SECURITIES AND EXCHANGE COMMISSION
==================================
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
==================================
 
ALTERNATIVE ENERGY AND ENVIRONMENTAL SOLUTIONS, INC.
(Exact Name of Registrant in its Charter)

Nevada
1389
27-2830681
(State or other Jurisdiction of Incorporation)
(Primary Standard Industrial Classification Code)
(IRS Employer Identification No.)
     
159 North State Street
Newtown, PA 18940
Tel.: 215-968-1600
 (Address and Telephone Number of Registrant’s Principal
Executive Offices and Principal Place of Business)

CSC Services of Nevada, Inc.
502 East John Street
Carson City, NV 89706
(775) 883-3711
 (Name, Address and Telephone Number of Agent for Service)
 
Copies of communications to:
Gregg E. Jaclin, Esq.
Anslow & Jaclin, LLP
195 Route 9 South, Suite204
Manalapan, NJ 07726
Tel. No.: (732) 409-1212
 Fax No.: (732) 577-1188
 
Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. x
 
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, please check the following box and list the Securities Act registration Statement number of the earlier effective registration statement for the same offering.  o

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o
 
If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box.  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
 
 
 

 
 
Large accelerated filer
o
Accelerated filer
o
Non-accelerated filer
o
Smaller reporting company
x
       
 
                                                                                                                                            
CALCULATION OF REGISTRATION FEE
 
Title of Each Class Of Securities to be Registered
 
Amount to be
Registered (1)
   
Proposed Maximum
Aggregate
Offering Price
per share
   
Proposed Maximum
Aggregate
Offering Price
   
Amount of
Registration fee
 
Common Stock, $0.0001 par value per share
   
1,012,516
   
$
0.75(2)
   
$
759,387(2)
   
$
54.14
 
Common Stock, $0.0001 par value per share issuable upon exercise of the Warrants
   
2,025,032
   
$
2.50
   
$
5,062,580
   
$
360.96
 
Total registration Fees
   
3,037,548
           
$
5,821,967
   
$
415.10
 

(1)  This Registration Statement covers the resale by the selling shareholders of the Registrant of up to 3,037,548 shares of our common stock, $0.0001 par value (the “Common Stock”), including: (i) up to 1,012,516 shares of our Common Stock previously issued to such selling shareholders in a private placement; and (ii) up to 2,025,032 shares of our Common Stock issuable upon exercise of the outstanding warrants, exercisable at a price of $2.50 per share (the “Warrants”), that were issued in connection with the private placement that closed on July 31, 2010.
 
(2) The offering price has been estimated solely for the purpose of computing the amount of the registration fee in accordance with Rule 457(o). Our common stock is not traded on any national exchange and in accordance with Rule 457; the offering price was determined by the price of the shares that were sold to our shareholders in a private placement memorandum. The price of $0.75 per share is a fixed price at which the selling security holders may sell their shares until our common stock is quoted on the OTCBB at which time the shares may be sold at prevailing market prices or privately negotiated prices. There can be no assurance that a market maker will agree to file the necessary documents with the Financial Industry Regulatory Authority, which operates the OTC Bulletin Board, nor can there be any assurance that such an application for quotation will be approved.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SUCH SECTION 8(a), MAY DETERMINE.

The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the U.S. Securities and Exchange Commission (“SEC”) is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

 
 

 
 
PRELIMINARY PROSPECTUS
Subject to completion, dated ___­­­_________ , 2010
ALTERNATIVE ENERGY AND ENVIRONMENTAL SOLUTIONS, INC.
3,037,548 SHARES OF COMMON STOCK
 
The selling security holders named in this prospectus are offering all of the shares of common stock offered through this prospectus.  We will not receive any proceeds from the sale of the shares of outstanding common stock covered by this prospectus.  To the extent that the selling stockholders exercise in cash all of the Warrants at the exercise price of $2.50 per share, we would receive $5,062,580  in the aggregate from such exercise.  The proceeds from the cash exercise of such warrants, if any, will be used by us for working capital and other general corporate purposes.

Our common stock is presently not traded on any market or securities exchange. The selling security holders have not engaged any underwriter in connection with the sale of their shares of common stock.  Common stock being registered in this registration statement may be sold by selling security holders at a fixed price of $0.75 per share until our common stock is quoted on the OTC Bulletin Board (“OTCBB”) and thereafter at a prevailing market prices or privately negotiated prices or in transactions that are not in the public market. There can be no assurance that a market maker will agree to file the necessary documents with the Financial Industry Regulatory Authority (“FINRA”), which operates the OTCBB, nor can there be any assurance that such an application for quotation will be approved. We have agreed to bear the expenses relating to the registration of the shares of the selling security holders.

Investing in our common stock involves a high degree of risk. See “Risk Factors” beginning on page 7 to read about factors you should consider before buying shares of our common stock.

  NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
  
The Date of This Prospectus is: ___­­­_________, 2010
 
 
 

 
 
TABLE OF CONTENTS
 
 
 
PAGE
Prospectus Summary
  1
Summary of Financial Information
  3
Risk Factors
  4
Use of Proceeds
  8
Determination of Offering Price
  8
Dilution
  9
Selling Security Holders
  9
Plan of Distribution
  13
Description of Securities to be Registered
  14
Interests of Named Experts and Counsel
  15
Description of Business
  15
Description of Property
  17
Legal Proceedings
  17
Market for Common Equity and Related Stockholder Matters
  17
Index to Financial Statements
  F-
Management Discussion and Analysis of Financial Condition and Results of Operations
  II-1
Changes In And Disagreements With Accountants On Accounting And Financial Disclosure
  II-2
Directors, Executive Officers, Promoters And Control Persons
  II-2
Executive Compensation
  II-3
Security Ownership of Certain Beneficial Owners and Management
  II-4
Transactions with Related Persons, Promoters and Certain Control Persons
  II-5
Where You Can Find Additional Information
  II-5
Disclosure of Commission Position on Indemnification of Securities Act Liabilities
  II-5
Part II:   Information Not Required in the Prospectus
  II-7
Signatures
  II-12
 
Please read this prospectus carefully. It describes our business, our financial condition and results of operations. We have prepared this prospectus so that you will have the information necessary to make an informed investment decision.

You should rely only on information contained in this prospectus.  We have not authorized any other person to provide you with different information.  This prospectus is not an offer to sell, nor is it seeking an offer to buy, these securities in any state where the offer or sale is not permitted.  The information in this prospectus is complete and accurate as of the date on the front cover, but the information may have changed since that date.

 
 

 
 
PROSPECTUS SUMMARY
 
This summary highlights selected information contained elsewhere in this prospectus.  This summary does not contain all the information that you should consider before investing in the common stock.  You should carefully read the entire prospectus, including “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the Financial Statements, before making an investment decision. In this Prospectus, the terms “Alternative Energy and Environmental Solutions,” “Company,” “we,” “us” and “our” refer to Alternative Energy and Environmental Solutions, Inc.

Overview

We are a development stage company incorporated on June 10, 2010 under the laws of the State of Nevada. To date, we have no operations or revenues. Our initial operations have included organization and incorporation, target market identification, marketing plans, and capital formation. A substantial portion of our activities to date have involved developing a business plan and establishing contacts and visibility in the marketplace. Our plan is to market an innovative new biotechnology that utilizes nutrient stimulants – organic microbes – to extract coal bed methane more efficiently in high-production as well as from low-producing, depleted and abandoned coalmines in the United States. Coal bed methane is a clean-burning natural gas used for heating in homes and is used to generate electricity. Activities during our development stage include developing the business plan and raising capital. We are based in Newtown, Pennsylvania.
 
We plan to license this patent-pending biotechnology to owners and operators of coal mines in the Power River Basin, which spans parts of Montana and Wyoming. This area has the potential to yield nearly 22 trillion cubic feet (Tcf) of coal bed methane over the next 20 years. The overall market potential for coal bed methane from the Power River Basin is estimated to reach $10 billion in the next decade. Because coal bed methane is a clean-burning natural gas, companies developing greater reserves contribute in a major way to the U.S.’s drive for higher reliance on renewable and cleaner energy sources, and can possibly qualify for significant tax incentives to help fund operations
 
Our independent auditors have issued a going concern opinion that raises substantial doubt about our ability to continue as a going concern. As reflected in the financial statements in this prospectus, we are a development stage company with limited operations.  We had a net loss of $212,440 since inception (June 10, 2010) through July 31, 2010. We incurred professional fees totaling $201,250 and general and administrative expenses of $11,190 for the same period, inception through July 31, 2010. Cash on hand as of July 31, 2010 was $495,536.
 
Scott Williams, President, Chief Executive Officer, Director and Majority Shareholder
 
Our President, CEO and Director, Scott Williams, is currently, and will remain after the offering, our majority shareholder.

Private Offerings
 
On July 31, 2010, we closed on a private placement which raised gross proceeds of $759,376 through the sale of 1,012,516 units (the “Units”), each Unit consisting of 1 share of our common stock, $0.0001 par value (the “Common Stock”), and a warrant to purchase 2 shares of our Common Stock exercisable at a price of $2.50 per share (the “Warrants”), to certain accredited investors. The investors entered into a subscription agreement (the “Subscription Agreement”) (see Exhibit 10.1), for the sale of our Common Stock. Pursuant to the terms of the Subscription Agreement, we offered the Units for sale at a purchase price of $0.75 per Unit.  Each investor also received a five (5) year Warrant (see Exhibit 10.2), to purchase two (2) shares of Common Stock for every one (1) share of Common Stock which the investor purchased in this offering at an exercise price of $2.50 per share.

Where You Can Find Us

Our principal executive office is located at 159 North State Street, Newtown, PA 18940, and our telephone number is (­­­215) 968-1600.
 
 
1

 
 
The Offering

Common Stock offered by selling security holders
 
3,037,548 shares of our Common Stock, including: (i) up to 1,012,516 shares of our Common Stock previously issued to the selling shareholders; and (ii) to up to 2,025,032 shares of our Common Stock issuable upon exercise of the outstanding warrants, exercisable at a price of $2.50 per share that were issued in connection with the private placement that closed on July 31, 2010. These warrants are immediately callable by us if the our Common Stock trades for a period of 20 consecutive trading days at an average price of $3.00 per share or greater. The 1,012,516 shares issued to the selling shareholders in the private placement represents 16.84 % of our current outstanding common stock.
     
Common stock outstanding before the offering
 
6,012,516 common shares as of October 25, 2010.
     
Common stock outstanding after the offering (includes  the exercise of all of the shares underlying the Warrants)
 
 8,037,548 shares.
     
Use of proceeds
 
We are not selling any shares of the common stock covered by this prospectus. To the extent that the selling stockholders exercise in cash all of the Warrants at the exercise price of $2.50 per share, we would receive $ 5,062,580 in the aggregate from such exercise. The proceeds from the cash exercise of such warrants, if any, will be used by us for working capital and other general corporate purposes.
Risk Factors
 
The Common Stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See “Risk Factors” beginning on page 7.

 
2

 
 
SUMMARY OF FINANCIAL INFORMATION

The following summary financial data should be read in conjunction with “Management’s Discussion and Analysis,” “Plan of Operations” and the Financial Statements and Notes thereto, included elsewhere in this prospectus. The statement of operations and balance sheet data from inception, June 10, 2010 through July 31, 2010 are derived from our audited financial statements.

 
For the Period
from Inception
(June 10, 2010) through
July 31, 2010
 
STATEMENT OF OPERATIONS
   
     
Revenues
 
$
-
 
Total Operating Expenses
   
212,440
 
Professional Fees
   
201,250
 
General and Administrative Expenses
   
11,190
 
Net Loss
   
(212,440
)
 
 
   
As of
July 31, 2010
 
BALANCE SHEET DATA
     
       
Cash
 
 $
495,536
 
Total Assets
   
495,536
 
Total Liabilities
   
15,000
 
Total Stockholders’ Equity
   
480,536
 
 
 
3

 
 
RISK FACTORS

The shares of our common stock being offered for resale by the selling security holders are highly speculative in nature, involve a high degree of risk and should be purchased only by persons who can afford to lose the entire amount invested in the common stock. Before purchasing any of the shares of common stock, you should carefully consider the following factors relating to our business and prospects. If any of the following risks actually occurs, our business, financial condition or operating results could be materially adversely affected. In such case, you may lose all or part of your investment.  You should carefully consider the risks described below and the other information in this process before investing in our common stock.

Risks Related to Our Business

WE HAVE LIMITED OPERATING HISTORY AND FACE MANY OF THE RISKS AND DIFFICULTIES FREQUENTLY ENCOUNTERED BY DEVELOPMENT STAGE COMPANY; ACCUMULATED DEFICIT.

There can be no assurance that our management will be successful in completing our business development with lenders, implementing the corporate infrastructure to support operations at the levels called for by our business plan or that we will generate sufficient revenues to meet its expenses or to achieve or maintain profitability.
We are a development stage company, and to date, our development efforts have been focused primarily on the development of our business model. We have limited operating history for investors to evaluate the potential of our business development. In addition, we also face many of the risks and difficulties inherent in introducing new products and services. These risks include the ability to:

·        Develop effective business plan;
·        Meet customer standards;
·        Implement advertising and marketing plan;
·        Maintain current strategic relationships and develop new strategic relationships;
·        Respond effectively to competitive pressures;
·        Continue to develop and upgrade our service; and
·        Attract, retain and motivate qualified personnel.

Our future will depend on our ability to manage our biotechnology development and testing, which requires careful planning to avoid incurring unnecessary costs and expenses.

WE NEED ADDITIONAL CAPITAL TO DEVELOP OUR BUSINESS.

The development of our operations will require the commitment of substantial resources to implement our business plan. Currently, we have no established bank-financing arrangements. Therefore, it is likely we would need to seek additional financing through subsequent future private offering of our equity securities, or through strategic partnerships and other arrangements with corporate partners.

We cannot give you any assurance that any additional financing will be available to us, or if available, will be on terms favorable to us. The sale of additional equity securities will result in dilution to our stockholders. The occurrence of indebtedness would result in increased debt service obligations and could require us to agree to operating and financing covenants that would restrict our operations. If adequate additional financing is not available on acceptable terms, we may not be able to implement our business development plan or continue our business operations.

The funds raised in the private placement may not be enough to complete enough full-scale field developments. Failure to conduct and complete adequate field developments will adversely affect our business.

OUR FUTURE SUCCESS IS DEPENDENT, IN PART, ON THE PERFORMANCE AND CONTINUED SERVICE OF SCOTT WILLIAMS, OUR PRESIDENT, CEO AND DIRECTOR. WITHOUT HIS CONTINUED SERVICE, WE MAY BE FORCED TO INTERRUPT OR EVENTUALLY CEASE OUR OPERATIONS.
 
 
4

 
 
We are dependent on our key executive, President and Chief Executive Officer, Scott Williams, for the foreseeable future.  The loss of the services from Scott Williams could have a material adverse effect on our operations and prospects. At this time, we do not have an employment agreement with Scott Williams, though wemay enter into such an agreement with its President on terms and conditions usual and customary for its industry.  We do not currently have “key man” life insurance on Scott Williams.
 
WE MAY INCUR SIGNIFICANT COSTS TO BE A PUBLIC COMPANY TO ENSURE COMPLIANCE WITH U.S. CORPORATE GOVERNANCE AND ACCOUNTING REQUIREMENTS AND WE MAY NOT BE ABLE TO ABSORB SUCH COSTS.

We may incur significant costs associated with our public company reporting requirements, costs associated with newly applicable corporate governance requirements, including requirements under the Sarbanes-Oxley Act of 2002 and other rules implemented by the Securities and Exchange Commission. We expect all of these applicable rules and regulations to significantly increase our legal and financial compliance costs and to make some activities more time consuming and costly. We also expect that these applicable rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as executive officers. We are currently evaluating and monitoring developments with respect to these newly applicable rules, and we cannot predict or estimate the amount of additional costs we may incur or the timing of such costs. In addition, we may not be able to absorb these costs of being a public company which will negatively affect our business operations.

THE LACK OF PUBLIC COMPANY EXPERIENCE OF OUR MANAGEMENT TEAM COULD ADVERSELY IMPACT OUR ABILITY TO COMPLY WITH THE REPORTING REQUIREMENTS OF U.S. SECURITIES LAWS.
 
Our   management team lacks public company experience, which could impair our ability to comply with legal and regulatory requirements such as those imposed by Sarbanes-Oxley Act of 2002. Our senior management has never had responsibility for managing a publicly traded company. Such responsibilities include complying with federal securities laws and making required disclosures on a timely basis. Our senior management may not be able to implement programs and policies in an effective and timely manner that adequately respond to such increased legal, regulatory compliance and reporting requirements, including the establishing and maintaining internal controls over financial reporting.  Any such deficiencies, weaknesses or lack of compliance could have a materially adverse effect on our ability to comply with the reporting requirements of the Securities Exchange Act of 1934 which is necessary to maintain our public company status. If we were to fail to fulfill those obligations, our ability to continue as a U.S. public company would be in jeopardy in which event you could lose your entire investment in our company. 
 
OUR COMPANY WILL BE IMPACTED BY FLUCTUATIONS IN THE PRICE OF NATURAL GAS. THE NATURAL GAS MARKET HAS BEEN VOLATILE AND SUCH VOLATILITY OR AN UNEXPECTED INCREASE IN NATURAL GAS PRICES COULD HAVE AN ADVERSE EFFECT ON OUR BUSINESS.
 
Our company will be impacted by fluctuations in the price of natural gas. The natural gas market has been volatile and such volatility or an unexpected increase in natural gas prices could have an adverse effect on our business. A substantial increase in the price of natural gas may reduce the demand for natural gas and natural gas exploration and mining services, which would adversely impact our revenues and could cause our business to fail.
 
OUR BUSINESS IS SUBJECT TO GOVERNMENT REGULATION OF MINING AND EXTRACTING INDUSTRIES. IF THE GOVERNMENT MAKES IT MORE DIFFICULT OR EXPENSIVE FOR OUR CUSTOMERS TO OBTAIN THE PROPER PERMITS TO CONDUCT SUCH ACTIVITIES, OUR REVENUES MAY BE ADVERSELY AFFECTED.
 
 
5

 
 
Our business is subject to government regulation of mining and extracting industries. If the government makes it more difficult for our customers to obtain the proper permits to conduct such activities, our revenues may be adversely impacted. Though the permitting environment is considered favorable to mining companies at this time, the government may erect barriers or make the process more onerous.
 
IF WE CAN SUCCESSFULLY BEGIN OPERATIONS, WE WILL FACE INTENSE COMPETITION FROM OTHER COMPANIES THAT ARE MUCH LARGER, WITH MORE CAPITAL, AND HAVE GREATER RESOURCES AND MORE EXPERIENCE.
 
If we can successfully begin operations, we will face intense competition from other companies that are much larger, with more capital, and have greater resources and more experience. If we do not manage our operations effectively and cannot establish our company as a viable competitor, our revenues will bill adversely affected or our business plan could fail.
 
WE MAY EXPERIENCE DIFFICULTIES IN FINDING COMPANIES WILLING TO LICENSE OUR TECHNOLOGY.
 
Our principal business strategy is to license our biotechnology to enough of the 100 or so coalmine operators in the Power River Basin area to make the business model profitable. We have no licensing agreements in place and may have difficulty securing the number of agreements necessary to sustain our business plan.
 
Risk Related To Our Capital Stock
 
WE MAY NEVER PAY DIVIDENDS TO OUR SHAREHOLDERS.
 
We have never declared or paid any cash dividends or distributions on our capital stock. We currently intend to retain our future earnings, if any, to support operations and to finance expansion and therefore we do not anticipate paying any cash dividends on our common stock in the foreseeable future.
 
The declaration, payment and amount of any future dividends will be made at the discretion of the board of directors, and will depend upon, among other things, the results of our operations, cash flows and financial condition, operating and capital requirements, and other factors as the board of directors considers relevant. There is no assurance that future dividends will be paid, and, if dividends are paid, there is no assurance with respect to the amount of any such dividend.
 
OUR ARTICLES   OF INCORPORATION PROVIDE FOR INDEMNIFICATION OF OFFICERS AND DIRECTORS AT OUR EXPENSE AND LIMIT THEIR LIABILITY WHICH MAY RESULT IN A MAJOR COST TO US AND HURT THE INTERESTS OF OUR SHAREHOLDERS BECAUSE CORPORATE RESOURCES MAY BE EXPENDED FOR THE BENEFIT OF OFFICERS AND/OR DIRECTORS.  

Our Certificate of Incorporation and By-Laws include provisions that eliminate the personal liability of our  directors for monetary damages to the fullest extent possible under the laws of the State of Nevada or other applicable law.  These provisions eliminate the liability of our directors and our stockholders for monetary damages arising out of any violation of a director of his fiduciary duty of due care.  Under Nevada law, however, such provisions do not eliminate the personal liability of a director for (i) breach of the director’s duty of loyalty, (ii) acts or omissions not in good faith or involving intentional misconduct or knowing violation of law, (iii) payment of dividends or repurchases of stock other than from lawfully available funds, or (iv) any transaction from which the director derived an improper benefit.  These provisions do not affect a director’s liabilities under the federal securities laws or the recovery of damages by third parties.

We have been advised that, in the opinion of the SEC, indemnification for liabilities arising under federal securities laws is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification for liabilities arising under federal securities laws, other than the payment by us of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding, is asserted by a director, officer or controlling person in connection with the securities being registered, we will (unless in the opinion of our counsel, the matter has been settled by controlling precedent) submit to a court of appropriate jurisdiction, the question whether indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. The legal process relating to this matter if it were to occur is likely to be very costly and may result in us receiving negative publicity, either   of which factors is likely to materially reduce the market and price for our shares, if such a market ever develops.    
 
 
6

 
 
THE OFFERING PRICE OF OUR COMMON STOCK WAS DETERMINED BASED ON THE PRICE OF OUR PRIVATE OFFERING, AND THEREFORE SHOULD NOT BE USED AS AN INDICATOR OF THE FUTURE MARKET PRICE OF THE SECURITIES. THEREFORE, THE OFFERING PRICE BEARS NO RELATIONSHIP TO OUR ACTUAL VALUE, AND MAY MAKE OUR SHARES DIFFICULT TO SELL.
 
Since our shares are not listed or quoted on any exchange or quotation system, the offering price of $0.75 per share for the shares of common stock was determined based on the price of our private offering. The facts considered in determining the offering price were our financial condition and prospects, our limited operating history and the general condition of the securities market. The offering price bears no relationship to the book value, assets or earnings of our company or any other recognized criteria of value. The offering price should not be regarded as an indicator of the future market price of the securities.

YOU WILL EXPERIENCE DILUTION OF YOUR OWNERSHIP INTEREST BECAUSE OF THE FUTURE ISSUANCE OF ADDITIONAL SHARES OF OUR COMMON STOCK AND OUR PREFERRED STOCK.
 
In the future, we may issue our authorized but previously unissued equity securities, resulting in the dilution of the ownership interests of our present stockholders. We are currently authorized to issue an aggregate of 110,000,000 shares of capital stock consisting of 100,000,000 shares of common stock, par value $0.0001 per share, and 10,000,000 shares of preferred stock, par value $0.0001 per share.

We may also issue additional shares of our common stock or other securities that are convertible into or exercisable for common stock in connection with hiring or retaining employees or consultants, future acquisitions, future sales of our securities for capital raising purposes, or for other business purposes. The future issuance of any such additional shares of our common stock or other securities may create downward pressure on the trading price of our common stock. There can be no assurance that we will not be required to issue additional shares, warrants or other convertible securities in the future in conjunction with hiring or retaining employees or consultants, future acquisitions, future sales of our securities for capital raising purposes or for other business purposes, at a price (or exercise prices) below the price at which shares of our common stock are quoted on the OTCBB.

OUR COMMON STOCK IS CONSIDERED A PENNY STOCK, WHICH MAY BE SUBJECT TO RESTRICTIONS ON MARKETABILITY, SO YOU MAY NOT BE ABLE TO SELL YOUR SHARES.
 
If our common stock becomes tradable in the secondary market, we will be subject to the penny stock rules adopted by the Securities and Exchange Commission that require brokers to provide extensive disclosure to their customers prior to executing trades in penny stocks. These disclosure requirements may cause a reduction in the trading activity of our common stock, which in all likelihood would make it difficult for our shareholders to sell their securities.

Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. The broker-dealer must also make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security that becomes subject to the penny stock rules. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in our securities, which could severely limit the market price and liquidity of our securities. These requirements may restrict the ability of broker-dealers to sell our common stock and may affect your ability to resell our common stock.
 
 
7

 
 
WE CAN GIVE NO ASSURANCE THAT A LIQUID PUBLIC MARKET FOR OUR SECURITIES WILL DEVELOP OR THAT OUR COMMON STOCK WILL EVER TRADE ON A RECOGNIZED OR SENIOR EXCHANGE. THEREFORE, YOU MAY BE UNABLE TO LIQUIDATE YOUR INVESTMENT IN OUR COMMON STOCK.
 
There is no established public trading market for our common stock. Our shares have not been listed or quoted on any exchange or quotation system. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTCBB, nor can there be any assurance that such an application for quotation will be approved or that a regular trading market will develop or that if developed, will be sustained. In the absence of a trading market, an investor may be unable to liquidate their investment.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

The information contained in this report, including in the documents incorporated by reference into this report, includes some statements that are not purely historical and that are “forward-looking statements.” Such forward-looking statements include, but are not limited to, statements regarding our management’s expectations, hopes, beliefs, intentions or strategies regarding the future, including our financial condition, results of operations, and financial performance. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipates,” “believes,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “might,” “plans,” “possible,” “potential,” “predicts,” “projects,” “seeks,” “should,” “will,” “would” and similar expressions, or the negatives of such terms, may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.

The forward-looking statements contained in this report are based on current expectations and beliefs concerning future developments and the potential effects on the parties and the transaction. There can be no assurance that future developments actually affecting us will be those anticipated. These that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements, including the following forward-looking statements involve a number of risks, uncertainties (some of which are beyond the parties’ control) or other assumptions.

USE OF PROCEEDS

We will not receive any proceeds from the sale of common stock by the selling security holders. All of the net proceeds from the sale of our common stock will go to the selling security holders as described below in the sections entitled “Selling Security Holders” and “Plan of Distribution.” We have agreed to bear the expenses relating to the registration of the common stock for the selling security holders. To the extent that the selling stockholders exercise in cash all of the Warrants at the exercise price of $2.50 per share, we would receive $5,062,580 in the aggregate from such exercise. The proceeds from the cash exercise of such warrants, if any, will be used by us for working capital and other general corporate purposes.

DETERMINATION OF OFFERING PRICE

Since our common stock is not listed or quoted on any exchange or quotation system, the offering price of the shares of common stock was determined by the price of the common stock that was sold to our security holders pursuant to an exemption under Section 4(2) of the Securities Act of 1933 and Rule 506 of Regulation D promulgated under the Securities Act of 1933.
 
The offering price of the shares of our common stock does not necessarily bear any relationship to our book value, assets, past operating results, financial condition or any other established criteria of value. The facts considered in determining the offering price were our financial condition and prospects, our limited operating history and the general condition of the securities market.

Although our common stock is not listed on a public exchange, we will be filing to obtain a listing on the OTCBB concurrently with the filing of this prospectus. In order to be quoted on the OTCBB, a market maker must file an application on our behalf in order to make a market for our common stock. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Bulletin Board, nor can there be any assurance that such an application for quotation will be approved.
 
 
8

 
 
In addition, there is no assurance that our common stock will trade at market prices in excess of the initial offering price as prices for the common stock in any public market which may develop will be determined in the marketplace and may be influenced by many factors, including the depth and liquidity.

DILUTION

The common stock to be sold by the selling shareholders is provided in the “Selling Security Holders” section below and represents common stock that is currently issued. Accordingly, there will be no dilution to our existing shareholders.

SELLING SECURITY HOLDERS

The common shares being offered for resale by the 62 selling security holders consist of 3,037,548 shares of our Common Stock, including (i) 1,012,516 shares of our Common Stock issued to the selling shareholders, and (ii) up to 2,025,032 shares of or Common Stock underlying the Warrants issuable to the investors in the private placement that closed on July 31, 2010. Such shareholders include the holders of 1,012,516 shares sold in our private offering pursuant to Regulation D Rule 506 completed on July 31, 2010 at an offering price of $0.75 per Unit.
 
The following table sets forth the name of the selling security holders, the number of shares of common stock beneficially owned by each of the selling stockholders as of October 25, 2010 and the number of shares of common stock being offered by the selling stockholders. The shares being offered hereby are being registered to permit public secondary trading, and the selling stockholders may offer all or part of the shares for resale from time to time. However, the selling stockholders are under no obligation to sell all or any portion of such shares nor are the selling stockholders obligated to sell any shares immediately upon effectiveness of this prospectus. All information with respect to share ownership has been furnished by the selling stockholders.



Name
Shares of
Common Stock Beneficially
Owned Prior
To Offering (1)
Maximum
Number of
Shares of
Common Stock
to be Offered
Number of Shares
of Common Stock
Beneficially
Owned After
Offering
Percent
Ownership
After
Offering (2)
Badger, Carleton M. (3)
3,068
9,204
0
0%
Bauz, Karl F. (4)
20,000
60,000
0
0%
Benchmark Capital (5)
35,000
105,000
0
0%
Blue, Robert E. Jr. (6)
6,667
20,001
0
0%
Calhoun, Harry W. & Barbara A. -Joint Subscribers (7)
6,670
20,010
0
0%
Callan, J. Laurence (8)
6,700
20,100
0
0%
Callan, P. Douglas (9)
4,000
12,000
0
0%
Chack, Janis D. (10)
66,667
200,001
0
0%
Coe, Paul R.-Imperial Capital LLC STE (11)
20,000
60,000
0
0%
Cohen, Cheryl (12)
13,334
40,002
0
0%
Cohen, Jamie Rebecca (13)
10,000
30,000
0
0%
Cohen, Michael Stuart (14)
10,000
30,000
0
0%
Consaley, Frederick E. & Helen J. - Joint Subscribers (15)
13,500
40,500
0
0%
Ebert, Edward C. (16)
26,667
80,001
0
0%
 
 
9

 
 
Ebert, Karen M. (17)
6,667
20,001
0
0%
Eisen, Sally S. (Eisen Family Trust) (18)
20,000
60,000
0
0%
Ellis, Carol-IRA (19)
3,059
9,177
0
0%
Ellis, Stephen & Carol JTWROS - Joint Subscribers (20)
30,006
90,018
0
0%
Ferguson, Jean (21)
13,334
40,002
0
0%
Flax, Lance (22)
6,667
20,001
0
0%
Flax, Lauren (23)
3,334
10,002
0
0%
Flax, Marian H. (24)
6,667
20,001
0
0%
Garre, MaryJo S. (25)
20,000
60,000
0
0%
Goldfine, Howard R.(26)
20,000
60,000
0
0%
Hanan, Lisa G. (27)
10,000
30,000
0
0%
Hanan, Scott H. (28)
23,334
70,002
0
0%
Hawkins, Barry C. (29)
13,334
40,002
0
0%
Hollway, John F. (30)
26,667
80,001
0
0%
HWC LLC (31)
66,667
200,001
0
0%
Hyatt, Geoffrey (32)
20,000
60,000
0
0%
Keller, Laurence D. (33)
10,000
30,000
0
0%
Keszeli, Dr. Alexander C. & Kim -  Joint Subscribers (34)
20,000
60,000
0
0%
Lisausky, Adam (35)
6,667
20,001
0
0%
Macrae-Gibson, Gavin (36)
33,334
100,002
0
0%
Madian, Susan (37)
13,334
40,002
0
0%
Manzo, Angela S. (38)
10,000
30,000
0
0%
Manzo, Donald A. (39)
10,000
30,000
0
0%
O'Brien, Anne E. (40)
13,334
40,002
0
0%
Patten, Kathleen N. (41)
32,000
96,000
0
0%
Peacock, James P. Sr. (42)
5,000
15,000
0
0%
Peacock, Rebecca A. (43)
5,000
15,000
0
0%
Picariello, Michael A. & Darocha, Irene B.- Joint Subscribers (44)
20,000
60,000
0
0%
Robinson, Wendell Walker (45)
13,500
40,500
0
0%
Samkavitz, Sandra G. (46)
13,334
40,002
0
0%
Schanz, Francis J. Jr. (47)
20,000
60,000
0
0%
Schink, William B. (48)
5,000
15,000
0
0%
Smith, Brenda Ann (49)
20,000
60,000
0
0%
Stein, Neil A. & Diane M. -Joint Subscribers (50)
6,667
20,001
0
0%
Stern, Alan & Deborah - Joint Subscribers (51)
28,000
84,000
0
0%
Stewart, Christopher R. (52)
46,667
140,001
0
0%
Talarico, Michael J. & Sharron G. - Joint Subscribers (53)
14,000
42,000
0
0%
Twigg, Maria (54)
13,334
40,002
0
0%
Twigg, Todd Alan (55)
13,334
40,002
0
0%
Wichert, Cathy A. (Living Trust) (56)
33,334
100,002
0
0%
Williams, Daniel (Trust) (57)
6,667
20,001
0
0%
Williams, James P. (58)
20,000
60,000
0
0%
Williams, Joshua Paul (Trust) (59)
6,667
20,001
0
0%
 
 
10

 
 
Williams, Matthew (Trust) (60)
6,667
20,001
0
0%
Wisniewski, Mark W. (61)
8,000
24,000
0
0%
Wisniewski, William (62)
6,667
20,001
0
0%
Wissner, Beverlie F., TTE (Trust) (63)
10,000
30,000
0
0%
Wissner, Donald A., TTE (Trust) (64)
10,000
30,000
0
0%
TOTAL
1,012,516
3,037,548
0
0%


(1)  
Beneficial ownership is determined in accordance with the rules and regulations of the SEC. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, securities that are currently convertible or exercisable into shares of our Common Stock, or convertible or exercisable into shares of our Common Stock within 60 days of the date hereof are deemed outstanding. Such shares, however, are not deemed outstanding for the purposes of computing the percentage ownership of any other person. Except as indicated in the footnotes below, each stockholder named in the table has sole voting and investment power with respect to the shares set forth opposite such stockholder’s name.
(2)  
The percentage of beneficial ownership is based on 3,037,548 shares of Common Stock outstanding post-offering, which includes the 2,025,032 shares of Common Stock underlying the Warrants.
(3)  
Maximum number of shares offered consists of 3,068 shares of our Common and 6,136 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(4)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(5)  
Maximum number of shares offered consists of 35,000 shares of our Common Stock and 70,000 shares of our Common Stock underlying the Warrant issued to Benchmark Capital. John Patten is the Principal of Benchmark Capital. John Patten , acting alone, has voting and dispositive power over the shares beneficially owned by Benchmark Capital.
(6)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(7)  
Maximum number of shares offered consists of 6,670 shares of our Common and 13,400 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(8)  
Maximum number of shares offered consists of 6,700 shares of our Common and 13,400 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(9)  
Maximum number of shares offered consists of 4,000 shares of our Common and 8,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(10)  
Maximum number of shares offered consists of 66,667 shares of our Common and 133,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(11)  
Maximum number of shares offered consists of 20,000 shares of our Common Stock and 40,000 shares of our Common Stock underlying the Warrant issued to Imperial Capital LLC. Paul R. Coe is the Principal of Imperial Capital LLC. Paul R. Coe, acting alone, has voting and dispositive power over the shares beneficially owned by Imperial Capital LLC.
(12)  
Maximum number of shares offered consists of 13,334 shares of our Common and 26,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(13)  
Maximum number of shares offered consists of 10,000 shares of our Common and 20,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(14)  
Maximum number of shares offered consists of 10,000 shares of our Common and 20,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(15)  
Maximum number of shares offered consists of 13,500 shares of our Common and 27,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(16)  
Maximum number of shares offered consists of 26,667 shares of our Common and 53,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(17)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(18)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
 
 
11

 
 
(19)  
Maximum number of shares offered consists of 3,059 shares of our Common and 6,118 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(20)  
Maximum number of shares offered consists of 30,006 shares of our Common and 60,012 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(21)  
Maximum number of shares offered consists of 13,334 shares of our Common and 26,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(22)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(23)  
Maximum number of shares offered consists of 3,334 shares of our Common and 6,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(24)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(25)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(26)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(27)  
Maximum number of shares offered consists of 10,000 shares of our Common and 20,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(28)  
Maximum number of shares offered consists of 23,334 shares of our Common and 46,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(29)  
Maximum number of shares offered consists of 13,334 shares of our Common and 26,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(30)  
Maximum number of shares offered consists of 26,667 shares of our Common and 53,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(31)  
Maximum number of shares offered consists of 66,667 shares of our Common Stock and 133,334 shares of our Common Stock underlying the Warrant issued to HWC LLC. David Callan is the Principal of HWC LLC. David Callan , acting alone, has voting and dispositive power over the shares beneficially owned by HWC LLC.
(32)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(33)  
Maximum number of shares offered consists 10,000 of shares of our Common and 20,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(34)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(35)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(36)  
Maximum number of shares offered consists of 33,334 shares of our Common and 66,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(37)  
Maximum number of shares offered consists of 13,334 shares of our Common and 26,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(38)  
Maximum number of shares offered consists of 10,000 shares of our Common and 20,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(39)  
Maximum number of shares offered consists of 10,000 shares of our Common and 20,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(40)  
Maximum number of shares offered consists of 13,334 shares of our Common and 26,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(41)  
Maximum number of shares offered consists of 32,000 shares of our Common and 64,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(42)  
Maximum number of shares offered consists of 5,000 shares of our Common and 10,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(43)  
Maximum number of shares offered consists of 5,000 shares of our Common and 10,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(44)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(45)  
Maximum number of shares offered consists of 13,500 shares of our Common and 27,500 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
 
 
12

 
 
(46)  
Maximum number of shares offered consists of 13,334 shares of our Common and 26,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(47)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(48)  
Maximum number of shares offered consists of 5,000 shares of our Common and 10,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(49)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(50)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(51)  
Maximum number of shares offered consists of 28,000 shares of our Common and 56,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(52)  
Maximum number of shares offered consists of 46,667 shares of our Common and 93,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(53)  
Maximum number of shares offered consists of 14,000 shares of our Common and 28,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(54)  
Maximum number of shares offered consists of 13,334 shares of our Common and 26,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(55)  
Maximum number of shares offered consists of 13,334 shares of our Common and 26,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(56)  
Maximum number of shares offered consists of 33,334 shares of our Common and 66,668 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(57)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(58)  
Maximum number of shares offered consists of 20,000 shares of our Common and 40,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(59)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(60)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(61)  
Maximum number of shares offered consists of 8,000 shares of our Common and 16,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(62)  
Maximum number of shares offered consists of 6,667 shares of our Common and 13,334 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(63)  
Maximum number of shares offered consists of 10,000 shares of our Common and 20,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.
(64)  
Maximum number of shares offered consists of 10,000 shares of our Common and 20,000 shares of our Common Stock underlying the Warrants issued to the selling stockholder.

To our knowledge, none of the selling shareholders:

-
has had a material relationship with us other than as a shareholder at any time within the past three years;
 
-
Except for  David Callan, has ever been one of our officers or directors or an officer or director of our predecessors or affiliates; or
 
-  
are broker-dealers or affiliated with broker-dealers. 
 

PLAN OF DISTRIBUTION

The selling security holders may sell some or all of their shares at a fixed price of $0.75 per share until our shares are quoted on the OTCBB and thereafter at prevailing market prices or privately negotiated prices. Prior to being quoted on the OTC Bulletin Board, shareholders may sell their shares in private transactions to other individuals. Although our common stock is not listed on a public exchange, we will be filing to obtain a listing on the OTCBB concurrently with the filing of this prospectus. In order to be quoted on the OTC Bulletin Board, a market maker must file an application on our behalf in order to make a market for our common stock. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTC Bulletin Board, nor can there be any assurance that such an application for quotation will be approved. However, sales by selling security holders must be made at the fixed price of $0.75 until a market develops for the stock.
 
 
13

 
 
Once a market has developed for our common stock, the shares may be sold or distributed from time to time by the selling stockholders, who may be deemed to be underwriters, directly to one or more purchasers or through brokers or dealers who act solely as agents, at market prices prevailing at the time of sale, at prices related to such prevailing market prices, at negotiated prices or at fixed prices, which may be changed. The distribution of the shares may be effected in one or more of the following methods:
 
·  
-   ordinary broker transactions, which may include long or short sales;
·  
-   transactions involving cross or block trades on any securities or market where our common stock is trading;
·  
-   through direct sales to purchasers or sales effected through agents;
·  
-   through transactions in options, swaps or other derivatives (whether exchange listed of otherwise);
·  
-   any combination of the foregoing.

In addition, the selling stockholders may enter into hedging transactions with broker-dealers who may engage in short sales, if short sales are permitted, of shares in the course of hedging the positions they assume with the selling stockholders. The selling stockholders may also enter into option or other transactions with broker-dealers that require the delivery by such broker-dealers of the shares, which shares may be resold thereafter pursuant to this prospectus. To our best knowledge, none of the selling security holders are broker-dealers or affiliates of broker dealers.
 
We will advise the selling security holders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling security holders and their affiliates. In addition, we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the selling security holders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The selling security holders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities arising under the Securities Act.
 
Brokers, dealers, or agents participating in the distribution of the shares may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/or the purchasers of shares for whom such broker-dealers may act as agent or to whom they may sell as principal, or both (which compensation as to a particular broker-dealer may be in excess of customary commissions). Neither the selling stockholders nor we can presently estimate the amount of such compensation. We know of no existing arrangements between the selling stockholders and any other stockholder, broker, dealer or agent relating to the sale or distribution of the shares. We will not receive any proceeds from the sale of the shares of the selling security holders pursuant to this prospectus. We have agreed to bear the expenses of the registration of the shares, including legal and accounting fees, and such expenses are estimated to be approximately $41,915.
 
Notwithstanding anything set forth herein, no FINRA member will charge commissions that exceed 8% of the total proceeds of the offering.

DESCRIPTION OF SECURITIES TO BE REGISTERED

We are authorized to issue 100,000,000 shares of common stock, par value $0.0001 and 10,000,000 shares of preferred stock, par value $0.0001. As of October 25, 2010, 6,012,516 shares of our common stock were issued and outstanding and no shares of preferred stock were issued and outstanding.

Common Stock . The holders of the common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. Our certificate of incorporation and by-laws do not provide for cumulative voting rights in the election of directors. Accordingly, holders of a majority of the shares of common stock entitled to vote in any election of directors may elect all of the directors standing for election. Holders of common stock are entitled to receive ratably such dividends as may be declared by the Board out of funds legally available therefore. In the event of our liquidation, dissolution or winding up, holders of common stock are entitled to share ratably in the assets remaining after payment of liabilities. Holders of common stock have no preemptive, conversion or redemption rights. As of October 25, 2010, 6,012,516 shares of our common stock were issued and outstanding. There will be up to 8,037,548 shares of our common stock issued and outstanding after the offering if the investors in the private placement of units that closed on July 31, 2010 exercise all of their warrants.
 
 
14

 
 
Preferred Stock . Our board of directors has the authority, within the limitations and restrictions in our articles of incorporation, to issue 10,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, privileges and restrictions thereof, including dividend rights, dividend rates, conversion rights, voting rights, terms of redemption, redemption prices, liquidation preferences and the number of shares constituting any series or the designation of any series, without further vote or action by the stockholders. The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in our control without further action by the stockholders. The issuance of preferred stock with voting and conversion rights may adversely affect the voting power of the holders of our common Stock, including voting rights, of the holders of our common Stock. In some circumstances, this issuance could have the effect of decreasing the market price of our common stock. We currently have no plans to issue any shares of preferred stock.
 
Dividends
 
We have not paid any cash dividends to our shareholders.  The declaration of any future cash dividends is at the discretion of our board of directors and depends  upon our earnings, if any, our capital requirements and financial position, our general economic conditions, and other pertinent conditions.  It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in our business operations.

Warrants
 
Currently, there are outstanding warrants to issue up to 2,025,032 shares of or common stock, issuable upon exercise of the outstanding warrants, exercisable at a price of $2.50 per share or immediately callable by the Company if our common stock trades for a period of 20 consecutive trading days at an average price of $3.00 per share or greater. The warrants were issued in connection with the private placement that closed on July 31, 2010.

Options
 
There are no outstanding options to purchase our securities.

Transfer Agent and Registrar
 
Currently we do not have a stock transfer agent and we function as our own transfer agent. We intend to engage a stock transfer agent in the near future.

INTERESTS OF NAMED EXPERTS AND COUNSEL
 
No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.
 
The financial statements included in this prospectus and the registration statement have been audited by Webb & Company, P.A. to the extent and for the periods set forth in their report appearing elsewhere herein and in the registration statement, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.

The validity of the issuance of the common stock hereby will be passed upon for us by Anslow & Jaclin, LLP, of Manalapan, New Jersey.

DESCRIPTION OF BUSINESS
 
 
15

 
 
Alternative Energy and Environmental Solutions, Inc. was incorporated in 2010 in the State of Nevada to market an innovative new biotechnology that utilizes nutrient stimulants — organic microbes — to extract coalbed methane more efficiently in high-production as well as from low-producing, depleted and abandoned coalmines in the US. Coal bed methane is a clean-burning natural gas used for heating in homes and is used to generate electricity.
 
Nutrient stimulation for coalbed methane production is considered by the U.S. Geological Survey to be an environmentally sound and inexpensive method to increase yields. As the U.S. shifts to cleaner and more environmentally friendly fuel sources for heating and electricity, coalbed methane is becoming more valuable. Innovative methods for cost-effectively and efficiently extracting more of this natural gas are now in demand.
 
We plans to apply for patents on its biotechnology solution based on in-situ biogenic nutrient-circulation methods and the nutritional amendments used in the biogenic process successfully piloted both in the lab and in the field during the last two years.
 
We plans to license this patent-pending biotechnology to owners and operators of coalmines in the Power River Basin, which spans parts of Montana and Wyoming. This area has the potential to yield nearly 22 trillion cubic feet (Tcf) of coalbed methane during the next 20 years. The overall market potential for coalbed methane from the Power River Basin is estimated to reach $10 billion in the next decade. Because coalbed methane is a clean-burning natural gas, companies developing greater reserves contribute in a major way to the U.S.’s drive for higher reliance on renewable and cleaner energy sources, and can possibly qualify for significant tax incentives to help fund operations.
 
We began operations in June 2010, and is currently a development-stage company with no operations or revenues.
 
Our principal executive office location and mailing address is 159 North State Street, Newtown, PA 18940. The telephone number is 215-968-1600. Our fiscal year end is July 31.
 
The Company
 
Alternative Energy and Environmental Solutions, Inc., was established in June 2010 to bring to market and license its innovative new biotechnology for the environmentally friendly and cost-effective extraction of natural gas (coal bed methane) from low-producing, depleted and abandoned coal mines in the U.S. Using organic stimulants to increase the availability of natural gas, our technology could help licensees tap a market with the potential for $10 billion over the next 10 years.
 
Coal bed methane is a clean-burning natural gas used for heating and electricity generation. According to the U.S Geological Survey, natural gas reserves from the Powder River Basin of Montana and Wyoming alone approach 22 trillion cubic feet (Tcf.) Between 1997 and 2007, the number of wells drilled for natural gas extraction in this area reached 22,000. With the U.S. energy industry aggressively trying to adopt cleaner, renewable energy sources, coal bed methane is becoming an extremely valuable fuel. Operators in the Powder River Basin area are seeking innovative new biotechnology for the efficient and cost-effective extraction of this natural gas from coalmines that are underperforming.
 
Our plan to market our biotechnology to the 100 or so coal mine and natural gas concerns in the Power River Basin area. The business strategy is to license this innovative solution for cost-effective and efficient coalbed methane extraction from the 50 percent or more of the existing wells that are abandoned, depleted or under-producing. This technology can also be used on high-production wells to keep them at top capacity for far longer.
 
Employees
 
We currently have two employees, who work 10+ hours per week to advance the company’s business development efforts with coalmine and natural gas operators in the targeted region.
 
Business Development
 
 
16

 
 
We seek to complete at least three licensing agreements with coal mine or/ natural gas operators in the targeted region. See “USE OF PROCEEDS.”  Implementation of a reduced program would slow our revenue growth.
 
Business Development Efforts
 
Our initial marketing efforts will be focused on engaging with the 100 or so companies with coalmines and natural gas efforts in the Powder River basin of Montana and Wyoming.   Our officials have developed relationships with a number of these companies and the goal is to field three new in-situ pilots with three of these companies as proof points for the participating companies and the industry.
 
Once the three pilots are complete, we plans to offer our biotechnology solution on a renewable, annual license agreement to those operators who seek to increase their coal bed methane yields over the next few years.
 
DESCRIPTION OF PROPERTY
 
Our principal executive office is located at 159 North State Street, Newtown, PA 18940, and our telephone number is (215) 968-1600.

LEGAL PROCEEDINGS

From time to time, we may become involved in various lawsuits and legal proceedings, which arise, in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have a material adverse effect on our business, financial condition or operating results.

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

There is presently no public market for our shares of common stock. We anticipate applying for quoting of our common stock on the OTCBB upon the effectiveness of the registration statement of which this prospectus forms apart. However, we can provide no assurance that our shares of common stock will be quoted on the OTCBB or, if quoted, that a public market will materialize.

Holders of Capital Stock

As of the date of this registration statement, we had 63 holders of our common stock.
 
Rule 144 Shares
 
As of the date of this registration statement, we do not have any shares of our common stock that are currently available for sale to the public in accordance with the volume and trading limitations of Rule 144.

Stock Option Grants
 
We do not have any stock option plans.
 
 
17

 
 
ALTERNATIVE ENERGY & ENVIRONMENTAL SOLUTIONS, INC.
(A DEVELOPMENT STAGE COMPANY)

 

CONTENTS


PAGE
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
     
PAGE
F-2
BALANCE SHEET AS OF JULY 31, 2010.
     
PAGE
F-3
STATEMENT OF OPERATIONS FOR THE PERIOD FROM JUNE 10, 2010 (INCEPTION) TO JULY 31, 2010.
     
PAGE
F-4
STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY FOR THE PERIOD FROM JUNE 10, 2010 (INCEPTION) TO JULY 31, 2010.
     
PAGE
F-5
STATEMENT OF CASH FLOWS FOR THE PERIOD FROM JUNE 10, 2010 (INCEPTION) TO JULY 31, 2010.
     
PAGES
F-6 - F-11
NOTES TO FINANCIAL STATEMENTS.
     


 
 

 
 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors of:
Alternative Energy & Environmental Solutions, Inc.
(A Development Stage Company)

We have audited the accompanying balance sheet of Alternative Energy & Environmental Solutions, Inc. (a development stage company) (the “Company”) as of July 31, 2010 and the related statements of operations, changes in stockholders’ equity and cash flows for the period from June 10, 2010 (Inception) to July 31, 2010 .  These financial statements are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly in all material respects, the financial position of Alternative Energy & Environmental Solutions, Inc. (a development stage company) as of July 31, 2010 and the results of its operations and its cash flows for the period from June 10, 2010 (Inception) to July 31, 2010 in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note 5 to the financial statements, the Company is in the development stage with limited operations, a net loss of $212,440 and used $195,340 of cash in operations from inception. These factors raise substantial doubt about the Company's ability to continue as a going concern.  Management's plans concerning these matters are also described in Note 5.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.



WEBB & COMPANY, P.A.
Certified Public Accountants


Boynton Beach, Florida
September 17, 2010
 
 
F-1

 

Alternative Energy & Environmental Solutions, Inc.
(A Development Stage Company)
Balance Sheet
 
ASSETS
 
   
July 31, 2010
 
       
Current Assets
     
Cash
  $ 495,536  
Total Assets
  $ 495,536  
         
LIABILITIES AND STOCKHOLDERS' EQUITY
 
         
Current Liabilities
       
Accounts Payable & Accrued Expenses
  $ 15,000  
Total  Liabilities
  $ 15,000  
         
Commitments and Contingencies
    -  
         
Stockholders' Equity
       
  Preferred stock, $0.0001 par value; 10,000,000 shares authorized,
       
none issued  and outstanding
    -  
  Common stock, $0.0001 par value; 100,000,000 shares authorized, 6,012,516 shares
       
issued and outstanding
    601  
  Additional paid-in capital
    746,375  
Less: Stock subscription receivable
    (54,000 )
  Deficit accumulated during the development stage
    (212,440 )
Total Stockholders' Equity
    480,536  
         
Total Liabilities and Stockholders' Equity
  $ 495,536  
 
See accompanying notes to financial statements
 
 
F-2

 
 
Alternative Energy & Environmental Solutions, Inc.
 
(A Development Stage Company)
 
Statement of Operations
 
   
       
   
For the period from June 10, 2010
 
   
(inception) to
July 31, 2010
 
Operating Expenses
     
Professional fees
  $ 201,250  
General and administrative
    11,190  
Total Operating Expenses
    212,440  
         
LOSS FROM OPERATIONS BEFORE INCOME TAXES
    (212,440 )
         
         
Provision for Income Taxes
    -  
         
NET LOSS
  $ (212,440 )
         
Net Loss Per Share  - Basic and Diluted
  $ (0.05 )
         
Weighted average number of shares outstanding
    4,648,187  
  during the period - Basic and Diluted
       
 
See accompanying notes to financial statements
 
 
F-3

 
 
Alternative Energy & Environmental Solutions, Inc.
 
(A Development Stage Company)
 
Statement of Changes in Stockholders' Equity
 
For the period from June 10, 2010 (Inception) to July 31, 2010
 
                                                 
                                                 
                                 
Deficit
             
   
Preferred Stock
   
Common stock
   
Additional
   
accumulated during the
         
Total
 
                           
paid-in
   
development
   
Subscription
   
Stockholders'
 
   
Shares
   
Amount
   
Shares
   
Amount
   
capital
   
stage
   
Receivable
   
Equity
 
                                                 
Balance June 10, 2010
    -     $ -       -     $ -     $ -     $ -     $ -     $ -  
                                                                 
 Common stock issued for cash to founders ($0.0001 per share)
                    5,000,000       500       -       -       -       500  
                                                                 
 Common stock issued for cash ($0.75/ per share)
    -       -       1,012,516       101       759,275       -       (54,000 )     705,376  
                                                                 
 Stock Offering Costs
    -       -       -       -       (15,000 )     -       -       (15,000 )
                                                                 
 In kind contribution of services
    -       -       -       -       2,100       -       -       2,100  
                                                                 
 Net loss for the period June 10, 2010 (inception) to July 31, 2010
    -       -       -       -       -       (212,440 )     -       (212,440 )
                                                                 
 Balance, July 31, 2010
    -     $ -       6,012,516     $ 601     $ 746,375     $ (212,440 )   $ (54,000 )   $ 480,536  
 
See accompanying notes to financial statements
 
 
F-4

 
 
Alternative Energy & Environmental Solutions, Inc.
 
(A Development Stage Company)
 
Statement of Cash Flows
 
       
   
For the period from June 10, 2010
 
   
(inception) to July 31, 2010
 
Cash Flows Used in Operating Activities:
     
Net Loss
  $ (212,440 )
  Adjustments to reconcile net loss to net cash used in operations
       
    In-kind contribution of services
    2,100  
  Changes in operating assets and liabilities:
       
      (Decrease) Increase in accounts payable and accrued expenses
    15,000  
Net Cash Used In Operating Activities
    (195,340 )
         
Cash Flows From Financing Activities:
       
Proceeds from issuance of common stock, net of offering costs
    690,876  
Net Cash Provided by Financing Activities
    690,876  
         
Net Increase in Cash
    495,536  
         
Cash at Beginning of Period
    -  
         
Cash at End of Period
  $ 495,536  
         
Supplemental Disclosure of Cash Flow Information:
       
         
Cash paid for interest
  $ -  
Cash paid for taxes
  $ -  
         
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
 
         
Stock issued for subscription receivable
  $ 54,000  
 
See accompanying notes to financial statements
 
 
F-5

 
 
Alternative Energy & Environmental Solutions, Inc.
 (A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF July 31, 2010
 
 
NOTE 1            SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A) Organization

Alternative Energy and Environmental Solutions, Inc. (a development stage company) (the "Company") was incorporated under the laws of the State of Nevada on June 10, 2010 to market an innovative new biotechnology that utilizes nutrient stimulants – organic microbes – to extract coalbed methane more efficiently in high-production as well as from low-producing, depleted and abandoned coalmines in the U.S. Coalbed methane is a clean-burning natural gas used for heating in homes and is used to generate electricity.

Activities during the development stage include developing the business plan and raising capital.

(B) Use of Estimates

In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period.  Actual results could differ from those estimates.

(C) Cash and Cash Equivalents

The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents.  At July 31, 2010, the Company had no cash equivalents.

(D) Loss Per Share
 
In accordance with the accounting guidance now codified as FASB ASC Topic 260, “ Earnings per Share” basic earnings (loss) per share is computed by dividing net income (loss) by weighted average number of shares of common stock outstanding during each period.  Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.
 
Since the Company reflected a net loss in 2010, the effect of considering any common stock equivalents, if outstanding, would have been anti-dilutive.  A separate computation of diluted earnings (loss) per share is not presented.

 
F-6

 
 
Alternative Energy & Environmental Solutions, Inc.
 (A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF July 31, 2010

 
(E) Income Taxes

The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”).  Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  Under ASC 740-10-25, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

As of July 31, 2010, the Company has a net operating loss carryforward of approximately $210,340 available to offset future taxable income through July 31, 2030.  The valuation allowance at July 31, 2010 was $81,094.  The net change in the valuation allowance for the year ended July 31, 2010 was an increase of $81,094.

The net deferred tax liability in the accompanying balance sheets includes the following amounts of deferred tax assets and liabilities:


 
F-7

 
 
Alternative Energy & Environmental Solutions, Inc.
 (A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF July 31, 2010
 
 
The Company's income tax expense differed from the statutory rates (federal 34% and state 4.55%) as follows:
 
   
Year Ended June 30,
 
   
2010
 
       
Statutory rate applied to earnings before income taxes:
 
$
(81,904)
 
Increase (decrease) in income taxes resulting from:
       
     State income taxes
   
-
 
     Change in deferred tax asset valuation allowance
   
81,094
 
     Non-deductible expenses
   
810
 
Income Tax Expense
 
$
-
 
         
 
   
July 31, 2010
 
       
       
Deferred tax liability:
 
$
-
 
Deferred tax asset
       
     Net Operating Loss Carryforward
   
81,094
 
     Valuation allowance
   
(81,094)
 
     Net deferred tax asset
   
-
 
     Net deferred tax liability
 
$
-
 
 
The valuation allowance was established to reduce the deferred tax asset to the amount that will more likely than not be realized. This is necessary due to the Company’s continued operating losses and the uncertainty of the Company’s ability to utilize all of the net operating loss carryforwards before they will expire through the year 2030.
 
The components of income tax expense related to continuing operations are as follows:
 
   
2010
 
Federal
       
     Current
 
 $
-
 
     Deferred
   
-
 
   
 $
-
 
State and Local
       
     Current
 
 $
-
 
     Deferred
   
-
 
   
 $
-
 
         

 
F-8

 
 
Alternative Energy & Environmental Solutions, Inc.
 (A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF July 31, 2010

 
(F) Business Segments

The Company operates in one segment and therefore segment information is not presented.

(G) Revenue Recognition

The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”.  In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.

(H) Concentration of Credit Risk

The Company at times has cash in banks in excess of FDIC insurance limits. The Company had approximately $245,536 in excess of FDIC insurance limits at July 31, 2010.


NOTE 2           STOCKHOLDERS’ EQUITY
 
(A) Common Stock and Warrants Issued for Cash

For the period ended July 31, 2010, the Company issued 1,012,516 units for cash. Each unit consisted of one share of common stock and two warrants to purchase common stock for a total of 1,012,516 shares of common stock and 2,025,032 warrants to purchase common stock for $759,376($0.75/share) less stock offering costs of $15,000.  In addition, the Company also received the right to immediately call the warrants if the Company’s common stock trades for a period of 20 consecutive days at an average trading price of $3.00 per share or greater (see Note 2(C). Of the total funds raised, $54,000 has been recorded as a subscription receivable.  The $54,000 was received August 4, 2010 (See note 6).  The Company also issued 5,000,000 shares of common stock to its founders for $500 ($0.0001 per share) (See note 4).

(B) In-Kind Contribution

For the year ended July 31, 2010, a shareholder of the Company contributed services having a fair value of $2,100 (See Note 4).

(C) Warrants

The following tables summarize all warrant grants for the period ended July 31, 2010, and the related changes during these periods are presented below.
 
 
F-9

 
 
Alternative Energy & Environmental Solutions, Inc.
 (A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF July 31, 2010
 
 
   
Number of Warrants
   
Weighted Average Exercise Price
 
Warrants
           
Balance at June 10, 2010 (Inception)
   
-
     
-
 
Granted
   
2,025,032
         
Exercised
   
-
         
Forfeited
   
-
         
Balance at July 31, 2010
   
2,025,032
         
Warrants exercisable at July 31, 2010
   
2,025,032
   
$
2.50
 
Weighted average fair value of warrants granted during the period ending July 31, 2010
         
$
2.50
 
 
Of the total warrants granted, 2,025,032 are fully vested, exercisable and non-forfeitable.
 

2010 Warrants Outstanding
   
Warrants Exercisable
 
Range of Exercise Price
   
Number
Outstanding at
July 31, 2010
   
Weighted Average Remaining Contractual Life
   
Weighted Average Exercise Price
   
Number
Exercisable at
July 31, 2010
   
Weighted Average Exercise Price
 
$
2.50
     
2,025,032
     
4.88
   
$
2.50
     
2,025,032
   
$
2.50
 

These warrants are immediately exercisable at $2.50 per share and are immediately callable by the Company if the Company’s common stock trades for a period of 20 consecutive days at an average trading price of $3.00 per share or greater.  This option gives the Company the right, but not the obligation to repurchase the shares of common stock.  As of July 31, 2010, the fair value of the call option was less then the exercise price of the option and no value has been recorded for the option.  
 
F-10

 
 
Alternative Energy & Environmental Solutions, Inc.
 (A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF July 31, 2010
 
 
NOTE 3          COMMITMENTS

On June 4, 2010, the Company entered into a consulting agreement to receive administrative and other miscellaneous services.  The Company is required to pay $4,500 a month.  The agreement is to remain in effect unless either party desired to cancel the agreement.

On July 5, 2010, the Company entered into a consulting agreement for services to furthering the business.  These services include, but are not limited to the following: well work over, well injection services, injection of microbial nutrients & down hole services. In addition, the Company will have access to their transportation system (Pipeline), treatment facilities, meter runs, and equipment.  This agreement will be in effect for a period of 12 months unless extended and will cover up to $600,000 of services. As of July 31, 2010, the Company has paid $200,000 for services. Another $300,000 was paid in August 2010. 
 
NOTE 4           RELATED PARTY TRANSACTIONS

For the year ended July 31, 2010, shareholders of the Company contributed services having a fair value of $2,100 (See Note 2( B )).

On June 18, 2010, the Company issued 5,000,000 shares of common stock to its founders having a fair value of $500 ($0.0001/share) in exchange for cash provided (See Note 2 ( A )).

NOTE 5           GOING CONCERN

As reflected in the accompanying financial statements, the Company is in the development stage with no operations, used cash in operations of $195,340 from inception and has a net loss since inception of $212,440.    This raises substantial doubt about its ability to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan.  The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.
 
NOTE 6          SUBSEQUENT EVENTS

In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through September 17, 2010, the date the financial statements were issued.

On August 4, 2010, the Company received $54,000 for subscriptions that were outstanding as of July 31, 2010 (see Note 2( A )).
 
 
 
F-11

 

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

The following plan of operation provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition. The discussion should be read along with our financial statements and notes thereto. This section includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our predictions.

Plan of Operations

Alternative Energy and Environmental Solutions, Inc. is a development-stage company that plans to market an innovative new biotechnology that utilizes organic microbes to stimulate extraction of coal bed methane gas, a natural gas fuel, from coalmines in the U.S. The Company has not yet begun operation and has to-date not generated any revenue.
 
The Company plans to license its proprietary microbial-enhanced coal bed methane extraction technology to the companies owning coalmines or seeking to harvest natural gas from coalmines in the Powder River Basin area of Montana and Wyoming.
 
According to the U.S Geological Survey (USGS) the Powder River Basin has the potential to produce 22 Tcf of natural gas in the next 20 years. More than half of the 22,000 natural gas wells in the Powder River Basin are considered low producing, depleted or abandoned. Our proprietary biotech solution can become a cost-effective method for revitalizing the yields from these low-producing mines as well as valuable solution for helping to maintain yields in high-producing mines.
 
The Company’s innovative and environmentally sound biotechnology involves a continual injection of naturally occurring microbes into the available organic carbon and nutrients in wells of a coal seam. Our technology has been developed and refined since 2006, when Company associates initiated biogenic research with the University of Wyoming and Western Research Institute.
 
There are approximately 100 companies with mines in the Power River Basin that may be interested in cost-effective ways to develop additional reserves of this natural gas energy source. The Company plans to engage these companies in discussions geared toward developing licensing agreements, providing our biotech solution to aid these companies’ efforts to develop high yielding coal bed methane reserves.
 
The Company maintains it principal office at 159 North State Street, Newtown, PA 18940, and the Company’s telephone number is 215-968-1600.

Limited Operating History

We have not previously demonstrated that we will be able to expand our business. We cannot guarantee that the expansion efforts described in this prospectus will be successful. Our business is subject to risks inherent in growing an enterprise, including limited capital resources and possible rejection of our renovation services offering.
 
If the proceeds of our private placement prove to be insufficient to generate additional profits, future financing may not be available to us on acceptable terms.  If financing is not available on satisfactory terms, we may be unable to continue expanding our operations. Equity financing will result in a dilution to existing shareholders.

Our independent auditors have issued a going concern opinion that raises substantial doubt about our ability to continue as a going concern. As reflected in the financial statements in this prospectus, we are a development stage company with limited operations.  We had a net loss of $212,440 since inception (June 10, 2010) through July 31, 2010. We incurred professional fees totaling $201,250 and general and administrative expenses of $11,190 for the same period, inception through July 31, 2010. Cash on hand as of July 31, 2010 was $495,536.
 
 
II-1

 
 
Results of Operations

For the period from June 10, 2010 (inception), to July 31, 2010, we had $0 in revenue. Expenses for the period totaled $212,440 resulting in a net loss of $212,440.  Expenses for the period consisted of $201,250 in professional fees and $11,190 for general and administrative expenses.

Capital Resources and Liquidity

We raised cash to grow our business through a private placement that was completed on July 31, 2010. If we determine that we need more money to build our business, we will seek alternative sources, like a second private placement of securities or loans from our officers or others. At the present time, we have not made any arrangements to raise additional cash. If we need additional cash and are unable to raise it, we will either have to suspend or cease our expansion plans entirely. Other than as described in this registration statement, we have no other financing plans.
 
We issued 5,000,000 shares of common stock to Scott Williams, the President and Chief Executive Officer of the Company, pursuant to the exemption from registration set forth in section 4(2) of the Securities Act of 1933. Mr. Williams, the founder of the Company, contributed $500 for the 5,000,000 shares.
 
We anticipate that depending on market conditions and our plan of operations, we may incur operating losses in the foreseeable future. Therefore, our auditors have raised substantial doubt about our ability to continue as a going concern.

Off-Balance Sheet Arrangements
 
We have no off-balance sheet arrangements.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

There have been no changes in or disagreements with accountants on accounting or financial disclosure matters.

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

The following table sets forth the name and age of officers and directors as of October 25, 2010. Our executive officers are elected annually by our Board of Directors. Our executive officers hold their offices until they resign, are removed by the Board, or his successor is elected and qualified.  

Name
Age
Position
Scott Williams 59 President, Chief Executive Officer and Director
     
David Callan 45 Chief Financial Officer, Secretary and Director
     
John Tilger 45 Director
 

Set forth below is a brief description of the background and business experience of our executive officers and directors for the past five years.
 
 
II-2

 

Scott Williams, President, Chief Executive Officer and Director.

Scott Williams is the President, Chief Executive Officer and a Director of the Company. Mr. Williams is a seasoned sales and finance executive who has worked for the past 30 years to maximize return on investment for Wall Street firms, individual client investors and his own businesses. After a brief time as a salesman with Sterling Drug Company, he joined A.G. Edwards and Sons in 1978, the beginning of a long career in the investment business. Mr. Williams joined Drexel, Burnham Lambert in 1984 and was the assistant branch and sales manager of their Jenkintown, PA office.  When the branch was purchased by Prudential Securities, Mr. Williams continued in that capacity. In December of 1992, Mr. Williams and Mr. Callan, our Secretary and Treasurer, along with other former Prudential employees, joined Pennsylvania Merchant Group (“PMG”) in Radnor, PA. PMG was an investment banking boutique specializing in private equity transactions. Mr. Williams rose to become partner and Managing Director of the firm.  In late 2000, the firm was sold to a South African brokerage company called Investec, and all the PMG partners sold their stakes.  Investec left the business in 2002. Mr. Williams worked for a couple of Broker Dealers subsequently and in April 2005, along with Mr. Callan, formed Hawk Opportunity Fund, a specialty private investment fund.  Currently the fund has just under $20,000,000 under management and controls approximately $30,000,000 in assets. Mr. Scott lives in Washington Crossing, PA and is married with 3 grown sons. Mr. Williams graduated from the University of Oklahoma in 1975 with a B.A. in Political Science.
 
David Callan, Chief Financial Officer and Secretary.

David Callan is the Chief Financial Officer, Secretary and a Director of the Company. Mr. Callan is also a seasoned sales and finance executive with more than 20 years experience managing wealth for high net-worth individuals. Mr. Callan formed Polar Capital in 1995 with the primary objective of opportunistic investing in real estate and public and private securities. He merged Polar into Hawk Management in 2005 and continues to partner with Mr. Williams, our President and Director, in managing the firms’ funds and portfolio. In addition, Mr. Callan currently manages and/or owns more than $55 million in real estate projects.
 
John Tilger, Director.
 
As the founder and principal of Wharton Advisors, Mr. Tilger has helped to develop a now nationally recognized practice specializing in both estate and financial planning strategies for high net worth individuals, and in designing effective solutions for the fiduciary liability attached to "at risk" individuals involved in both qualified and non-qualified retirement plans. Wharton Advisors' client base ranges from Fortune 500 companies to local businesses and high net worth families in the Delaware Valley. Mr. Tilger presently maintains Series 6-Limited Securities Representative license, Series 7-General Securities Representative license, Series 24-General Securities Principal license, Series 63-Uniform Securities State Law license and Series 65-Uniform Investment Advisor Law license. Mr. Tilger received his bachelors degree from LaSalle University,
 
Term of Office
 
Our directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.

Director Independence and Committees

We have no independent directors nor have we formed any nominating, audit or compensation committees.

EXECUTIVE COMPENSATION

We have not paid any form of compensation to our executives. The compensation discussed herein addresses all compensation awarded to, earned by, or paid to the named officer, including base salaries, bonus awards and number of stock options granted, and certain other compensation, if any.
 
The Company has no employment agreement with Scott Williams. Scott Williams received no compensation for the period of inception (June 10, 2010) through July 31, 2010.
 
The Company has no employment agreement with David Callan. David Callan received no compensation for the period of inception (June 10, 2010) through July 31, 2010.
 
The Company has no employment agreement with John Tilger. John Tilger received no compensation for the period of inception (June 10, 2010) through July 31, 2010.
 
 
II-3

 
 
There are no other stock option plans, retirement, pension or profit sharing plans for the benefits of our officers and directors other than as described herein.

The following summary compensation table sets forth all compensation awarded to, earned by, or paid to the named executive officers paid by us during the period ended July 31, 2010.


Summary Compensation Table
 
Name and
Principal Position
Year
 
Salary
($)
 
Bonus
($)
 
Stock
Awards
($)
 
Option Awards
($)
 
Non-Equity Incentive Plan Compensation ($)
 
Non-Qualified Deferred Compensation Earnings
($)
All Other Compensation
($)
 
Totals
($)
 
Scott Williams, President, Chief Executive Officer and Director
2010
 
$
0
 
0
   
0
 
0
   
0
 
0
$0
 
$
0
 
                                           
David Callan, Secretary and Treasurer
2010
 
$
0
 
0
   
0
 
0
   
0
 
0
$0
 
$
0
 
                                           
John Tilger,
Director
2010
 
$
0
 
0
   
0
 
0
   
0
 
0
$0
 
$
0
 

 
Option Grants Table . There were no individual grants of stock options to purchase our common stock made to the executive officers named in the above Summary Compensation Table for the period from June 10, 2010 (inception) through July 31, 2010.
 
Aggregated Option Exercises and Fiscal Year-End Option Value .   There were no stock options exercised during period from inception through July 31, 2010 by the executive officers named in the Summary Compensation Table.
 
Long-Term Incentive Plan (“LTIP”) Awards .   There were no awards made to named executive officers in the last completed fiscal year under any LTIP.
 
Compensation of Directors

Directors are permitted to receive fixed fees and other compensation for their services as directors. The Board of Directors has the authority to fix the compensation of directors. No amounts have been paid to, or accrued to, directors in such capacity.

Employment Agreements

Currently, we do not have any employment agreements in place with any executive officers or employees.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 
The following table provides the names and addresses of each person known to us to own more than 5% of our outstanding shares of common stock as of October 25, 2010 and by the officers and directors, individually and as a group. Except as otherwise indicated, all shares are owned directly and the shareholders listed possesses sole voting and investment power with respect to the shares shown.
 
 
II-4

 
 
Name
 
Number of Shares Beneficially Owned
   
Percent of Class (1)
 
Scott Williams,
President, CEO, Director
4 Timber Knoll Drive
Washington Crossing, PA 18977
    5,000,000       83.16 %
                 
All Executive Officers and Directors as a group (1 person)
    5,000,000       83.16 %
  
(1) Based on 6,012,516 shares of common stock outstanding as of October 25, 2010
 
TRANSACTIONS WITH RELATED PERSONS, PROMOTERS AND
CERTAIN CONTROL PERSONS
 
For the year ended July 31, 2010, shareholders of the Company contributed services having a fair value of $2,100.

On June 18, 2010, we issued 5,000,000 shares of common stock to our founders having a fair value of $500 ($0.0001/share) in exchange for cash provided.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

We filed with the Securities and Exchange Commission a registration statement under the Securities Act of 1933 for the shares of common stock in this offering. This prospectus does not contain all of the information in the registration statement and the exhibits and schedule that were filed with the registration statement. For further information with respect to us and our common stock, we refer you to the registration statement and the exhibits and schedule that were filed with the registration statement. Statements contained in this prospectus about the contents of any contract or any other document that is filed as an exhibit to the registration statement are not necessarily complete, and we refer you to the full text of the contract or other document filed as an exhibit to the registration statement. A copy of the registration statement and the exhibits and schedules that were filed with the registration statement may be inspected without charge at the Public Reference Room maintained by the Securities and Exchange Commission at 100 F. Street, N.E., Washington, DC 20549-6010, and copies of all or any part of the registration statement may be obtained from the Securities and Exchange Commission upon payment of the prescribed fee. Information regarding the operation of the Public Reference Room may be obtained by calling the Securities and Exchange Commission at 1-800-SEC-0330. The Securities and Exchange Commission maintains a web site that contains reports, proxy and information statements, and other information regarding registrants that file electronically with the SEC. The address of the site is www.sec.gov.

DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION OF
SECURITIES ACT LIABILITIES.

Our Certificate of Incorporation and By-Laws include provisions that eliminate the personal liability of our directors  for monetary damages to the fullest extent possible under the laws of the State of Nevada or other applicable law. These provisions eliminate the liability of directors to us and our stockholders for monetary damages arising out of any violation of a director of his fiduciary duty of due care.  Under Nevada law, however, such provisions do not eliminate the personal liability of a director for (i) breach of the director’s duty of loyalty, (ii) acts or omissions not in good faith or involving intentional misconduct or knowing violation of law, (iii) payment of dividends or repurchases of stock other than from lawfully available funds, or (iv) any transaction from which the director derived an improper benefit. These provisions do not affect a director’s liabilities under the federal securities laws or the recovery of damages by third parties.
 
We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to a court of appropriate jurisdiction. We will then be governed by the court’s decision.
 
 
II-5

 
 
ALTERNATIVE ENERGY AND ENVIRONMENTAL SOLUTIONS, INC.
 
3,037,548 SHARES OF COMMON STOCK

PROSPECTUS

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT OR THAT WE HAVE REFERRED YOU TO. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT. THIS PROSPECTUS IS NOT AN OFFER TO SELL COMMON STOCK AND IS NOT SOLICITING AN OFFER TO BUY COMMON STOCK IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
 
Until _____________, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as underwriter and with respect to their unsold allotments or subscriptions.

The Date of This Prospectus is ­­­­­­­­­­­­­­___________, 2010
 
 
II-6

 
 
PART II:   INFORMATION NOT REQUIRED IN THE PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

Securities and Exchange Commission registration fee
 
$
415
 
Federal Taxes
 
$
0
 
State Taxes and Fees
 
$
0
 
Transfer Agent Fees
 
$
0
 
Accounting fees and expenses
 
$
5,000
 
Legal fees and expense
 
$
35,000
 
Blue Sky fees and expenses
 
$
1,500
 
Miscellaneous
 
$
0
 
Total
 
$
41,915
 

All amounts are estimates other than the Commission’s registration fee. We are paying all expenses of the offering listed above. No portion of these expenses will be borne by the selling shareholders. The selling shareholders, however, will pay any other expenses incurred in selling their common stock, including any brokerage commissions or costs of sale.
 
Item 14. Indemnification of Directors and Officers.
 
Our Certificate of Incorporation and By-Laws include provisions that eliminate the personal liability of our directors for monetary damages to the fullest extent possible under the laws of the State of Nevada or other applicable law. These provisions eliminate the liability of directors to the us and our stockholders for monetary damages arising out of any violation of a director of his fiduciary duty of due care.  Under Nevada law, however, such provisions do not eliminate the personal liability of a director for (i) breach of the director’s duty of loyalty, (ii) acts or omissions not in good faith or involving intentional misconduct or knowing violation of law, (iii) payment of dividends or repurchases of stock other than from lawfully available funds, or (iv) any transaction from which the director derived an improper benefit. These provisions do not affect a director’s liabilities under the federal securities laws or the recovery of damages by third parties.
 
We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to a court of appropriate jurisdiction. We will then be governed by the court’s decision.
 
Item 15. Recent Sales of Unregistered Securities.
 
We were incorporated in the State of Nevada on June 10, 2010. At that time 5,000,000 shares of common stock were issued to Scott Williams for $500. These shares were issued in reliance on the exemption under Section 4(2) of the Securities Act of 1933, as amended (the “Act”) and were issued as founder’s shares. These shares of our common stock qualified for exemption under Section 4(2) of the Securities Act of 1933 since the issuance shares by us did not involve a public offering. The offering was not a “public offering” as defined in Section 4(2) due to the insubstantial number of persons involved in the deal, size of the offering, manner of the offering and number of shares offered. We did not undertake an offering in which we sold a high number of shares to a high number of investors. In addition, Mr. Williams had the necessary investment intent as required by Section 4(2) since he agreed to and received share certificates bearing a legend stating that such shares are restricted pursuant to Rule 144 of the 1933 Securities Act. This restriction ensures that these shares would not be immediately redistributed into the market and therefore not be part of a “public offering.” Based on an analysis of the above factors, we have met the requirements to qualify for exemption under Section 4(2) of the Securities Act of 1933 for this transaction.
 
 
II-7

 
 
On July 31, 2010, we raised gross proceeds of $759,376 through the private placement of 1,012,516 Units at $0.75 per Unit with each Unit consisting of 1 share of our Common Stock, and a five (5) year Warrant to purchase 2 shares of our Common Stock exercisable at a price of $2.50 per share, to certain accredited investors.
 
The following sets forth the identity of persons to whom we sold these shares and the amount of shares beneficially owned by each shareholder:

Name (1)
Shares of Common Stock
Beneficially Owned (2)
Badger, Carleton M.
3,068
Bauz, Karl F.
20,000
Benchmark Capital
35,000
Blue, Robert E. Jr.
6,667
Calhoun, Harry W. & Barbara A. -Joint Subscribers
6,670
Callan, J. Laurence (3)
6,700
Callan, P. Douglas (4)
4,000
Chack, Janis D.
66,667
Coe, Paul R.-Imperial Capital LLC STE
20,000
Cohen, Cheryl
13,334
Cohen, Jamie Rebecca
10,000
Cohen, Michael Stuart
10,000
Consaley, Frederick E. & Helen J. - Joint Subscribers
13,500
Ebert, Edward C.
26,667
Ebert, Karen M.
6,667
Eisen, Sally S. (Eisen Family Trust)
20,000
Ellis, Carol-IRA
3,059
Ellis, Stephen & Carol JTWROS - Joint Subscribers
30,006
Ferguson, Jean
13,334
Flax, Lance
6,667
Flax, Lauren
3,334
Flax, Marian H.
6,667
Garre, MaryJo S.
20,000
Goldfine, Howard R
20,000
Hanan, Lisa G.
10,000
Hanan, Scott H.
23,334
Hawkins, Barry C.
13,334
Hollway, John F.
26,667
HWC LLC
66,667
Hyatt, Geoffrey
20,000
Keller, Laurence D.
10,000
Keszeli, Dr. Alexander C. & Kim -  Joint Subscribers
20,000
Lisausky, Adam
6,667
Macrae-Gibson, Gavin
33,334
Madian, Susan
13,334
Manzo, Angela S.
10,000
Manzo, Donald A.
10,000
O'Brien, Anne E.
13,334
 
 
II-8

 
 
Patten, Kathleen N.
32,000
Peacock, James P. Sr.
5,000
Peacock, Rebecca A.
5,000
Picariello, Michael A. & Darocha, Irene B.- Joint Subscribers
20,000
Robinson, Wendell Walker
13,500
Samkavitz, Sandra G.
13,334
Schanz, Francis J. Jr.
20,000
Schink, William B.
5,000
Smith, Brenda Ann
20,000
Stein, Neil A. & Diane M. -Joint Subscribers
6,667
Stern, Alan & Deborah - Joint Subscribers
28,000
Stewart, Christopher R.
46,667
Talarico, Michael J. & Sharron G. - Joint Subscribers
14,000
Twigg, Maria
13,334
Twigg, Todd Alan
13,334
Wichert, Cathy A. (Living Trust)
33,334
Williams, Daniel (Trust) (5)
6,667
Williams, James P. (6)
20,000
Williams, Joshua Paul (Trust) (6)
6,667
Williams, Matthew (Trust) (8)
6,667
Wisniewski, Mark W.
8,000
Wisniewski, William
6,667
Wissner, Beverlie F., TTE (Trust)
10,000
Wissner, Donald A., TTE (Trust)
10,000
TOTAL
1,012,516

(1)  
Shareholdings of spouses are listed together.
(2)  
Beneficial ownership is determined in accordance with the rules and regulations of the SEC. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, securities that are currently convertible or exercisable into shares of our Common Stock, or convertible or exercisable into shares of our Common Stock within 60 days of the date hereof are deemed outstanding. Such shares, however, are not deemed outstanding for the purposes of computing the percentage ownership of any other person. Except as indicated in the footnotes below, each stockholder named in the table has sole voting and investment power with respect to the shares set forth opposite such stockholder’s name.
(3)  
Laurence J. Callan is the father of David Callan, our Chief Financial Officer and Secretary.
(4)  
Douglas P. Callan is the Uncle of David Callan, our Chief Financial Officer and Secretary.
(5)  
Daniel Williams is the son of Scott Williams, our President, Chief Executive Officer and Director. Daniel’s shares are held in a trust.
(6)  
James P. Williams is the brother of Scott Williams, our President, Chief Executive Officer and Director.
(7)  
Joshua P. Williams is the son of Scott Williams, our President, Chief Executive Officer and Director. Joshua’s shares are held in a trust.
(8)  
Matthew Williams is the son of Scott Williams, our President, Chief Executive Officer and Director. Matthew’s shares are held in a trust.

Please note that pursuant to Rule 506, all shares purchased in the Regulation D, Rule 506 offering were restricted in accordance with Rule 144 of the Securities Act of 1933. In addition, each of these shareholders were either “accredited investors” as defined in Rule 501 (a) of Regulation D promulgated under the Securities Act or “sophisticated investors” as defined in Rule 506(b)(2)(ii) of Regulation D promulgated under the Securities Act.
   
(A)
At the time of the offering we were not: (1) subject to the reporting requirements of Section 13 or 15 (d) of the Exchange Act; or (2) an “investment company” within the meaning of the federal securities laws.
 
 
II-9

 
 
(B)
Neither we, nor any of our predecessors, nor any of our directors, nor any beneficial owner of 10% or more of any class of our equity securities, nor any promoter currently connected with us in any capacity has been convicted within the past ten years of any felony in connection with the purchase or sale of any security.
   
(C)
The offers and sales of securities by us pursuant to the offerings were not attempts to evade any registration or resale requirements of the securities laws of the United States or any of its states.
   
(D)
Except as set forth above, n one of the investors are affiliated with any of our directors, officers or promoters or any beneficial owner of 10% or more of our securities.

We never utilized an underwriter for an offering of our securities. Other than the securities mentioned above, we have not issued or sold any securities.

Item 16. Exhibits and Financial Statement Schedules.
 
EXHIBIT NUMBER
DESCRIPTION
3.1
Articles of Incorporation
3.2
By-Laws
5.1
Opinion of Anslow & Jaclin, LLP
10.1 Subscription Agreement
10.2
Form of Warrant
23.1
Consent of  Webb & Company, P.A.
23.2
Consent of Counsel (included as Exhibit 5.1)

Item 17. Undertakings.

(A) The undersigned Registrant hereby undertakes:
 
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
 
i.             To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
 
ii.             To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement.
 
iii.             To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
 
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
 
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. 
 
 
II-10

 
 
(4) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
 
(5) Each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
 
(6) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
 
i.             Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
 
ii.             Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
 
iii.            The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
 
iv.            Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

 
II-11

 

SIGNATURES
 
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Durham, State of Pennsylvania on October 25, 2010.
 
  ALTERNATIVE ENERGY AND ENVIRONMENTAL SOLUTIONS, INC.  
       
 
By:
/s/  Scott Williams  
    Name: Scott Williams  
    Position: President, Chief Executive Officer, Director  
 
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.
 
 
By:
/s/  Scott Williams  
    Name: Scott Williams  
    Position: President, Chief Executive Officer, Director  

 
POWER OF ATTORNEY
 
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Scott Williams and each of them, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities (including his capacity as a director and/or officer of Alternative Energy and Environmental Solutions, Inc.) to sign any or all amendments (including post-effective amendments) to this registration statement and any and all additional registration statements pursuant to rule 462(b) of the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the SEC, granting unto each said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

In accordance with the requirements of the Securities Act of 1933, as amended, this registration statement was signed below by the following persons in the capacities and on the dates stated.
 
 
By:
/s/  Scott Williams  
    Name: Scott Williams  
    Position: President, Chief Executive Officer, Director  
 
 
II-12
 
Exhibit 3.1
 
 
 
 
 
 
 
 
CORPORATE CHARTER
 
I,  ROSS MILLER,  the duly elected and qualified Nevada Secretary of State, do hereby certify that ALTERNATIVE ENERGY & ENVIRONMENTAL SOLUTIONS, INC., did on
June 10, 2010, file in this office the original Articles of Incorporation; that said Articles of Incorporation are now on file and of record in the
office of the Secretary of State of the State of Nevada, and further, that said Articles contain all the provisions required by the law of
said State of Nevada.
 
 
 
 
 
 
IN WITNESS WHEREOF, I have hereunto set my
hand and affixed the Great Seal of State, at my office
on June 10, 2010
 
/s/ Ross Miller
Ross Miller
Secretary of State
 
 
 
 
 

 
 
 
ROSS MILLER
Secretary of State
204 North Carson Street, Suite 4
Carson City, Nevada 89701-4520
(775) 684-5708
Website: www.nvsos.gov
 
 
Filed in the office of
/s/  Ross Miller
Ross Miller
Secretary of State
State of Nevada
Document Number
20100418333-05
Filing Date and Time
06/10/2010  10:35 AM
Entity Number
E0281562010-1
 
 
Articles of Incorporation
(PURSUANT TO NRS CHAPTER 78)
 
 
USE BLACK INK ONLY – DO NOT HIGHLIGHT
ABOVE SPACE FOR  OFFICE USE ONLY
 
1 .  Name of
Corporation
ALTERNATIVE ENERGY & ENVIRONMENTAL SOLUTIONS, INC.
   
2. Registered  Agent
for Service of  Process: (check
only one box)
 
x Commercial Registered Agent
CSC SERVICE OF NEVADA, INC.
o   Noncommercial Registered Agent
      (name and address below)   
OR
o   Office or Position with Entity
      (name and address below)
 
Name of Noncommercial Registered Agent OR Name of Title of Office or Other Position with Entity
   
Nevada
 
Street Address
City
 
Zip Code
   
Nevada
 
Mailing Address (If different from street address)
City
 
Zip code
3.  Authorized Stock : (number of shares corporation is authorized to issue)
Number of shares
With par value: 
 
10,000,000 Preferred 
100,000,000 Common
Par value
Per share:
 
$0.0001
Number of
Shares Without
par value:
 
 
4.  Name and Addresses
 Of the Board of Directors/Trustees: 
(each Director/Trustee
must be a natural person
at least 18 years of age:
attach additional page if
more than two
directors/trustees)
1.
SCOTT WILLIAMS
 
Name
 
159 North State Street
Newtown
PA
18940
 
Street Address
City
State
Zip Code
2
DAVID CALLAN
 
Name
  159 North State Street Newtown PA 18940
 
Street Address
City
State
Zip Code
5.  Purpose:
 (optional –see Instructions)
The purpose of this corporation shall be:
To engage in any lawful act or activity for which a corporation may be organized under Chapter 78 of NRS.
 
6.  Name, Address
And Signature of
Incorporator:
 (attach additional pages if
 more than one Incorporator)
CSC SERVICES OF NEVADA, INC.
X By: /s/ Mark Williams, AVP
Name
Incorporator Signature: Elizabeth R. Konieczny
502 EAST JOHN STREET
CARSON CITY
NV
89706
Address
City
State
Zip Code
7.  Certificate of
Acceptance of
Appointment of
Resident Agent
I hereby accept appointment as Resident Agent for the above named Entity.
X By: /s/ Mark Williams, AVP Business Filings Incorporated
6/10/10
Authorized Signature or Registrant Agent or on Behalf of Registered Agent Entity
Date
   
 
Exhibit 3.1
 
BYLAWS
OF
ALTERNATIVE ENERGY & ENVIRONMENTAL SOLUTIONS, INC.

A Nevada Corporation
As of June 10, 2010

ARTICLE I
Meetings of Stockholders

Section 1.1           Time and Place . Any meeting of the stockholders may be held at such time and such place, either within or without the State of Nevada, as shall be designated from time to time by resolution of the board of directors or as shall be stated in a duly authorized notice of the meeting.

Section 1.2           Annual Meeting . The annual meeting of the stockholders shall be held on the date and at the time fixed, from time to time, by the board of directors. The annual meeting shall be for the purpose of electing a board of directors and transacting such other business as may properly be brought before the meeting.

Section 1.3           Special Meetings . Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute or by the articles of incorporation, may be called by the president  and shall be called by the president or secretary if requested in writing by the holders of not less than one-tenth (1/10) of all the shares entitled to vote at the meeting. Such request shall state the purpose or purposes of the proposed meeting.

Section 1.4           Notices . Written notice stating the place, date and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be given not less than ten nor more than sixty days before the date of the meeting, except as otherwise required by statute or the articles of incorporation, either personally, by mail or by a form of electronic transmission consented to by the stockholder, to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be given when deposited in the official government mail of the United States or any other country, postage prepaid, addressed to the stockholder at his address as it appears on the stock records of the Corporation. If given personally or otherwise than by mail, such notice shall be deemed to be given when either handed to the stockholder or delivered to the stockholder’s address as it appears on the records of the Corporation.

Section 1.5           Record Date . In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting, or at any adjournment of a meeting, of stockholders; or entitled to receive payment of any dividend or other distribution or allotment of any rights; or entitled to exercise any rights in respect of any change, conversion, or exchange of stock; or for the purpose of any other lawful action; the board of directors may fix, in advance, a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the board of directors. The record date for determining the stockholders entitled to notice of or to vote at any meeting of the stockholders or any adjournment thereof shall not be more than sixty nor less than ten days before the date of such meeting. The record date for determining the stockholders entitled to consent to corporate action in writing without a meeting shall not be more than ten days after the date upon which the resolution fixing the record date is adopted by the board of directors. The record date for any other action shall not be more than sixty days prior to such action. If no record date is fixed, (i) the record date for determining stockholders entitled to notice of or to vote at any meeting shall be at the close of business on the day next preceding the day on which notice is given or, if notice is waived by all stockholders, at the close of business on the day next preceding the day on which the meeting is held; (ii) the record date for determining stockholders entitled to express consent to corporate action in writing without a meeting, when no prior action by the board of directors is required, shall be the first date on which a signed written consent setting forth the action taken or to be taken is delivered to the Corporation and, when prior action by the board of directors is required, shall be at the close of business on the day on which the board of directors adopts the resolution taking such prior action; and (iii) the record date for determining stockholders for any other purpose shall be at the close of business on the day on which the board of directors adopts the resolution relating to such other purpose. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the board of directors may fix a new record date for the adjourned meeting.
 
 
1

 
 
Section 1.6           Voting List . If the Corporation shall have more than five (5) shareholders, the secretary shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order and showing the address and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, at the Corporation’s principal offices. The list shall be produced and kept at the place of the meeting during the whole time thereof and may be inspected by any stockholder who is present.

Section 1.7           Quorum . The holders of a majority of the stock issued and outstanding and entitled to vote at the meeting, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business, except as otherwise provided by statute or by the articles of incorporation. If, however, such a quorum shall not be present at any meeting of stockholders, the stockholders entitled to vote, present in person or represented by proxy, shall have the power to adjourn the meeting from time to time, without notice if the time and place are announced at the meeting, until a quorum shall be present. At such adjourned meeting at which a quorum shall be present, any business may be transacted which might have been transacted at the original meeting. If the adjournment is for more than thirty days or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

Section 1.8           Voting and Proxies . At every meeting of the stockholders, each stockholder shall be entitled to one vote, in person or by proxy, for each share of the capital stock having voting power held by such stockholder, but no proxy shall be voted on after six months from its date unless the proxy provides for a longer period, which may not exceed seven years. When a specified item of business is required to be voted on by a class or series of stock, the holders of a majority of the shares of such class or series shall constitute a quorum for the transaction of such item of business by that class or series. If a quorum is present at a properly held meeting of the shareholders, the affirmative vote of the holders of a majority of the shares represented in person or by proxy and entitled to vote on the subject matter under consideration, shall be the act of the shareholders, unless the vote of a greater number or voting by classes (i) is required by the articles of incorporation, or (ii) has been provided for in an agreement among all shareholders entered into pursuant to and enforceable under Nevada Revised Statutes §78.365.

Section 1.9           Waiver . Attendance of a stockholder of the Corporation, either in person or by proxy, at any meeting, whether annual or special, shall constitute a waiver of notice of such meeting, except where a stockholder attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. A written waiver of notice of any such meeting signed by a stockholder or stockholders entitled to such notice, whether before, at or after the time for notice or the time of the meeting, shall be equivalent to notice. Neither the business to be transacted at, nor the purpose of, any meeting need be specified in any written waiver of notice.

Section 1.10         Stockholder Action Without a Meeting .  Except as may otherwise be provided by any applicable provision of the Nevada Revised Statutes, any action required or permitted to be taken at a meeting of the stockholders may be taken without a meeting if, before or after the action, a written consent thereto is signed by stockholders holding at least a majority of the voting power; provided that if a different proportion of voting power is required for such an action at a meeting, then that proportion of written consents is required.  In no instance where action is authorized by written consent need a meeting of stockholders be called or noticed.

 
ARTICLE II
Directors

Section 2.1           Number . The number of directors shall be one or more, as fixed from time to time by resolution of the board of directors; provided, however, that the number of directors shall not be reduced so as to shorten the tenure of any director at the time in office.
 
 
2

 
 
Section 2.2           Elections . Except as provided in Section 2.3 of this Article II, the board of directors shall be elected at the annual meeting of the stockholders or at a special meeting called for that purpose. Each director shall hold such office until his successor is elected and qualified or until his earlier resignation or removal.

Section 2.3           Vacancies . Any vacancy occurring on the board of directors and any directorship to be filled by reason of an increase in the board of directors may be filled by the affirmative vote of a majority of the remaining directors, although less than a quorum, or by a sole remaining director. Such newly elected director shall hold such office until his successor is elected and qualified or until his earlier resignation or removal.

Section 2.4           Meetings . The board of directors may, by resolution, establish a place and time for regular meetings which may be held without call or notice.

Section 2.5           Notice of Special Meetings . Special meetings may be called by the chairman, the president  or any two members of the board of directors. Notice of special meetings shall be given to each member of the board of directors: (i) by mail by the secretary, the chairman or the members of the board calling the meeting by depositing the same in the official government mail of the United States or any other country, postage prepaid, at least seven days before the meeting, addressed to the director at the last address he has furnished to the Corporation for this purpose, and any notice so mailed shall be deemed to have been given at the time when mailed; or (ii) in person, by telephone or by electronic transmission addressed as stated above at least forty-eight hours before the meeting, and such notice shall be deemed to have been given when such personal or telephone conversation occurs or at the time when such electronic transmission is delivered to such address.

Section 2.6           Quorum . At all meetings of the board, a majority of the total number of directors shall constitute a quorum for the transaction of business, and the act of a majority of the directors present at any meeting at which a quorum is present shall be the act of the board of directors, except as otherwise specifically required by statute, the articles of incorporation or these bylaws. If less than a quorum is present, the director or directors present may adjourn the meeting from time to time without further notice. Voting by proxy is not permitted at meetings of the board of directors.

Section 2.7           Waiver . Attendance of a director at a meeting of the board of directors shall constitute a waiver of notice of such meeting, except where a director attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. A written waiver of notice signed by a director or directors entitled to such notice, whether before, at or after the time for notice or the time of the meeting, shall be equivalent to the giving of such notice.

Section 2.8           Action Without Meeting . Any action required or permitted to be taken at a meeting of the board of directors may be taken without a meeting if a consent in writing setting forth the action so taken shall be signed by all of the directors and filed with the minutes of proceedings of the board of directors. Any such consent may be in counterparts and shall be effective on the date of the last signature thereon unless otherwise provided therein.
 
Section 2.9           Attendance by Telephone . Members of the board of directors may participate in a meeting of such board by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at such meeting.

ARTICLE III
Officers

Section 3.1           Election . The Corporation shall have such officers, with such titles and duties, as the board of directors may determine by resolution, which must include a chairman of the board, a president, a secretary and a treasurer and may include one or more vice presidents and one or more assistants to such officers. The officers shall in any event have such titles and duties as shall enable the Corporation to sign instruments and stock certificates complying with Section 6.1 of these bylaws, and one of the officers shall have the duty to record the proceedings of the stockholders and the directors in a book to be kept for that purpose. The officers shall be elected by the board of directors; provided, however, that the chairman may appoint one or more assistant secretaries and assistant treasurers and such other subordinate officers as he deems necessary, who shall hold their offices for such terms and shall exercise such powers and perform such duties as are prescribed in the bylaws or as may be determined from time to time by the board of directors or the chairman. Any two or more offices may be held by the same person.
 
 
3

 
 
Section 3.2           Removal and Resignation . Any officer elected or appointed by the board of directors may be removed at any time by the affirmative vote of a majority of the board of directors. Any officer appointed by the chairman may be removed at any time by the board of directors or the chairman. Any officer may resign at any time by giving written notice of his resignation to the chairman or to the secretary, and acceptance of such resignation shall not be necessary to make it effective unless the notice so provides. Any vacancy occurring in any office of chairman of the board, president, vice president, secretary or treasurer shall be filled by the board of directors. Any vacancy occurring in any other office may be filled by the chairman.

Section 3.3           Chairman of the Board . The chairman of the board shall preside at all meetings of shareholders and of the board of directors, and shall have the powers and  perform the duties usually pertaining to such office, and shall have such other powers and perform such other duties as may be from time to time prescribed by the board of directors..

Section 3.4           President . The president shall be the chief executive officer of the Corporation, and shall have general and active management of the business and affairs of the Corporation, under the direction of the board of directors. Unless the board of directors has appointed another presiding officer, the president shall preside at all meetings of the shareholders.

Section 3.5           Vice President . The vice president or, if there is more than one, the vice presidents in the order determined by the board of directors or, in lieu of such determination, in the order determined by the president, shall be the officer or officers next in seniority after the president. Each vice president shall also perform such duties and exercise such powers as are appropriate and such as are prescribed by the board of directors or, in lieu of or in addition to such prescription, such as are prescribed by the president from time to time. Upon the death, absence or disability of the president, the vice president or, if there is more than one, the vice presidents in the order determined by the board of directors or, in lieu of such determination, in the order determined by the president, or, in lieu of such determination, in the order determined by the chairman, shall be the officer or officers next in seniority after the president. in the order determined by the and  shall perform the duties and exercise the powers of the president.

Section 3.6           Assistant Vice President . The assistant vice president, if any, or, if there is more than one, the assistant vice presidents shall, under the supervision of the president or a vice president, perform such duties and have such powers as are prescribed by the board of directors, the president or a vice president from time to time.
 
Section 3.7          Secretary . The secretary shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the board of directors, keep the minutes of such meetings, have charge of the corporate seal and stock records, be responsible for the maintenance of all corporate files and records and the preparation and filing of reports to governmental agencies (other than tax returns), have authority to affix the corporate seal to any instrument requiring it (and, when so affixed, attest it by his signature), and perform such other duties and have such other powers as are appropriate and such as are prescribed by the board of directors or the president from time to time.

Section 3.8           Assistant Secretary . The assistant secretary, if any, or, if there is more than one, the assistant secretaries in the order determined by the board of directors or, in lieu of such determination, by the president or the secretary shall, in the absence or disability of the secretary or in case such duties are specifically delegated to him by the board of directors, the chairman, or the secretary, perform the duties and exercise the powers of the secretary and shall, under the supervision of the secretary, perform such other duties and have such other powers as are prescribed by the board of directors, the chairman, or the secretary from time to time.

Section 3.9           Treasurer . The treasurer shall have control of the funds and the care and custody of all the stocks, bonds and other securities of the Corporation and shall be responsible for the preparation and filing of tax returns. He shall receive all moneys paid to the Corporation and shall have authority to give receipts and vouchers, to sign and endorse checks and warrants in its name and on its behalf, and give full discharge for the same. He shall also have charge of the disbursement of the funds of the Corporation and shall keep full and accurate records of the receipts and disbursements. He shall deposit all moneys and other valuable effects in the name and to the credit of the Corporation in such depositories as shall be designated by the board of directors and shall perform such other duties and have such other powers as are appropriate and such as are prescribed by the board of directors or the president from time to time.
 
 
4

 
 
Section 3.10         Assistant Treasurer . The assistant treasurer, if any, or, if there is more than one, the assistant treasurers in the order determined by the board of directors or, in lieu of such determination, by the chairman or the treasurer shall, in the absence or disability of the treasurer or in case such duties are specifically delegated to him by the board of directors, the chairman or the treasurer, perform the duties and exercise the powers of the treasurer and shall, under the supervision of the treasurer, perform such other duties and have such other powers as are prescribed by the board of directors, the president or the treasurer from time to time.

Section 3.11         Compensation . Officers shall receive such compensation, if any, for their services as may be authorized or ratified by the board of directors. Election or appointment as an officer shall not of itself create a right to compensation for services performed as such officer.

Section 4.1           Designation of Committees . The board of directors may establish committees for the performance of delegated or designated functions to the extent permitted by law, each committee to consist of one or more directors of the Corporation, and if the board of directors so determines, one or more persons who are not directors of the Corporation. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the board of directors to act at the meeting in the place of such absent or disqualified member.
 
 Section 4.2           Committee Powers and Authority . The board of directors may provide, by resolution or by amendment to these bylaws, for an Executive Committee to consist of one or more directors of the Corporation (but no persons who are not directors of the Corporation) that may exercise all the power and authority of the board of directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it; provided, however, that an Executive Committee may not exercise the power or authority of the board of directors in reference to amending the articles of incorporation (except that an Executive Committee may, to the extent authorized in the resolution or resolutions providing for the issuance of shares of stock adopted by the board of directors, pursuant to Article 3(3) of the articles of incorporation, fix the designations and any of the preferences or rights of shares of preferred stock relating to dividends, redemption, dissolution, any distribution of property or assets of the Corporation, or the conversion into, or the exchange of shares for, shares of any other class or classes or any other series of the same or any other class or classes of stock of the Corporation or fix the number of shares of any series of stock or authorize the increase or decrease of the shares of any series), adopting an agreement of merger or consolidation, recommending to the stockholders the sale, lease, or exchange of all or substantially all of the Corporation’s property and assets, recommending to the stockholders a dissolution of the Corporation or a revocation of a dissolution, or amending these bylaws; and, unless the resolution expressly so provides, no an Executive Committee shall have the power or authority to declare a dividend or to authorize the issuance of stock.

Section 4.3           Committee Procedures . To the extent the board of directors or the committee does not establish other procedures for the committee, each committee shall be governed by the procedures established in Section 2.4 (except as they relate to an annual meeting of the board of directors) and Sections 2.5, 2.6, 2.7, 2.8 and 2.9 of these bylaws, as if the committee were the board of directors.

ARTICLE V
Indemnification

Section 5.1           Expenses for Actions Other Than By or In the Right of the Corporation . The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation) by reason of the fact that he is or was a director or officer of the Corporation, or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, association or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with which action, suit or proceeding, if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction or upon plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Corporation and, with respect to any criminal action or proceeding, that he had reasonable cause to believe that his conduct was unlawful.
 
 
5

 
 
Section 5.2           Expenses for Actions By or In the Right of the Corporation . The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that he is or was a director or officer of the Corporation, or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, association or other enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit, if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the court shall deem proper.
 
Section 5.3           Successful Defense . To the extent that any person referred to in the preceding two sections of this Article V has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in such sections, or in defense of any claim issue, or matter therein, he shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection therewith.

Section 5.4           Determination to Indemnify . Any indemnification under the first two sections of this Article V (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the director or officer is proper in the circumstances because he has met the applicable standard of conduct set forth therein. Such determination shall be made (i) by the stockholders, (ii) by the board of directors by majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (iii) if such quorum is not obtainable or, if a quorum of disinterested directors so directs, by independent legal counsel in a written opinion.

Section 5.5           Expense Advances . Expenses incurred by an officer or director in defending any civil or criminal action, suit or proceeding may be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of the director or officer to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the Corporation as authorized in this Article V.

Section 5.6           Provisions Nonexclusive . The indemnification and advancement of expenses provided by, or granted pursuant to, the other sections of this Article V shall not be deemed exclusive of any other rights to which any person seeking indemnification or advancement of expenses may be entitled under the articles of incorporation or under any other bylaw, agreement, insurance policy, vote of stockholders or disinterested directors, statute or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office.

Section 5.7          Insurance . By action of the board of directors, notwithstanding any interest of the directors in the action, the Corporation shall have power to purchase and maintain insurance, in such amounts as the board of directors deems appropriate, on behalf of any person who is or was a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, association or other enterprise, against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not he is indemnified against such liability or expense under the provisions of this Article V and whether or not the Corporation would have the power or would be required to indemnify him against such liability under the provisions of this Article V or of the Nevada Revised Statutes §78.7502; §78.751 or §78.752 or by any other applicable law.
 
 
6

 
 
Section 5.8           Surviving Corporation . The board of directors may provide by resolution that references to “the Corporation” in this Article V shall include, in addition to this Corporation, all constituent corporations absorbed in a merger with this Corporation so that any person who was a director or officer of such a constituent corporation or is or was serving at the request of such constituent corporation as a director, employee or agent of another corporation, partnership, joint venture, trust, association or other entity shall stand in the same position under the provisions of this Article V with respect to this Corporation as he would if he had served this Corporation in the same capacity or is or was so serving such other entity at the request of this Corporation, as the case may be.

Section 5.9           Inurement. The indemnification and advancement of expenses provided by, or granted pursuant to, this Article V shall continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors, and administrators of such person.

Section 5.10         Employees and Agents . To the same extent as it may do for a director or officer, the Corporation may indemnify and advance expenses to a person who is not and was not a director or officer of the Corporation but who is or was an employee or agent of the Corporation or who is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, association or other enterprise.
 
ARTICLE VI
Stock

Section 6.1           Certificates . Every holder of stock in the Corporation represented by certificates and, upon request, every holder of uncertificated shares shall be entitled to have a certificate, signed by or in the name of the Corporation by the President or chairman of the board of directors, or a vice president, and by the secretary or an assistant secretary, or the treasurer or an assistant treasurer of the Corporation, certifying the number of shares owned by him in the Corporation.

Section 6.2           Facsimile Signatures . Where a certificate of stock is countersigned (i) by a transfer agent other than the Corporation or its employee or (ii) by a registrar other than the Corporation or its employee, any other signature on the certificate may be facsimile. In case any officer, transfer agent or registrar who has signed, or whose facsimile signature or signatures have been placed upon, any such certificate shall cease to be such officer, transfer agent or registrar, whether because of death, resignation or otherwise, before such certificate is issued, the certificate may nevertheless be issued by the Corporation with the same effect as if he were such officer, transfer agent or registrar at the date of issue.

Section 6.3           Transfer of Stock . Transfers of shares of stock of the Corporation shall be made on the books of the Corporation only upon presentation of the certificate or certificates representing such shares properly endorsed or accompanied by a proper instrument of assignment, except as may otherwise be expressly provided by the laws of the State of Nevada or by order by a court of competent jurisdiction. The officers or transfer agents of the Corporation may, in their discretion, require a signature guaranty before making any transfer.

Section 6.4           Lost Certificates . The board of directors may direct that a new certificate of stock be issued in place of any certificate issued by the Corporation that is alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate to be lost, stolen, or destroyed. When authorizing such issue of a new certificate, the board of directors may, in its discretion and as a condition precedent to the issuance of a new certificate, require the owner of such lost, stolen, or destroyed certificate, or his legal representative, to give the Corporation a bond in such sum as it may reasonably direct as indemnity against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate.
 
 
7

 
 
ARTICLE VII
Seal

The board of directors may, but are not required to, adopt and provide a common seal or stamp which, when adopted, shall constitute the corporate seal of the Corporation. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or manually reproduced.

ARTICLE VIII
Fiscal Year

The board of directors, by resolution, may adopt a fiscal year for the Corporation.

ARTICLE IX
Amendment

These bylaws may at any time and from time to time be amended, altered or repealed exclusively by the board of directors, as provided in the articles of incorporation.
 
 
8
Exhibit 5.1

 
 
 
October 22, 2010

Real Estate Restoration & Rental, Inc.
710 Wellingham Drive
Durham, North Carolina 27713

Gentlemen:
 
You have requested our opinion, as counsel for Alternative Energy and Environmental Solutions, Inc., a Nevada corporation (the “Company”), in connection with the registration statement on Form S-1 (the “Registration Statement”), under the Securities Act of 1933 (the “Act”), filed by the Company with the Securities and Exchange Commission.
 
The Registration Statement relates to an offering of 3,037,548 shares of the Company’s common stock.
 
We have examined such records and documents and made such examination of laws as we have deemed relevant in connection with this opinion. It is our opinion that the shares of common stock to be sold by the selling shareholders have been duly authorized and are legally issued, fully paid and non-assessable.
 
No opinion is expressed herein as to any laws other than the State of Nevada of the United States. This opinion opines upon Nevada law including the statutory provisions, all applicable provisions of the Nevada Constitution and reported judicial decisions interpreting those laws.
 
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our firm under the caption “Experts” in the Registration Statement. In so doing, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Act and the rules and regulations of the Securities and Exchange Commission promulgated thereunder.
 
Very truly yours,
 
ANSLOW & JACLIN, LLP


By:
/s/ Gregg E. Jaclin
 
 
Gregg E. Jaclin, Partner
ANSLOW & JACLIN, LLP
 

 
195 Route 9 South, Suite 204, Manalapan, New Jersey 07726
Tel: (732) 409-1212 Fax: (732) 577-1188
 


Exhibit 10.1
 
 
SUBSCRIPTION AGREEMENT
 
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 Company 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 under 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.
 
 
 

 
 
Subject to applicable state securities laws, the Purchaser may not revoke any subscription that such Purchaser delivers to the Company. However, the Purchaser understands and agrees that the Company, in its sole discretion, may (i) reject the subscription of any Purchaser, whether or not qualified, in whole or in, part, and (ii) may withdraw the Offering at any time prior to the termination of the Offering.  The Company shall have no obligation to accept subscriptions in the order received. This subscription shall become binding only if accepted by the Company.

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 Agreement 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:
 
 
 

 
 
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE "ACT") OR. APPLICABLE STATE SECURITIES LAWS, AND SUCH SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH SALE OR TRANSFER IS EXEMPT FROM SUCH REGISTRATION REQUIREMENTS OF THE ACT AND APPLICABLE STATE SECURITIES 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.

The Purchaser understands the meaning and legal consequences of the representations and warranties contained in Section 4.2, and agrees to indemnify and hold harmless the Company and each member, officer, employee, agent or representative thereof against any and all loss, damage or liability due to or arising out of a breach of any representation or warranty, or breach or failure to comply with any covenant, of the Purchaser, whether contained in the Private Placement Memorandum or this Agreement. Notwithstanding any of the representations, warranties, acknowledgments or agreements made herein by the Purchaser, the Purchaser does not thereby or in any other manner waive any rights granted to the Purchaser under federal or state securities laws.

6.                      Provisions of Certain State Laws.

IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE ISSUER AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
 
 
 

 
 
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE NEW YORK UNIFORM SECURITIES ACT AND, THEREFORE, CANNOT BE RESOLD UNLESS THEY ARE REGISTERED UNDER THE ACT OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
 
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.

8.           Irrevocability; Binding Effect.

The Purchaser hereby acknowledges and agrees that the subscription hereunder is irrevocable, that the Purchaser is not entitled to cancel, terminate or revoke this Agreement or any agreements of the Purchaser thereunder, and that this Agreement and such other agreements shall survive the death or disability of the Purchaser and shall be binding upon and inure to the benefit of the parties and their heirs, executors, administrators, successors, legal representatives and assigns.  If the Purchaser is more than one person, the obligations of the Purchaser hereunder shall be joint and several and the agreements, representations, warranties and acknowledgments herein contained shall be deemed to be made by and be binding upon each such person and his heirs, executors, legal representatives and assigns.

9. Modification.

Neither this Subscription Agreement nor any provisions hereof shall be waived, modified, discharged or terminated except by an instrument in writing signed by the party against whom any such waiver, modification, discharge or termination is sought.

10. Notices.

Any notice, demand or other communication which any party hereto may be required, or may elect, to give to any other party hereunder shall be sufficiently given if (a) deposited, postage prepaid, in a United States mail box, stamped registered or certified mail, return receipt requested, addressed to such address as may be listed on the books of the Company, or (b) delivered personally at such address.

11. Counterparts.

This Agreement may be executed through the use of separate signature pages or in any number of counterparts, and each such counterpart shall, for all purposes, constitute one agreement binding on all parties, notwithstanding that all parties are not signatories to the same counterpart.

12.           Entire Agreement.

This Agreement contains the entire agreement of the parties with respect to the subject matter hereof and there are no representations, covenants or other agreements except as stated or referred to herein.

13. Severability.

Each provision of this Agreement is intended to be severable from every other provision, and the invalidity or illegality of any portion hereof shall not affect the validity or legality of the remainder hereof.
 
 
 

 
 
14. Assignability.

This Agreement is not transferable or assignable by the Purchaser.

15. Applicable Law.

This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflict of laws principles, as applied to residents of that State executing contracts wholly to be performed in that State.

16. Choice of Jurisdiction.

The parties agree that any action or proceeding arising, directly, indirectly or otherwise, in connection with, out of or from this Subscription Agreement, any breach hereof or any transaction covered hereby shall be resolved within the County, City and State of New York. Accordingly, the parties consent and submit to the jurisdiction of the United States federal and state courts located within the County, City and State of New York.

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.

[-Signature Pages Follow-]
 
 
 

 
 
SUBSCRIPTION AGREEMENT
SIGNATURE PAGE

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.
 
     
Exact Name in which Shares are to be Registered     Exact Name in which Shares are to be Registered
     
     
Signature   Signature
     
     
Print Name     Print Name  
     
     
Tax Identification Number:    Tax Identification Number: 
     
     
Mailing Address     Mailing Address  
     
     
Residence Phone Number   Residence Phone Number
     
     
Work Phone Number    Work Phone Number 
     
     
E-Mail Address    E-Mail Address 
     
 
 
 

 
 
ACCEPTANCE OF SUBSCRIPTION


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

 
 

 

Exhibit I to Subscription Agreement

DEFINITION OF “ACCREDITED INVESTOR”
WITHIN THE MEANING OF REGULATION D

“Accredited investor” means any person who comes within any of the following categories, or whom the Company reasonably believes comes within any of the following categories, at the time of the sale of the Units to that person:

(i) any bank as defined in Section 3(a)(2) of the Securities Act or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary capacity; any broker dealer registered pursuant to Section 15 of the Exchange Act; any insurance company as defined in Section 2(13) of the Securities Act; any investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that act; any Small Business Investment Company licensed by the U.S., Small Business Administration under Section 301 (c) or (d) of the Small Business Investment Act of 1958; any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has total assets in excess of $5,000,000; any employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000, or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors;

(ii)  any private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940;

(iii) any organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;

(iv)  any of the directors or executive officers of the Company;

(v)  any natural person whose individual net worth, or joint net worth with that person's spouse, at the time of investment in the Common Stock, exceeds $500,000;

(vi) any natural person who had an individual income in excess of $150,000 in each of the two most recent years or joint income with that person's spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching that same income level in the current year;

(vii) any trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Common Stock, whose purchase is directed by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D; or

(viii)  any entity in which all of the equity owners are accredited investors.
 
 
 

 
 
Exhibit II to Subscription Agreement

PURCHASER QUESTIONNAIRE FOR INDIVIDUALS

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 “accredited 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.

THE COMPANY WILL NOT OFFER OR SELL UNITS TO ANY INDIVIDUAL WHO HAS NOT FILLED OUT, AS THOROUGHLY AS POSSIBLE, A PROSPECTIVE PURCHASER QUESTIONNAIRE.

Instructions:

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 (___) ___-____.

PLEASE ANSWER ALL QUESTIONS . If the appropriate answer is “None” or “Not Applicable,” so state. Please print or type your answers to all questions. Attach additional sheets if necessary to complete your answers to any item.

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:  ____________________________________________________________________

II.            Financial Condition:

1.           Did your individual annual income during each of 2008 and 2009 exceed $200,000 and do you reasonably expect your individual annual income during 2010 to exceed $200,000?
Yes _______                                No _______

2.           Did your joint (with spouse) annual income during each of 2008 and 2009 exceed $300,000 and do you reasonably expect your individual annual income during 2010 to exceed $300,000?
Yes _______                                No  _______

3.           Does your individual or joint net worth exceed $1,000,000?
Yes _______                                No  _______

By signing this Questionnaire I hereby confirm the following statements:

(a) I am aware that the offering of Common Stock will involve securities that are not transferable and for which no market exists, thereby requiring my investment to be maintained for an indefinite period of time.

(b) I acknowledge that any delivery to me of the Private Placement Memorandum relating to the Units prior to the determination by the Company of my suitability as an investor, shall not constitute an offer of such Units until such determination of suitability shall be made, and I agree that I shall promptly return the Private Placement Memorandum to the Company upon request.

(c)           My answers to the foregoing questions are, and were on any date (if any) that I previously subscribed for Units in the Company, true and complete to the best of my information and belief and were true on any date that I previously as of, and I will promptly notify the Company of any changes in the information I have provided.

Executed:

Date:________________  _______________________________________________
(Printed Name)

Place:  ____________________________________

__________________________________________
(Signature)

__________________________________________
(Printed Name of Joint Subscriber)
Exhibit 10.2
 
 
NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS WARRANT NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.  NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 
Right to Purchase shares of Common Stock of Alternative Energy & Environmental, Inc. (subject to adjustment as provided herein)

COMMON STOCK PURCHASE WARRANT
 
No. A-001 Issue Date: October    , 2010
 
Alternative Energy & Environmental, Inc., a corporation organized under the laws of the State of Nevada (the “Company”), hereby certifies that, for value received,               , or his assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company at any time after the Issue Date until 5:00 p.m., E.S.T on October   , 2015 (the “Expiration Date”), up to             fully paid and nonassessable shares of Common Stock at a per share purchase price of $2.50.  The aforedescribed purchase price per share, as adjusted from time to time as herein provided, is referred to herein as the “Purchase Price.”  The number and character of such shares of Common Stock and the Purchase Price are subject to adjustment as provided herein.

As used herein the following terms, unless the context otherwise requires, have the following respective meanings:
 
(a)           The term “Company” shall mean ALTERNATIVE ENERGY & ENVIRONMENTAL, INC., a Nevada corporation, and any corporation which shall succeed or assume the obligations of ALTERNATIVE ENERGY  & ENVIRONMENTAL, INC. hereunder.
 
(b)           The term “Common Stock” includes (i) the Company's Common Stock, $0.0001 par value per share, as authorized on the Issue Date, and (ii) any other securities into which or for which any of the securities described in (i) may be converted or exchanged pursuant to a plan of recapitalization, reorganization, merger, sale of assets or otherwise.
 
(c)           The term “Other Securities” refers to any stock (other than Common Stock) and other securities of the Company or any other entity (corporate or otherwise) which the holder of the Warrant at any time shall be entitled to receive, or shall have received, on the exercise of the Warrant, in lieu of or in addition to Common Stock, or which at any time shall be issuable or shall have been issued in exchange for or in replacement of Common Stock or Other Securities pursuant to Section 4 herein or otherwise.
 
(d)           The term “ Trading Day ” means (a) a day on which the Common Stock is traded on a Trading Market, or (b) if the Common Stock is not traded on a Trading Market, a day on which the Common Stock is quoted in the over-the-counter market as reported by the National Quotation Bureau Incorporated (or any similar organization or agency succeeding its functions of reporting prices); provided , however , that in the event that the Common Stock is not listed or quoted as set forth in (a) or (b) hereof, then Trading Day shall mean any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in the State of New York are authorized or required by law or other government action to close.
 
 
1

 
 
(e)           The term “ Trading Market ” means the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE Amex Equities, the NASDAQ Capital Market, the NASDAQ Global Market, the NASDAQ Global Select Market, the New York Stock Exchange or the OTC Bulletin Board.
 
(f)           The term “Warrant Shares” shall mean the Common Stock issuable upon exercise of this Warrant.
 
1.            Exercise of Warrant .
 
1.1.            Number of Shares Issuable upon Exercise .  From and after the Issue Date through and including the Expiration Date, the Holder hereof shall be entitled to receive, upon exercise of this Warrant in whole in accordance with the terms of Section 1.2 or upon exercise of this Warrant in part in accordance with Section 1.3, shares of Common Stock of the Company, subject to adjustment pursuant to Section 4.
 
1.2.            Full Exercise .  This Warrant may be exercised in full by the Holder hereof by delivery of an original or facsimile copy of the form of subscription attached as Exhibit A hereto (the “Subscription Form”) duly executed by such Holder and delivery within two days thereafter of payment, in cash, wire transfer or by certified or official bank check payable to the order of the Company, in the amount obtained by multiplying the number of shares of Common Stock for which this Warrant is then exercisable by the Purchase Price then in effect.  The original Warrant is not required to be surrendered to the Company until it has been fully exercised, except as set forth in Section 1.3.
 
1.3.            Partial Exercise .  This Warrant may be exercised in part (but not for a fractional share) by delivery of a Subscription Form in the manner and at the place provided in Section 1.2 except that the amount payable by the Holder on such partial exercise shall be the amount obtained by multiplying (a) the number of whole shares of Common Stock designated by the Holder in the Subscription Form by (b) the Purchase Price then in effect.  On any such partial exercise provided the Holder has surrendered the original Warrant, the Company, at its expense, will forthwith issue and deliver to or upon the order of the Holder hereof a new Warrant of like tenor, in the name of the Holder hereof or as such Holder (upon payment by such Holder of any applicable transfer taxes) may request, the whole number of shares of Common Stock for which such Warrant may still be exercised.
 
1.5.            Company Acknowledgment .  The Company will, at the time of the exercise of the Warrant, upon the request of the Holder hereof, acknowledge in writing its continuing obligation to afford to such Holder any rights to which such Holder shall continue to be entitled after such exercise in accordance with the provisions of this Warrant.  If the Holder shall fail to make any such request, such failure shall not affect the continuing obligation of the Company to afford to such Holder any such rights.
 
1.6.            Delivery of Stock Certificates, etc. on Exercise .  The Company agrees that, provided the full purchase price listed in the Subscription Form is received as specified in Section 1.2, the shares of Common Stock purchased upon exercise of this Warrant shall be deemed to be issued to the Holder hereof as the record owner of such shares as of the close of business on the date on which delivery of a Subscription Form shall have occurred and payment made for such shares as aforesaid.  As soon as practicable after the exercise of this Warrant in full or in part, and in any event within three (3) business days thereafter (“Warrant Share Delivery Date”), the Company at its expense (including the payment by it of any applicable issue taxes) will cause to be issued in the name of and delivered to the Holder hereof, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct in compliance with applicable securities laws, a certificate or certificates for the number of duly and validly issued, fully paid and non-assessable shares of Common Stock (or Other Securities) to which such Holder shall be entitled on such exercise, plus, in lieu of any fractional share to which such Holder would otherwise be entitled, cash equal to such fraction multiplied by the then Fair Market Value of one full share of Common Stock, together with any other stock or other securities and property (including cash, where applicable) to which such Holder is entitled upon such exercise pursuant to Section 1 or otherwise.
 
 
2

 
 
           1.7.            Call Option.   The Warrants shall be immediately callable by the Company 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.
 
2.            Adjustment for Reorganization, Consolidation, Merger, etc.
 
2.1.            Fundamental Transaction .  If, at any time while this Warrant is outstanding, (A) the Company effects any merger or  consolidation  of the Company with or into another entity, (B) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions,  (C) any tender offer or exchange offer (whether by the Company or another entity) is completed pursuant to which holders of Common Stock are permitted to tender or exchange their shares for other securities, cash or property, (D) the Company consummates a stock purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, or spin-off) with one or more persons or entities whereby such other persons or entities acquire more than the 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by such other persons or entities making or party to, or associated or affiliated with the other persons or entities making or party to, such stock purchase agreement or other business combination), (E) any "person" or "group" (as these terms are used for purposes of Sections 13(d) and 14(d) of the 1934 Act) is or shall become the "beneficial owner" (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of 50% of the aggregate Common Stock of the Company, or (F) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (in any such case, a “Fundamental  Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder, (a) upon exercise of this Warrant, the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable upon or as a result of such reorganization, reclassification, merger, consolidation or disposition of assets by a Holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such event or (b) if the Company is acquired in (1) a transaction where the consideration paid to the holders of the Common Stock consists solely of cash, (2) a “Rule 13e-3 transaction” as defined in Rule 13e-3 under the 1934 Act, or (3) a transaction involving a person or entity not traded on a national securities exchange, the Nasdaq Global Select Market, the Nasdaq Global Market or the Nasdaq Capital Market, cash equal to the Black-Scholes Value.  For purposes of any such exercise, the determination of the Purchase Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such fundamental Transaction, and the Company shall apportion the Purchase Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.  If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction.  To the extent necessary to effectuate the foregoing provisions, any successor to the Company or surviving entity in such Fundamental Transaction shall issue to the Holder a new warrant consistent with the foregoing provisions and evidencing the Holder's right to exercise such warrant into Alternate Consideration.  The terms of any agreement pursuant to which a Fundamental Transaction is effected shall include terms requiring any such successor or surviving entity to comply with the provisions of this Section 3.1 and insuring that this Warrant (or any such replacement security) will be similarly adjusted upon any subsequent transaction analogous to a Fundamental Transaction.  “Black-Scholes Value” shall be determined in accordance with the Black-Scholes Option Pricing Model obtained from the “OV” function on Bloomberg L.P. using (i) a price per share of Common Stock equal to the VWAP of the Common Stock for the Trading Day immediately preceding the date of consummation of the applicable Fundamental Transaction, (ii) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of the date of such request and (iii) an expected volatility equal to the 100 day volatility obtained from the HVT function on Bloomberg L.P. determined as of the Trading Day immediately following the public announcement of the applicable Fundamental Transaction.
 
 
3

 
 
2.2.            Continuation of Terms .  Upon any reorganization, consolidation, merger or transfer (and any dissolution following any transfer) referred to in this Section 3, this Warrant shall continue in full force and effect and the terms hereof shall be applicable to the Other Securities and property receivable on the exercise of this Warrant after the consummation of such reorganization, consolidation or merger or the effective date of dissolution following any such transfer, as the case may be, and shall be binding upon the issuer of any Other Securities, including, in the case of any such transfer, the person acquiring all or substantially all of the properties or assets of the Company, whether or not such person shall have expressly assumed the terms of this Warrant as provided in Section 4.
 
3.            Extraordinary Events Regarding Common Stock .  In the event that the Company shall (a) issue additional shares of the Common Stock as a dividend or other distribution on outstanding Common Stock, (b) subdivide its outstanding shares of Common Stock, or (c) combine its outstanding shares of the Common Stock into a smaller number of shares of the Common Stock, then, in each such event, the Purchase Price shall, simultaneously with the happening of such event, be adjusted by multiplying the then Purchase Price by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding immediately prior to such event and the denominator of which shall be the number of shares of Common Stock outstanding immediately after such event, and the product so obtained shall thereafter be the Purchase Price then in effect. The Purchase Price, as so adjusted, shall be readjusted in the same manner upon the happening of any successive event or events described herein in this Section 4.  The number of shares of Common Stock that the Holder of this Warrant shall thereafter, on the exercise hereof, be entitled to receive shall be adjusted to a number determined by multiplying the number of shares of Common Stock that would otherwise (but for the provisions of this Section 4) be issuable on such exercise by a fraction of which (a) the numerator is the Purchase Price that would otherwise (but for the provisions of this Section 4) be in effect, and (b) the denominator is the Purchase Price in effect on the date of such exercise.
 
4.            Certificate as to Adjustments .  In each case of any adjustment or readjustment in the shares of Common Stock (or Other Securities) issuable on the exercise of the Warrants, the Company at its expense will promptly cause its Chief Financial Officer or other appropriate designee to compute such adjustment or readjustment in accordance with the terms of the Warrant and prepare a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based, including a statement of (a) the consideration received or receivable by the Company for any additional shares of Common Stock (or Other Securities) issued or sold or deemed to have been issued or sold, (b) the number of shares of Common Stock (or Other Securities) outstanding or deemed to be outstanding, and (c) the Purchase Price and the number of shares of Common Stock to be received upon exercise of this Warrant, in effect immediately prior to such adjustment or readjustment and as adjusted or readjusted as provided in this Warrant. The Company will forthwith mail a copy of each such certificate to the Holder of the Warrant and any Warrant Agent of the Company (appointed pursuant to Section 9 hereof).
 
5.            Reservation of Stock, etc. Issuable on Exercise of Warrant; Financial Statements .  The Company will at all times reserve and keep available, solely for issuance and delivery on the exercise of the Warrants, all shares of Common Stock (or Other Securities) from time to time issuable on the exercise of the Warrant.  This Warrant entitles the Holder hereof, upon written request, to receive copies of all financial and other information distributed or required to be distributed to the holders of the Company's Common Stock.
 
 
4

 
 
6.            Assignment; Exchange of Warrant .  Subject to compliance with applicable securities laws, this Warrant, and the rights evidenced hereby, may be transferred by any registered holder hereof (a “Transferor”).  On the surrender for exchange of this Warrant, with the Transferor's endorsement in the form of Exhibit B attached hereto (the “Transferor Endorsement Form”) and together with an opinion of counsel reasonably satisfactory to the Company that the transfer of this Warrant will be in compliance with applicable securities laws, the Company will issue and deliver to or on the order of the Transferor thereof a new Warrant or Warrants of like tenor, in the name of the Transferor and/or the transferee(s) specified in such Transferor Endorsement Form (each a “Transferee”), calling in the aggregate on the face or faces thereof for the number of shares of Common Stock called for on the face or faces of the Warrant so surrendered by the Transferor.
 
7.            Replacement of Warrant .  On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction of this Warrant, on delivery of an indemnity agreement or security reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, on surrender and cancellation of this Warrant, the Company at its expense, twice only, will execute and deliver, in lieu thereof, a new Warrant of like tenor.
 
8.            Registration Rights .  No registration rights are granted to the Holder of this Warrant.
 
9.            Warrant Agent .  The Company may, by written notice to the Holder of the Warrant, appoint an agent (a “Warrant Agent”) for the purpose of issuing Common Stock (or Other Securities) on the exercise of this Warrant pursuant to Section 1, exchanging this Warrant pursuant to Section 7, and replacing this Warrant pursuant to Section 8, or any of the foregoing, and thereafter any such issuance, exchange or replacement, as the case may be, shall be made at such office by such Warrant Agent.
 
10.            Transfer on the Company's Books .  Until this Warrant is transferred on the books of the Company, the Company may treat the registered holder hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary.
 
11.            Notices .  All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice.  Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur.  The addresses for such communications shall be:
 
If to the Company, to:

ALTERNATIVE ENERGY  & ENVIRONMENTAL, INC.
159 North State Street
Newtown, PA 18940

 
5

 
 
With a copy by fax only to (which copy shall not constitute notice):
Anslow & Jaclin LLP
Attn: Gregg E. Jaclin, Esq.
195 Route 9 South, Suite 204
Manalapan, NJ 07726
facsimile: (732) 577-1188

If to the Holder:

 
12.            Law Governing This Warrant .  This Warrant shall be governed by and construed in accordance with the laws of the State of Nevada without regard to principles of conflicts of laws.  Any action brought by either party against the other concerning the transactions contemplated by this Warrant shall be brought only in the state courts of Nevada or in the federal courts located in the state of Nevada.  The parties to this Warrant hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens .  The Company and Holder waive trial by jury.  The prevailing party shall be entitled to recover from the other party its reasonable attorney's fees and costs.  In the event that any provision of this Warrant or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law.  Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement.  Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Warrant by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
 
 
[Intentionally Blank Signature Page Follows]
 
 
6

 
 
IN WITNESS WHEREOF, the Company has executed this Warrant as of the date first written above.
 
  ALTERNATIVE ENERGY  & ENVIRONMENTAL, INC.  
       
 
By:
/s/   
    Name   
    Title   
       
 
 
 
7

 
 
Exhibit A

FORM OF SUBSCRIPTION
(to be signed only on exercise of Warrant)
TO:  ALTERNATIVE ENERGY  & ENVIRONMENTAL, INC. , INC.
The undersigned, pursuant to the provisions set forth in the attached Warrant (No.____), hereby irrevocably elects to purchase (check applicable box):

___           ________ shares of the Common Stock covered by such Warrant; or
___           the maximum number of shares of Common Stock covered by such Warrant pursuant to the cashless exercise procedure set forth in Section 2.

The undersigned herewith makes payment of the full purchase price for such shares at the price per share provided for in such Warrant, which is $___________.  Such payment takes the form of (check applicable box or boxes):

___           $__________ in lawful money of the United States; and/or
___           the cancellation of such portion of the attached Warrant as is exercisable for a total of _______ shares of Common Stock (using a Fair Market Value of $_______ per share for purposes of this calculation); and/or

The undersigned requests that the certificates for such shares be issued in the name of, and delivered to _____________________________________________________ whose address is _________________________________________________ ______________________________________.
The undersigned represents and warrants that all offers and sales by the undersigned of the securities issuable upon exercise of the within Warrant shall be made pursuant to registration of the Common Stock under the Securities Act of 1933, as amended (the “Securities Act”), or pursuant to an exemption from registration under the Securities Act.
 
 
Dated:      
      (Signature must conform to name of holder as specified on the face of the Warrant)
       
       
       
      (Address)
 
 
8

 
 
Exhibit B
 
 
FORM OF TRANSFEROR ENDORSEMENT
(To be signed only on transfer of Warrant)
 
For value received, the undersigned hereby sells, assigns, and transfers unto the person(s) named below under the heading "Transferees" the right represented by the within Warrant to purchase the percentage and number of shares of Common Stock of ALTERNATIVE ENERGY  & ENVIRONMENTAL, INC. , INC. to which the within Warrant relates specified under the headings "Percentage Transferred" and "Number Transferred," respectively, opposite the name(s) of such person(s) and appoints each such person Attorney to transfer its respective right on the books of EXPEDITE 5, INC. with full power of substitution in the premises.
 
 
Transferees
Percentage Transferred
Number Transferred
     
     
     
 
 
 
Dated:       
    (Signature must conform to name of holder as specified on the face of the warrant)
     
Signed in the presence of:    
     
     
(Name)    
    (address)
     
ACCEPTED AND AGREED:    
[TRANSFEREE]    
    (address)
     
(Name)    

 
9
Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



We hereby consent to the use in this Registration Statement on Form S-1 of our report dated September 17, 2010 relating to the July 31, 2010 financial statements of Alternative Energy & Environmental Solutions, Inc.

We also consent to the reference to our Firm under the caption "Experts" in the Registration Statement.


 

WEBB & COMPANY, P.A.
Certified Public Accountants


Boynton Beach, Florida
October 21, 2010