INVESTMENT AGREEMENT
between
UNITED ECOENERGY CORP.
and
SSC, INC.
Dated
May __,
2009
INVESTMENT AGREEMENT
("Agreement") dated as of May __, 2009 between United EcoEnergy
Corp., a Nevada corporation (“UEEC”), and SSC, Inc., a
Washington corporation (“SSC”)
RECITALS
WHEREAS, SSC is an operating company which manufactures and sells
American supercars, including the Aero and other high performance
automobiles; and
WHEREAS, UEEC has agreed to invest in SSC and to acquire an equity
interest in SSC and SSC would like to receive such investment and
provide an equity interest in SSC.
NOW, THEREFORE, UEEC and SSC agree that UEEC and the investors
shall acquire up to thirty-five (35) percent of the total
outstanding equity interests in SSC on the terms and conditions and
in the manner as set forth herein.
ARTICLE 1:
THE EQUITY INVESTMENT
1.1 Initial Investment. At the
Effective Date (as defined in Section 1.2), upon the terms and
subject to the conditions of this Agreement, UEEC shall acquire
2,000,000 shares of the Convertible Preferred Stock of SSC (the
“SSC Stock”) representing, as of the Effective Date,
not less than five (5) percent of all stock of SSC issued and
outstanding on a fully diluted basis at a value of $1.00 per share,
in exchange for 3,636,363shares of common stock of UEEC (the
“UEEC Stock”) equal in value on the Effective Date to
the SSC Stock.
1.2 Subsequent Investment .
Following the Closing of the Initial Investment, UEEC shall invest
or introduce or source investment of up to $5,000,000 in additional
funds and UEEC Stock into SSC to acquire SSC Stock, in increments
of $500,000 in cash during the term of this Agreement, on the
following basis:
1.2.1 For each $500,000 investment at
or after the Effective Date (the date of each such additional
investment being hereafter referred to as the “Investment
Date”), UEEC or the investors shall receive an additional
500,000 shares of SSC Stock representing 2.5 percent of the
resulting total issued and outstanding equity ownership interests
in SSC; and
1.2.2 For each $500,000 investment at
or after the Effective Date that is made by UEEC , UEEC shall be
granted an additional one-half of one percent (0.05%) of SSC Stock,
and SSC shall be granted an additional one-half of one percent
(0.05%) of common stock of UEEC.
1.2.3. The parties understand that
follow on financing may be required. At SSC’s request, and as
quickly as feasible, UEEC agrees to use best effots to arrange or
perform such financing on terms acceptable to SSC and in an amount
and time that is acceptable to SSC. In exchange for the covenant by
UEEC under this section 1.2.2, for two years after the effective
date of this Agreement, UEEC shall have the first right of refusal
to match any other offer that third parties make to invest in
SSC.
1.2.4 The parties acknowledge that SSC
and UEEC have entered into a separate secured promissory note for
$250,000 and that, notwithstanding any of the terms and provisions
of that note, all fudns advanced to SSC by UEEC thereunder shall be
considered a part of the additional investment provided for in Item
1.2.1
1.3 Convertible
Preferred Stock . The Convertible Preferred Stock to
be issued hereunder by SSC shall be at a purchase price of $1.00
per share, voting preferred stock, which shall entitle the holder
to vote on a par with the common stock of SSC, with each share of
Convertible Preferred Stock having the number of votes it would
have as and if converted into common stock of SSC. The Convertible
Preferred Stock shall be convertible into the number of shares of
common stock of SSC which shall represent the appropriate
percentage of the total equity interests in SSC determined at the
time of issue.
1.4 Effective Date;
Closing . Immediately upon the execution of this Agreement by
UEEC and SSC, and the satisfaction or waiver of the conditions set
forth in Article 5 (the time of such execution and satisfaction
being the " Effective Date "), the parties hereto
shall cause the Initial Investment by UEEC to be consummated by
executing and delivering the documents required to complete the
exchange provided for in Paragraph 1.1 and the parties shall take
all such other and further actions as may be required to cause the
Initial Investment and the exchange of Convertible Preferred Stock
and UEEC Stock to become effective immediately (the “
Closing ”).
1.5 Board of Directors.
At the Effective Date, the Board of
Directors of SSC shall be set at three members, one of which shall
be designated at all times by UEEC, and two of which shall be
designated by Jerod O. Shelby. The By-Laws of SSC shall provide
that all material decisions by or for SSC shall be by a majority of
the Board of Directors and that a quorum of Directors, in person or
by conference telephone, shall be at least three Directors.
1.6 Valuation of UEEC Stock .
The UEEC Stock shall be valued at the Average Market Price of the
common stock of UEEC at the applicable valuation date, on the
following basis:
1.6.1 The Average Market Price shall
be the average closing price of UEEC common stock on the trading
market on which the shares are then trading, for the five (5)
trading days immediately prior to the applicable valuation
date.
1.6.2 In the event that the common
shares of UEEC are not then trading on any market, the Average
Market Price shall be the net asset value per share of the common
stock of UEEC on the applicable valuation date, determined in the
same manner as UEEC determines and reports its new asset value for
purposes of its required SEC filings.
1.7. Registration of UEEC Stock . The parties acknowledge
that UEEC is a publicly reporting and trading company, and that it
may not issue its shares on a free trading basis except through a
registration statement which is effective with the U.S. Securities
& Exchange Commission. Accordingly, UEEC agrees that it will
include the UEEC Stock issued under this Agreement in the next S-1
registration statement filed thereafter by it with the SEC, at no
cost or expense to SSC, and that if it has not filed such a
registration statement within 6 months of the applicabke issuance
of UEEC Stock to SSC, it will prepare and file a registration
statement with the SEC within 45 days thereafter and diligentsly
pursue the registration until effective; provided, however, if and
to the extent any UEEC Stock issued hereunder is eligible for
transfer or trading under the provisions of SEC Rule 144 at that
time, then no such registration statement need be filed or
thereafter pursued by UEEC .
ARTICLE 2:
MANAGEMENT ASSISTANCE
During the term of this Agreement, UEEC shall render to SSC such
advisory, management consulting and other services in relation to
the operations of SSC as are requested in writing by the Board of
Directors of SSC, including strategic planning; domestic marketing
and sales; and financial and management oversight, including,
without limitation, advisory and consulting services in relation to
the selection, retention and supervision of independent auditors,
budgeting, internal financial controls, design and implementation
of financial controls and systems, the selection, retention and
supervision of outside legal counsel, the selection, retention and
supervision of investment bankers or other financial advisors or
consultants, the structuring and implementation of equity
participation plans, employee benefit plans and other incentive
arrangements for certain key executives of the Company (the
"Advisory Services"). Advisory Services shall be performed by and
through such of UEEC's officers, employees, agents, representatives
and affiliates as UEEC, in its sole discretion, shall
designate.
Article 3:
REPRESENTATIONS AND WARRANTIES OF UEEC
To
the best of UEEC’s actual knowledge, UEEC represents and
warrants to, and agrees with, SSC as follows with respect to
UEEC:
3.1 Organization
. UEEC is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Nevada, with its principal place of business located
in Florida. UEEC has all requisite corporate power and authority to
own, lease and operate its properties and to carry on its business
as now being conducted. UEEC is duly qualified to do business and
is in good standing as a foreign corporation in each other
jurisdiction, if any, in which its property or business makes such
qualification necessary.
3.2 Authority Relative to this
Agreement . UEEC has full corporate power and authority to
execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions
contemplated hereby have been or will be at Closing duly and
validly authorized by the Board of Directors of UEEC and no other
corporate proceedings on the part of UEEC are necessary to
authorize this Agreement or to consummate the transactions
contemplated hereby. This Agreement has been duly and validly
executed and delivered by UEEC and constitutes a valid and binding
agreement, enforceable against it in accordance with its terms.
3.3 No Conflict; Required Filings
and Consents .
(a) The execution and delivery of this
Agreement by UEEC does not, and the consummation of the
transactions contemplated hereby will not, (i) conflict with or
violate any law, regulation, court order, judgment or decree
applicable to UEEC or by which its properties are bound or
affected, (ii) violate or conflict with either the Articles of
Incorporation or By-Laws of UEEC or (iii) result in any breach of
or constitute a default (or an event which with notice or lapse of
time or both would become a default) under, or give to others any
right of termination or cancellation of, or result in the creation
of a lien on any of the properties of UEEC pursuant to any contract
to which UEEC is a party or by which UEEC or any of its respective
properties is bound or affected.
(b) UEEC is not required to submit any
notice, report or other filing with any governmental entity or
regulating body, domestic or foreign, in connection with the
execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby. No waiver,
consent, approval or authorization of any governmental entity or
regulatory body, domestic or foreign, is required to be obtained or
made by UEEC in connection with its execution, delivery or
performance of this Agreement or the consummation of the
transactions contemplated hereby.
3.4 Litigation. No
investigation or review by any governmental entity or regulatory
body, foreign or domestic, with respect to UEEC is pending or
threatened against UEEC, and no governmental entity or regulatory
body has advised UEEC of an intention to conduct the same. There is
no claim, action, suit, investigation or proceeding pending or
threatened against or affecting UEEC at law or in equity or before
any federal, state, municipal or other governmental entity or
regulatory body, or which challenges the validity of this Agreement
or any action taken or to be taken by UEEC pursuant to this
Agreement. As of the date hereof, UEEC is not subject to, nor is
there in existence, any outstanding judgment, award, order, writ,
injunction or decree of any court, governmental entity or
regulatory body relating to UEEC.
ARTICLE 4: REPRESENTATIONS AND WARRANTIES OF
SSC
To
the best of SSC’s actual knowledge, SSC represents and
warrants to, and agrees with, UEEC as follows with respect to
SSC:
4.1 Organization . SSC is a
corporation, duly organized, validly existing and in good standing
under the laws of the State of Washington and has all requisite
power and authority to own, lease and operate its properties and to
carry on its business as now being conducted. SSC is duly qualified
to do business and in good standing as a foreign corporation or
entity in each jurisdiction in which property owned, leased or
operated by it or the nature of the business conducted by it makes
such qualification necessary. SSC has heretofore delivered to UEEC
true, accurate and complete copies of its Articles of
Incorporation, By-Laws and all other governing documents as in
effect on the date hereof and minutes of all meetings of the Board
of Directors of SSC held through and including the date of this
Agreement to the extent the same exist. SSC is not in violation of
any of the provisions of its Articles of Incorporation, By-Laws and
all other governing documents.
4.2 Authority Relative to this
Agreement . SSC has full power and authority to execute and
deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have
been or will be at Closing duly and validly authorized by the Board
of Directors of SSC, and no other proceedings are necessary to
authorize this Agreement or to consummate the transactions
contemplated hereby. This Agreement has been duly and validly
executed and delivered by SSC and constitutes a valid and binding
agreement, enforceable against it in accordance with its terms.
4.3 No Conflict; Required Filings
and Consents .
(a) The execution and delivery of this
Agreement by SSC does not, and the consummation of the transactions
contemplated hereby will not, (i) conflict with or violate any law,
regulation, court order, judgment or decree applicable to SSC or by
which its properties are bound or affected, (ii) violate or
conflict with its Articles of Incorporation, By-Laws and all other
governing documents of SSC or (iii) result in any breach of or
constitute a default (or an event which with notice or lapse of
time or both would become a default) under, or give to others any
right of termination or cancellation of, or result in the creation
of a lien on any of the properties of SSC pursuant to any contract
to which SSC is a party or by which SSC or any of its respective
properties is bound or affected.
(b) SSC is not required to submit any
notice, report or other filing with any governmental entity or
regulating body, domestic or foreign, in connection with the
execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby. No waiver,
consent, approval or authorization of any governmental entity or
regulatory body, domestic or foreign, is required to be obtained or
made by SSC in connection with the execution, delivery or
performance of this Agreement or the consummation of the
transactions contemplated hereby.
(c) SSC has filed the necessary and
appropriate federal and state securities documents related to the
offering for the company’s shares.
4.4 Financial Statements .
(a) The balance
sheet of SSC (the “ SSC Balance Sheet ”),
and the related statements of income and retained earnings,
(“ SSC’s Financial Statements ”),
copies of which will have been or will be delivered by SSC to UEEC prior to and as a condition to
Closing, fairly present the financial condition of SSC as of said dates and the results of its
operations for the periods then ended. SSC’s Financial
Statements, (y) are in accordance with the books and records of SSC
and (z) present fairly the financial position and results of
operations of SSC at the times and for the periods to which they
relate on a cash basis method of accounting. SSC has maintained its
books of account on a cash basis, and such books and records are,
and during the periods covered by SSC’s Financial Statements
were correct and complete in all material respects, fairly and
accurately reflect and reflected the income, expenses, assets and
liabilities of SSC and provide and provided a fair and accurate
basis for the preparation of SSC’s Financial Statements and
of the tax returns and reports of SSC, except as otherwise provided
in this Agreement.
4.5 Real and Personal Property
. SSC does not own any real property. SSC has good and marketable
title to, or valid leasehold interests in, all other assets used or
held for use in the conduct of its business. All of the assets
owned or leased by SSC are in all material respects in good
condition and repair, ordinary wear and tear excepted, and well
maintained.
4.6 Absence of Undisclosed
Liabilities . Except to the extent reflected or reserved
against in SSC’s Financial Statements and Interim Financial
Statements or as otherwise disclosed to UEEC, SSC will not have at
the Closing Date any material liabilities or obligations (secured,
unsecured, contingent or otherwise) of a nature customarily
reflected in a company balance sheet (" Liabilities ").
4.7 Absence of Certain Changes
. Since inception (i) there has been no material adverse change in
the condition (financial or otherwise), of the assets, liabilities,
results of operations, business or prospects of SSC and (ii)
nothing has occurred relative to the business or prospects of SSC
which would have a material adverse effect on the future business
of SSC.
4.8 Litigation. No
investigation or review by any governmental entity or regulatory
body, foreign or domestic, with respect to SSC is pending or
threatened against SSC, and no governmental entity or regulatory
body has advised SSC of an intention to conduct the same. There is
no material claim, action, suit, investigation or proceeding
pending or threatened against or affecting SSC at law or in equity
or before any federal, state, municipal or other governmental
entity or regulatory body, or which challenges the validity of this
Agreement or any action taken or to be taken by SSC pursuant to
this Agreement. As of the date hereof, SSC is not subject to, nor
is there in exis
