission disclosing the settlement. Furthermore, in the event that the Company
raises their issued and outstanding Common Stock by an additional ten percent
(10%) or more, Company shall file a form 8-K with the Securities and Exchange
Commission each and every time. The Company shall further immediately file such
additional SEC filings as may be or are required in respect of the transactions.
In the event that the Company fails to fully comply with this provision, then
the Discount pursuant to this Agreement shall be increased by five percent (5%),
as well as an additional five percent (5%) for each additional delinquency of
five (5) Trading Days up to a maximum Discount of ninety percent (90%) until all
Settlement Shares and settlement fee shares have been received by RCP and
Company has fully complied with all terms and conditions and obligations
pursuant to this Settlement Agreement and Stipulation.

 

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(c) RCP hereby covenants that they have not provided any funds or other
consideration to the Company and have no intent to do so. In no event shall any
of the funds received from the sale of shares of the Company in reliance upon
the Court Order be used to provide any consideration to the Company or any
affiliate of the Company.

 

(d) RCP has utilized the services of Meyers Associates, L.P. as a placement
agent in this transaction and RCP has not and is not acting as a broker dealer
in such capacity in this transaction pursuant to Section 15 of the Securities
Exchange Act of 1934. Meyers Associates, L.P. has performed due diligence on the
debts associated with this transaction, negotiated the terms hereof and arranged
for RCP to place their capital in this transaction. Rockwell Capital Partners,
Inc., through the transactions, agreements or proceedings above are not a part
of a plan or scheme or evade the registration requirements of Section 15 of the
Securities Exchange Act of 1934 or any other applicable provisions.

 

15.  Indemnification. Company covenants and agrees to indemnify, defend and hold
RCP and its agents, employees, representatives, officers, directors,
stockholders, controlling persons and affiliates harmless arising from or
incident or related to this Agreement, including, without limitation and not
limited to any claim or action brought derivatively or by the Seller or
Shareholders of the Company and further, harmless against any charges, claims,
suits, losses, expenses, damages, obligations, fines, judgments, liabilities,
costs and expenses (including actual costs of investigation and reasonable
attorney’s fees) whether brought by an individual or entity or imposed by a
court of law or by administrative action of any Federal, State or Local
governmental body or agency, administrative agency or regulatory authority
related to arising in any manner out of, based upon or in connection with (a)
any untrue statement or alleged untrue statement of a material fact made by the
Company or any omission or alleged omission of the Company to state a material
fact required to be stated herein or in any seller document or necessary to make
the statements therein not misleading or (b) the inaccuracy or breach of any
covenant, representation or warranty made by the Company contained herein or in
any seller document or (c) any transaction, proposal or any other matter
contemplated herein. The Company will promptly reimburse the indemnified parties
for all expenses (including reasonable fees and expenses of legal counsel) as
incurred in connection with the investigation of, preparation for or defense of
any pending or threatened claim related to or arising in any manner out of any
matter contemplated by this Agreement, or any action or proceeding arising
therefrom, whether or not such indemnified party is a formal party to any such
proceeding. This Agreement specifically includes, but is not limited to the
foregoing concerning any claim that Rockwell Capital Partners is in violation of
or has violated Section 5 of the Securities Act of 1933, as amended, for
unlawful or unauthorized sale of securities based upon Rockwell Capital
Partners, Inc.’s reliance on representations of Company or misrepresentations of
Company pursuant to (a), (b) or (c) herein and/or that any payments made by RCP
to Creditors were fraudulent, based upon false instruments provided to RCP or
not bona fide claims within the meaning of Section 3(a)(10) of the Securities
Act of 1933. Notwithstanding the foregoing, the Company shall not be liable in
respect of any claims that a court of competent jurisdiction has judicially
determined by final judgment (and the time to appeal has expired or the last
right of appeal of has been denied) which resulted solely or in part from the
willful misconduct of an indemnified party or the willful violation of any
securities law or regulations by the indemnified party. The Company further
agrees that it will not, without the prior written consent of Rockwell Capital
Partners, settle, compromise or consent to the entry of any judgment in any
pending or threatened proceeding in respect of which indemnification may be
sought hereunder (whether or not Rockwell Capital Partners or any indemnified
party is an actual or potential party to such proceeding), unless such
settlement, compromise or consent includes an unconditional release of Rockwell
Capital Partners and each other indemnified party hereunder from all liability
arising out of such proceeding. In order to provide for just and equitable
contribution in any case in which (i) an Indemnified Party is entitled to
indemnification pursuant to this Indemnification Agreement but it is judicially
determined by the entry of a final judgment decree by a court of competent
jurisdiction and (the time to appeal has expired or the last right of appeal has
been denied) that such indemnification may not be enforced in such case, or (ii)
contribution may be required by the Company in circumstances for which an
Indemnified Party is otherwise entitled to indemnification under the Agreement,
then, and in each such case, the Company shall contribute to the aggregate
losses, Claims and damages and/or liabilities in an amount equal to the amount
for which indemnification was held unavailable.

 

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The Company further agrees that no Indemnified Party shall have any liability
(whether direct or indirect, in contract or tort or otherwise) to the Company
for or in connection with Rockwell's agreement hereunder except for Claims that
a court of competent jurisdiction shall have determined by final judgment (and
the time to appeal has expired or the last right of appeal has been denied)
resulted solely or in part from the willful misconduct of such Indemnified Party
or the willful violation of any securities laws or regulations by an Indemnified
Party. The indemnity, reimbursement and contribution obligations of the Company
set forth herein shall be in addiction to any liability which the Company may
otherwise have an shall be binding upon and inure to the benefit of any
successors, assigns, heirs and personal representatives of the Company or an
Indemnified Party.

 

16.  Legal Effect. The parties to this Agreement represent that each of them has
been advised as to the terms and legal effect of this Agreement and the Order
provided for herein, and that the settlement and compromise stated herein is
final and conclusive forthwith, shall supersede all prior written or oral
between the parties, subject to the conditions stated herein, and each attorney
represents that his or her client has freely consented to and authorized this
Agreement after having been so advised.

 

17.  Mutual Drafting. Each party has participated jointly in the drafting of
this Agreement which each party acknowledges is the result of negotiation
between the pm1ies and through placement agent Meyers Associates, L.P., and the
language used in this Agreement shall be deemed to be the language chosen by the
parties to express their mutual intent. If ambiguity or question of intent or
interpretation arises, then this Agreement will accordingly be construed as
drafted jointly by the parties, and no presumption or burden of proof will arise
favoring or disfavoring any party to this Agreement by virtue of the authorship
of any of the provisions of this Agreement.

 

18.  Waiver of Defense. Each party hereto waives a statement of decision, and
the right to appeal from the Order after its entry. Company further waives any
defense based on the rule against splitting causes of action. The prevailing
party in any motion to enforce the Order shall be awarded its reasonable
attorney fees and expenses in connection with such motion. Except as expressly
set forth herein, each party shall bear its own attorneys’ fees, expenses and
costs.

 

19.  Signatures. This Agreement may be signed in counterparts and the Agreement,
together with its counterpart signature pages, shall be deemed valid and binding
on each party when duly executed by all parties. Facsimile and electronically
scanned signatures shall be deemed valid and binding for all purposes. This
Agreement may be amended only by an instrument in writing signed by the party to
be charged with enforcement thereof. This Agreement supersedes all prior
agreements and understandings among the parties hereto with respect to the
subject matter hereof.

 

20.  Choice of Law, Etc. Notwithstanding the place where this Agreement may be
executed by either of the parties, or any other factor, all terms and provisions
hereof shall be governed by and construed in accordance with the laws of the
State of Florida, applicable to agreements made and to be fully performed in
that State and without regard to the principles of conflicts of laws thereof.
Any action brought to enforce, or otherwise arising out of this Agreement shall
be brought only in State Court sitting in Sarasota County, Florida.

 

21.  Exclusivity. For a period of the later of one hundred eighty (180) days
from the date of the execution of this Agreement or upon RCP' s final sale of
all shares of stock issued pursuant hereto subsequent to final adjustment, (a)
Company and its representatives shall not enter into any exchange transaction
under Section 3(a)(l0) of the Securities Act nor directly or indirectly discuss,
negotiate or consider any proposal, plan or offer from any other party relating
to any liabilities, or any financial transaction having an effect or result
similar to the transactions contemplated hereby, and (b) RCP shall have the
exclusive right to negotiate and execute definitive documentation embodying the
terms set forth herein and other mutually acceptable terms.

 

22.  Inconsistency. In the event of any inconsistency between the terms of this
Agreement and any other document executed in connection herewith, the terms of
this Agreement shall control to the extent necessary to resolve such
inconsistency.

 

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23.  Notices. Any notice required or permitted hereunder shall be given in
writing (unless otherwise specified herein) and shall be deemed effectively
given on the earliest of:

 

(a) the date delivered, if delivered by personal delivery as against written
receipt therefore or by confirmed facsimile transmission,

 

(b) the fifth business day after deposit, postage prepaid, in the United States
Postal Service by registered or certified mail, or

 

(c) the second business clay after mailing by domestic or international express
courier, with delivery costs and fees prepaid,

 

(d) delivery by email upon delivery,

 

in each case, addressed to each of the other parties thereunto entitled at the
following addresses (or at such other addresses as such party may designate by
ten (10) days' advance written notice similarly given to each of the other
parties hereto):

 

Company:

 

InCapta, Inc.

1950 Fifth Avenue, Suite 100

San Diego, CA 92101

Attn: John Fleming,

Telephone: (619) 798-9284

E-mail: ceo@incapta.com

 

RCP:

 

Rockwell Capital Partners, Inc.

919 North Market Street, Suite 101

Wilmington, Delaware 19801

Attn: Samuel O’Shea

Telephone: (305) 351-7728

E-mail: documents@rockwellcp.com

 

With a copy to:

 

Michael G. Brown, Esq.

P.O. Box 19702

Sarasota, Florida 34237

Telephone: (941)780-1300

Facsimile: (941) 296-7500

Florida Bar No. 0148709

 

Charles N. Cleland, Jr., P.A.

2127 Ringling Boulevard, Suite 104

Sarasota, Florida 34237

Telephone: (941) 955-1595

Facsimile: (941 ) 953-7185

Florida Bar No. 0896195

 

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

 

Rockwell Capital Partners, Inc.

 

 

By:   /s/ Samuel O’Shea   Name: Samuel O’Shea   Title:  Secretary  

 

InCapta, Inc.

 

 

By:   /s/ John Fleming   Name: John Fleming   Title: CEO  

 

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