EXHIBIT
      10.40








**DEBT
      SETTLEMENT AGREEMENT AND RELEASE**





THIS
      DEBT
      SETTLEMENT AGREEMENT AND RELEASE (this “ Agreement ”)
      is
      made and entered into as of the 19 th **** day
      of
      July, 2006, by and between Nicholas A. Fegen (“ Fegen ”),
      and
      Gabriel Technologies Corporation, a Delaware corporation (the “ Company ”).





**WHEREAS** ,
      as of
      the date hereof, the Company has an outstanding promissory note payable to
      the
      order of Fegen in the principal amount of $210,547.95 (the “ Note ”)
      with
      accrued but unpaid interest on such Note equaling $3,497.81 (the “ Interest ”);
      and





**WHEREAS** ,
      the
      Company and Fegen desire to cancel the Note and settle and release all
      outstanding obligations, debts, and liabilities with respect thereto, including
      without limitation the Interest, and to certain other matters between them
      pursuant to the terms of this Agreement.





**NOW,
      THEREFORE** ,
      for
      good and valuable consideration, the receipt and adequacy of which are hereby
      acknowledged and confessed, the parties agree as follows:





1.  **RELEASE
      BY FEGEN** .
      Fegen,
      on behalf of himself and his heirs, representatives, successors and assigns,
      hereby fully, finally and completely RELEASES AND FOREVER DISCHARGES the Company
      and its predecessors, successors, assigns, partners, members, managers,
      affiliates, subsidiaries, parents, officers, shareholders, directors, employees,
      attorneys, and agents, past, present and future (the “ Company
      Released Parties ”),
      of
      and from any and all actions, causes of action, suits, debts, disputes, damages,
      claims, obligations, liabilities, and demands of any kind whatsoever, at law
      or
      in equity, whether matured or unmatured, liquidated or unliquidated, vested
      or
      contingent, known or unknown, solely with respect to matters arising in
      connection with the Note (including principal, any interest thereon or other
      fees or obligations related thereto) that Fegen had, now has, or hereafter
      may
      have against the Company Released Parties (the “ Fegen
      Claims ”).
      Fegen
      hereby agrees that he will not assert, and that he is estopped from asserting,
      against any and all of the Company Released Parties, any Fegen Claims that
      are
      released in this Agreement.





2.  **CONSIDERATION** .
      As
      consideration for the execution and delivery of this Agreement, and upon
      delivery and cancellation of the Note pursuant to Section 3 below, the Company
      shall (i) issue a stock certificate representing 286,000 shares of the Company’s
      capital stock (the “ Shares ”),
      and
      (ii) issue a warrant to acquire 286,000 shares of the Company’s capital stock at
      an exercise price of $1.00 in substantially the form of **Exhibit
      A** attached
      hereto (the “ Warrant ”)
      (collectively, the “ Securities ”).





3.  **DELIVERY
      AND CANCELLATION OF NOTE** .
      Upon
      execution and delivery of this Agreement, Fegen shall deliver to the Company
      the
      Note which shall be marked as “cancelled” by the Company. Fegen hereby releases
      and forever discharges the Company’s obligation to pay all or any portion of the
      Note.





4.  **FEGEN
      REPRESENTATIONS AND WARRANTIES** .
      As of
      the date hereof, Fegen represents and warrants the following:





(a)
            He
                has not assigned, pledged, or transferred in any manner to any person
                or
                entity any right, title, or interest to the Note, Interest, or any
                of the
                Fegen Claims.





(b)
            He
                has the requisite power and authority to enter into this
                Agreement.


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(c)
            He
                recognizes that acquiring the Securities involves a high degree of
                risk
                and is suitable only for persons of adequate financial means who
                have no
                need for liquidity in this investment, in****that
                (a) it may not be possible to liquidate the investment in the event
                of
                emergency; (b) transferability is extremely limited; and (c) in the
                event
                of a disposition, a complete loss of investment could
                occur.





(d)
            He
                (a) is competent to understand and does understand the nature of
                the
                investment, and (b) is able to bear the economic risk of the
                investment.





(e)
            He
                is an accredited investor as defined in Rule 501 of Regulation D
                promulgated by the Securities and Exchange Commission (the “SEC”)****under
                the Securities Act of 1933, as amended (the “Act”).





(f)
            He
                has significant prior investment experience, including investment
                in
                nonlisted and nonregistered securities, and that he has read all
                of the
                documents furnished or made available by the Company to evaluate
                the
                merits and risks of the investment, recognizes the highly speculative
                nature of this investment, and is able to bear the economic risk
                hereby
                assumed.





(g)
            All
                information regarding the Company which was requested or desired
                by him
                has been furnished, all other documents which could be reasonably
                provided
                have been made available for inspection and review, and he believes
                that
                such information is sufficient to make an informed decision with
                respect
                to his acquiring the Securities
                herein.





(h)
            He
                is acquiring the Securities for his own account, for investment,
                and not
                for distribution or resale to others, and that he will not sell,
                transfer,
                or otherwise dispose of the Securities or any portion thereof unless
                they
                are registered under the Act or unless an exemption from such registration
                is available.





(i)
            He
                may, with the Company’s written consent, transfer the Securities if such
                request for transfer is accompanied by an opinion of counsel satisfactory
                to the Company that neither the sale nor the proposed transfer of
                the
                Securities results in a violation of the Act or any applicable state
“blue
                sky” laws (collectively, the “Securities
                Laws”).





(j)
            He
                consents to the placement of a legend on the certificates evidencing
                the
                Shares and on the Warrant stating that they have not been registered
                under
                the Act and setting forth or referring to the restrictions on
                transferability and sale thereof.





5.  **INDEMNIFICATION** .
      Fegen
      agrees to hold the Company, its officer and directors, and their respective
      heirs, representatives, successors, and assigns harmless and to indemnify them
      against all liabilities, costs, and expenses (including attorneys’ fees)
      incurred by them as a result of any sale or distribution of the Securities
      by
      Fegen in violation of any Securities Laws or any misrepresentation
      herein.





6.  **ENTIRE
      AGREEMENT** **.** This
      Agreement constitutes the entire agreement between the parties as to the subject
      matter hereof. There are no verbal understandings, agreements, representations
      or warranties that are not expressly set forth herein. This Agreement shall
      not
      be changed orally, but only in writing signed by the parties
      hereto.





7.  **SEVERABILITY** .
      Any
      provision of this Agreement which is for any reason prohibited or found or
      held
      invalid or unenforceable by any court or governmental agency shall be
      ineffective to the extent of such prohibition or invalidity or unenforceability,
      without invalidating the remaining provisions hereof in such jurisdiction or
      affecting the validity or enforceability of such provision in any other
      jurisdiction.


-2-


8.  **BINDING
      EFFECT** .
      This
      Agreement shall be binding upon and inure to the benefits of the parties hereto,
      their respective successors and assigns.





9.  **GOVERNING
      LAW** .
      This
      Agreement shall be governed by and construed, enforced and interpreted in
      accordance with the laws of the State of Nebraska (without regard to principles
      of conflicts of laws). The parties consent to the sole and exclusive
      jurisdiction of the state courts and U.S. federal courts having jurisdiction
      in
      Douglas County, Nebraska for any dispute arising out of this
      Agreement.





10.  **COUNTERPARTS** .
      This
      Agreement may be executed in any number of original counterparts, each of which
      having been so executed and delivered shall be deemed an original and all of
      which, collectively, shall constitute one agreement; it being understood and
      agreed that the signature pages may be detached from one or more such
      counterparts and combined with the signature pages from any other counterparts
      in order that one or more fully executed originals may be assembled. A facsimile
      signature shall be deemed to be original signature.





**IN
      WITNESS WHEREOF** ,
      the
      parties hereto have caused this Agreement to be executed and delivered as of
      the
      day and year first written above.











/s/
      Nicholas A.
      Fegen


NICHOLAS
      A. FEGEN











GABRIEL
      TECHNOLOGIES CORPORATION








By: /s/
      Keith R.
      Feilmeier


Keith
      Feilmeier


Chief
      Executive Officer