SETTLEMENT AGREEMENT

THIS SETTLEMENT AGREEMENT (the “Agreement”) is made and entered into as of
February 22, 2010 (the “Effective Date”) by and between: (i) Tactical Air
Defense Services, Inc., a Nevada corporation (the “Company”); and (ii) DS
Enterprises, Inc., a California corporation (the “Settlor”) (The Company and the
Settlor may be individually referred to hereinafter as a “Party” and
collectively as the “Parties”).

RECITALS

WHEREAS, on or about September 8, 2006, the Company and the Settlor entered into
a Financial Advisory Services Agreement (the “Advisory Agreement”).

WHEREAS, pursuant to the terms of the Advisory Agreement, the Settlor completed
the services under the Advisory Agreement and was issued a convertible
promissory note on May 8, 2007 (the “Note,” a copy of which are attached hereto
as Exhibit A).

WHEREAS, pursuant to the terms of and the rights afforded by the Note, the
Settlor has made numerous demands upon the Company for conversion of the balance
of the Note into 66,385,157 shares of the Company’s common stock, par value
$0.001 (the “Common Stock”).

WHEREAS, the Company has reviewed the Note and confirms the existence of and
liability for the Note.

WHEREAS, the Company is unable to settle the Note through the payment of cash
and in an effort to clean up its balance sheet, the Company believes it to be in
the best interest of the Company and its shareholders to settle the Note through
the issuance of shares of Common Stock as further described herein.

WHEREAS, the Parties wish to enter into this Agreement and settle and forever
resolve the claims the Settlor has against the Company related to the Note.

NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement, and for good and valuable consideration, the receipt of which is
hereby acknowledged, it is hereby agreed as follows:

AGREEMENT

1.           Release of Claims.    Upon issuance of the Settlement Shares (as
further defined and described herein) the Settlor hereby agrees to fully settle
and forever resolve any and all past, present and future claims the Settlor may
have against the Company related to Advisory Agreement and the Note, including
all principal and interest due thereunder as of the Effective Date (hereinafter
the “Claims”).

2.           Consideration.   As consideration for the release of the Claims,
the Company shall issue and transfer to the Settlor or its assignees, free and
clear of any security interests, liens, claims or other encumbrances whatsoever,
Forty Five Million Eight Hundred and Five Thousand Seven Hundred and Fifty Eight
(45,805,758) shares of Common Stock (the “Settlement Shares”). The Settlement
Shares shall be issued to the Settlor or its assignees: (i) within five (5)
business days of the Effective Date via DWAC electronic transfer pursuant to the
transfer instructions attached hereto as Exhibit B; (ii) pursuant to a valid
Company Board of Directors resolution; and (iii) as unrestricted, free trading
shares pursuant to the opinion letter provided by the Settlor’s counsel (the
“Opinion Letter,” a copy of which has been attached hereto as Exhibit C), which
the Company hereby irrevocably authorizes the Company’s transfer agent, Transfer
Online, Inc., to accept. The Settlement Shares shall be deemed to have been
converted from the Note and, as such, the issuance date for such Settlement
Shares shall tack back to the original issuance date of the Note pursuant to
Rule 144 promulgated under the Securities Act of 1933. The Settlement Shares
shall represent the total compensation due and payable to the Settlor in
connection with Claims. In the event the Settlement Shares are not issued as
free trading unrestricted shares due to events outside of the Company’s control,
this Agreement shall be nullified in its entirety and the Note shall remain as
issued and valid.

3.           Assignability.  This Agreement shall be binding upon the Company
and its successors, and shall inure to the benefit of the Settlor and their
successors and assigns. The Settlement Shares, and all of the terms and
conditions described herein, are assignable and may be transferred sold, or
pledged, hypothecated or otherwise granted as security by the Settlor at their
sole discretion.

4.           Waiver of Section 1542.     In signing this Agreement, the Parties
has been advised of, understand and knowingly waive their rights under
California Civil Code Section 1542 which provides as follows: A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST
IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST
HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

5.           No Further Claims.     The Parties covenant and agree never to
commence against each other, any legal action or proceeding based in whole or in
part upon the Claims, demands, allegations, and/or injuries released in this
Agreement.

6.           Dispute Resolution.   The subject matter of this Agreement shall be
governed by and construed in accordance with the laws of the State of California
(without reference to its choice of law principles), and to the exclusion of the
law of any other forum, without regard to the jurisdiction in which any action
or special proceeding may be instituted.  EACH PARTY HERETO AGREES TO SUBMIT TO
THE PERSONAL JURISDICTION AND VENUE OF THE STATE COURTS LOCATED IN THE NORTH
COUNTY OF SAN DIEGO, CALIFORNIA FOR RESOLUTION OF ALL DISPUTES ARISING OUT OF,
IN CONNECTION WITH, OR BY REASON OF THE INTERPRETATION, CONSTRUCTION, AND
ENFORCEMENT OF THIS AGREEMENT, AND HEREBY WAIVES THE CLAIM OR DEFENSE THEREIN
THAT SUCH COURTS CONSTITUTE AN INCONVENIENT FORUM.  AS A MATERIAL INDUCEMENT FOR
THIS AGREEMENT, EACH PARTY SPECIFICALLY WAIVES THE RIGHT TO TRIAL BY JURY OF ANY
ISSUES SO TRIABLE.

7.           Attorney’s Fees.   Should any Party hereto employ an attorney for
the purpose of enforcing or constituting this Agreement, the Advisory Agreement
or the Note, or any judgment based on this Agreement or the Note, in any legal
proceeding whatsoever, including insolvency, bankruptcy, arbitration,
declaratory relief or other litigation, the prevailing party shall be entitled
to receive from the other Party or Parties thereto reimbursement for all
reasonable attorneys’ fees and all reasonable costs, including but not limited
to service of process, filing fees, court and court reporter costs,
investigative costs, expert witness fees, and the cost of any bonds, whether
taxable or not, and that such reimbursement shall be included in any judgment or
final order issued in that proceeding.

8.           Necessary Action.   At all times after the execution of this
Agreement, 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 complete or perfect the
transaction contemplated hereby.

9.           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 transaction provided in this Agreement have been duly
authorized by all necessary action of the respective person or entity, including
receipt of approvals from any governing board of directors, and that the person
executing this Agreement on its behalf, if applicable, has the full capacity to
bind that entity.

10.           Time of Essence.  Time is of the essence in the performance of all
obligations under this Agreement.

11.           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 executed by all Parties. Facsimile signatures
shall be valid and binding for all purposes.

12.           No Oral Change; Waiver.  This Agreement may only be changed,
modified, or amended in writing by the mutual consent of the Parties
hereto.  The provisions of this Agreement may only be waived in or by writing
signed by the Party against whom enforcement of any waiver is sought.

13.           Severance.    Should any provision of this Agreement be held by a
court of competent jurisdiction to be invalid, void or unenforceable for
whatever reason, the remaining provisions not so declared shall, nevertheless,
continue in full force and effect, without being impaired in any manner
whatsoever.

14.           Acknowledgments and Assent.   The Parties acknowledge that they
have been given adequate time to consider this Agreement and that they were
advised to consult with an independent attorney prior to signing this Agreement
and that they have in fact consulted with counsel of their own choosing prior to
executing this Agreement. The Parties agree that they have read this Agreement
and understand the content herein, and freely and voluntarily assent to all of
the terms herein.

 
SIGNATURE PAGE

IN WITNESS WHEREOF the Parties have executed this Settlement Agreement effective
as of February 22, 2010.

COMPANY:
 
Tactical Air Defense Services, Inc.
 
A Nevada corporation
 
 
 
___________________________________
By: Alexis Korybut
Its: Chief Executive Officer
SETTLOR:
 
DS Enterprises, Inc.
 
A California corporation
 
 
 
___________________________________
By: Phil Scott, CFA
Its: President

A FACSIMILE COPY OF THIS AGREEMENT SHALL HAVE THE SAME LEGAL EFFECT AS AN
ORIGINAL OF THE SAME