SETTLEMENT AND RELEASE AGREEMENT

     This Release and Settlement (hereinafter  "Agreement") is made effective as
of.  latest  date set forth on the  signature  pages  hereof,  by and between 1)
Insynq, Inc., whose address is 1101 Broadway Plaza,  Tacoma, WA 98402;  relevant
employees,  agents,  ) and/or  members  of the  Board of  Directors  of  Insynq;
("Insynq")  and 2) William G. Hargin,  whose address is 10632 157th Avenue N.E.,
Redmond, WA 98052.

     NOW  THEREFORE,  in  consideration  of the mutual  promises,  covenants and
conditions set forth herein, Insynq and Hargin agree as follows:

1.   RELEASE AGREEMENT

1.1  Release. In exchange for, and upon delivery of the seventeen thousand five
     hundred dollars ($17,500) and Two Hundred Thousand (200,000) Insynq
     Non-qualified stock options (NQSO), as defined and using the delivery
     schedule defined in section 2 herein, Hargin and Insynq, individually and
     on behalf of themselves, their predecessors, successors, heirs,
     beneficiaries and assigns, release and forever discharge each other, their
     respective attorneys, and their predecessors, successors, heirs,
     beneficiaries and assigns, from and against any and all claims, damages,
     actions, causes of action, liabilities, judgments, liens, contracts,
     agreements, rights, debts, suits, obligations, promises, acts, costs and
     expenses, damages, and charges of whatsoever nature, whether known or
     w1known, suspected or unsuspected, fixed or contingent, which they now
     have, claim to have, or at any time had or claimed to have as a result of
     any thing undertaken, done, or omitted to be done including anything,
     arising out of, or m any way related to, any litigation, proceedings and/or
     claims between and among the parties to this Agreement, and/or any act or
     omission of the either party, their respective attorneys, and their
     predecessors, successors, heirs, beneficiaries and assigns

1.2  Hargin agrees to immediately dismiss, without prejudice, the Complaint for
     damages against InsynQ m the Superior Court for the State of Washington in
     and for the County of Pierce, Case No.00-2-08573-1. Hargin also agrees to
     dismiss, with prejudice, the Complaint for damages against InsynQ m the
     Superior Court for the State of Washington in and for the County of Pierce,
     Case No.00-2-08573-1 upon receipt of the seventeen thousand five hundred
     dollars ($17,500) and Two Hundred Thousand (200,000) options under the
     schedule identified in section 2. The dismissal without prejudice shall be
     filed m the appropriate courts upon the execution of this agreement and the
     dismissal with prejudice shall be filed m the appropriate courts upon
     receipt of said cash and options pursuant to this agreement.


1.3  It is understood and agreed that this settlement is the compromise of a
     disputed claim, and this payment is not to be construed as admission of
     liability on Insynq or Hargin by whom liability is expressly denied.

2.   CASH, ATTORNEY'S FEES, NQSO, CONDITION PRECEDENT AND PRESS RELEASE

2.1  Cash. Hargin will receive fifteen thousand dollars ($15,000) in two
     payments often thousand dollars ($10,000) and five thousand dollars
     ($5,000). The first payment of ten thousand dollars ($10,000) shall be
     issued within ten business days of the receipt of the second traunch of
     funding from the current group of investors who have proposed to fund
     InsynQ with 1.2 million dollars in three traunches. The second payment of
     five thousand dollars ($5,000) shall be issued within ten business days of
     the receipt of third traunch from the funding group mentioned in the prior
     sentence.

2.2  Attorney Fees. A payment of two thousand five hundred dollars ($2,500)
     shall be issued to the Law Offices of Richard Phillips, PLLC to pay the
     reasonable costs Hargin , s attorney's fees. Said payment shall be made
     within ten business days of the receipt of the third traunch in funding
     from the funding group mentioned in the prior section.

2.3  Non-qualified Stock Options. Hargin shall receive two hundred thousand
     (200,000) Non-qualified stock options (NQSO) with an exercise price of six
     and one half cents ($.065). The option agreement and documents required to
     exercise these options shall be forwarded immediately to Hargin upon
     execution of this agreement.


2.4  Condition Precedent. Receipt of the funds specified in paragraphs 2.1 and
     2.2 and receipt of the non-qualified stock options specified in paragraph
     2.3 shall be a condition precedent to the effectiveness of the release
     specified in paragraph 1.1 and to delivery of the dismissal with prejudice
     specified in paragraph 1.2.

2.5  Press Release. Hargin authorizes that InsynQ may issue press releases
     immediately upon the execution of this agreement and such press releases
     shall substantially state the following:

         "William Hargin is pleased to have this lawsuit settled. InsynQ, Inc.
         has a great concept and wonderful service to provide to companies, and
         I wish them well. "

3.   UNANTICIPATED DAMAGE

3.1  There is a risk that subsequent to the execution of this agreement that
     Insynq or Hargin, individually, jointly and/or severally, on behalf of
     themselves, their predecessors, successors, heirs, beneficiaries and
     assigns, will incur or suffer personal or bodily discomfort, financial
     loss, property damage, tax liability, civil or criminal penalty, or any
     other type of damage or any of these, which is in some way caused by the
     facts set forth in the lawsuit referred to above, but which is unknown and
     unanticipated at the time this Agreement is signed; and further, there is a
     risk that the damages presently known may be, or may become, more serious
     than the undersigned now expects or anticipates. The parties hereby assume
     the above-mentioned risks and this Agreement shall apply to all unknown or
     unanticipated results of the occurrence described above as well as those
     known and anticipated.

4.   ADVICE OF LEGAL COUNSEL

     The advice of legal counsel has been obtained by all parties prior to
     signing this Agreement. Counsel for each party to this agreement has played
     an active role in drafting each term of this agreement. Accordingly, no
     provision of this agreement shall be interpreted against any party on the
     grounds that it was drafted by that party. BY SIGNING THIS AGREEMENT, EACH
     PARTY HERETO ATTESTS THAT THIS AGREEMENT WAS ENTERED INTO FREE FROM ANY
     DURESS AND/OR COERCION, BASED UPON EACH SIGNA TORY'S OWN WILL AFTER OBT
     AINING ADVICE OF COUNSEL. If any provision of this Agreement is held to be
     invalid or ineffective, such invalidity or ineffectiveness shall not affect
     the remaining provisions or applications of this Agreement, which shall be
     given full and complete effect without the invalid or ineffective
     provisions hereof. To this end, the provisions of this Agreement are
     severable.

5.   HEADINGS

     The headings of this Agreement are for purposes of reference only and shall
     not limit or define the meaning of the provisions of this Agreement. Any
     rule of law or legal decision that would require interpretation of any
     ambiguities contained herein against the party that has drafted it is not
     applicable and is waived. The provisions of this Agreement shall be
     interpreted in a reasonable manner to effect the purpose of the parties and
     this Agreement.

6.   FURTHER DOCUMENTS.

     Each of the parties hereto shall execute and deliver any and all additional
     papers, documents, instructions and other instruments, including without
     limitation the memorandum, and shall do any and all acts and things
     reasonably necessary in connection with the performance of their
     obligations hereunder and to carry out the intent of the parties hereto.

7.   TAXES

     Hargin is assuming the responsibility for all personal income and social
     security taxes associated with the settlement of this claim and Hargin will
     assume any liabilities indemnifying InsynQ for payment of all such taxes
     that may become due under this settlement.

8.   CONFIDENTIALITY

     The parties and the parties' Counsel agree that the terns and contents of
     this Agreement, and any information regarding the Agreement (other than the
     fact of the settlement and its confidentiality) including the negotiation
     hereof, shall be maintained as confidential, and shall not be disclosed
     either directly or indirectly to any person, firm, association,
     partnership, corporation or other entity except as directed to be disclosed
     by law.

     This release contains the ENTIRE AGREEMENT between the parties hereto, and
     the terns of this release are contractual and not a mere recital.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year first written above.

         INSYNQ, INC.:
         And Xcel Management, Inc.:  (cb) (wgh)



         /s/ M. Carroll Benton
         ---------------------
         INSYNQ, INC., AUTHORIZED REPRESENTATIVE

         M. Carroll Benton
         PRINT NAME AND TITLE

         Aug. 6, 2001
         DATE

         WILLIAM G. HARGIN:

         /s/ William G. Hargin
         ---------------------
         WILLIAM G. HARGIN

         7/26/01
         DATE