-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UwlR62XDXBd5PcKWw6u5c7Cd+qHurKtNEoHfVPjfugMp6x2GTLiiwh++uUbAzR7G 43z2KhRNRY38uDN5d0K6AQ== /in/edgar/work/0000950123-00-010966/0000950123-00-010966.txt : 20001123 0000950123-00-010966.hdr.sgml : 20001123 ACCESSION NUMBER: 0000950123-00-010966 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20001122 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: NETWORK SYSTEMS INTERNATIONAL INC CENTRAL INDEX KEY: 0000842722 STANDARD INDUSTRIAL CLASSIFICATION: [6770 ] IRS NUMBER: 870460247 STATE OF INCORPORATION: NV FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 13D SEC ACT: SEC FILE NUMBER: 005-59183 FILM NUMBER: 775147 BUSINESS ADDRESS: STREET 1: 200 NORTH ELM STREET CITY: GREENSBORO STATE: NC ZIP: 27401 BUSINESS PHONE: 6024648900 MAIL ADDRESS: STREET 1: 200 N ELM ST CITY: GREENSBORO STATE: NC ZIP: 27401 FORMER COMPANY: FORMER CONFORMED NAME: AQUA AUSTRALIS INC DATE OF NAME CHANGE: 19940322 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: TABIN HERBERT CENTRAL INDEX KEY: 0001104218 STANDARD INDUSTRIAL CLASSIFICATION: [ ] FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 6413 CONGRESS AVENUE STREET 2: SUITE 230 CITY: BOCA RATON STATE: FL ZIP: 33487 MAIL ADDRESS: STREET 1: 6413 CONGRESS AVENUE STREET 2: SUITE 230 CITY: BOCA RATON STATE: FL ZIP: 33487 SC 13D 1 y42996sc13d.txt NETWORK SYSTEMS INTERNATIONAL INC./ HERBERT TABIN 1 CUSIP NO 64121L-10-3 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D UNDER THE SECURITIES EXCHANGE ACT OF 1934 NETWORK SYSTEMS INTERNATIONAL, INC. ----------------------------------- (Name of Issuer) COMMON STOCK, $.001 PAR VALUE ----------------------------- (Title of Class of Securities) 64121L-10-3 ----------- (CUSIP Number) HERBERT TABIN 6413 CONGRESS AVENUE SUITE 230 BOCA RATON, FL 33487 561-988-2334 ------------ (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) July 25, 2000 ------------- (Date of Event Which Requires Filing of This Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), Rule 13d-1(f) of Rule 13d-1(g), check the following box. [ __ ] Check the following box if a fee is being paid with this statement. [ ] 2 CUSIP NO 64121L-10-3 SCHEDULE 13D CUSIP No. 64121L-10-3 1. Name of Reporting Persons - IRS Identifications No. of Above Person (Entities Only) Herbert Tabin 2. Check the Appropriate Box if a Member of a Group (a) [ __ ] (b) [ __ ] 3. SEC Use Only 4. Source of Funds Personal funds. (PF) 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) To Items 2(d) or 2(e) [ __ ] 6. Citizenship or Place of Organization United States Number of Shares Beneficially Owned by Each Reporting Person With: 7. Sole Voting Power 2,700,000 8. Shared Voting Power 0 9. Sole Dispositive Power 2,700,000 3 CUSIP No 64121L-10-3 10. Shared Dispositive Power 0 11. Aggregate Amount Beneficially Owned by Each Reporting Person 2,700,000 12. Check if the Aggregate Amount in Row 11 Excludes Certain Shares [ ] -- 13. Percent of Class Represented by Amount in Row 11 28.5 % (1) 14. Type of Reporting Person IN (1) Calculated based upon the total of 9,489,171 shares of Common Stock outstanding as of July 31, 2000 per the Company's stock transfer agent. Item 1. Security and Issuer This Schedule 13D relates to the shares of common stock, par value $.001 per share (the "Common Stock"), of Network Systems International, Inc., a Nevada corporation (the "Company"). The principal executive offices of the Company are located at 6413 Congress Avenue, Suite 230, Boca Raton, Florida 33487. Item 2. Identity and Background (a) Name: Herbert Tabin (b) Address: 6413 Congress Avenue, Suite 230 Boca Raton, Florida 33487 4 CUSIP NO 64121L-10-3 (c) Present Principal Occupation: Mr. Tabin is vice-president of Millennium Holdings Group, Inc. ("Millennium") and vice-president and chief operating officer for International Internet, Inc. ("IINN"). (d) During the last five years, Mr. Tabin has not been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). (e) During the last five years, Mr. Tabin was not party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, Federal or State securities laws or finding any violation with respect to such laws. (f) Citizenship: Mr. Tabin is a United States citizen. Item 3. Source and Amount of Funds or Other Consideration Mr. Tabin paid $1,500,000 from personal funds to acquire 2,700,000 shares. Item 4. Purpose of Transaction As described in the Company's Current Report on Form 8-K which was filed with the Securities and Exchange Commission on July 10, 2000, a copy of which is attached hereto as Exhibit A and incorporated herein by reference, the Company entered into a Stock Purchase Agreement dated July 10, 2000 (the "Stock Purchase Agreement") with Richard T. Clark, Joel C. Holt, D. Mark White, George D. Gordon, Bryan John, John Signorello and Steven Elias (the "Initial Investors"). Subject to the terms and conditions of the Stock Purchase Agreement, the Company issued 1,666,667 new, restricted shares of the Company's common stock at $0.60 per share to the Initial Investors in a private placement organized by Millennium Holdings Group, Inc. ("Millennium"). The sale under the Stock Purchase Agreement was subject to the satisfaction of the following conditions, which are discussed in more detail below: (i) certain of the Company's current management shareholders must agree to sell 2,700,000 shares of the Company's common stock to accredited investors arranged by Millennium, (ii) these current management shareholders must grant the Company a put option giving the Company the right to require such management shareholders to purchase substantially all of the assets associated with the Company's business as currently conducted for $3,000,000, (iii) all of the Company's current directors must resign and a designated representative of the Initial Investors must be appointed to replace the former directors effective as of the closing date of the stock sale, and (iv) the Company must receive the consent of its current revolving credit lender, 5 CUSIP No 64121L-10-3 Wachovia Bank, N.A. ("Wachovia"). The sale under the Stock Purchase Agreement closed on July 25, 2000. As a condition to the Initial Investors' obligations pursuant to the terms of the Stock Purchase Agreement, four of the Company's current management shareholders, Robbie M. Efird, E. W. "Sonny" Miller, Jr., David F. Christian and James W. Moseley (collectively, the "Selling Shareholders") entered into Stock Purchase Agreements dated July 10, 2000 (the "Investment Agreements") to collectively sell 2,700,000 shares to Herbert Tabin, a managing partner with Millennium, for $1,500,000 (approximately $0.56 per share) in a second private placement arranged by Millennium. As a further condition to the Initial Investors' obligations under the Stock Purchase Agreement, the Selling Shareholders granted the Company a put option, expiring forty-five (45) days after the closing date, giving the Company the right to require the Selling Shareholders to purchase substantially all of the Company's operating assets and liabilities (the "Company Assets") and substantially all of the operating assets and liabilities of Vercom Software, Inc., a wholly-owned subsidiary corporation of the Company ("Vercom") (the "Vercom Assets"; the Company Assets and the Vercom Assets shall collectively be referred to as the "Assets") for $3,000,000. The Assets include all of the operating assets related to the Company's business as currently conducted. During this 45-day period, the Company will determine the value of the Assets and evaluate whether it is in the best interests of the Company and its shareholders for the Company to sell the Assets to the Selling Shareholders at the put price, to sell the Assets to a third party, to retain the Assets or to take other appropriate action. In order to facilitate the Company's potential exercise of the put option, the Company contributed the Company Assets to a recently formed wholly owned subsidiary corporation, Network Systems International of North Carolina, Inc. on July 20, 2000. As part of this process, the Company assigned its rights and obligation under substantially all of its current agreements (including its software license agreements, service agreements and employment agreements) to Network Systems International of North Carolina, Inc. In order to satisfy a condition to the Initial Investors' obligations under the Stock Purchase Agreement, all of the Company's current directors resigned effective as of the closing date, except for Mr. Efird. The current officers of the Company also resigned as of the closing date. Herbert Tabin has been appointed to the Company's Board of Directors as of the closing date. If the Company elects to exercise the put option and require the Selling Shareholders to purchase the Assets for $3,000,000, the Selling Shareholders will make an initial cash payment of $1,500,000 to the Company. The Selling Shareholders will deliver a non-recourse promissory note in the principal amount of $1,500,000, payable in one hundred 6 CUSIP No 64121L-10-3 twenty (120) days, for the remaining purchase price. The Selling Shareholders will pledge all of their remaining 2,925,856 shares of the Company's common stock (the "Pledged Shares") as security for the payment of the promissory note. The Company's right to exercise the put option will be conditioned upon the Company using $2,000,000 of the sales price received for the Assets to reduce the obligation under the revolving credit arrangement with Wachovia. The Company plans to use $1,250,000 from the Selling Shareholders' initial cash payment and $750,000 from the sale, if any, of the Pledged Shares to reduce the outstanding indebtedness. The sale of the Pledged Shares is discussed below. As a further condition to the Company's right to exercise the put option, the Company will also agree to change its name on its corporate charter, to discontinue the use of the name "Network Systems International" and to transfer all rights to the name "Network Systems International" to the Selling Shareholders. The Company understands that Millennium will use its best efforts to place the Pledged Shares with accredited investors on behalf of the Selling Shareholders for at least $1,500,000, or approximately $0.513 per share. Millennium will remit the proceeds generated by the sale of the Pledged Shares, up to $1,500,000, to the Company to satisfy the remaining balance of the purchase price for the Assets. If all of the Pledged Shares are sold for an amount greater than $1,500,000, Millennium will retain the excess. If Millennium cannot sell all of the Pledged Shares for at least $1,500,000, Millennium will use its best efforts to place as many of the Pledged Shares as possible with accredited investors on behalf of the Selling Shareholders for approximately $0.513 per share. Pursuant to the terms of the put option, the Company will use the first $750,000 from the sale of the Pledged Shares to reduce the obligation under the revolving credit arrangement with Wachovia. If Millennium is unable to sell all of the Pledged Shares, the Company will extinguish the promissory note at maturity and retain any remaining shares in satisfaction of the outstanding purchase price for the sale of the Subsidiaries to the Selling Shareholders. Mr. Tabin may from time to time acquire additional securities of the Company or at any time dispose of securities of the Company he now beneficially owns or hereafter may acquire. Item 5. Interest in Securities of the Issuer Mr. Efird beneficially owns, and has the sole power to vote and dispose of 811,491 shares, or 8.6%, of the outstanding shares of the Company's Common Stock. The calculation of ownership set forth herein is based upon 9,479,821 shares of Common Stock outstanding as of July 31, 2000, as indicated on the records of the Company's transfer agent. 7 CUSIP No 64121L-10-3 Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer. Stock Purchase Agreement dated July 10, 2000 between Robbie M. Efird and Herbert Tabin (attached hereto as Exhibit 99.1). Stock Purchase Agreement dated July 10, 2000 between E.W. Miller, Jr. and Herbert Tabin (attached hereto as Exhibit 99.2). Stock Purchase Agreement dated July 10, 2000 between David F. Christian and Herbert Tabin (attached hereto as Exhibit 99.3). Stock Purchase Agreement dated July 10, 2000 between James W. Moseley and Herbert Tabin (attached hereto as Exhibit 99.4). Item 7. Materials to Be Filed as Exhibits Exhibit 99.1 - Stock Purchase Agreement dated July 10, 2000 between Robbie M. Efird and Herbert Tabin Exhibit 99.2 - Stock Purchase Agreement dated July 10, 2000 between E.W. Miller, Jr. and Herbert Tabin Exhibit 99.3 - Stock Purchase Agreement dated July 10, 2000 between David F. Christian and Herbert Tabin Exhibit 99.4 - Stock Purchase Agreement dated July 10, 2000 between James W. Moseley and Herbert Tabin Signature After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Date: November 15, 2000 /s/ Herbert Tabin ------------------ Herbert Tabin EX-99.1 2 y42996ex99-1.txt STOCK PURCHASE AGREEMENT 1 Exhibit 99.1 STOCK PURCHASE AGREEMENT THIS STOCK PURCHASE AGREEMENT ("Agreement") is entered into this 10 day of July, 2000, by and among Herbert Tabin, a resident of Florida, and his assigns (hereinafter referred to as "Buyer"); and ROBBIE M. EFIRD, (hereinafter referred to as "Seller"), being a shareholder of NETWORK SYSTEMS INTERNATIONAL, INC., a Nevada corporation (hereafter referred to as "Company"). WHEREAS, Seller is the owner of record and beneficially owns One Million Nine Hundred Thousand (1,900,000) shares of the issued and outstanding shares of Common Stock of the Company (herein referred to as"Shares"); and WHEREAS, Seller desires to sell the Shares to Buyer, and Buyer desires to purchase the Shares, upon the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, and subject to the accuracy of the representations and warranties of the parties, the parties hereto agree as follows: I. SALE AND PURCHASE OF THE SHARES 1.1 Sale and Purchase. Subject to the terms and conditions hereof, at the Closing (as defined in paragraph 1.2 below), Seller agrees to sell, assign, transfer, convey and deliver to Buyer, and Buyer agrees to purchase the Shares from Seller. 1.2 Closing. The purchase shall be consummated at a closing ("Closing") to take place at 9:00 o'clock a.m., at the offices of Network Systems International, Inc. on or about July 21, 2000 ("Closing Date"). 1.3 Purchase Price. The purchase price ("Purchase Price") for the Shares shall be a cash payment of One Million Fifty-Five Thousand Five Hundred Fifty Five Dollars ($1,055,555) payable to the Seller in certified funds. At the closing, the Purchase Price will be delivered and deposited with G. David Gordon & Associates, P.C., as escrow agent ("Escrow Agent"). If the Put Option described in Section 4.3 is exercised by the Company, the Escrow Agent will deliver the Purchase Price to the Company as the Seller's portion of the initial cash payment provided for therein. If the Put Option is not exercised by the Company prior to its expiration, the Escrow Agent will immediately release the Purchase Price to Seller. 2 II. REPRESENTATIONS AND WARRANTIES 2.1 Representations and Warranties of Seller. Seller represents and warrants to Buyer as follows: (a) Title to the Shares. At Closing, Seller shall own of record and beneficially the Shares of the Company, free and clear of all liens, encumbrances, pledges, claims, options, charges and assessments of any nature whatsoever, with full right and lawful authority to transfer the Shares to Buyer. No person has any rights of first refusal with respect to any of the Shares. There exists no voting agreement, voting trust, or outstanding proxy with respect to any of the Shares. There are no outstanding rights, options, warrants, calls, commitments, or any other agreements of any character, whether oral or written, with respect to the Shares. (b) Authority. Seller has full power and lawful authority to execute and deliver this Agreement to which he is a party and to consummate and perform the Agreement as contemplated thereby. This Agreement to which Seller is a party constitutes (or shall, upon execution, constitute) valid and legally binding obligations upon Seller, enforceable in accordance with their terms. Neither the execution and delivery of this Agreement to which he is a party by Seller, nor the consummation and performance of the Agreement contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Seller is a party or by which Seller or any of his properties or assets are bound or affected. (c) Full Disclosure. All statements of Seller contained in this Agreement and in any other written documents delivered by or on behalf of Seller to Buyer are true and correct in all material respects and do not omit any material fact necessary to make the statements contained therein not misleading in light of the circumstances under which they were made. 2.2 Representations and Warranties of Buyer. Buyer represents and warrants to Seller as follows: (a) Authority. Buyer has full power and lawful authority to execute and deliver this Agreement to which Buyer is a party and to consummate and perform the Agreement as contemplated thereby. This Agreement to which Buyer is a party constitutes (or shall, upon execution, constitute) valid 3 and legally binding obligations upon Buyer, enforceable in accordance with their terms. Neither the execution and delivery of this Agreement to which Buyer is a party by Buyer, nor the consummation and performance of this Agreement contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Buyer is a party or by which Buyer or any of his properties or assets are bound or affected. (b) Investment Intent. Buyer is acquiring the Shares for his own account, for investment purposes only, and not with a view to the sale or distribution of any part thereof, and Buyer has no present intention of selling, granting participation in, or otherwise distributing the same. Buyer understands the specific risks related to an investment in the Shares, especially as it relates to the financial performance of the Company. III. COVENANTS 3.1 Covenants of Seller. Seller covenants and agrees that from the date hereof to the Closing without the prior written consent of Buyer: (a) Maintain Books. Seller will use reasonable efforts, as its Chairman of the Board, to cause the Company to maintain its books, accounts and records in the usual, regular ordinary and sound business manner and in accordance with generally accepted accounting principles applied on a basis consistent with past practices. (b) Notice of Change. Seller will promptly advise Buyer in writing of any material adverse change, or the occurrence of any event which involves any substantial possibility of a material adverse change, in the business, financial condition, results of operations, assets, liabilities or prospects of the Company, in the event he becomes aware of any such circumstances. IV. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER TO CLOSE The obligation of Buyer to close the transactions contemplated hereby is subject to the fulfillment by Seller prior to Closing of each of the following conditions, which may be waived in whole or in part by Buyer: 4 4.1 Compliance with Representations, Warranties and Covenants. The representations and warranties of Seller contained in this Agreement shall have been true and correct when made and shall be true and correct as of the Closing with the same force and effect as if made at the Closing. Seller shall have performed all agreements, covenants and conditions required to be performed by Seller prior to the Closing. 4.2 No Legal Proceedings. No suit, action or other legal or administrative proceeding before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the transactions contemplated hereby. 4.3 Put Option. The Selling Shareholders (as that term is defined in the Stock Purchase Agreement among the Company and the Investors named therein dated July 10, 2000 (the "Initial Stock Purchase Agreement")) shall have entered into an agreement to provide the Company an option (the "Put Option") to require the Selling Shareholders to purchase all of the issued and outstanding shares of the Subsidiaries (as that term is defined in the Initial Stock Purchase Agreement) for a purchase price of three million dollars ($3,000,000), generally upon the terms and conditions set forth in Section 4.5 of the Initial Stock Purchase Agreement. Buyer acknowledges and agrees that the Company's ability to exercise the Put Option will be conditioned upon (1) compliance with the Company's Articles of Incorporation and Bylaws; (2) the Company obtaining all requisite corporate authorization with respect to the sale of all of the issued and outstanding capital stock of the Subsidiaries; (3) compliance with applicable laws with respect to the sale of all of the issued and outstanding capital stock of the Subsidiaries; (4) the Company's written commitment to reduce the Company's outstanding obligation under its revolving credit arrangement with Wachovia Bank, N.A., by three million dollars ($3,000,000); (5) the Company's written commitment to amend its Articles of Incorporation to change its name, to discontinue the use of the name "Network Systems International" and to transfer all rights to the "Network Systems International" name to Network Systems International of North Carolina, Inc. ("NSI-NC"); and (6) the Company's written commitment to transfer all benefits with respect to the right to receive future tax refunds to NSI-NC. 4.4 Documents to be Delivered by Seller. Seller shall have delivered the following documents to the Escrow Agent to be held in escrow until delivery of the Purchase Price as provided in section 1.3. (a) Stock certificates representing all of the Shares, duly endorsed to Buyer in blank or accompanied by duly executed stock powers. (b) Such other documents or certificates as shall be reasonably required by Buyer or its counsel in order to close and consummate this Agreement. 5 V. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER TO CLOSE The obligation of Seller to close the transactions is subject to the fulfillment prior to Closing of each of the following conditions, any of which may be waived in whole or in part by Seller: 5.1 Compliance with Representations, Warranties and Covenants. The representations and warranties made by Buyer in this Agreement shall have been true and correct when made and shall be true and correct in all material respects at the Closing with the same force and effect as if made at the Closing, and Buyer shall have performed all agreements, covenants and conditions required to be performed by Buyer prior to the Closing. 5.2 No Legal Proceedings. No suit, action or other legal or administrative proceedings before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the transactions contemplated hereby. 5.3 Payments. Escrow Agent shall have received from Buyer the Purchase Price as provided in section 1.3. 5.4 Closing of Sale of Newly Issued Company Shares. The Company shall have consummated the sale of 1,666,667 shares of newly issued common stock pursuant to the terms of the initial Stock Purchase Agreement. VI. MODIFICATION, WAIVERS, TERMINATION AND EXPENSES 6.1 Modification. Buyer and Seller may amend, modify or supplement this Agreement in any manner as they may mutually agree in writing. 6.2 Waivers. Buyer and Seller may in writing extend the time for or waive compliance by the other with any of the covenants or conditions of the other contained herein. 6.3 Termination and Abandonment. This Agreement may be terminated and the purchase of the Shares may be abandoned before the Closing: (a) By the mutual consent of Seller and Buyer; (b) By Buyer, if the representations and warranties of Seller set forth herein shall not be accurate, or the conditions precedent set forth in Article IV shall have not have been satisfied by the closing date , in all material respects; or 6 (c) By Seller, if the representations and warranties of Buyer set forth herein shall not be accurate, or the conditions precedent set forth in Article V shall not have been satisfied by the closing date in all material respects. Termination shall be effective on the date of receipt of written notice specifying the reasons therefore. VII. MISCELLANEOUS 7.1 Representations and Warranties to Survive. Unless otherwise provided, all of the representations and warranties contained in this Agreement and in any certificate, exhibit or other document delivered pursuant to this Agreement shall survive the Closing for a period of one (1) year. No investigation made by any party hereto or their representatives shall constitute a waiver of any representation or warranty, and no such representation or warranty shall by merged into the Closing. 7.2 Binding Effect of the Agreement. This Agreement and the certificates and other instruments delivered by or on behalf of the parties pursuant thereto, constitute the entire agreement between the parties. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective heirs, legal representatives, successor and assigns of the parties hereto. Nothing in the Agreement, expressed or implied, confers any rights or remedies upon any party other than the parties hereto and their respective heirs, legal representatives and assigns. 7.3 Applicable Law. The Agreement are made pursuant to, and will be construed under, the laws of the State of North Carolina. 7.4 Notices. All notices, requests, demands and other communications hereunder shall be in writing and will be deemed to have been duly given when delivered or mailed, first class postage prepaid: (a) If to Seller, to: Robbie M. Efird 200 North Elm Street Greensboro, NC 27401 Telephone (336)-271-8400 Fax (336)-271-0852 7 (b) If to Buyer, to: G. David Gordon, Esquire 7633 East 63rd Place, Suite 210 Tulsa, OK 74133 Telephone: (918) 254-4997 Fax: (918) 254-2988 These addresses may be changed from time to time by written notice to the other parties. 7.5 Headings. The headings contained in this Agreement are for reference only and will not affect in any way the meaning or interpretation of this Agreement. 7.6 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one instrument. 7.7 Severability. If any one or more of the provisions of this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable under applicable law this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. The remaining provisions of this Agreement shall be given effect to the maximum extent then permitted by law. 7.8 Forbearance; Waiver. Failure to pursue any legal or equitable remedy or right available to a party shall not constitute a waiver of such right, nor shall any such forbearance, failure or actual waiver imply or constitute waiver of subsequent default or breach. 7.9 Attorneys' Fees and Expenses. The prevailing party in any legal proceeding based upon this Agreement shall be entitled to reasonable attorneys' fees and expenses and court costs. 7.10 Expenses. Each party shall pay all fees and expenses incurred by it incident to this Agreement and in connection with the consummation of all transactions contemplated by this Agreement 7.11 Exhibits. All of the following Exhibits to this Agreement are incorporated herein in the places referenced in this Agreement as if fully set forth herein. 8 IN WITNESS WHEREOF, the undersigned parties hereto have duly executed this Agreement on the date first written above. "BUYER" /s/ Herbert Tabin Herbert Tabin "SELLER" /s/ Robbie M. Efird Robbie M. Efird "Escrow Agent" G. David Gordon & Associates, P.C. /s/ G. David Gordon G. David Gordon, President EX-99.2 3 y42996ex99-2.txt STOCK PURCHASE AGREEMENT 1 Exhibit 99.2 STOCK PURCHASE AGREEMENT THIS STOCK PURCHASE AGREEMENT ("Agreement") is entered into this 10 day of July, 2000, by and among Herbert Tabin, a resident of Florida, and his assigns (hereinafter referred to as "Buyer"); and E.W. Miller, Jr., (hereinafter referred to as "Seller"), being a shareholder of NETWORK SYSTEMS INTERNATIONAL, INC., a Nevada corporation (hereafter referred to as "Company"). WHEREAS, Seller is the owner of record and beneficially owns Six Hundred Thousand (600,000) shares of the issued and outstanding shares of Common Stock of the Company (herein referred to as"Shares"); and WHEREAS, Seller desires to sell the Shares to Buyer, and Buyer desires to purchase the Shares, upon the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, and subject to the accuracy of the representations and warranties of the parties, the parties hereto agree as follows: I. SALE AND PURCHASE OF THE SHARES 1.1 Sale and Purchase. Subject to the terms and conditions hereof, at the Closing (as defined in paragraph 1.2 below), Seller agrees to sell, assign, transfer, convey and deliver to Buyer, and Buyer agrees to purchase the Shares from Seller. 1.2 Closing. The purchase shall be consummated at a closing ("Closing") to take place at 9:00 o'clock a.m., at the offices of Network Systems International, Inc. on or about July 21, 2000 ("Closing Date"). 1.3 Purchase Price. The purchase price ("Purchase Price") for the Shares shall be a cash payment of Three Hundred Thirty Three Thousand Three Hundred Thirty Three Dollars ($333,333) payable to the Seller in certified funds. At the closing, the Purchase Price will be delivered and deposited with G. David Gordon & Associates, P.C., as escrow agent ("Escrow Agent"). If the Put Option described in Section 3.3 is exercised by the Company, the Escrow Agent will deliver the Purchase Price to the Company as the Seller's portion of the initial cash payment provided for therein. If the Put Option is not exercised by the Company prior to its expiration, the Escrow Agent will immediately release the Purchase Price to Seller. 2 II. REPRESENTATIONS AND WARRANTIES 2.1 Representations and Warranties of Seller. Seller represents and warrants to Buyer as follows: (a) Title to the Shares. At Closing, Seller shall own of record and beneficially the Shares of the Company, free and clear of all liens, encumbrances, pledges, claims, options, charges and assessments of any nature whatsoever, with full right and lawful authority to transfer the Shares to Buyer. No person has any rights of first refusal with respect to any of the Shares. There exists no voting agreement, voting trust, or outstanding proxy with respect to any of the Shares. There are no outstanding rights, options, warrants, calls, commitments, or any other agreements of any character, whether oral or written, with respect to the Shares. (b) Authority. Seller has full power and lawful authority to execute and deliver this Agreement to which he is a party and to consummate and perform the Agreement as contemplated thereby. This Agreement to which Seller is a party constitutes (or shall, upon execution, constitute) valid and legally binding obligations upon Seller, enforceable in accordance with their terms. Neither the execution and delivery of this Agreement to which he is a party by Seller, nor the consummation and performance of the Agreement contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Seller is a party or by which Seller or any of his properties or assets are bound or affected. (c) Full Disclosure. All statements of Seller contained in this Agreement and in any other written documents delivered by or on behalf of Seller to Buyer are true and correct in all material respects and do not omit any material fact necessary to make the statements contained therein not misleading in light of the circumstances under which they were made. 2.2 Representations and Warranties of Buyer. Buyer represents and warrants to Seller as follows: (a) Authority. Buyer has full power and lawful authority to execute and deliver this Agreement to which Buyer is a party and to consummate and perform the Agreement as contemplated thereby. This Agreement to which Buyer is a party constitutes (or shall, upon execution, constitute) valid 3 and legally binding obligations upon Buyer, enforceable in accordance with their terms. Neither the execution and delivery of this Agreement to which Buyer is a party by Buyer, nor the consummation and performance of this Agreement contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Buyer is a party or by which Buyer or any of his properties or assets are bound or affected. (b) Investment Intent. Buyer is acquiring the Shares for his own account, for investment purposes only, and not with a view to the sale or distribution of any part thereof, and Buyer has no present intention of selling, granting participation in, or otherwise distributing the same. Buyer understands the specific risks related to an investment in the Shares, especially as it relates to the financial performance of the Company. III. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER TO CLOSE The obligation of Buyer to close the transactions contemplated hereby is subject to the fulfillment by Seller prior to Closing of each of the following conditions, which may be waived in whole or in part by Buyer: 3.1 Compliance with Representations, Warranties and Covenants. The representations and warranties of Seller contained in this Agreement shall have been true and correct when made and shall be true and correct as of the Closing with the same force and effect as if made at the Closing. Seller shall have performed all agreements, covenants and conditions required to be performed by Seller prior to the Closing. 3.2 No Legal Proceedings. No suit, action or other legal or administrative proceeding before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the transactions contemplated hereby. 3.3 Put Option. The Selling Shareholders (as that term is defined in the Stock Purchase Agreement among the Company and the Investors named therein dated July 10, 2000 (the "Initial Stock Purchase Agreement")) shall have entered into an agreement to provide the Company an option (the "Put Option") to require the Selling Shareholders to purchase all of the issued and outstanding shares of the Subsidiaries (as that term is defined in the Initial Stock Purchase Agreement) for a purchase price of three million dollars ($3,000,000), generally upon the terms and conditions set forth in Section 4.5 of the Initial Stock Purchase Agreement. Buyer acknowledges and agrees that the Company's ability to exercise the Put 4 Option will be conditioned upon (1) compliance with the Company's Articles of Incorporation and Bylaws; (2) the Company obtaining all requisite corporate authorization with respect to the sale of all of the issued and outstanding capital stock of the Subsidiaries; (3) compliance with applicable laws with respect to the sale of all of the issued and outstanding capital stock of the Subsidiaries; (4) the Company's written commitment to reduce the Company's outstanding obligation under its revolving credit arrangement with Wachovia Bank, N.A., by three million dollars ($3,000,000); (5) the Company's written commitment to amend its Articles of Incorporation to change its name, to discontinue the use of the name "Network Systems International" and to transfer all rights to the "Network Systems International" name to Network Systems International of North Carolina, Inc. ("NSI-NC"); and (6) the Company's written commitment to transfer all benefits with respect to the right to receive future tax refunds to NSI-NC. 3.4 Documents to be Delivered by Seller. Seller shall have delivered the following documents to the Escrow Agent to be held in escrow until delivery of the Purchase Price as provided in section 1.3. (a) Stock certificates representing all of the Shares, duly endorsed to Buyer in blank or accompanied by duly executed stock powers. (b) Such other documents or certificates as shall be reasonably required by Buyer or its counsel in order to close and consummate this Agreement. IV. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER TO CLOSE The obligation of Seller to close the transactions is subject to the fulfillment prior to Closing of each of the following conditions, any of which may be waived in whole or in part by Seller: 4.1 Compliance with Representations, Warranties and Covenants. The representations and warranties made by Buyer in this Agreement shall have been true and correct when made and shall be true and correct in all material respects at the Closing with the same force and effect as if made at the Closing, and Buyer shall have performed all agreements, covenants and conditions required to be performed by Buyer prior to the Closing. 4.2 No Legal Proceedings. No suit, action or other legal or administrative proceedings before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the transactions contemplated hereby. 4.3 Payments. Escrow Agent shall have received from Buyer the Purchase Price as provided in section 1.3. 5 4.4 Closing of Sale of Newly Issued Company Shares. The Company shall have consummated the sale of 1,666,667 shares of newly issued common stock pursuant to the terms of the initial Stock Purchase Agreement. V. MODIFICATION, WAIVERS, TERMINATION AND EXPENSES 5.1 Modification. Buyer and Seller may amend, modify or supplement this Agreement in any manner as they may mutually agree in writing. 5.2 Waivers. Buyer and Seller may in writing extend the time for or waive compliance by the other with any of the covenants or conditions of the other contained herein. 5.3 Termination and Abandonment. This Agreement may be terminated and the purchase of the Shares may be abandoned before the Closing: (a) By the mutual consent of Seller and Buyer; (b) By Buyer, if the representations and warranties of Seller set forth herein shall not be accurate, or the conditions precedent set forth in Article III shall have not have been satisfied by the closing date , in all material respects; or (c) By Seller, if the representations and warranties of Buyer set forth herein shall not be accurate, or the conditions precedent set forth in Article IV shall not have been satisfied by the closing date in all material respects. Termination shall be effective on the date of receipt of written notice specifying the reasons therefor. VI. MISCELLANEOUS 6.1 Representations and Warranties to Survive. Unless otherwise provided, all of the representations and warranties contained in this Agreement and in any certificate, exhibit or other document delivered pursuant to this Agreement shall survive the Closing for a period of one (1) year. No investigation made by any party hereto or their representatives shall constitute a waiver of any representation or warranty, and no such representation or warranty shall be merged into the Closing. 6.2 Binding Effect of the Agreement. This Agreement and the certificates and other instruments delivered by or on behalf of the parties pursuant thereto, constitute the entire agreement between the parties. The terms and conditions of this Agreements shall inure to the benefit of and be binding upon the respective heirs, legal 6 representatives, successor and assigns of the parties hereto. Nothing in the Agreement, expressed or implied, confers any rights or remedies upon any party other than the parties hereto and their respective heirs, legal representatives and assigns. 6.3 Applicable Law. The Agreement are made pursuant to, and will be construed under, the laws of the State of North Carolina. 6.4 Notices. All notices, requests, demands and other communications hereunder shall be in writing and will be deemed to have been duly given when delivered or mailed, first class postage prepaid: (a) If to Seller, to: E.W. Miller,Jr. 200 North Elm Street Greensboro, NC 27401 Telephone (336)-271-8400 Fax (336)-271-0852 (b) If to Buyer, to: G. David Gordon, Esquire 7633 East 63rd Place, Suite 210 Tulsa, OK 74133 Telephone: (918) 254-4997 Fax: (918) 254-2988 These addresses may be changed from time to time by written notice to the other parties. 6.5 Headings. The headings contained in this Agreement are for reference only and will not affect in any way the meaning or interpretation of this Agreement. 6.6 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one instrument. 6.7 Severability. If any one or more of the provisions of this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable under applicable law this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. The remaining provisions of this Agreement shall be given effect to the maximum extent then permitted by law. 6.8 Forbearance; Waiver. Failure to pursue any legal or equitable remedy or right available to a party shall not constitute a waiver of such right, nor shall any 7 such forbearance, failure or actual waiver imply or constitute waiver of subsequent default or breach. 6.9 Attorneys' Fees and Expenses. The prevailing party in any legal proceeding based upon this Agreement shall be entitled to reasonable attorneys' fees and expenses and court costs. 6.10 Expenses. Each party shall pay all fees and expenses incurred by it incident to this Agreement and in connection with the consummation of all transactions contemplated by this Agreement. 6.11 Exhibits. All of the following Exhibits to this Agreement are incorporated herein in the places referenced in this Agreement as if fully set forth herein. IN WITNESS WHEREOF, the undersigned parties hereto have duly executed this Agreement on the date first written above. "BUYER" /s/ Herbert Tabin Herbert Tabin "SELLER" /s/ E.W. Miller, Jr. E.W. Miller, Jr. "ESCROW AGENT" G. David Gordon & Associates, P.C. /s/ G. David Gordon G. David Gordon, President EX-99.3 4 y42996ex99-3.txt STOCK PURCHASE AGREEMENT 1 Exhibit 99.3 STOCK PURCHASE AGREEMENT THIS STOCK PURCHASE AGREEMENT ("Agreement") is entered into this 10 day of July, 2000, by and among Herbert Tabin, a resident of Florida, and his assigns (hereinafter referred to as "Buyer"); and David F. Christian, (hereinafter referred to as "Seller"), being a shareholder of NETWORK SYSTEMS INTERNATIONAL, INC., a Nevada corporation (hereafter referred to as "Company"). WHEREAS, Seller is the owner of record and beneficially owns One Hundred Thousand (100,000) shares of the issued and outstanding shares of Common Stock of the Company (herein referred to as"Shares"); and WHEREAS, Seller desires to sell the Shares to Buyer, and Buyer desires to purchase the Shares, upon the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, and subject to the accuracy of the representations and warranties of the parties, the parties hereto agree as follows: I. SALE AND PURCHASE OF THE SHARES 1.1 Sale and Purchase. Subject to the terms and conditions hereof, at the Closing (as defined in paragraph 1.2 below), Seller agrees to sell, assign, transfer, convey and deliver to Buyer, and Buyer agrees to purchase the Shares from Seller. 1.2 Closing. The purchase shall be consummated at a closing ("Closing") to take place at 9:00 o'clock a.m., at the offices of Network Systems International, Inc. on or about July 21, 2000 ("Closing Date"). 1.3 Purchase Price. The purchase price ("Purchase Price") for the Shares shall be a cash payment of Fifty Five Thousand Five Hundred Fifty Six Dollars ($55,556) payable to the Seller in certified funds. At the closing, the Purchase Price will be delivered and deposited with G. David Gordon & Associates, P.C., as escrow agent ("Escrow Agent"). If the Put Option described in Section 3.3 is exercised by the Company, the Escrow Agent will deliver the Purchase Price to the Company as the Seller's portion of the initial cash payment provided for therein. If the Put Option is not exercised by the Company prior to its expiration, the Escrow Agent will immediately release the Purchase Price to Seller. 2 II. REPRESENTATIONS AND WARRANTIES 2.1 Representations and Warranties of Seller. Seller represents and warrants to Buyer as follows: (a) Title to the Shares. At Closing, Seller shall own of record and beneficially the Shares of the Company, free and clear of all liens, encumbrances, pledges, claims, options, charges and assessments of any nature whatsoever, with full right and lawful authority to transfer the Shares to Buyer. No person has any rights of first refusal with respect to any of the Shares. There exists no voting agreement, voting trust, or outstanding proxy with respect to any of the Shares. There are no outstanding rights, options, warrants, calls, commitments, or any other agreements of any character, whether oral or written, with respect to the Shares. (b) Authority. Seller has full power and lawful authority to execute and deliver this Agreement to which he is a party and to consummate and perform the Agreement as contemplated thereby. This Agreement to which Seller is a party constitutes (or shall, upon execution, constitute) valid and legally binding obligations upon Seller, enforceable in accordance with their terms. Neither the execution and delivery of this Agreement to which he is a party by Seller, nor the consummation and performance of the Agreement contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Seller is a party or by which Seller or any of his properties or assets are bound or affected. (c) Full Disclosure. All statements of Seller contained in this Agreement written documents delivered by or on behalf of Seller to Buyer are true and correct in all material respects and do not omit any material fact necessary to make the statements contained therein not misleading in light of the circumstances under which they were made. 2.2 Representations and Warranties of Buyer. Buyer represents and warrants to Seller as follows: (a) Authority. Buyer has full power and lawful authority to execute and deliver this Agreement to which Buyer is a party and to consummate and perform the Agreement as contemplated thereby. This Agreement to which Buyer is a party constitutes (or shall, upon execution, constitute) valid and legally binding obligations upon Buyer, enforceable in accordance with 3 their terms. Neither the execution and delivery of this Agreement to which Buyer is a party by Buyer, nor the consummation and performance of this Agreement contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Buyer is a party or by which Buyer or any of his properties or assets are bound or affected. (b) Investment Intent. Buyer is acquiring the Shares for his own account, for investment purposes only, and not with a view to the sale or distribution of any part thereof, and Buyer has no present intention of selling, granting participation in, or otherwise distributing the same. Buyer understands the specific risks related to an investment in the Shares, especially as it relates to the financial performance of the Company. III. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER TO CLOSE The obligation of Buyer to close the transactions contemplated hereby is subject to the fulfillment by Seller prior to Closing of each of the following conditions, which may be waived in whole or in part by Buyer: 3.1 Compliance with Representations, Warranties and Covenants. The representations and warranties of Seller contained in this Agreement shall have been true and correct when made and shall be true and correct as of the Closing with the same force and effect as if made at the Closing. Seller shall have performed all agreements, covenants and conditions required to be performed by Seller prior to the Closing. 3.2 No Legal Proceedings. No suit, action or other legal or administrative proceeding before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the transactions contemplated hereby. 3.3 Put Option. The Selling Shareholders (as that term is defined in the Stock Purchase Agreement among the Company and the Investors named therein dated July 10, 2000 (the "Initial Stock Purchase Agreement")) shall have entered into an agreement to provide the Company an option (the "Put Option") to require the Selling Shareholders to purchase all of the issued and outstanding shares of the Subsidiaries (as that term is defined in the Initial Stock Purchase Agreement) for a purchase price of three million dollars ($3,000,000), generally upon the terms and conditions set forth in Section 4.5 of the Initial Stock Purchase Agreement. Buyer acknowledges and agrees that the Company's ability to exercise the Put Option will be conditioned upon (1) compliance with the Company's Articles of 4 Incorporation and Bylaws; (2) the Company obtaining all requisite corporate authorization with respect to the sale of all of the issued and outstanding capital stock of the Subsidiaries; (3) compliance with applicable laws with respect to the sale of all of the issued and outstanding capital stock of the Subsidiaries; (4) the Company's written commitment to reduce the Company's outstanding obligation under its revolving credit arrangement with Wachovia Bank, N.A., by three million dollars ($3,000,000); (5) the Company's written commitment to amend its Articles of Incorporation to change its name, to discontinue the use of the name "Network Systems International" and to transfer all rights to the "Network Systems International" name to Network Systems International of North Carolina, Inc. ("NSI-NC"); and (6) the Company's written commitment to transfer all benefits with respect to the right to receive future tax refunds to NSI-NC. 3.4 Documents to be Delivered by Seller. Seller shall have delivered the following documents to the Escrow Agent to be held in escrow until delivery of the Purchase Price as provided in section 1.3. (a) Stock certificates representing all of the Shares, duly endorsed to Buyer in blank or accompanied by duly executed stock powers. (b) Such other documents or certificates as shall be reasonably required by Buyer or its counsel in order to close and consummate this Agreement. IV. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER TO CLOSE The obligation of Seller to close the transactions is subject to the fulfillment prior to Closing of each of the following conditions, any of which may be waived in whole or in part by Seller: 4.1 Compliance with Representations, Warranties and Covenants. The representations and warranties made by Buyer in this Agreement shall have been true and correct when made and shall be true and correct in all material respects at the Closing with the same force and effect as if made at the Closing, and Buyer shall have performed all agreements, covenants and conditions required to be performed by Buyer prior to the Closing. 4.2 No Legal Proceedings. No suit, action or other legal or administrative proceedings before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the transactions contemplated hereby. 4.3 Payments. Escrow Agent shall have received from Buyer the Purchase Price as provided in section 1.3. 5 4.4 Closing of Sale of Newly Issued Company Shares. The Company shall have consummated the sale of 1,666,667 shares of newly issued common stock pursuant to the terms of the initial Stock Purchase Agreement. V. MODIFICATION, WAIVERS, TERMINATION AND EXPENSES 5.1 Modification. Buyer and Seller may amend, modify or supplement this Agreement in any manner as they may mutually agree in writing. 5.2 Waivers. Buyer and Seller may in writing extend the time for or waive compliance by the other with any of the covenants or conditions of the other contained herein. 5.3 Termination and Abandonment. This Agreement may be terminated and the purchase of the Shares may be abandoned before the Closing: (a) By the mutual consent of Seller and Buyer; (b) By Buyer, if the representations and warranties of Seller set forth herein shall not be accurate, or the conditions precedent set forth in Article III shall have not have been satisfied by the closing date , in all material respects; or (c) By Seller, if the representations and warranties of Buyer set forth herein shall not be accurate, or the conditions precedent set forth in Article IV shall not have been satisfied by the closing date in all material respects. Termination shall be effective on the date of receipt of written notice specifying the reasons therefor. VI. MISCELLANEOUS 6.1 Representations and Warranties to Survive. Unless otherwise provided, all of the representations and warranties contained in this Agreement and in any certificate, exhibit or other document delivered pursuant to this Agreement shall survive the Closing for a period of one (1) year. No investigation made by any party hereto or their representatives shall constitute a waiver of any representation or warranty, and no such representation or warranty shall be merged into the Closing. 6.2 Binding Effect of the Agreement. This Agreement and the certificates and other instruments delivered by or on behalf of the parties pursuant thereto, constitute the entire agreement between the parties. The terms and conditions of this Agreements shall inure to the benefit of and be binding upon the respective heirs, legal representatives, successor and assigns of the parties hereto. Nothing in the 6 Agreement, expressed or implied, confers any rights or remedies upon any party other than the parties hereto and their respective heirs, legal representatives and assigns. 6.3 Applicable Law. The Agreement are made pursuant to, and will be construed under, the laws of the State of North Carolina. 6.4 Notices. All notices, requests, demands and other communications hereunder shall be in writing and will be deemed to have been duly given when delivered or mailed, first class postage prepaid: (a) If to Seller, to: David F. Christian 200 North Elm Street Greensboro, NC 27401 Telephone (336)-271-8400 Fax (336)-271-0852 (b) If to Buyer, to: G. David Gordon, Esquire 7633 East 63rd Place, Suite 210 Tulsa, OK 74133 Telephone: (918) 254-4997 Fax: (918) 254-2988 These addresses may be changed from time to time by written notice to the other parties. 6.5 Headings. The headings contained in this Agreement are for reference only and will not affect in any way the meaning or interpretation of this Agreement. 6.6 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one instrument. 6.7 Severability. If any one or more of the provisions of this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable under applicable law this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. The remaining provisions of this Agreement shall be given effect to the maximum extent then permitted by law. 6.8 Forbearance; Waiver. Failure to pursue any legal or equitable remedy or right available to a party shall not constitute a waiver of such right, nor shall any 7 such forbearance, failure or actual waiver imply or constitute waiver of subsequent default or breach. 6.9 Attorneys' Fees and Expenses. The prevailing party in any legal proceeding based upon this Agreement shall be entitled to reasonable attorneys' fees and expenses and court costs. 6.10 Expenses. Each party shall pay all fees and expenses incurred by it incident to this Agreement and in connection with the consummation of all transactions contemplated by this Agreement. 6.11 Exhibits. All of the following Exhibits to this Agreement are incorporated herein in the places referenced in this Agreement as if fully set forth herein. IN WITNESS WHEREOF, the undersigned parties hereto have duly executed this Agreement on the date first written above. "BUYER" /s/ Herbert Tabin Herbert Tabin "SELLER" /s/ David F. Christian David F. Christian "ESCROW AGENT" G. David Gordon & Associates, P.C. /s/ G. David Gordon G. David Gordon, Presidents EX-99.4 5 y42996ex99-4.txt STOCK PURCHASE AGREEMENT 1 Exhibit 99.4 STOCK PURCHASE AGREEMENT THIS STOCK PURCHASE AGREEMENT ("Agreement") is entered into this 10 day of July, 2000, by and among Herbert Tabin, a resident of Florida, and his assigns (hereinafter referred to as "Buyer"); and James W. Moseley, (hereinafter referred to as "Seller"), being a shareholder of NETWORK SYSTEMS INTERNATIONAL, INC., a Nevada corporation (hereafter referred to as "Company"). WHEREAS, Seller is the owner of record and beneficially owns One Hundred Thousand (100,000) shares of the issued and outstanding shares of Common Stock of the Company (herein referred to as "Shares"); and WHEREAS, Seller desires to sell the Shares to Buyer, and Buyer desires to purchase the Shares, upon the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, and subject to the accuracy of the representations and warranties of the parties, the parties hereto agree as follows: I. SALE AND PURCHASE OF THE SHARES 1.1 Sale and Purchase. Subject to the terms and conditions hereof, at the Closing (as defined in paragraph 1.2 below), Seller agrees to sell, assign, transfer, convey and deliver to Buyer, and Buyer agrees to purchase the Shares from Seller. 1.2 Closing. The purchase shall be consummated at a closing ("Closing") to take place at 9:00 o'clock a.m., at the offices of Network Systems International, Inc. on or about July 21, 2000 ("Closing Date"). 1.3 Purchase Price. The purchase price ("Purchase Price") for the Shares shall be a cash payment of Fifty Five Thousand Five Hundred Fifty Six Dollars ($55,556) payable to the Seller in certified funds. At the closing, the Purchase Price will be delivered and deposited with G. David Gordon & Associates, P.C., as escrow agent ("Escrow Agent"). If the Put Option described in Section 3.3 is exercised by the Company, the Escrow Agent will deliver the Purchase Price to the Company as the Seller's portion of the initial cash payment provided for therein. If the Put Option is not exercised by the Company prior to its expiration, the Escrow Agent will immediately release the Purchase Price to Seller. 2 II. REPRESENTATIONS AND WARRANTIES 2.1 Representations and Warranties of Seller. Seller represents and warrants to Buyer as follows: (a) Title to the Shares. At Closing, Seller shall own of record and beneficially the Shares of the Company, free and clear of all liens, encumbrances, pledges, claims, options, charges and assessments of any nature whatsoever, with full right and lawful authority to transfer the Shares to Buyer. No person has any rights of first refusal with respect to any of the Shares. There exists no voting agreement, voting trust, or outstanding proxy with respect to any of the Shares. There are no outstanding rights, options, warrants, calls, commitments, or any other agreements of any character, whether oral or written, with respect to the Shares. (b) Authority. Seller has full power and lawful authority to execute and deliver this Agreement to which he is a party and to consummate and perform the Agreement as contemplated thereby. This Agreement to which Seller is a party constitutes (or shall, upon execution, constitute) valid and legally binding obligations upon Seller, enforceable in accordance with their terms. Neither the execution and delivery of this Agreement to which he is a party by Seller, nor the consummation and performance of the Agreement contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Seller is a party or by which Seller or any of his properties or assets are bound or affected. (c) Full Disclosure. All statements of Seller contained in this Agreement written documents delivered by or on behalf of Seller to Buyer are true and correct in all material respects and do not omit any material fact necessary to make the statements contained therein not misleading in light of the circumstances under which they were made. 2.2 Representations and Warranties of Buyer. Buyer represents and warrants to Seller as follows: (a) Authority. Buyer has full power and lawful authority to execute and deliver this Agreement to which Buyer is a party and to consummate and perform the Agreement as contemplated thereby. This Agreement to which Buyer is a party constitutes (or shall, upon execution, constitute) valid and legally binding obligations upon Buyer, enforceable in accordance with 3 their terms. Neither the execution and delivery of this Agreement to which Buyer is a party by Buyer, nor the consummation and performance of this Agreement contemplated thereby, conflicts with, requires the consent, waiver or approval of, results in a breach of or default under, or gives to others any interest or right of termination, cancellation or acceleration in or with respect to, any agreement by which Buyer is a party or by which Buyer or any of his properties or assets are bound or affected. (b) Investment Intent. Buyer is acquiring the Shares for his own account, for investment purposes only, and not with a view to the sale or distribution of any part thereof, and Buyer has no present intention of selling, granting participation in, or otherwise distributing the same. Buyer understands the specific risks related to an investment in the Shares, especially as it relates to the financial performance of the Company. III. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER TO CLOSE The obligation of Buyer to close the transactions contemplated hereby is subject to the fulfillment by Seller prior to Closing of each of the following conditions, which may be waived in whole or in part by Buyer: 3.1 Compliance with Representations, Warranties and Covenants. The representations and warranties of Seller contained in this Agreement shall have been true and correct when made and shall be true and correct as of the Closing with the same force and effect as if made at the Closing. Seller shall have performed all agreements, covenants and conditions required to be performed by Seller prior to the Closing. 3.2 No Legal Proceedings. No suit, action or other legal or administrative proceeding before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the transactions contemplated hereby. 3.3 Put Option. The Selling Shareholders (as that term is defined in the Stock Purchase Agreement among the Company and the Investors named therein dated July 10, 2000 (the "Initial Stock Purchase Agreement")) shall have entered into an agreement to provide the Company an option (the "Put Option") to require the Selling Shareholders to purchase all of the issued and outstanding shares of the Subsidiaries (as that term is defined in the Initial Stock Purchase Agreement) for a purchase price of three million dollars ($3,000,000), generally upon the terms and conditions set forth in Section 4.5 of the Initial Stock Purchase Agreement. Buyer acknowledges and agrees that the Company's ability to exercise the Put Option will be conditioned upon (1) compliance with the Company's Articles of 4 Incorporation and Bylaws; (2) the Company obtaining all requisite corporate authorization with respect to the sale of all of the issued and outstanding capital stock of the Subsidiaries; (3) compliance with applicable laws with respect to the sale of all of the issued and outstanding capital stock of the Subsidiaries; (4) the Company's written commitment to reduce the Company's outstanding obligation under its revolving credit arrangement with Wachovia Bank, N.A., by three million dollars ($3,000,000); (5) the Company's written commitment to amend its Articles of Incorporation to change its name, to discontinue the use of the name "Network Systems International" and to transfer all rights to the "Network Systems International" name to Network Systems International of North Carolina, Inc. ("NSI-NC"); and (6) the Company's written commitment to transfer all benefits with respect to the right to receive future tax refunds to NSI-NC. 3.4 Documents to be Delivered by Seller. Seller shall have delivered the following documents to the Escrow Agent to be held in escrow until delivery of the Purchase Price as provided in section 1.3. (a) Stock certificates representing all of the Shares, duly endorsed to Buyer in blank or accompanied by duly executed stock powers. (b) Such other documents or certificates as shall be reasonably required by Buyer or its counsel in order to close and consummate this Agreement. IV. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER TO CLOSE The obligation of Seller to close the transactions is subject to the fulfillment prior to Closing of each of the following conditions, any of which may be waived in whole or in part by Seller: 4.1 Compliance with Representations, Warranties and Covenants. The representations and warranties made by Buyer in this Agreement shall have been true and correct when made and shall be true and correct in all material respects at the Closing with the same force and effect as if made at the Closing, and Buyer shall have performed all agreements, covenants and conditions required to be performed by Buyer prior to the Closing. 4.2 No Legal Proceedings. No suit, action or other legal or administrative proceedings before any court or other governmental agency shall be pending or threatened seeking to enjoin the consummation of the transactions contemplated hereby. 4.3 Payments. Escrow Agent shall have received from Buyer the Purchase Price as provided in section 1.3. 5 4.4 Closing of Sale of Newly Issued Company Shares. The Company shall have consummated the sale of 1,666,667 shares of newly issued common stock pursuant to the terms of the initial Stock Purchase Agreement. V. MODIFICATION, WAIVERS, TERMINATION AND EXPENSES 5.1 Modification. Buyer and Seller may amend, modify or supplement this Agreement in any manner as they may mutually agree in writing. 5.2 Waivers. Buyer and Seller may in writing extend the time for or waive compliance by the other with any of the covenants or conditions of the other contained herein. 5.3 Termination and Abandonment. This Agreement may be terminated and the purchase of the Shares may be abandoned before the Closing: (a) By the mutual consent of Seller and Buyer; (b) By Buyer, if the representations and warranties of Seller set forth herein shall not be accurate, or the conditions precedent set forth in Article III shall have not have been satisfied by the closing date , in all material respects; or (c) By Seller, if the representations and warranties of Buyer set forth herein shall not be accurate, or the conditions precedent set forth in Article IV shall not have been satisfied by the closing date in all material respects. Termination shall be effective on the date of receipt of written notice specifying the reasons therefor. VI. MISCELLANEOUS 6.1 Representations and Warranties to Survive. Unless otherwise provided, all of the representations and warranties contained in this Agreement and in any certificate, exhibit or other document delivered pursuant to this Agreement shall survive the Closing for a period of one (1) year. No investigation made by any party hereto or their representatives shall constitute a waiver of any representation or warranty, and no such representation or warranty shall be merged into the Closing. 6.2 Binding Effect of the Agreement. This Agreement and the certificates and other instruments delivered by or on behalf of the parties pursuant thereto, constitute the entire agreement between the parties. The terms and conditions of this Agreements shall inure to the benefit of and be binding upon the respective heirs, legal representatives, successor and assigns of the parties hereto. Nothing in the 6 Agreement, expressed or implied, confers any rights or remedies upon any party other than the parties hereto and their respective heirs, legal representatives and assigns. 6.3 Applicable Law. The Agreement are made pursuant to, and will be construed under, the laws of the State of North Carolina. 6.4 Notices. All notices, requests, demands and other communications hereunder shall be in writing and will be deemed to have been duly given when delivered or mailed, first class postage prepaid: (a) If to Seller, to: James W. Moseley 200 North Elm Street Greensboro, NC 27401 Telephone (336)-271-8400 Fax (336)-271-0852 (b) If to Buyer, to: G. David Gordon, Esquire 7633 East 63rd Place, Suite 210 Tulsa, OK 74133 Telephone: (918) 254-4997 Fax: (918) 254-2988 These addresses may be changed from time to time by written notice to the other parties. 6.5 Headings. The headings contained in this Agreement are for reference only and will not affect in any way the meaning or interpretation of this Agreement. 6.6 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one instrument. 6.7 Severability. If any one or more of the provisions of this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable under applicable law this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. The remaining provisions of this Agreement shall be given effect to the maximum extent then permitted by law. 6.9 Forbearance; Waiver. Failure to pursue any legal or equitable remedy or right available to a party shall not constitute a waiver of such right, nor shall any such forbearance, failure or actual waiver imply or constitute waiver of subsequent default or breach. 7 6.9 Attorneys' Fees and Expenses. The prevailing party in any legal proceeding based upon this Agreement shall be entitled to reasonable attorneys' fees and expenses and court costs. 6.10 Expenses. Each party shall pay all fees and expenses incurred by it incident to this Agreement and in connection with the consummation of all transactions contemplated by this Agreement. 6.11 Exhibits. All of the following Exhibits to this Agreement are incorporated herein in the places referenced in this Agreement as if fully set forth herein. IN WITNESS WHEREOF, the undersigned parties hereto have duly executed this Agreement on the date first written above. "BUYER" /s/ Herbert Tabin Herbert Tabin "SELLER" /s/ James W. Mosely James W. Moseley "ESCROW AGENT" G. David Gordon & Associates, P.C. /s/ G. David Gordon G. David Gordon, President -----END PRIVACY-ENHANCED MESSAGE-----