Exhibit 10.1

 

SETTLEMENT AGREEMENT AND STIPULATION

 

THIS SETTLEMENT AGREEMENT and Stipulation dated as of October 9th, 2019
(“Agreement”) by and between plaintiff Trillium Partners, LP (“TRILLIUM”), and
defendant Renewable Energy & Power, Inc. (“COMPANY”).

 

BACKGROUND:

 

WHEREAS, there is bona fide outstanding Claim against the Company in the
principal amount of not less than $219,460.18 which was owed by the Company to
Labrys Fund, LP pursuant to the terms of an unpaid promissory note originally
executed by the Company on June 26, 2017 and which was subsequently assigned to
TRILLIUM; and

 

WHEREAS, the Claim is past due; and

 

WHEREAS, TRILLIUM acquired the Claim on the terms and conditions set forth in
Settlement and Assignment Agreement dated October 9th, 2019, directly from
Labrys Fund, LP, subject however to compliance with the provisions hereof; and

 

WHEREAS, TRILLIUM and the Company desire to resolve, settle, and compromise the
Claim through the issuance of free-trading shares of the Company’s common stock
issued pursuant to Section 3(a)(10) of the Securities Act of 1933 (the “Act”),
subject to compliance with the provisions hereof.

 

NOW, THEREFORE, the parties hereto agree as follows:

 

1. 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.

 

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“CLAIM AMOUNT” shall mean $219,460.18.

 

“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 the Federal District Court located in Baltimore, Maryland.

 

“DTC” shall have the meaning specified in Section 3b.

 

“DWAC” shall have the meaning specified in Section 3b.

 

“FAST” shall have the meaning specified in Section 3b.

 

“PRINCIPAL MARKET” shall mean the Nasdaq National Market, the Nasdaq SmallCap
Market, the Over the Counter Bulletin Board, OTCXD, 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.

 

“SELLER” shall mean Labrys Fund, LP, which assigned the Claim to TRILLIUM.

 

“SETTLEMENT SHARES” shall have the meaning specified in Section 3a.

 

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

 

“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).

 

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2. Fairness Hearing. Upon the execution hereof, Company and TRILLIUM agree,
pursuant to Section 3(a) (10) of the Securities Act of 1933 (the “Act”), and the
applicable section of the General Statutes of Maryland, to promptly 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. a. Following entry of an Order by the Court in accordance
with Paragraph 2 herein and the delivery by TRILLIUM and Company of the
Stipulation of Dismissal (as defined below), in settlement of the Claim, the
Company shall issue and deliver to TRILLIUM shares of its Common Stock (the
“Settlement Shares”) in one or more tranches as necessary, and subject to
adjustment and ownership limitations as set forth below, sufficient to generate
proceeds such that the net proceeds from TRILLIUM’s sale of the Settlement
Shares equals the Claim Amount. TRILLIUM is entitled, at its option, to request
all or any lesser portion of the Claim Amount plus any /all accrued but unpaid
Interest into Common Stock at a conversion price per share equal to the lowest
closing bid price for the Company’s common stock during the twenty (20) trading
days immediately preceding the date of delivery by TRILLIUM to Company of the
Conversion Notice (the “Conversion Price”).

 

b. No later than the fifth Trading 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 TRILLIUM and such transfer agent, that the shares of
Common Stock to be issued as the initial issuance and any additional issuance
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 TRILLIUM without restriction pursuant to the Court Order; and (ii)
issue the Settlement Shares, in tranches as necessary, by physical delivery, or
as Direct Registration Systems (DRS) shares to TRILLIUM’s account with The
Depository Trust Company (DTC) or through the Fast Automated Securities Transfer
(FAST) Program of DTC’s Deposit/Withdrawal Agent Commission (DWAC) system,
without any legends or restriction on transfer pursuant to the Court Order. The
date upon which the initial tranche, or additional tranche, of the Settlement
Shares has been received into TRILLIUM’s account and are available for sale by
TRILLIUM shall be referred to as the “Issuance Date”.

 

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c. The Company shall deliver to TRILLIUM, through the initial tranche and any
required additional tranches, that number of Settlement Shares the proceeds of
sales of which will equal to the Claim Amount. The parties reasonably estimate
that the fair market value of the Settlement Shares to be received by TRILLIUM
is equal to approximately $219,460.18. To the extent that the Company issues
Settlement Shares in excess of that necessary to satisfy the aggregate Claim
Amount, TRILLIUM shall return any excess Settlement Shares to Company for
reinstatement as authorized, but unissued shares. The parties acknowledge that
the number of Settlement 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. Notwithstanding anything to the contrary contained herein, the Settlement
Shares beneficially owned by TRILLIUM 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 TRILLIUM, or deemed beneficially owned by TRILLIUM,
would result in TRILLIUM owning more than 9.99% 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.

 

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 required to be
delivered hereby, in consideration of the terms and conditions of this
Agreement, and except for the obligations, representations 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 Claim. Nothing contained herein shall be deemed to negate or affect
TRILLIUM’s right and title to any securities heretofore or hereafter issued to
it by Company or any subsidiary of Company.

 

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

 

a. There are 10,000,000,000 shares of Common Stock of the Company authorized, of
which 60,321,098 Shares of Common Stock are issued and outstanding as of
September 30, 2019;

 

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. Upon Court approval of this Stipulation and entry of the Order, the shares
will be exempt from registration under the Securities Act and issuable without
any restrictive legend;

 

d. The Company has, or will have, reserved from its duly authorized capital
stock a number of shares of Common Stock at least equal to the number of shares
that could be issued pursuant to the terms of the Order;

 

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
TRILLIUM 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 Claim, 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;

 

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g. Without limitation, the Company hereby waives any provision in any agreement
related to the Claim 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 (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 Claim in
contemplation of any distribution of Company’s common stock or other securities;

 

k. There has been no modification, compromise, forbearance, or waiver entered
into or given by the Company with respect to the Claim. There is no action based
on the Claim by the Company that is currently pending in any other court or
other legal venue;

 

1. There are no taxes due, payable or withholdable as an incident of the
provision of goods and services, and no taxes will be due, payable or
withholdable as a result of settlement of the Claim;

 

m. To the best of the Company’s knowledge, no Labrys Fund, LP is not, directly
or indirectly, utilizing any of the proceeds received from TRILLIUM for selling
the Claim to provide any consideration to or invest in any manner in the Company
or any affiliate of the Company;

 

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n. 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; and

 

o. Labrys Fund, LP 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 settling the Claim.

 

p. Company acknowledges that TRILLIUM or its affiliates may from time to time,
hold outstanding securities of the Company, including securities 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 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.

 

TRILLIUM hereby represents, warrants and covenants to Company as follows:

 

a. It acquired the Claim pursuant to the execution of the aforementioned
Settlement an Assignment Agreement, to whom payment is conditioned upon the full
performance by Company of the terms of this Agreement;

 

b. It is a limited liability company duly filed and in good standing under the
laws of Nevada; and

 

c. The execution, delivery and performance of this Stipulation by TRILLIUM has
been duly authorized by all requisite action on the part of TRILLIUM, and this
Stipulation has been duly executed and delivered by TRILLIUM.

 

7. Continuing Jurisdiction. 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 continuing 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.

 

8. Conditions Precedent/ Default.

 

a. If Company shall default in promptly delivering the Settlement Shares to
TRILLIUM in the form and mode of delivery as required by Section 3 herein;

 

b. If the Order shall not have been entered by the Court on or prior to December
31, 2019;

 

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

 

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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 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 have been established for securities traded on the
Principal Market; 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 TRILLIUM, makes it impracticable or
inadvisable to trade the Settlement Shares; and such suspension, limitation or
other action is not cured within ten (10) trading days; then, at the sole option
of TRILLIUM, TRILLIUM may deem the Company to be in default of the Agreement and
Order, and TRILLIUM may treat this Agreement as null and void.

 

9. Information. Company and TRILLIUM 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.

 

10. Ownership and Authority. Company and TRILLIUM 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
prolonged 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.

 

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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.

 

14. Covenants.

 

a. For so long as TRILLIUM or any of its affiliates holds any Settlement Shares,
neither Company nor any of its affiliates shall, without the prior written
consent of TRILLIUM (which may not be unreasonably withheld), 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) causing a class of securities of Defendant 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, (2) 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, (3) taking any action which would
impede the purposes and objects of this Settlement Agreement.

 

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b. Upon the signing of the Order by the Court, the Company shall file such
OTCMarkets.com or SEC filings as may be required in respect of this Settlement
Agreement.

 

15. Indemnification. Company shall indemnify, defend and hold TRILLIUM and its
affiliates harmless with respect to all obligations of Company arising from or
incident or related to this Agreement, including, without limitation, any claim
or action brought derivatively or directly by the Seller or shareholders of
Company.

 

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, subject to the conditions stated herein, and
each attorney represents that his or her client has freely consented to and
authorized this Agreement after have been so advised.

 

17. 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 reasonably
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.

 

18. 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. 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.

 

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19. 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 Maryland, 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 Federal District Court located in Baltimore, Maryland.

 

20. Exclusivity. For a period of one hundred twenty (120) days from the date of
the execution of this Agreement, (a) Company and its representatives shall not
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) TRILLIUM shall have the exclusive right to negotiate and execute
definitive documentation embodying the terms set forth herein and other mutually
acceptable terms.

 

21. 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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22. 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 therefor or by confirmed facsimile transmission,

 

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

 

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

 

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:

 

Renewable Energy & Power, Inc.
3395 W. Cheyenne Ave

Suite 111B

N. Las Vegas, Nevada 89032

 

Plaintiff:

 

Trillium Partners, LP

90 Grove Street, Suite 108
Ridgefield, CT 06877

 

with a copy to:

 

Matheau J. W. Stout, Esq.
201 International Circle
Suite 230

Hunt Valley, MD 21030
Tel (410) 429-7076

  

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

  

  TRILLIUM PARTNERS, LP         By: /s/ Stephen Hicks     Name: Stephen Hicks  
  Title: Manager         RENEWABLE ENERGY & POWER, INC.         By: /s/ Conrad
Huss     Name: Conrad Huss     Title: Chief Executive Officer

 

 

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