Document:

ex10_1.htm

     

    
      

      

    

    
      

       

      STOCK ISSUANCE
AGREEMENT

      

      

      STOCK
ISSUANCE AGREEMENT dated the 10th day
of September, 2010

      

      BETWEEN:

      

      AMERICAN POWER CORP., a Nevada
domestic corporation, with offices at 16 Market Square Centre, 1400 16th
Street, Ste 400, Denver CO 80202, USA (hereinafter, the "Company")

      

      AND:

      BLACK SANDS HOLDINGS INC., a
corporation organized under the laws of the Marshall Islands, with registered
address on Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro,
Marshall Islands, MH 96960 (hereinafter, the "Subscriber")

      

      NOW THEREFORE THIS STOCK
ISSUANCE AGREEMENT
(“Agreement”) WITNESSES that the parties hereto agree as
follows:

      

      ARTICLE 1 –
DEFINITIONS

      

      Section 1.1. Definitions. When
used in this Agreement (including the recitals and schedules hereto) or in any
amendment hereto, the following terms shall, unless otherwise expressly
provided, have the meanings assigned to them herein:

      

      
        	
                ·  

              	
                “Banking Day” shall mean
      any day other than a Saturday, Sunday, public holiday under the laws of
      the State of Nevada or other day on which banking institutions are
      authorized or obligated to close in
Nevada.

              

      

      

      
        	
                ·  

              	
                “Charter Documents”
      means constating documents and by-laws, and all amendments
      thereto;

              

      

      

      
        	
                ·  

              	
                “Consent” means any
      permit, license, approval, consent, order, right, certificate, judgment,
      writ, injunction, award, determination, direction, decree, authorization,
      franchise, privilege, grant, waiver, exemption and other concession or
      by-law, rule or regulation;

              

      

      

      
        	
                ·  

              	
                “Unit Price” means a
      price equal to 75% of the volume weighted average of the closing price
      (the “VWAP”) of Common Stock, for the ten (10) Banking Days immediately
      preceding the date of the Notice, as quoted on http://www.nasdaq.com/, or
      other source of stock quotes as agreed to by the parties;
    and

              

      

      

      
        	
                ·  

              	
                “Dollar” or “$” means the currency
      of the United States of America.

              

      

      

      ARTICLE 2 - THE STOCK
ISSUANCE

      

      Section 2.1. STOCK ISSUANCE.
The Subscriber shall make available to the Company in accordance with,
and subject to the terms and conditions of, this Agreement, until March 31, 2013
(the "Completion Date"),
up to $10,000,000 by way of Advances in accordance with this Sections
2.2, 2.3 and 2.4 of this Agreement. The Completion Date may be extended for an
additional term of up to twelve months at the option of the Company or the
Subscriber upon written notice on or before the Completion Date in accordance
with the notice provisions in Section 6.1 of this Agreement.

      

      Section 2.2. The Advances. On
the terms and conditions set forth herein the Subscriber, from time to time, on
any Banking Day, prior to the Completion Date, agrees to make advances to the
Company ("Advances").
Each Advance shall be in an aggregate amount of not more than $1,000,000 and in
integral multiples of $100,000. The funding made available to the Company within
any three-month period shall not exceed $1,000,000 unless mutually agreed by the
parties.

      

      Section 2.3. Procedure to Request
Advances. Each Advance shall be made on or before five Banking Days
following notice from the Company. Each such notice shall be given by a notice
to the Subscriber in the form substantially the same as the form attached hereto
in Schedule A (each a "Notice").

      

      Section 2.4. Subscription Agreement.
Upon making each Advance, the Subscriber shall provide an executed
Subscription Agreement, in a form acceptable to both parties to this Agreement,
to the Company.

      

      Section 2.5. Use of Proceeds.
The Company shall use all Advances to fund operating expenses,
acquisitions, working capital and general corporate activities.

      

      ARTICLE 3 - REPRESENTATIONS
AND WARRANTIES

      

      Section 3.1. Representations and
Warranties of the Company. The Company represents and warrants to the
Subscriber:

      

      
        	
                 
      

              	
                (a)

              	
                Organization
      and Corporate Power. The Company has been duly incorporated and organized
      and is validly subsisting and in good standing under the laws of its
      jurisdiction and has full corporate right, power and authority to enter
      into and perform its obligations under the Agreement to which it is or
      shall be a party and has full corporate right, power and authority to own
      and operate its properties and to carry on its
  business;

              

      

      

      
        	
                 
      

              	
                (b)

              	
                Conflict
      with Other Instruments. The execution and delivery by the Company of the
      Agreement and the performance by the Company of its obligations
      thereunder, do not and will not: (i) conflict with or result in a breach
      of any of the terms, conditions or provisions of: (A) the Charter
      Documents of the Company; (B) any law applicable to or binding on the
      Company; or (C) any contractual restriction binding on or affecting the
      Company or its properties the breach of which would have a material
      adverse effect on the Company; or (ii) result in, or require or permit:
      (A) the imposition of any lien on or with respect to the properties now
      owned or hereafter acquired by the Company; or (B) the acceleration of the
      maturity of any debt of the Company, under any contractual provision
      binding on or affecting the
Company;

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Consents,
      Official Body Approvals. The execution and delivery of the Agreement and
      the performance by the Company of its obligations thereunder have been
      duly authorized by all necessary action on the part of the Company, and no
      Consent under any applicable law and no registration, qualification,
      designation, declaration or filing with any official body having
      jurisdiction over the Company is or was necessary therefor. The Company
      possesses all Consents, in full force and effect, under any applicable
      law, which are necessary in connection with the operation of its business,
      the non-possession of which could reasonably be expected to have a
      material adverse effect on the
Company;

              

      

      

      
        	
                 
      

              	
                (d)

              	
                Execution
      of Binding Obligation. The Agreement has been duly executed and delivered
      by the Company and, when duly executed by the Company and delivered for
      value, the Agreement will constitute legal, valid and binding obligations
      of the Company, enforceable against the Company, in accordance with its
      terms;

              

      

      

      
        	
                 
      

              	
                (e)

              	
                No
      Litigation. There are no actions, suits or proceedings pending or, to the
      knowledge of the Company, after due inquiry, threatened against or
      affecting the Company (nor, to the knowledge of the Company, after due
      inquiry, any basis therefor) before any official body having jurisdiction
      over the Company which purport to or do challenge the validity or
      propriety of the transactions contemplated by the Stock Issuance the
      Company, which if adversely determined could reasonably be expected to
      have a material adverse effect on the
Company;

              

      

      

      
        	
                 
      

              	
                (g)

              	
                Absence
      of Changes. Since the date of the most recently delivered financial
      statements of the Company, the Company has carried on its business,
      operations and affairs only in the ordinary and normal course consistent
      with past practice.

              

      

      

      Section
3.2.  Representations and Warranties of the
Subscriber.  The Subscriber represents and warrants to the
Company:

      

      
        	
                 
      

              	
                (a)

              	
                Organization
      and Corporate Power. The Subscriber has been duly incorporated and
      organized and is validly subsisting and in good standing under the laws of
      its jurisdiction and has full corporate right, power and authority to
      enter into and perform its obligations under the Agreement to which it is
      or shall be a party and has full corporate right, power and authority to
      own and operate its properties and to carry on its
    business;

              

      

      

      
        	
                 
      

              	
                (b)

              	
                Consents,
      Official Body Approvals. The execution and delivery of the Agreement and
      the performance by the Subscriber of its obligations thereunder have been
      duly authorized by all necessary action on the part of the Subscriber, and
      no Consent under any applicable law and no registration, qualification,
      designation, declaration or filing with any official body having
      jurisdiction over the Subscriber is or was necessary therefor. The
      Subscriber possesses all Consents, in full force and effect, under any
      applicable law, which are necessary in connection with the operation of
      its business, the non-possession of which could reasonably be expected to
      have a material adverse effect on the
  Subscriber;

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Execution
      of Binding Obligation. The Agreement has been duly executed and delivered
      by the Subscriber and, when duly executed by the Subscriber and delivered
      for value, the Agreement will constitute legal, valid and binding
      obligations of the Subscriber, enforceable against the Subscriber, in
      accordance with its terms.

              

      

      

      ARTICLE 4 - COVENANTS OF THE
COMPANY

      

      Section 4.1. Affirmative Covenants.
Until the Completion Date, the Company shall:

      

      
        	
                 
      

              	
                (a)

              	
                Compliance with Laws, etc.
      Comply with all applicable laws, non-compliance with which could
      have a material adverse effect on the
Company;

              

      

      

      
        	
                 
      

              	
                (b)

              	
                Payment of Taxes and Claims.
      Pay and discharge before the same shall become delinquent: (i) all
      taxes and assessments; and (ii) all lawful claims which, if unpaid, might
      become a lien upon or in respect of the Company's assets or
      properties;

              

      

      

      
        	
                 
      

              	
                (c)

              	
                Maintain Title. Maintain
      and, as soon as reasonably practicable, defend and take, all action
      necessary or advisable at any time, and from time to time, to maintain,
      defend, exercise or renew its right, title and interest in and to all of
      its property and assets;

              

      

      

      
        	
                 
      

              	
                (d)

              	
                Pay Obligations to Subscriber
      and Perform Other Covenants. Make full and timely payment of its
      obligations hereunder and duly comply with the terms and covenants
      contained in this Agreement, all at the times and places and in the manner
      set forth therein;

              

      

      

      
        	
                 
      

              	
                (e)

              	
                Further Assurances. At
      its cost and expense, upon request by the Subscriber, duly execute and
      deliver, or cause to be duly executed and delivered, to the Subscriber,
      such further instruments and do and cause to be done such other acts as
      may be necessary or proper in the reasonable opinion of the Subscriber to
      carry out more effectually the provisions and purposes of this
      Agreement.

              

      

      

      
        ARTICLE 5 – STOCK
ISSUANCE

         

      

      Section 5.1 Stock
Issuance.  The Company shall issue, within ten (10) Banking
Days following the date of the receipt by the Company of any Advance under this
Agreement, units (each a “Unit”) of the Company at the
Unit Price.  Each Unit shall consist of one (1) share (each a “Share”) of the common stock of
the Company (the “Common
Stock”) and one share
purchase warrant (each a “Warrant”).  Each
Warrant shall entitle the Subscriber to purchase one additional share (each a
“Warrant Share”) of
Common Stock, at an exercise price equal to 150% of the Unit Price at which the
Unit containing the Warrant being exercised was issued, for a period of three
(3) years from the date such Warrant is issued.  Upon receipt of any
Advance under this Agreement, the Company shall promptly cause its registrar and
transfer agent to issue the certificates representing the Shares. If the
Subscriber exercises the Warrants, the Company shall promptly cause its
registrar and transfer agent to issue the certificates representing the Warrant
Shares.

      

      Section 5.2 Fractional
Shares.  Notwithstanding any other provisions of this
Agreement, no certificate for fractional shares of the Shares or the Warrant
Shares shall be issued to the Subscriber.  In lieu of any such
fractional shares or warrants, if the Subscriber would otherwise be entitled to
receive a fraction of a Share, Warrant or Warrant Shares following an Stock
Issuance or
exercise of a Warrant, as applicable, the Subscriber shall be entitled to
receive from the Company a stock certificate representing the nearest whole
number of shares of the Company, or in the case of an Advance that results in
the issuance of one-half of a Warrant, the Company shall issue the Subscriber a
Warrant certificate representing the nearest whole number of Warrant
Shares.

      

      ARTICLE 6 -
MISCELLANEOUS

      

      Section 6.1. Notices, etc.
Except as otherwise expressly provided herein, all notices, requests,
demands, directions and communications by one party to the other shall be sent
by hand delivery or registered mail or fax, and shall be effective when hand
delivered or when delivered by the relevant postal service or when faxed and
confirmed, as the case may be. All such notices shall be addressed to the
President of the notified party at its address given on the signature page of
this Agreement, or in accordance with any unrevoked written direction from such
party to the other party.

      

      Section 6.2. No Waiver; Remedies.
No failure on the part of the Subscriber or the Company to exercise, and
no delay in exercising, any right under this Agreement shall operate as a waiver
thereof. The remedies herein provided are cumulative and not exclusive of any
remedies provided by Law.

      

      Section 6.3. Jurisdiction. (1)
Each of the parties hereby irrevocably attorns to the non-exclusive jurisdiction
of the Courts of the State of Nevada in any action or proceeding arising out of
or relating to this Agreement. The Company agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by Law;
and (2) nothing in this Section 6.3 shall affect the right of the Subscriber to
serve legal process in any other manner permitted by Law or affect the right of
the Subscriber to bring any action or proceeding against the Company or its
property in the courts of other jurisdictions.

      

      Section 6.4. Successors and Assigns.
The Company shall not have the right to assign its rights hereunder or
any interest herein without the prior written consent of the Subscriber, which
consent may be arbitrarily withheld.

      

      Section 6.5. Severability. If
one or more provisions of this Agreement be or become invalid, or unenforceable
in whole or in part in any jurisdiction, the validity of the remaining
provisions of this Agreement shall not be affected. The parties hereto undertake
to replace any such invalid provision without delay with a valid provision which
as nearly as possible duplicates the economic intent of the invalid
provision.

      

      Section 6.6. Counterparts.
This Agreement may be executed in counterparts and by different parties
in separate counterparts, each of which when so executed shall be deemed an
original and all of which, taken together, shall constitute one and the same
instrument.

      

      Section 6.7.
Syndication/Participation. The Subscriber may not sell, transfer, assign,
participate, syndicate or negotiate to one or more third parties, in whole or in
part, the Commitment and its rights under this Agreement, without the prior
written consent of the Company, which consent may not be arbitrarily
withheld.

      

      [SIGNATURE
PAGE FOLLOWS]

      

      IN WITNESS WHEREOF the parties
hereto have caused this Agreement to be executed by their respective officers
thereunto duly authorized, as of the date first above written.

      

      

      
        	
                THE SUBSCRIBER

                 

                BLACK
      SANDS HOLDINGS INC.

                 

                 

                By:                                                                

                Authorized
      Signing Officer

              	
                THE COMPANY

                 

                AMERICAN
      POWER CORP.

                 

                 

                By:                                                                

                Authorized
      Signing Officer

                 

              

      

      

      Address
for
Notice:                                                                                     Address
for Notice:

      16
Market Square Centre

      1400
16th Street, Ste
400,

      Denver
CO 80202, USA

      Fax:
+1.720.932.8189

       

      SCHEDULE
A

      

      NOTICE

      

      Messrs
Black Sands Holdings Inc.

       

      The
undersigned, AMERICAN POWER
CORP. (the “Company”) hereby requests an advance of
US$__________________, in accordance with the terms and conditions set forth in
the Stock Issuance Agreement dated September 10th,
2010, between the Subscriber and the Company and as of the Date of Notice
written below.

       

      Date of
Notice:                                ________________

       

      Remaining
amount to be advanced under the Share
Issuance:                                                                                                                                US$
_____________

       

      Price
Calculation:

       

      
        	
                Date

              	
                Closing
      Price

              	
                Volume
      

              	 
      	
                Calculations

              	 
      	 
      
	
                Date
      1

              	
                #

              	
                #

              	 
      	 
      	 
      	 
      
	
                Date
      2

              	
                #

              	
                #

              	 
      	
                A)
      Weighted Average Price

              	
                :

              	
                #.##

              
	
                Date
      3

              	
                #

              	
                #

              	 
      	
                B)
      75% of A

              	
                :

              	
                #.##

              
	
                Date
      4

              	
                #

              	
                #

              	 
      	
                C)
      Amount of Subscription

              	
                :

              	
                $###,###.##

              
	
                Date
      5

              	
                #

              	
                #

              	 
      	
                D)
      Shares Subscribed (C/B) 

              	
                :

              	
                #

              
	
                Date
      6

              	
                #

              	
                #

              	 
      	
                E)
      Warrants Price (150% x B)

              	
                :

              	
                #.##

              
	
                Date
      7

              	
                #

              	
                #

              	 
      	
                F)
      Warrant Shares (1:2)

              	
                :

              	
                #

              
	
                Date
      8

              	
                #

              	
                #

              	 
      	 
      	 
      	 
      
	
                Date
      9

              	
                #

              	
                #

              	 
      	 
      	 
      	 
      
	
                Date
      10

              	
                #

              	
                #

              	 
      	 
      	 
      	 
      

      

       

      
 

      
        	
                AMERICAN
      POWER CORP.

                 

                 

                Per:
      ____________________________

                Authorized
      Representative

              	 
      
	 
      	
                The
      Subscriber hereby acknowledges receipt of this Notice and agrees with the
      amounts set out above as of this Notice.

                 

                 

                BLACK
      SANDS HOLDINGS INC.

                Per:                                                            

                Authorized
      Representativeex10_12.htm

     

    
      

      

    

    
      SETTLEMENT
AGREEMENT

       

      This
Settlement Agreement (this “Agreement”) is
entered into between America
Power Corp. ("Borrower" or the
“Company”) and
Black Sands Holdings
Inc. (the "Lender").  Borrower
and Lender are each a “Party” and
collectively, the “Parties”.

       

      RECITALS

       

      WHEREAS,
Borrower raised funds for general corporate purposes and borrowed funds from the
Lender to provide the Company with working capital to continue operations (the
“Obligation”); and

       

      WHEREAS,
the Parties desire to settle the Obligation owed by Borrower to Lender;
and

       

      WHEREAS,
neither the Lender nor third party vendor is affiliated with Borrower as defined
by the Securities and Exchange Acts of 1933 and 1934.

       

      NOW
THEREFORE, in consideration of the recitals, payments, covenants, and agreements
contained herein, and for other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the Parties agree as
follows:

       

      SETTLEMENT
TERMS

       

      
        	
                1.  

              	
                Release of
      Claims. In exchange for the release of claims by Lender against
      Borrower, Borrower agrees to enter into debt to equity conversion as a
      means of settling the outstanding loan amount of
      US$208,602.74.

              

      

       

      
        	
                2.  

              	
                Debt to Equity
      Conversion. Lender agrees to settle the outstanding amount owed to
      Lender from Borrower through acceptance of common stock (the “Shares”) of
      the Borrower. Such Shares will be issued at a conversion rate of $0.50. At
      said rate, it is agreed that 417,205 shares will satisfy the conversion in
      full. Shares will be issued with restrictive legend pursuant to Rule 144
      of the Securities & Exchange Commission Acts of 1933 and
      1944.

              

      

       

      
        	
                3.  

              	
                Effectiveness of
      Releases. The Releases granted in Section 5 below by Borrower in
      favor of Lender are effective immediately upon execution of this Agreement
      by the Parties. The Releases granted in Section 5 below by Lender in favor
      of Borrower become effective upon the occurrence the execution of this
      Agreement by the Parties.

              

      

       

      
        	
                4.  

              	
                Attorneys’
      Fees. In the event of a breach of this Agreement, the prevailing
      party is entitled to recover reasonable attorneys’ fees and costs, in
      addition to any other damages.

              

      

       

      
        	
                5.  

              	
                Mutual
      Releases. As consideration of all obligations contained herein, the
      Parties agree to the mutual releases of each other, including any
      officers, directors, employees, agents, representatives, subsidiaries,
      successors, predecessors, affiliates, heirs, devisees, servants,
      attorneys, assigns, and potential assigns (the “Releases”). These Releases
      shall extend to any and all manners of action, causes of action, suits,
      debts, sums of money, accounts, bonds, bills, covenants, contracts,
      controversies, agreements, promises, damages, expenses, claims and demands
      whatsoever, hereof, in contract, tort, statute, law, equity or otherwise,
      which the Parties had or have, upon or by reason of any fact, matter,
      cause or thing whatsoever.

              

      

       

      
        	
                6.  

              	
                Governing Law and
      Venue. This Agreement shall be exclusively governed by and
      construed according to the laws of the State of Nevada except that any
      conflicts of law rule requiring reference to the laws of another
      jurisdiction shall be disregarded. Venue for determination of any dispute
      arising under or related to this Agreement shall lie exclusively within
      Las Vegas, Nevada.

              

      

       

      
        	
                7.  

              	
                Representations and
      Warranties. Each Party hereby expressly warrants and represents
      that: (i) it has authority to act for itself or the lawful owner of its
      respective claims herein; (ii) it has full power and express authority to
      settle the claims as set forth in this Agreement; (iii) it has not made
      any assignment or transfer of the claims as set forth in this Agreement,
      including but not limited to assignment or transfer by subrogation or by
      operation of law; (iv) it knows of no person or entity that intends to
      assert a claim by, through, under, or on behalf of such Party; (v) it is
      not relying upon any statements, understandings, representations,
      expectations, or agreements other than those expressly set forth in this
      Agreement; (vi) it is represented and has been advised by counsel in
      connection with this Agreement, which such Party executes wholly
      voluntarily and of its own choice, volition, judgment, belief and
      knowledge, after consultation with such counsel and not under coercion or
      duress; (vii) it has made its own investigation of the facts and is
      relying solely upon its own knowledge and the advice of its counsel;
      (viii) it knowingly waives any claim that this Agreement was induced by
      any misrepresentation or nondisclosure and any right to rescind or avoid
      this Agreement based upon presently existing facts either known or
      reasonably ascertainable. The Parties agree and stipulate that each Party
      is relying upon these representations and warranties in entering into this
      Agreement.

              

      

       

      
        	
                8.  

              	
                Entire
      Agreement. This Agreement contains and constitutes the entire
      agreement and understandings of the Parties and supersede as of the
      execution date all prior negotiations, discussions, undertakings or
      agreements of any sort whatsoever, whether oral or written, or any claims
      that might have ever been made by one Party against any opposing Party.
      There are no representations, agreements, or inducements except as set
      forth expressly and specifically in this
  Agreement.

              

      

       

      
        	
                9.  

              	
                Amendments in
      Writing. This Agreement may only be amended or modified by a
      written instrument that has been executed by the Parties and that
      unequivocally indicates the Parties’ intentions. No waiver of any breach
      of this Agreement shall be construed as an implied amendment or agreement
      to amend or modify any provision of this
  Agreement.

              

      

       

      
        	
                10.  

              	
                No Author. All
      terms and provisions of this Agreement, and the drafting of this
      Agreement, have been negotiated by the Parties at arm’s length, with
      assistance of the attorneys and appropriate representatives of the
      Parties’ choosing, with consideration by and participation of each, and no
      party shall be deemed the scrivener of this
  Agreement.

              

      

       

      
        	
                11.  

              	
                Construction.
      Words used in the Agreement of any gender or neuter shall be construed to
      include any other gender or neuter where appropriate. Words used in this
      Agreement that are either singular or plural shall be construed to include
      the other where appropriate.

              

      

       

      
        	
                12.  

              	
                Captions and
      Headings. The Parties agree that the captions and headings
      contained in this Agreement are for convenience only and shall not be
      deemed to constitute a part of this
Agreement.

              

      

       

      
        	
                13.  

              	
                Multiple
      Counterparts. This Agreement may be executed in multiple
      counterparts, any and all of which may contain the signatures of less than
      all the Parties and all of which shall be construed together as a single
      document. Each counterpart shall be fully effective as an original when
      all of the Parties have executed this Agreement. Such counterparts may
      also be executed by facsimile
signature.

              

      

       

      
        	
                14.  

              	
                No Admission of
      Fault. Neither the execution of this Agreement nor compliance with
      its terms, nor the consideration provided for herein, shall constitute or
      be construed as an admission of any fault, wrongdoing or liability
      whatsoever on the part of any of the Parties, or any of their agents,
      attorneys, representatives, or employees, but is in full settlement of
      disputed issues, and all such liability is expressly
    denied.

              

      

       

      
        	
                15.  

              	
                No Waiver. The
      failure by any of the Parties to this Agreement to enforce at any time, or
      for any period of time, any one or more of the terms or conditions of this
      Agreement or a course of dealing between the Parties, shall not be a
      waiver of such terms or conditions or of such Party’s right thereafter to
      enforce each and every term and condition of this
    Agreement.

              

      

       

      AGREED:

       

      
        	
                Black
      Sands Holdings, Inc.

                
                   

                   

                  ______________________

                

                Authorized
      Representative

                Date:

              	
                American
      Power Corporation

                
                   

                   

                  ______________________

                

                Authorized
      Representative

                Date:

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