Document:

SUBSCRIPTION AND INVESTMENT AGREEMENT

To:      Advanced Engine Technologies, Inc.
         11150 W. Olympic Boulevard, Suite 1020
         Los Angeles, California 90064

From:    Robert E. Petersen, Margaret M. Petersen, Trustee
         R.E. & M. Petersen Living Trust DTD 1/17/83 ("Petersen Trust")

Gentlemen:

         The undersigned, Petersen Trust having previously received and read the
offering Memorandum dated May 22, 1997, the valuation opinion letter from
Pattersen Travis, Inc., Investment Banker and Brokers, dated August 17, 2000,
having previously had numerous direct and indirect contacts and communications
with directors and officers of Advanced Engine Technologies, Inc. (the
"Company"), and having previously discussed on-going operations and proposed
operations of the Company, hereby makes an irrevocable offer to purchase
10,000,000 (Ten Million) shares or securities of the company ("Shares" or
"Securities"). Tendered herewith from the Petersen Trust is the amount of
$10,000,000. (Ten Million dollars) (hereinafter "Funds"), in return for which
the Company shall forthwith issue 10,000,000 (Ten Million) shares of common
stock of the Company to Petersen Trust.

         Please accept this document as a fully executed Subscription Agreement,
in connection with which Petersen Trust hereby represents and agrees as follows:

         1. The funds tendered herewith are irrevocable. Should this
subscription be rejected by the Company, the Company shall promptly and fully
return the subscription price tendered, without interest or deduction and this
Subscription Agreement shall be rendered null and void, and of no further force
or effect.

          2. This subscription is made subject to the following terms and
conditions:

         (a) The Company has the right to reject this  subscription  in whole or
in part;

         (b)  No  obligation  exists  on  the  part  of the  Company  to  accept
subscriptions in any particular order;

         (c) The certificate evidencing the Shares subscribed to herein shall be
issued only in the name of Petersen Trust, and only to Petersen Trust;

         (d) The offering will be terminated on August 25, 2000 subject to an
extension; or at any time by the Company, prior to the final acceptance of the
subscription.

<PAGE>

         3. In making the decision to subscribe to shares of the Company, the
Petersen Trust has relied upon the documents referred in this Subscription
Agreement as well as its own familiarity with the Company, its operations and
its management. Further, Petersen Trust's reliance has been placed upon its own
independent investigation and opinions.

         4. The Securities are being offered and sold under an exemption from
registration provided by the Securities Act of 1993 (the "1993 Act,") and the
rules and regulations promulgated thereunder, and certain exemptions from
registration provided by state securities laws.

         5. This transaction has not been reviewed by, passed on or submitted to
the United States Securities and Exchange Commission or to any state agency;
accordingly, the Petersen Trust makes the following additional representations
and warranties:

         (a) Petersen Trust is a bona fide resident or domiciliary of the State
of California, and has its principal residence and domicile in such state; the
trustee of the Petersen Trust (to wit: Robert Petersen) is a resident of the
State of California and a United States citizen of at least twenty one years of
age.

         (b) Petersen Trust understands and has fully considered, for purposes
of this investment, all the risks of investing in the Company, which has to date
developed only prototype engines and has no other history of operations.

         (c) Petersen Trust understands the Company has a limited or no
operating history or profits and the Securities are speculative investments
which involve a high degree or risk of loss by the subscriber; therefore, this
investment is more suitable for one who is sufficiently wealthy to afford a loss
of his or her entire investment.

         (d) Petersen Trust is able to afford this investment and understands
that it may lose the entire investment. Petersen Trust can bear the economic
consequences thereof.

         (e) Petersen Trust understands that substantial restrictions exist on
the transferability of the Securities, for which there may be no market, and,
accordingly, Petersen Trust understands that it will probably not be possible to
liquidate its investment in the Securities in the case of emergency.

         (f) The Company is relying on the truth and accuracy of the
representations, declarations and warranties made herein in offering the
Securities for sale to Petersen Trust, and is further relying upon applicable
federal and state exemptions.

         (g) The Securities subscribed to herein are being acquired for Petersen
Trust's account, for investment only, and are not being purchased with a view
toward resale, distribution, subdivision or fractionalization. Petersen Trust
has no contract, understanding, undertaking, agreement or arrangement, formal or
informal, with any person or persons to sell, transfer or pledge the Securities,
and Petersen Trust has no present plan to enter into any such contract or
agreement. The legal consequences of these representations is that Petersen
Trust must bear the economic risks of this investment for an indefinite period
of time, since the underlying Securities have not been registered in accordance
with the 1933 Act or any other securities laws, and therefore cannot be sold
unless they are subsequently registered (which the Company is not obligated to
do), or if an exemption can be relied upon.

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<PAGE>

         (h) The undersigned agrees that a legend reading substantially as
follows may be placed on any or every certificate representing all or any
portion of the Securities of the Company to be issued to Petersen Trust pursuant
to this Agreement:

         THE SHARES RESPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE ACT), AND ARE "RESTRICTED SECURITIES" AS
THAT TERM IS DEFINED IN RULE 144 UNDER THE ACT. THE SHARES MAY NOT BE OFFERED
FOR SALE, SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO
THE SATISFACTION OF THE COMPANY.

         The undersigned further agrees that the Company will place on its book
and the books of the transfer agent such "Stop Transfer" notice or order as may
be necessary for the purpose of implementing the terms, covenants, conditions,
and provisions of this investment letter.

         6. Petersen Trust makes the within representations, warranties and
undertakings with the intent that they may be relied upon in determining
Petersen Trust's suitability to purchase the Securities, and such
representations and warranties shall survive the within subscription.

         7. Petersen Trust agrees to indemnify and save harmless the Company
from any claims, liabilities, damages, expenses, losses or actions directly or
indirectly arising out of or in connection with the representations and
warranties, and agreements contained herein.

         8. Petersen Trust is not entitled to transfer or assign this
Subscription Agreement, or any interest herein, and the issuance of Securities
pursuant hereto shall be made only in accordance with the applicable laws.

         9. Petersen Trust is not entitled to cancel, terminate or revoke this
Subscription Agreement or any agreements contained herein, and the provisions of
this Subscription Agreement shall survive (i) purchase and issuance of the
Subscription subscribed to herein; and (ii) the death or disability of the
current trustee of the Petersen Trust. However, if the Company rejects this
Subscription, this Subscription Agreement shall automatically be canceled,
terminated and revoked.

                                        3

<PAGE>

         10. Petersen Trust has read Appendix A hereto, defining an "Accredited
Investor" as set forth in Rule 501 of Regulation D of the Securities Act of 1933
and certifies that Petersen Trust qualifies as an "Accredited Investor" in that
its net worth is greater than ten (10) time the proposed investment contemplated
by this Subscription Agreement.

         11. This  agreement  shall be governed by and  construed in  accordance
with the laws of the State of California.

         IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement this 21st day of August 2000.

                                    Robert E. Petersen, Margaret M. Petersen,
                                     Trustee

                                    R.E.& M. Petersen Living Trust DTD 1/17/83
                                    ("Petersen Trust")

                                    By:     /s/ Robert E. Petersen
                                            ----------------------------------
                                            Robert E. Petersen
                                            Trustee of the Petersen Trust

                                            ----------------------------------
                                            Taxpayer Identification No.
                                            or Social Security Number.

         Subject to the approval of the Company, the foregoing Subscription is
hereby accepted on behalf of the Company, subject to the terms and conditions
hereof, as of the 24th day of August, 2000.

                                    Advanced Engine Technologies, Inc.

                                    By:           /s/ Carroll Shelby
                                            ---------------------------------
                                                    Carroll Shelby
                                                      President

                                        4

<PAGE>

                                   APPENDIX A

         ACCREDITED INVESTOR: "Accredited investor" shall mean any person who
comes within any of the following categories, or who the issuer reasonably
believes comes within any of the following categories, at the time of the sale
of the securities to that person:

         (1) Any bank as defined in Section 3(a) (2) of the Securities Act, or
of any savings and loan association or other institution as defined in Section
3(a) (5) (A) of the Act any broker or dealer registered pursuant to Section 15
of the Securities Exchange Act of 1934; any insurance company as defined in
Section 2(13) of the 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; any 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 Security Act of 1974 if the investment decisions 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;

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

         (3) 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;

         (4) Any director, executive officer, or general partner of the issuer
of the securities being offered or sold, or any director, executive officer, or
general partner of a general partner of that issuer;

         (5) Any natural person whose individual net worth, or joint net worth
with that person's spouse, at the time of his purchase exceeds $1,000,000;

         (6) Any natural person who had an individual income in excess of
$200,000 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 the some income level in the current year;

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<PAGE>

         (7) Any trust, with total assets in excess of $5,000,000, not formed
for the specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person as described in Rule 506(b) (2) (ii); and

         (8) Any  entity  in  which  all of the  equity  owners  are  accredited
investors.

                                        6<PAGE>

                                                                    Exhibit 10.8

                       ADVANCED ENGINE TECHNOLOGIES, INC.
                       ---------------------------------

                               FIRST AMENDMENT TO
                               ------------------
                            2000 STOCK INCENTIVE PLAN
                            -------------------------

     The 2000 Stock Option Plan previously approved and implemented by the Board
of Directors of Advanced Engine Technologies, Inc. (AET), pursuant to unanimous
vote of the Board of Directors at a Special Meeting of the Board of Directors,
is hereby amended as follows:

     Paragraph 3 of the "2000 Stock Incentive Plan" is hereby deleted in its
entirety, and the following substituted paragraph 3 is hereby inserted and
substituted in its place as though fully set forth, from inception, in the "2000
Stock Incentive Plan":

          "3. Stock Subject to the Plan. Subject to the provisions of
              -------------------------
          Section 13 of the Plan, the maximum aggregate number of
          Shares which may be issued under the Plan will be Ten
          Million (10,000,000) Shares of Common Stock. The Shares may
          be authorized, but unissued, or reacquired Common Stock.

          If an Option expires or becomes unexercisable without having
          been exercised in full, or is surrendered pursuant to an
          Option Exchange Program, or if a Stock Award shall be
          cancelled or surrendered or expire for any reason without
          having been received in full, the Shares that were not
          purchased or received which were subject thereto will become
          available for future grant or sale under the Plan (unless
          the Plan has terminated). If the Company reacquires Shares
          which were issued pursuant to the exercise of an Option or
          grant of a Stock Award, however, those reacquired Shares
          will not be available for future grant under the Plan."

     The undersigned, as Secretary of AET, hereby certifies by his signature set
forth below that this Amendment was approved and adopted by the full Board of
Directors of AET, as the "Administrator" of the "2000 Stock Incentive Plan", at
the properly noticed and held Special Meeting of the Board of Directors of AET
which took place on March 22, 2001, at the corporate headquarters of AET located
at 11150 W. Olympic Boulevard, Suite 1050, Los Angeles, California.

DATED: March 23, 2001                   ADVANCED ENGINE TECHNOLOGIES, INC.

                                        By: /s/ M. Neil Cummings
                                           -------------------------------------
                                           M. Neil Cummings, Secretary

                                 -47-

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