U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (date of earliest event reported): May 31, 2016

 

INCAPTA, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

Nevada   0-29113   47-3903460
(State or Other Jurisdiction   (Commission File Number)   (I.R.S. Employer
of Incorporation)       Identification No.)

 

1950 Fifth Avenue, Suite 100, San Diego, California   92101
(Address of Principal Executive Offices)   (Zip Code)

 

Company’s telephone number, including area code: (619) 798-9284

 

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2 below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

 

ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

 

On May 31, 2016, the Company entered into a Settlement Agreement and Stipulation (“Agreement”) with Rockwell Capital Partners, Inc., a Delaware corporation (“Rockwell”) (see Exhibit 10.1). Under the Agreement, Rockwell acquired outstanding liabilities of the Company in the principal amount of $50,861.25 under the terms set forth in a Form of Claim Purchase Agreement (see Exhibit 10.2).

 

After the execution of the Agreement, the Company and Rockwell submitted, pursuant to Section 3(a)(10) of the Act, 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, as defined under the Agreement. On June 1, 2016, the Circuit Court of the Twelfth Judicial Circuit of Florida (Sarasota County) entered an order finding that the Agreement is approved as fair to Rockwell, within the meaning of Section 3(a)(10) of the Act, and that the sale of the shares to Rockwell and the resale of the shares by Rockwell will be exempt from registration under the Act. As of June 8, 2016, 22,000,000 free trading shares have been issued to Rockwell under this exemption.

 

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

 

Exhibits.

 

Exhibits included are set forth in the Exhibit Index pursuant to Item 601of Regulation S-K.

  

SIGNATURE

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  InCapta, Inc.
     
     
Dated: June 8, 2016 By:   /s/ John Fleming.  
    John Fleming, President

 

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EXHIBIT INDEX

 

Number Description

 

10.1 Settlement Agreement and Stipulation between the Company and Rockwell Capital Partners, Inc., dated May 31, 2016 (filed herewith).

 

10.2 Form of Claim Purchase Agreement between the Company and Rockwell Capital Partners, Inc., dated May 31, 2016 (filed herewith).

 

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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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Exhibit 10.2

 

FORM OF CLAIM PURCHASE AGREEMENT

 

This Claim Purchase Agreement (“Agreement”) (together wit h Exhibits A and B annexed hereto and made a part hereof, all of which taken together constitute this “Agreement”) is entered into effective as of the date of full execution (“Effective Date”), by and between Rockwell Capital Partners, Inc. (“Purchaser”), and the creditor identified below (“Creditor”'). Purchase and Creditor (each, a “Party” and, together, the “Parties”) agree as follows with respect to the outstanding debt owed to Creditor by the company named below (“Company”).

 

Company Name:    InCapta, Inc.  
     
Creditor Name:    
     
Claim Amount:    (Total amount payable from Company to Creditor)
     
Purchase Price:    (Amount for which Creditor is selling Claim to Purchaser)

 

Documentation of Claim (complete copies of all documentation attached):

 

x lnvoice(s) attached as Exhibit A.

 

x Indemnification Agreement attached as Exhibit B.

 

1.  Purchase and Sa l e. Purchaser here by purchases from Creditor, and Creditor here by sells, transfers, conveys and assigns to Purchaser, for the consideration set forth herein, all right, title and interest of Creditor in and to, one or more claims of Creditor against Company described herein and attached hereto (the “Claim”). Creditor hereby sells, transfers and assigns all right, title and interest of Creditor in the Claim to Purchaser.

 

2.  Settlement Approval. No later than the thirtieth (30th) business day after the Effective Date, Purchaser shall file an action against Company in the United States District Court or state court of trial jurisdiction in the State of Florida (the “Action”) seeking collection of the Claim. Purchaser shall seek to settle the Action on terms acceptable to Purchaser in its sole discretion find, by appropriate motion or other pleading, shall seek approval from the Court of such settlement.

 

3. Payment of Purchase Price. The Purchase Price will be paid to Creditor by Purchaser in one (1) installment, following entry and full effectuation of a Court order approving settlement of the Claim in form and substance acceptable to Purchaser (“Approval Date”), and the successful deposit of settlement shares of Company by Purchaser in an account or accounts as contemplated by any settlement agreement between Company and Purchaser until paid in full. Payment shall be made as follows: $4,000.00 within ten (10} days of the occurrence of the foregoing; provided however, that Purchaser shall not be obligated to pay any portion of such Purchase Price in the event of a Default being declared by Purchaser under any settlement agreement entered into between the Company and Purchaser in respect of the settlement of the Claim that is the subject of this Agreement. If such default by the Company occurs and is not cu red within the prescribed time period, the Purchaser shall cause to be transferred to Creditor any portion of the Claim not already paid for pursuant to this Section 3, and this Agreement shall be null and void, unless otherwise agreed by written agreement of the parties.

 

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4.  Cooperation. Creditor will furnish Purchaser with all documentation and evidence supporting the Claim, and reasonably cooperate in providing any other information and taking any other action that Purchaser deems necessary or appropriate to prosecute the action to collect the Claim. Upon Purchaser’s reasonable request, Creditor will duly execute and deliver, or cause to be duly executed and delivered to Purchaser such further instruments and do and cause to be done such further acts as may be necessary or proper in the reasonable opinion of Purchaser to effectuate the provisions and purposes of this Agreement.

 

5.  Termination. If the Approval Date has not occurred within ninety (90) days after the date hereof, either Party shall have the right to terminate and cancel this Agreement by providing written notice of termination to the other Party at any time after such date and prior to Court Approval. If termination is so effected, this Agreement shall be deemed void ab initio and of no further force and effect, no sale or assignment of the Claim shall have occurred, and Purchaser shall dismiss the Action. In the event of termination, the Purchase Price shall not be payable.

 

6.  Representations, Warranties and Covenants, Creditor hereby represents, warrants and covenants to Purchaser as follows:

 

(a) (i) The Claim is a bona fide outstanding claim against Company, and is an enforceable obligation arising in the ordinary course of business, for goods and/or services rendered to Company by Creditor in good faith. The Claim is currently due and owing and is payable in full. (ii) The Claim is not secured by any security interest in any property of the Company or an affiliate of the Company or by a guarantee of the Company or of an affiliate of the Company.

 

(b) Creditor did not enter into the transaction giving rise to the Claim in contemplation of any sale or distribution of Company’s common stock or other securities.

 

(c) The Claim Amount is the total amount due to Creditor with respect to the Claim, net of any applicable discounts, allowances or other deductions to which Company is lawfully entitled. The documents attached hereto are true, correct and complete copies of all documentations underlying the Claim.

 

(d) The Claim is not reasonably subject to dispute and Company is unconditionally obligated to pay the full Claim Amount without defense, counterclaim or offset. To the knowledge of Creditor, the Company’s failure to pay is due solely and exclusively to financial inability.

 

(e) Creditor is the sole owner of the Claim, free and clear of all liens, encumbrances and rights of third parties. Creditor has not previously sold, transferred, encumbered or released any part of the Claim.

 

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

 

(g) There are no taxes due, payable or withholdable as an incident of Creditors Claim; no taxes will be due, payable or withholdable as a result of settlement of the Claim; and Creditor may at all times promptly withhold (if applicable) and pay when due any federal, state, local and/or foreign taxes due as a result of payment of the Purchase Price.

 

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(h) Creditor has all necessary power and authority to (i) execute, deliver and perform all of its obligations under this Agreement, and (ii) sell, convey, transfer and assign the Claim to Purchaser. Creditor has such knowledge and experience in business and financial matters that it is able to protect it’s own interests and evaluate the risks and benefits of entering into this Agreement. Creditor acknowledges and agrees that it has had an opportunity to conduct its own diligence and consult with its own legal counsel, and tax, financial and other advisors, and that Creditor is not relying in that regard on Purchaser. Creditor acknowledges that Purchaser is not making any representations or warranties whatsoever, including, without limitation, about the Company.

 

(i) The execution, delivery and performance of this Agreement by Creditor has been duly authorized by all requisite action on the part of Creditor. This Agreement has been duly executed and delivered by Creditor and constitute the legal, valid and binding obligation of Creditor, enforceable against Creditor in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally or the availability of equitable remedies.

 

(j) Creditor is 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. Creditor is not in any way affiliated with any of the Company’s officers, directors or ten-percent (10%) shareholders. Creditor is a broker or dealer in securities.

 

(k) Creditor's claim does not arise out of Promotor or Investor Relations Services.

 

(l) The execution and delivery of this Agreement by Creditor and the performance of all of its obligations hereunder (i) do not and will not violate, conflict with, breach, or constitute a default under, any material contract, agreement or commitment binding upon such Creditor, and ( ii) do not and will not  conflict with or violate any applicable law, rule, regulation, judgment order or decree of any court or other government authority having jurisdiction over such Creditor or the Claim.

 

(m) There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or , to the knowledge of Creditor, threatened against or affecting Creditor or any of its assets before or by any court, arbitrator, governmental or administrative agency, or regulatory authority that a aversely affects or challenges the legality, validity or enforceability of, or that could have or reasonably be expected to result in a material adverse affect on this Agreement.

 

(n) Creditor shall not and has no present intention to utilize any of the proceeds to be received from Purchaser to directly or indirectly provide any consideration to or invest in any manner in the Company or any affiliate of the Company.

 

(o) Creditor will not, directly or indirectly, receive any consideration from or be compensated in any manner by the Company, or any affiliate of the Company, in exchange for or in consideration for selling the Claim.

 

(p) Creditor will immediately advise Purchaser if any of the foregoing cease to be fully true and accurate at any time up to and including the Approval Date.

 

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7.  Fees and Expenses. Each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation., execution, delivery and performance of this Agreement. Creditor understands that Purchaser shall not be liable for any commissions, selling expenses, orders purchases, contracts, taxes, withholding or obligations of any kind resulting from any or arising out of settlement of the Claim.

 

8.  Choice of Law. This Agreement shall be governed by and construed according to the laws of the State of Florida, without giving effect to its choice of law principles. Any actions and proceedings arising out of or relating directly or indirectly to this Agreement or any ancillary agreement or any other related obligations shall be litigated solely and exclusively in the state or federal courts located in Florida, and that such courts are convenient forums. Each Party here by submits to the persona l jurisdiction of such courts for purposes of any such actions or proceedings.

 

9.  Limitation of Damages. Notwithstanding the provisions of paragraph 10 herein, each of the Parties hereby waives any rights which it may have to claim or recover any incidental, special, exem1plary punitive or consequential dan1ages or any dan1age other than, or in addition to, actual damages. Purchaser shall have the right, in Purchaser’s sole discretion, to determine which rights, liens, security interests or remedies Purchaser may at any time pursue, relinquish, subordinate or modify or to take any other action and incur any costs or expenses with respect thereto and such determination will not in any way modify or affect any of Purchaser's rights hereunder. Purchaser shall have no liability hereunder for any delay in or failure to obtain Approval, or for any other causes beyond Purchaser’s control. Any liability of Purchaser for any default hereunder, including default in any payment to Creditor pursuant to Section 3 above, shall be limited solely to a return of the Claim to Creditor.

 

10.  Indemnification. Creditor covenants and agrees to indemnify, defend and hold Rockwell Capital Partners, Inc. and its agents, employees, representatives, officers, directors, stockholders, controlling persons and affiliates harmless arising from or incident or related to this Agreen1ent, pursuant to the terms of Exhibit “B” attached hereto and incorporated herein.

 

11.  Notices. All notices and other communications shall be in writing and shall be provided to the recipient Party to the addresses set forth on the signature page hereof. All notices and communications shall be deemed made and effective as follows: (a) if transmitted for overnight delivery via a nationally recognized delivery service, the first business day after being delivered by the transmitting Party to such  overnight delivery service, {b) if faxed, when transmitted in legible form by facsimile machine to the recipient Party’s correct facsimile machine number, (c) if by e-mail when transmitted by e-mail or(d) if mailed via regular U.S. mail, upon delivery. Any Party may designate a superseding notice contact name, street address, e-mail address or fax number by providing the other Parties with written notice pursuant to the provisions hereof.

  

12.  Amendments and Waivers. No provision of this Agreement may be waived or amended except in a written instrument signed, in the case of an amendment, by the Parties, or, in the case of a waiver, by the Party against whom enforcement of such waiver is sought. No waiver of any default shall be deemed to be a continuing or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any Party to exercise any right hereunder in any manner impair the exercise of any such right.

 

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13.  Construction; survival. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof. The language used in this Agreement will be deemed to be the language chosen by the Parties to express their mutual intent, and no rules of strict construction will be applied against any party. The representations and warranties contained herein shall survive the closing of the transactions contemplated herein and the assignment of the Claim.

 

14.  No Third Party Beneficiaries. This Agreement is intended for the benefit of Creditor and Purchaser and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by any other person.

 

15. Entire Agreement. This Agreement, together with the exhibits hereto, contains the entire agreement and understanding of the Parties, and supersedes all prior and contemporaneous agreements, letters, discussions, communications and understandings, both oral and written, concerning the sale, transfer, conveyance and assignment of the Claim, which the Parties acknowledge have been merged into this Agreement.

 

16. Signature. This Agreement may be executed in counterparts and by facsimile, portable document format or other electronic means, each of which shall constitute an original and all of which when taken together shall constitute one document.

  

CREDITOR:

 

 

By:      

Name:      

Title:      

Address:      

Telephone No.:      

Fax No.:      

E-mail:      

Wiring Instructions:      

  

PURCHASER: Rockwell Capital Partners, Inc.

 

 

By:   /s/ Samuel O’Shea  

Name: Samuel O’Shea

Title: Secretary

Address:  

919 North Market Street, Suite 101

Wilmington, Delaware 19801

 

Telephone No.: (305) 351-7728

E-mail: documents@rockwellcp.com

 

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