Exhibit 99.1
STOCK PURCHASE AND SUBSCRIPTION AGREEMENT
Xxx X. Xxxxxx
President
Solution Technology International, Inc.
Xxxxxxx Information Enterprise Center
000 Xxxxxx Xxxx, Xxxxx 00
XxXxxxx, Xxxxxxxx 00000
Dear Xx. Xxxxxx:
1. Access to Information Regarding Solution Technology International, Inc.
Subscriber hereby acknowledge access to the publicly available information with
the U.S. Securities and Exchange Commission regarding Solution Technology
International, Inc. (the "Company") in connection with the offer of the
Company's common stock, par value $.01 per share (the "Common Stock").
2. Subscription and Payment. Upon the terms of this Stock Purchase and
Subscription Agreement (the "Subscription Agreement"), Subscriber hereby
subscribes for and agrees to purchase 15,000,000 shares of the Company's Common
Stock at a per share price of $0.01. Subscriber has enclosed with this
Subscription Agreement payment in full in the amount of $150,000 for the Common
Stock in the form of a check, or evidence of a completed wire transfer to the
Company's bank account. The Company also agrees to issue a warrant to Subscriber
for 25,000,000 shares of its common stock at an exercise price of $.01 per share
that is exercisable for a period of two years from July 16, 2007.
3. Irrevocable: Acceptance or Rejection of Subscription. This subscription
is irrevocable and may not be withdrawn. The subscription may be accepted or
rejected for any reason, in the Company's sole discretion. Subscriber will be
notified within five days whether its subscription is accepted or rejected, or
if further information is needed. If its subscription is rejected, this
Subscription Agreement and the enclosed check or wired funds will be returned
promptly to it, without interest or deductions, and neither Subscriber nor the
Company will have any obligations under this Subscription Agreement. If
Subscriber's subscription is accepted, this Subscription Agreement will become a
binding contract between Subscriber and the Company, and the Company will issue
to Subscriber a certificate evidencing my ownership of the Common Stock being
purchased by Subscriber.
4. Investment Representations. To induce the Company to sell its Common
Stock to Subscriber, and with the understanding that it is relying on the
following representations and warranties, Subscriber hereby makes the following
representations and warranties to the Company:
a. Resident. Subscriber is a resident of New York.
b. Common Stock Not Registered Under Securities Laws. Subscriber
understands that the offer is being made pursuant to an exemption from
registration with the SEC under the Securities Act, for limited and non-public
offerings, and pursuant to similar exemptions under certain state securities
laws. Consequently, the offering materials from the Company and terms of the
offer have not been subject to review or comment by the SEC, the securities
administrator of any state, or any other regulatory authority.
c. Common Stock Acquired for Own Account. Subscriber is acquiring
the Company's Common Stock for its own account for investment and not with a
view to, or for sale in connection with, any distribution thereof, nor with any
present intention of distributing or selling the same.
d. Restrictions on Transfer of Common Stock. Subscriber will not
make any resales or other dispositions of the Common Stock by means of any
"general solicitation" or "general advertisement." Subscriber understands that
it will not be able to transfer or make any other disposition of the Common
Stock unless such transfer or disposition is registered or qualified under all
applicable federal or state securities laws, or unless the Subscriber has first
delivered to the Company written opinion of qualified counsel, satisfactory to
the Company, that such registration or qualification is not required. Subscriber
understands that the certificate representing the Subscriber's Common Stock will
bear a legend evidencing the restrictions on transfer described herein.
e. Access to Information. Subscriber has carefully reviewed the
information available to the Subscriber about the Company. Any and all
additional information requested by Subscriber has been made available to
Subscriber by the Company, and Subscriber has had an opportunity to question and
receive satisfactory answers from the officers of the Company in connection with
Subscriber's proposed purchase of Common Stock.
f. Experience: Ability to Risk Loss. Subscriber has such knowledge
and experience in financial and business matters that Subscriber is capable of
evaluating the merits and risks of this investment. Subscriber understands that
an investment in the Common Stock involves high risk. Subscriber is capable of
bearing all of the economic risks and burdens of this investment, including the
possible loss of all capital contributed by Subscriber. Subscriber has no need
for liquidity in this investment. Subscriber has carefully reviewed the
disclosures concerning the Company and has made detailed inquiries concerning
the Company, its business and its personnel; the officers of the Company have
made available to Subscriber any and all written information that Subscriber has
requested and has answered to Subscriber's satisfaction all inquiries made by
Subscriber; and Subscriber has adequate net worth and means of providing for
Subscriber's current needs and contingencies to sustain a complete loss of
Subscriber's investment in the Company; Subscriber's overall commitment to
investments that are not readily marketable is not disproportionate to
Subscriber's net worth and Subscriber's investment in the Common Stock will not
cause such overall commitment to become excessive.
g. Accredited Investor. Subscriber is an Accredited Investor within
the definition set forth in Rule 501(a) of the Securities Act, substantially as
follows (check any and all that apply as to why subscriber is an Accredited
Investor):
2
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 Act, or any savings
and loan association or other institution as defined in section 3(a)(5)(A) of
the Act whether acting in its individual or fiduciary capacity; 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
under section 301(c) or (d) of the Small Business Investment Act of 1958; any
plan established and maintained by a state, its political subdivisions, or any
agency or instrumentality of a state or its political subdivisions for the
benefits of its employees, if such plan has total assets in excess of
$5,000,000; any employee benefit plan within the meaning of the Employee
Retirement Income Security Act of 1974 if the investment decision is made by a
plan fiduciary, as defined in section 3(21) of such Act, which is either a bank,
savings and loan association, insurance company, or registered investment
adviser, or if the employee benefit plan has total assets in excess of
$5,000,000 or, if a self-directed plan, with investment decisions made solely by
persons that are accredited investors;
_______ (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 same income level in the current year;
_______ (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) of the
Securities Act; and
3
___X___ (8) Any entity in which all of the equity investors are accredited
investors.
(Rule 501(a) of the Securities Act)
h. No Assurances. The Company has not made any representation or
other assurance to Subscriber concerning the percentage of profit or the amount
or type of consideration, profit or loss (including tax deductions), if any, to
be realized by Subscriber as a result of an investment in the Common Stock.
i. Capacity and Authority to Contract. The signatory hereto has full
power and authority to execute, deliver and perform this Subscription Agreement.
All corporate or other action necessary to authorize the execution, delivery and
performance of this Subscription Agreement by the signatory hereto has been
taken. This Subscription Agreement has been duly executed on behalf of the
signatory hereto. Subscriber has full power and authority to enter into and to
perform this Subscription Agreement in accordance with its terms. Any Subscriber
that is a partnership or a corporation, represents that it has not been
organized, reorganized or recapitalized specifically for the purpose of
investing in the Company.
j. Offshore Sales. If Subscriber is purchasing the Common Stock
pursuant to Regulation S of the United States Securities and Exchange Commission
for securities that are offered and sold outside the United States, Subscriber
acknowledges that the Common Stock may not be sold in the United States, its
territories or possessions, or to United States residents or to a United States
person within the meaning of Regulation S (a "U.S. Person") until the expiration
of a one-year period commencing on the date of the closing of the purchase of
the Common Stock acquired pursuant to this Subscription Agreement or such other
restricted period as shall be required pursuant to Regulation S as it may be in
effect from time to time and, thereafter, only if the Common Stock are
registered under the Act or an exemption from the registration requirements
under the Act is available. Subscriber represents and warrants that it is not a
resident of the United States nor otherwise deemed to be a U.S. Person.
5. Market Standoff. Following the effective date of a registration
statement of the Company filed under the Securities Act, for the duration
specified by and to the extent requested by the Company and an underwriter of
the Company's equity securities, but in no event for a period to exceed 180
days, Subscriber shall not directly or indirectly sell, offer to sell, contract
to sell (including, without limitation, any short sale), grant any option to
purchase, or otherwise transfer or dispose of (other than to a donee who agrees
to be similarly bound) the Common Stock purchased by Subscriber at any time
during such period except Common Stock (or other securities) included in such
registration, provided however, that:
(a) such agreement shall be applicable only to the first such
registration statement of the Company that covers Common Stock (or other
securities) to be sold on its behalf to the public in an underwritten offering;
and
(b) all officers and directors of the Company and all persons with
registration rights with respect to the Company's capital stock enter into
similar agreements. This Subscription Agreement may be amended or assigned only
in compliance with applicable securities laws.
4
6. Registration Rights. Subscriber shall have unlimited piggyback rights
to register its shares of Common Stock received under the terms of this
Subscription Agreement when the Company is filing a registration statement other
than on Form S-4 or Form S-8. The Company shall pay the expenses of such
piggyback registrations other than underwriting discounts and commissions
relating to the shares registered under the terms of this Section.
7. Representations and Warranties of the Company. The Company hereby
acknowledges, represents, warrants, and agrees, as of the date of acceptance of
this Subscription Agreement, as follows:
(a) Organization and Corporate Power The Company is a corporation
duly organized, validly existing and in corporate good standing under the laws
of the State of Delaware. The Company is duly qualified to conduct business and
is in corporate good standing under the laws of each jurisdiction in which the
nature of its businesses or the ownership or leasing of its properties requires
such qualification, except where the failure to be so qualified or in good
standing would not have a material adverse effect on the Company's ability to
perform in any material respect on a timely basis its obligations under the this
Subscription Agreement. The Company has the corporate power and authority to
carry on the businesses in which it is engaged and to own and use the properties
owned and used by it. The Company is not in default under or in violation of any
provision of its charter or bylaws.
(b) Capitalization. All issued and outstanding shares of the Company
stock have been duly authorized and validly issued, and are fully paid and
nonassessable. Except as set forth in current SEC filings there are no
outstanding or authorized subscriptions, options, warrants, plans or other
agreements or rights of any kind to purchase or otherwise receive or be issued,
or securities or obligations of any kind convertible into, any shares of capital
stock or other securities of the Company, and there are no dividends which have
accrued or been declared but are unpaid on the capital stock of the Company.
Except as set forth in current SEC filings, there are no outstanding or
authorized stock appreciations, phantom stock or similar rights with respect to
the Company. After giving effect to the transactions contemplated hereby, other
than as set forth in current SEC filings, there are (A) no preemptive rights,
rights of first refusal, put or call rights or obligations or anti-dilution
rights with respect to the issuance, sale or redemption of the Company's capital
stock, (B) no rights to have the Company's capital stock registered for sale to
the public in connection with the laws of any jurisdiction and (C) no documents,
instruments or agreements relating to the voting of the Company's voting
securities or restrictions on the transfer of the Company's capital stock.
(c) Authorization. The Company has the corporate power and authority
to execute and deliver this and to perform its obligations hereunder. The
execution and delivery of this Subscription Agreement, the performance by the
Company of this Subscription Agreement and the consummation by the Company of
the transactions contemplated hereby, the sale and delivery of the Common Stock
under this Agreement has been duly and validly authorized by all necessary
corporate action on the part of the Company. This Subscription Agreement has
been duly and validly executed and delivered by the Company and constitutes a
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as enforcement may be limited by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws affecting the enforcement of creditors' rights generally, and except that
the availability of equitable remedies, including specific performance, is
subject to the discretion of the court before which any proceeding therefore may
be brought.
5
8. Miscellaneous. This Subscription Agreement may not be amended or
assigned without the written agreement of both parties and compliance with
applicable securities laws. This Subscription Agreement is governed by the laws
of the State of Delaware.
9. Wire Instructions. Any wires of funds to the Company should be made as
follows:
Bank: Xxx Xxxxxxx Xxxxx Xxxx, Xxx Xxxxxxx, Xxxxxxxx 00000
ABA Number: 000000000
Account Name: NetWorth Technologies
Account Number: 2000016754
Name in which the Stock Certificate is to be Issued:
EGATNIV LLC
----------------------------------------------------
EXECUTED this 16th day of July, 2007
Documents Required to be Enclosed
With this Subscription Agreement:
- Check or evidence of wire transfer for full subscription amount
SIGNED: ______________________________________________
Name: _______________________________
[Print]
Date:________________________________
PLEASE FORWARD A COPY OF THE EXECUTED SUBSCRIPTION AGREEMENT TO STI VIA FAX NO.
0-000-000-0000 AND 0-000-000-0000. THANK YOU.
ACCEPTED:
SOLUTION TECHNOLOGY INTERNATIONAL, INC.
By: __________________________________
Xxx Xxxxxx, President
6
