[-Signature Pages Follow-] SUBSCRIPTION AGREEMENT SIGNATURE PAGE

 

 

To: Alternative Energy & Environmental Solutions, Inc.

       159 North State Street

       Newton, PA 18940

Gentlemen:

1.           Subscription.

The undersigned (the “Purchaser”), intending to be legally bound, hereby irrevocably agrees to purchase from Alternative Energy & Environmental Solutions, Inc., a Nevada corporation (the “Company”), the number of units (the “Units”) set forth on the Signature Page at the end of this subscription agreement (the “Agreement”) at a purchase price of $0.75 per Unit (the “Offering”), upon the terms and conditions hereinafter set forth. Each Unit shall consist of: (i) one (1) share of the Company’s common stock, par value $.0001 (the “Common Stock” or the “Shares”), and (ii) two (2) warrants to purchase Shares of the Company’s Common Stock which shall be immediately exercisable at a price of $2.50 per share or immediately callable by the Compa ny if the Company’s Common Stock trades for a period of 20 consecutive trading days at an average price of $3.00 per share or greater (the “Warrants”). This subscription is submitted to the Company in accordance with and subject to the terms and conditions described in this Agreement and in the Private Placement Memorandum dated June [●], 2010 (the “Private Placement Memorandum”).

The Purchaser is delivering (i) the subscription payment made payable to Alternative Energy & Environmental Solutions, Inc., (ii) two executed copies of the Signature Page at the end of this Agreement, and (iii) one executed copy of Purchaser Questionnaire for Individuals (if appropriate), attached hereto as Exhibit II, to:

Alternative Energy & Environmental Solutions, Inc.

159 North State Street

Newton, PA 18940

The Purchaser understands that the Units are being issued pursuant to the exemption from the registration requirements of the United States Securities Act of 1933, as amended (the “Securities Act”), provided by Regulation D, Rule 506 of the Securities Act. As such, the Units are only being offered and sold to investors who qualify as “accredited investors,” and a limited number of “sophisticated investors” (as defined in Regulation D), and the Company is relying on the representations made by the Purchaser in this Agreement that the Purchaser qualifies as such an accredited or sophisticated investor. The Units and the shares of Common Stock underlying the Units are “restricted securities” for purposes of the United States securities laws and cannot be transferred except as permitted unde r these laws.

2.                      Acceptance of Subscription.

The Offering will be open until the earlier to occur of (i) February 15, 2011; or (ii) the sale of all of the Units, unless extended by us for up to an additional 60 day period, in our sole discretion.

 

 

3.                      Private Placement Memorandum.

The Purchaser hereby acknowledges receipt of a copy of the Private Placement Memorandum dated June [●], 2010.

4.                      Representations and Warranties.

4.1.           The Company represents and warrants to, and agrees with the Purchaser as follows, in each case as of the date hereof and in all material respects as of the date of any closing, except for any changes resulting solely from the Offering:

(a) The Company is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation with full power and authority to own, lease, license and use its properties and assets and to carry out the business in which it is engaged as described in the Private Placement Memorandum. The Company is in good standing as a foreign corporation in every jurisdiction in which its ownership, leasing, licensing or use of property or assets or the conduct of its business makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company.

(b) The authorized capital stock of the Company will consist of 100,000,000 shares of Common Stock, par value $.0001 per share, and 10,000,000 shares of preferred stock, par value $.0001 per share.

There is no commitment, plan or arrangement to issue, and no outstanding option, warrant or other right calling for the issuance of, any share of capital stock of the Company or any security or other instrument which by its terms is convertible into, exercisable for or exchangeable for capital stock of the Company, except, as may be described in the Private Placement Memorandum. There is no outstanding security or other instrument which by its terms is convertible into or exchangeable for capital stock of the Company, except as may be described in the Private Placement Memorandum.

(c)There is no litigation, arbitration, claim, governmental or other proceeding (formal or informal), or investigation pending or, to the best knowledge of the officers of the Company, threatened with respect to the Company, or any of its subsidiaries, operations, businesses, properties or assets except as may be described in the Private Placement Memorandum or such as individually or in the aggregate do not now have and could not reasonably be expected have a material adverse effect upon the operations, business, properties or assets of the Company.

 

 

(d) The Company is not in violation of, or in default with respect to, any law, rule, regulation, order, judgment or decree except as may be described in the Private Placement Memorandum or such as in the aggregate do not now have and will not in the future have a material adverse effect upon the operations, business, properties or assets of the Company; nor is the Company required to take any action in order to avoid any such violation or default.

(e) The Company has all requisite power and authority (i) to execute, deliver and perform its obligations under this Agreement, and (ii) to issue and sell the Units in the Offering.

(f) No consent, authorization, approval, order, license, certificate or permit of or from, or declaration or filing with, any United States federal, state, local, or other applicable governmental authority, or any court or any other tribunal, is required by the Company for the execution, delivery or performance by the Company of this Agreement or the issuance and sale of the Units, except such filings and consents as may be required and have been or at the initial closing will have been made or obtained under the laws of the United States federal and state securities laws.

(g) The execution, delivery and performance of this Agreement and the issuance of the Units will not violate or result in a breach of, or entitle any party (with or without the giving of notice or the passage of time or both) to terminate or call a default under any agreement or violate or result in a breach of any term of the Company's Articles of Incorporation or Bylaws of, or violate any law, rule, regulation, order, judgment or decree binding upon, the Company, or to which any of its operations, businesses, properties or assets are subject, the breach, termination or violation of which, or default under which, would have a material adverse effect on the operations, business, properties or assets of the Company.

(h) The Units issuable in this Offering are validly authorized and, if and when issued in accordance with the terms and conditions set forth in the Private Placement Memorandum and in this Agreement, will be validly issued, fully paid and non-assessable without any personal liability attaching to the ownership thereof, and will not be issued in violation of any preemptive or other rights of stockholders.

(i) The Private Placement Memorandum and this Agreement do not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. Without limiting the generality of the foregoing, there has been no material adverse change in the financial condition, results of operations, business, properties, assets, liabilities, or, to the knowledge of the Company, future prospects of the Company from the information set forth in the Private Placement Memorandum.

 

 

4.2.           The Purchaser hereby represents and warrants to, and agrees with, the Company as follows:

(a) The Purchaser is an “accredited investor” as that term is defined in Rule 501 (a) of Regulation D promulgated under the Securities Act, and as specifically indicated in Exhibit I attached to this Agreement.

(b) The Purchaser is a “sophisticated investor” as that term is defined in Rule 506(b)(2)(ii) of Regulation D promulgated under the Securities Act.

(c) For California and Massachusetts individuals: If the subscriber is a California resident, such subscriber’s investment in the Company will not exceed 10% of such subscriber’s net worth (or joint net worth with his or her spouse). If the subscriber is a Massachusetts resident, such subscriber’s investment in the Company will not exceed 25% of such subscriber’s joint net worth with such subscriber’s spouse (exclusive of principal residence and its furnishings).

(d) If a natural person, the Purchaser is a bona fide resident of the state or non-United States jurisdiction contained in the address set forth on the Signature Page of this Agreement as the Purchaser’s home address, at least 21 years of age, and legally competent to execute this Agreement. If an entity, the Purchaser has its principal offices or principal place of business in the state or non-United States jurisdiction contained in the address set forth on the Signature Page of this Agreement, the individual signing on behalf of the Purchaser is duly authorized to execute this Agreement and this Agreement constitutes the legal, valid and binding obligation of the Purchaser enforceable against the Purchaser in accordance with its terms.

(e) The Purchaser has received, read carefully and is familiar with this Agreement and the Private Placement Memorandum.

(f) The Purchaser is familiar with the Company’s business, plans and financial condition, the terms of the Offering and any other matters relating to the Offering, the Purchaser has received all materials which have been requested by the Purchaser, has had a reasonable opportunity to ask questions of the Company and its representatives, and the Company has answered all inquiries that the Purchaser or the Purchaser’s representatives have put to it. The Purchaser has had access to all additional information necessary to verify the accuracy of the information set forth in this Agreement and the Private Placement Memorandum and any other materials furnished herewith, and have taken all the steps necessary to evaluate the merits and risks of an investment as proposed hereunder.

(g) The Purchaser (or the Purchaser’s representative) has such knowledge and experience in finance, securities, taxation, investments and other business matters so as to be able to protect the interests of the Purchaser in connection with this transaction, and the Purchaser’s investment in the Company hereunder is not material when compared to the Purchaser’s total financial capacity.

 

 

(h) The Purchaser understands the various risks of an investment in the Company as proposed herein and can afford to bear such risks, including, without limitation, the risks of losing the entire investment.

(i) The Purchaser acknowledges that no market presently exists for the Shares of Common Stock underlying the Units and none may develop in the future and that the Purchaser may find it impossible to liquidate the investment at a time when it may be desirable to do so, or at any other time.

(j) The Purchaser has been advised by the Company that none of the Shares of Common Stock underlying the Units have been registered under the Securities Act, that the Shares of Common Stock underlying the Units will be issued on the basis of the statutory exemption provided by Rule 506 of the Securities Act or Regulation D promulgated thereunder, or both, relating to transactions by an issuer not involving any public offering and under similar exemptions under certain state securities laws; that this transaction has not been reviewed by, passed on or submitted to any federal or state agency or self-regulatory organization where an exemption is being relied upon; and that the Company’s reliance thereon is based in part upon the representations made by the Purchaser in this Agreement.

(k) The Purchaser acknowledges that the Purchaser has been informed by the Company of or is otherwise familiar with, the nature of the limitations imposed by the Securities Act and the rules and regulations thereunder on the transfer of the Shares of Common Stock underlying the Units. In particular, the Purchaser agrees that no sale, assignment or transfer of any of the Shares of Common Stock underlying the Units shall be valid or effective, and the Company shall not be required to give any effect to such a sale, assignment or transfer, unless (i) the sale, assignment or transfer of such Shares is registered under the Securities Act, it being understood that the Shares are not currently registered for sale and that the Company has no obligation or intention to so register the Shares, except as contemplated by the terms of this Agreem ent or (ii) such Shares are sold, assigned or transferred in accordance with all the requirements and limitations of Rule 144 under the Securities Act (it being understood that Rule 144 is not available at the present time for the sale of the Shares), or (iii) such sale, assignment or transfer is otherwise exempt from registration under the Securities Act, including Regulation S promulgated thereunder. The Purchaser further understands that an opinion of counsel and other documents may be required to transfer the Shares.

(l) The Purchaser acknowledges that the Units shall be subject to a stop transfer order and the certificate or certificates evidencing any Units shall bear the following or a substantially similar legend or such other legend as may appear on the forms of Shares of Common Stock underlying the Units and such other legends as may be required by state blue sky laws:

 

 

(m) The Purchaser will acquire the Units for the Purchaser’s own account (or for the joint account of the Purchaser and the Purchaser’s spouse either in joint tenancy, tenancy by the entirety or tenancy in common) for investment and not with a view to the sale or distribution thereof or the granting of any participation therein, and has no present intention of distributing or selling to others any of such interest or granting any participation therein.

(n) No representation, guarantee or warranty has been made to the Purchaser by any broker, the Company, any of the officers, directors, stockholders, partners, employees or agents of either of them, or any other persons, whether expressly or by implication, that:

(I) the Company or the Purchaser will realize any given percentage of profits and/or amount or type of consideration, profit or loss as a result of the Company’s activities or the Purchaser’s investment in the Company; or

(II) the past performance or experience of the management of the Company, or of any other person, will in any way indicate the predictable results of the ownership of the Units or of the Company's activities.

(o) No oral or written representations have been made other than as stated in the Private Placement Memorandum, and no oral or written information furnished to the Purchaser or the Purchaser’s advisor(s) in connection with the Offering were in any way inconsistent with the information stated in the Private Placement Memorandum.

(p) The Purchaser is not subscribing for the Units as a result of or subsequent to any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over television or radio, or presented at any seminar or meeting, or any solicitation of a subscription by a person other than a representative of the Company with which the Purchaser had a pre-existing relationship in connection with investments in securities generally.

(q) The Purchaser is not relying on the Company with respect to the tax and other economic considerations of an investment.

(r) The Purchaser understands that the net proceeds from all subscriptions paid and accepted pursuant to the Offering (after deduction for commissions, discounts and expenses of the Offering) will be used in all material respects for the purposes set forth in the Private Placement Memorandum.

 

 

(s) Without limiting any of the Purchaser’s other representations and warranties hereunder, the Purchaser acknowledges that the Purchaser has reviewed and is aware of the risk factors described in the Private Placement Memorandum.

(t) The Purchaser acknowledges that the representations, warranties and agreements made by the Purchaser herein shall survive the execution and delivery of this Agreement and the purchase of the Units.

(u) The Purchaser has consulted his own financial, legal and tax advisors with respect to the economic, legal and tax consequences of an investment in the Units and has not relied on the Private Placement Memorandum or the Company, its officers, directors or professional advisors for advice as to such consequences.

5.                      Indemnification.

6.                      Provisions of Certain State Laws.

 

 

 

7. Additional Information.

The Purchaser hereby acknowledges and agrees that the Company may make or cause to be made such further inquiry and obtain such additional information as they may deem appropriate, with regard to the suitability of the Purchaser.

 

IN WITNESS THEREOF, the Purchaser exercises and agrees to be bound by this Agreement by executing the Signature Page attached hereto on the date therein indicated.

 

 

By executing this Signature Page, the Purchaser hereby executes, adopts and agrees to all terms, conditions and representations of this Subscription Agreement and acknowledges all requirements are met by the purchaser to purchase Units in the Company.

Number of Units Subscribed at $.75 per Unit:  ___________________________________

Aggregate Purchase Price: $  ____________________________________________________

Type of ownership:                             ____________                                Individual

____________                                Joint Tenants

____________                                Tenants by the Entirety

____________                                Tenants in Common

____________                                Subscribing as Corporation or Partnership

____________                                Other

IN WITNESS WHEREOF, the Purchaser has executed this Signature

Page this __________   day of __________________________   , 2010.

 

ALTERNATIVE ENERGY & ENVIRONMENTAL SOLUTIONS, INC. hereby accepts the subscription of ________________Units as of the

____________day of _________________, 2010.

ALTERNATIVE ENERGY & ENVIRONMENTAL SOLUTIONS, INC.

By:  /s/ Scott Williams

Name:  Scott Williams

Title:  President and Director

 

 

Purpose of this Questionnaire.

Units of Alternative Energy & Environmental Solutions, Inc., a Nevada corporation (the “Company”), are being offered without registration under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of certain states, in reliance on the private offering exemption contained in Rule 506 of the Securities Act and on Regulation D of the Securities and Exchange Commission thereunder (“Regulation D”), and in reliance on similar exemptions under certain applicable state laws. The purpose of this Purchaser Questionnaire is to assure the Company that the proposed purchaser meets the standards imposed for the application of such exemptions including, but not limited to, whether the proposed purchaser qualifies as an “accr edited investor” as defined in Rule 501 under the Act or a “sophisticated investor” as defined in Rule 506 under the Act. Your answers will at all times be kept strictly confidential. However, by signing this Purchaser Questionnaire you agree that the Company may present this Purchaser Questionnaire to such parties as the Company may deem appropriate if called upon under the law to establish the availability of any exemption from registration of the private placement or if the contents hereof are relevant to any issue in any action, suit or proceeding to which the Company is a party or by which it may be bound. The Purchaser realizes that this Purchaser Questionnaire does not constitute an offer by the Company to sell Units but is a request for information.

One (1) copy of this Questionnaire should be completed, signed, dated and delivered to:

Alternative Energy & Environmental Solutions, Inc.

159 North State Street

Newton, PA 18940

Please contact  _________________ if you have any questions with respect to the Questionnaire at (___) ___-____.

I.           General Information:

Name:  ________________________________

Date of Birth:  ______________________________

Residence Address:  _______________________________________________________________

Business Address:  ________________________________________________________________

 

 

Home Telephone No.: ______________________________________________________________

Business Telephone No:  ____________________________________________________________

E-mail Address:  ___________________________________________________________________

Preferred Mailing Address: ________ Business  or  _________   Home  (check one)

Social Security Number:  ____________________________________________________________

Marital Status:  ____________________________________________________________________

Date:________________  _______________________________________________

(Printed Name)

Place:  ____________________________________

__________________________________________

(Signature)

__________________________________________

(Printed Name of Joint Subscriber)