As filed with the Securities and Exchange Commission on April 7, 1999
File No. 333-67625
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
PRE-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
V-ONE Corporation
-------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 52-1953278
- ------------------------------------------- ------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
20250 Century Boulevard, Suite 300, Germantown, MD 20874
(301) 515-5200
--------------------------------------------------------------
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Charles B. Griffis
Senior Vice President and Chief Financial Officer
V-ONE Corporation
20250 Century Boulevard
Suite 300
Germantown, MD 20874
(301) 515-5243
--------------------------------------------------------------------
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
Copies to:
Cary J. Meer, Esq.
Richard A. Gashler, Esq.
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W.
Washington, DC 20036-1800
Approximate date of commencement of proposed sale to the public: As soon
as practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. /x/
<PAGE>
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / / _____
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / / _____
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Proposed
Maximum Proposed Maximum Amount of
Title of Each Class of Amount To Offering Price Per Aggregate Offering Registration
Securities To Be Registered Be Registered Share(1) Price(1) Fee(1)
- -------------------------------------------------------------------------------------------------------
Common Stock, $.001 par 489,441 $ 2.9535 $ 1,445,563.90 $ 401.87
value per share (2)
- -------------------------------------------------------------------------------------------------------
Common Stock, $.001 par 5,000 $ 2.9535 $ 14,767.50 $ 4.11
value per share (3)
- -------------------------------------------------------------------------------------------------------
Total 494,441 $ 2.9535 $ 1,460,331.40 $ 405.98*
- -------------------------------------------------------------------------------------------------------
</TABLE>
* Paid previously.
(1) Estimated pursuant to Rule 457 for the purpose of calculating the
registration fee only; based upon the average of the high and low sales
prices for the Common Stock of V-ONE Corporation ("Common Stock") on the
Nasdaq National Market on November 16, 1998. Registration fee is
calculated pursuant to Rule 457(c).
(2) Includes shares of Common Stock issuable in connection with warrants to
purchase Common Stock granted to Advantage Fund II Ltd. Pursuant to Rule
416, also includes such indeterminate number of additional shares of
Common Stock as may become issuable upon exercise of these warrants (a) to
prevent dilution resulting from stock splits, stock dividends or similar
transactions or (b) by reason of reductions in the exercise price of the
warrants in accordance with the terms thereof.
(3) Includes 5,000 shares of Common Stock held by Golden Eagle Partners
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
2
<PAGE>
PROSPECTUS
Subject to Completion, April 7, 1999
494,441 Shares
V-ONE CORPORATION
COMMON STOCK
The 494,441 shares of common stock of V-ONE Corporation offered
through this prospectus will be sold by certain current shareholders
of V-ONE. The shareholders selling shares of common stock pursuant to
this offering are Advantage Fund II Ltd. and Golden Eagle Partners.
The selling shareholders own their shares either directly or
indirectly in the form of warrants to purchase shares of common
stock. In some instances, the shares offered pursuant to this
prospectus may be sold by the pledgees, donees or transferees of or
other successors in interest to the selling shareholders. None of the
proceeds from this offering will be received by V-ONE.
The sale of shares offered through this prospectus may be
effected by the selling shareholders from time to time in
transactions on the Nasdaq National Market, in privately negotiated
transactions or in a combination of such methods of sale. The shares
may be sold at fixed prices that may change, at prices prevailing at
the time of sale, at prices relating to such prevailing prices or at
negotiated prices.
V-ONE's common stock is currently listed on the Nasdaq National
Market under the trading symbol "VONE."
V-ONE's principal executive offices are located at 20250
Century Boulevard, Suite 300, Germantown, Maryland 20874. V-ONE's
telephone number is (301) 515-5200.
POTENTIAL INVESTORS SHOULD CONSIDER CAREFULLY THE RISK FACTORS
BEGINNING ON PAGE 2 OF THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES
OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
______________, 1999
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY
CHANGE. THE SELLING SHAREHOLDERS MAY NOT SELL THEIR SHARES UNTIL THE
REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL
THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE>
V-ONE
V-ONE develops, markets, and licenses a comprehensive suite of network
security products that enables organizations to conduct secured electronic
transactions and information exchange using private enterprise networks and
public networks, such as the Internet. V-ONE's suite of products address network
user authentication, perimeter security, access control, and data integrity
through the use of smart cards, firewalls, and encryption technology. V-ONE's
products interoperate seamlessly and can be combined to form a complete,
integrated network security solution or can be used as independent components in
customized security solutions. V-ONE's products have been designed with an open
and flexible architecture to enable applications to work better and to support
future network security standards. In addition, V-ONE's products enable
organizations to deploy and scale their solutions from small, single-site
networks to large, multi-site environments and can accomodate both wireline and
wireless media.
V-ONE was incorporated in Maryland in February 1993 and reincorporated in
Delaware in February 1996. Effective July 2, 1996, V-ONE changed its name from
"Virtual Open Network Environment Corporation" to "V-ONE Corporation."
RISK FACTORS
V-ONE operates in a rapidly changing environment that involves numerous
risks, some of which are beyond V-ONE's control. The following discussion
highlights some of the risks V-ONE faces. This prospectus contains
"forward-looking statements." Such statements involve known and unknown risks
and uncertainties that could cause V-ONE's actual performance or achievements to
differ from any future performance or achievements expressed or implied by such
statements. Readers should carefully consider the following risk factors before
purchasing common stock of V-ONE. Readers are also referred to other documents
to be filed by V-ONE with the SEC, specifically V-ONE's 1999 Annual Report on
Form 10-K and subsequent fiscal years, which may identify important risk factors
for V-ONE.
V-ONE'S LIMITED OPERATING HISTORY, ACCUMULATED DEFICIT AND FINANCING ACTIVITIES
As of December 31, 1998, V-ONE had an accumulated deficit of approximately
$29,692,000. V-ONE currently expects to incur additional net losses over the
next several quarters. V-ONE will need to raise additional capital through
various financing activities in the short term to finance its ongoing operations
and is presently exploring sources of such financing.
Because of V-ONE's limited operating history, V-ONE may not achieve or
sustain profitability or significant revenues. To address these risks, V-ONE
must, among other things, continue its emphasis on research and development,
successfully execute and implement its marketing strategy, respond to
competitive developments and seek to attract and retain talented personnel.
V-ONE may be unable successfully to address these risks and the failure to do so
could have a material adverse effect on V-ONE's business, financial condition,
results of operations and cash flows.
V-ONE was founded in February 1993 and introduced its first product in
December 1994. Accordingly, V-ONE did not generate any significant revenues
until 1995 when it commenced sales of its SmartWall firewall product and
introduced its SmartGate client/server system. Revenues for 1995, 1996, 1997 and
1998 were approximately $1,104,000, $5,319,000, $5,973,000 and $6,260,000,
respectively.
Losses attributable to holders of Common Stock for 1995, 1996, 1997 and
1998 were approximately $1,122,000, $7,813,000, $10,828,000 and $9,407,000,
respectively.
V-ONE's growth in recent periods may not be an accurate indication of
future results of operations in light of V-ONE's short operating history, the
evolving nature of the network security market and the uncertainty of the demand
for Internet and intranet products in general and V-ONE's products in
particular.
RISKS RELATING TO AVAILABILITY OF CAPITAL
It is anticipated that V-ONE will continue to expend significant amounts
to fund its operations and research and development. V-ONE's cash and cash
equivalents may not be sufficient to meet its requirements beyond August 31,
1999. In order to maintain V-ONE's operations and research and development at
present levels, V-ONE anticipates that it will need to secure additional
financing through the sale of equity securities by the third quarter of 1999. If
such additional financing is not available to V-ONE, it will attempt to reduce
2
<PAGE>
its cash requirements through significant reductions in operating levels. V-ONE
may be unable to place equity securities on favorable terms or in an amount
required to meet its future cash requirements. In addition, V-ONE may not be
successful in reducing operating levels or, if operating levels are reduced,
V-ONE may not be able to maintain operations for any extended period of time.
RISKS RELATING TO SECURED LOAN
On February 24, 1999, V-ONE obtained a $3,000,000 term loan from
Transamerica Business Credit Corporation. The term loan is due on August 31,
1999. Thereafter, the term loan will convert into a revolving credit facility if
V-ONE is not in default under its credit agreement with Transamerica. The
maximum amount that can be borrowed by V-ONE under the revolving credit facility
is the lesser of $3,000,000 and 80% of eligible receivables. The revolving
credit facility expires on August 31, 2000.
In connection with this loan, V-ONE granted a security interest in all of
its assets, including its intellectual property, to Transamerica. If V-ONE is
unable to repay the loan or there is an event of default under the loan,
Transamerica could foreclose on its security interest.
Pursuant to the terms of the loan agreement relating to this term loan,
receipt by V-ONE of an opinion from its independent auditors which expresses
doubt with regard to the ability of V-ONE to continue as a going concern
constitutes an event of default under the loan agreement and allows Transamerica
to foreclose on its security interest. V-ONE has received such an opinion from
its independent auditors in connection with their audit of V-ONE's financial
statements as of and for the year ended December 31, 1998. As of the date of
such opinion, there was an event of default under the loan agreement; however,
Transamerica has subsequently waived this event of default. In consideration for
such waiver, V-ONE has agreed (a) to grant an affiliate of Transamerica warrants
to purchase 100,000 shares of Common Stock at an exercise price of $3.25 per
share and (b) accept an additional financial covenant that V-ONE's net worth
will be $5,000,000 as of June 30, 1999 and September 30, 1999. There can be no
assurance that V-ONE will be able to comply with the loan covenants.
RISKS ASSOCIATED WITH THE EMERGING NETWORK SECURITY MARKET
The market for V-ONE's products, particularly its client/server VPN or
virtual private network products, is in an early stage of development and the
market's acceptance of these products has been slower than expected. The rapid
development of Internet and intranet computing has increased the ability of
users to access proprietary information and resources and has recently increased
demand for network security products. Because the market for network security
products is only beginning to develop and potential customers are only beginning
to realize the benefits of VPN technology, it is difficult to assess the size of
the market, the product features desired by the market, the best price structure
for V-ONE's products, the best distribution strategy and the competitive
environment that will develop in this market.
The demand for V-ONE's products could decline as a result of competition,
technological change, the public's perception of the need for security products,
developments in the hardware and software environments in which these products
operate, general economic conditions or other factors beyond V-ONE's control.
Any such decline would adversely effect V-ONE.
ANTICIPATED FLUCTUATIONS IN QUARTERLY RESULTS
At V-ONE's board of directors meeting on March 4, 1999, V-ONE revised its
revenue recognition policy. V-ONE had previously used a "sell-in" model with
distributors, where revenue is recognized when product is sold to the
distributor. V-ONE is now using a "sell-through" model, where revenue is
recognized when the distributor has delivered the licenses to end-user customers
and the end-user customers have registered the software with V-ONE. This
revision in policy will cause revenue to be recognized later in the distribution
cycle and may make V-ONE's quarterly financial results more variable. In
addition, future revenues may be less affected by V-ONE's direct sales efforts
unless V-ONE directly assists resellers in sales to end users.
3
<PAGE>
V-ONE is applying the revised revenue recognition policy to its financial
statements for the year ended December 31, 1998. In addition, V-ONE has restated
its financial statements for the years ended December 31, 1997 and 1996 and for
the quarters ended September 30, 1998, 1997 and 1996, June 30, 1998 and 1997 and
March 31, 1998 and 1997 for consistency of presentation.
V-ONE'S DEPENDENCE ON KEY PERSONNEL
V-ONE's success depends, to a large extent, upon the performance of its
senior management and its technical, sales and marketing personnel, many of whom
have only recently joined V-ONE. There is intense competition in the software
security industry to hire and retain qualified personnel. V-ONE is actively
searching for additional qualified personnel. V-ONE's success will depend upon
its ability to retain and hire additional key personnel. The loss of the
services of key personnel or the inability to attract additional qualified
personnel could materially and adversely effect V-ONE's results of operations
and product development efforts.
V-ONE has entered into employment agreements with David D. Dawson, its
Chairman of the Board, President and Chief Executive Officer, Charles B.
Griffis, its Senior Vice President and Chief Financial Officer, and Robert F.
Kelley, its Vice President of Engineering, that provide for fixed terms of
employment. However, V-ONE has not historically provided such types of
employment agreements to its other employees. This may adversely impact V-ONE's
ability to attract and retain the necessary technical, management and other key
personnel.
RISK OF V-ONE'S INABILITY TO MANAGE GROWTH
To manage growth effectively, V-ONE needs to continue to improve its
operational, financial and management information systems and to hire, train,
motivate and manage its employees. Competition is intense for qualified
technical, marketing and management personnel. V-ONE may be unable to achieve or
manage any future growth. Its failure to do so could delay V-ONE's product
development cycles and marketing efforts.
V-ONE has experienced and may experience future growth in the number of
its employees and the scope of its operations, resulting in increased
responsibilities for management and added pressure on V-ONE's operating and
financial systems. As of January 1, 1999, V-ONE had 77 employees, as compared to
83, 77, and 34 employees on January 1, 1998, 1997, and 1996, respectively.
RISK OF V-ONE'S DEPENDENCE ON SMARTGATE AND SMARTWALL
V-ONE currently generates most of its revenues from its SmartWall and
SmartGate products. SmartWall and SmartGate have met with a favorable degree of
market acceptance since sales of SmartWall commenced in the first quarter of
1995 and since SmartGate was introduced in the fourth quarter of 1995. However,
SmartWall or SmartGate may not continue to be accepted in the future. In
addition, any or all of V-ONE's other current or future products could fail to
win market acceptance.
V-ONE's success depends, in part, on V-ONE's ability to design, develop
and introduce new products, services and enhancements on a timely basis to meet
changing customer needs, technological developments and evolving industry
standards.
RISK OF INADEQUATE PROTECTION FOR V-ONE'S TECHNOLOGIES
V-ONE relies on trademark, copyright, patent and trade secret laws,
employee and third-party non-disclosure agreements and other methods to protect
the rights of V-ONE and the companies from which V-ONE licenses technology.
V-ONE currently holds patents on its Wallet Technology, its SmartGate
technology, its Smartcard Technology, and its On-Line Registration technology.
Others may independently develop similar technologies or duplicate any
technology developed by V-ONE.
Prosecution of patent applications and any other patent applications may
require the expenditure of substantial resources. For example, the issuance of a
patent may require 24 months or longer. During this period, V-ONE's technology
may become obsolete. Pending or future patent applications may not be granted,
4
<PAGE>
future patents may be challenged, invalidated or circumvented and the rights
granted may not provide competitive advantages to V-ONE.
V-ONE currently intends to pursue patent protection outside of the United
States for the technology covered by the most recently filed patent
applications. This protection may not be granted. Even if it is granted, it may
not adequately protect the covered technology.
V-ONE's success also depends on its software technology and technology
licensed from others. V-ONE's trade secrets, license agreements and
non-disclosure agreements may not provide appropriate protection for V-ONE's
technology or the technology it licenses from others. Further, V-ONE relies on
license agreements that are not signed by the end user to license V-ONE's
products. These license agreements may be unenforceable under the laws of
certain jurisdictions.
V-ONE may be subject to additional risk as V-ONE enters into transactions
in countries where intellectual property laws are not well developed or are
poorly enforced. Legal protections of V-ONE's rights may be ineffective in
foreign markets and technology developed by V-ONE may not be protectable in
foreign jurisdictions.
As the number of security products in the industry increases and the
functionality of these products overlap, software developers may become subject
to infringement claims. Third parties may in the future assert infringement
claims against V-ONE with respect to current or future products. V-ONE also may
desire or be required to obtain licenses from others. Failure to obtain those
licenses could adversely effect V-ONE's ability to market its software security
products. However, V-ONE may be unable to obtain these licenses on commercially
reasonable terms, if at all. In addition, the patents underlying such licenses
may not be valid or enforceable and the proprietary nature of the unpatented
technology underlying such licenses may not remain proprietary.
Any claims or litigation could be costly and could result in a diversion
of management's attention. Adverse determinations in such claims or litigation
could also adversely effect V-ONE.
RISK OF ERRORS OR FAILURES
The complex nature of V-ONE's software products can make the detection of
errors or failures difficult when products are introduced. If errors or failures
are subsequently discovered, this may result in delays and lost revenues during
the correction process. In addition, technology licensed by V-ONE for use in its
products may contain errors that adversely effect such products. Despite testing
by V-ONE and current and prospective customers, errors may still be discovered
in new products or releases after commencement of commercial shipments. This
might result in delay, adverse publicity, loss of market acceptance and claims
against V-ONE.
A malfunction or the inadequate design of V-ONE's products could result in
tort or warranty claims. V-ONE generally attempts to reduce the risk of such
losses to itself and to the companies from which V-ONE licenses technology
through warranty disclaimers and liability limitation clauses in its license
agreements. V-ONE may not have obtained adequate contractual protection in all
instances or where otherwise required under agreements V-ONE has entered into
with others. In addition, these measures may not be effective in limiting
V-ONE's liability to end users and to the companies from which V-ONE licenses
technology.
V-ONE'S PRODUCT LIABILITY RISK
V-ONE currently has product liability insurance. However, V-ONE's
insurance coverage may not be adequate and any product liability claim against
V-ONE for damages resulting from security breaches could be substantial. In
addition, a well-publicized actual or perceived security breach could adversely
effect the market's perception of security products in general or V-ONE's
products in particular. This could result in a decline in demand for V-ONE's
products.
5
<PAGE>
RISKS OF CHANGES IN TECHNOLOGY AND INDUSTRY STANDARDS AND NEW PRODUCT
INTRODUCTION
The network security industry is characterized by rapid changes, including
evolving industry standards, frequent new product introductions, continuing
advances in technology and changes in customer requirements and preferences.
Advances in techniques by individuals and entities seeking to gain unauthorized
access to networks could expose V-ONE's existing products to new and unexpected
attacks and require accelerated development of new products or enhancements to
existing products.
V-ONE may be unable to counter challenges to its current products. V-ONE's
future products may not keep pace with technological changes implemented by
competitors or persons seeking to breach network security. Its products may not
satisfy evolving consumer preferences and V-ONE may not be successful in
developing and marketing products for any future technology. Failure to develop
and introduce new products and improve current products in a timely fashion
could adversely effect V-ONE.
RISK OF DEFECTS AND DEVELOPMENT DELAYS
V-ONE may experience schedule overruns in software development triggered
by factors such as insufficient staffing or the unavailability of
development-related software, hardware or technologies. Further, when developing
new software products, V-ONE's development schedules may be altered as a result
of the discovery of software bugs, performance problems or changes to the
product specification in response to customer requirements, market developments
or V-ONE-initiated changes.
Changes in product specifications may delay completion of documentation,
packaging or testing. This may, in turn, affect the release schedule of the
product.
When developing complex software products, the technology market may shift
during the development cycle, requiring V-ONE either to enhance or change a
product's specifications to meet a customer's changing needs. All of these
factors may cause a product to enter the market behind schedule, which may
adversely effect market acceptance of the product or place it at a disadvantage
to a competitor's product that has already gained market share or market
acceptance during the delay.
RISKS RELATING TO EVOLVING DISTRIBUTION CHANNELS
V-ONE relies on its direct sales force and its channel distribution
strategy for the sale and marketing of its products. V-ONE's sales and marketing
organization may be unable to successfully compete against the more extensive
and well-funded sales and marketing operations of certain of its current and
future competitors.
V-ONE's distribution strategy involves the development of relationships
with resellers and international distributors to enable V-ONE to achieve broad
market penetration. However, V-ONE may be unable to continue to attract
integrators and resellers that will be able to market V-ONE's products
effectively and that will be qualified to provide timely and cost-effective
customer support and service.
V-ONE ships products to distributors, integrators and resellers on receipt
of a purchase-order, and its distributors, integrators and resellers generally
carry competing product lines. Current distributors, integrators and resellers
may not continue to represent V-ONE's products. The inability to recruit, or the
loss of, important sales personnel, distributors, integrators or resellers could
adversely effect V-ONE.
RISKS RELATING TO COLLECTION OF RECEIVABLES
Due to certain worldwide economic factors, V-ONE has from time to time
experienced and may continue to experience difficulty in collecting its
receivables on a timely basis. V-ONE continues to focus on the collection of its
receivables on a timely basis. However, if V-ONE is unable to collect its
receivables on a timely basis, it could have an adverse effect on V-ONE's
financial condition, results of operations and cash flows.
6
<PAGE>
RISKS ASSOCIATED WITH LONG SALES CYCLE AND SEASONALITY
Sales of V-ONE's products generally involve a significant commitment of
capital by its customers. For sales by V-ONE's sales force directly to end
users, V-ONE often permits customers to evaluate products being considered for
license, generally for a period of up to 30 days. For these and other reasons,
the sales cycle associated with V-ONE's products is likely to be lengthy and
subject to a number of significant risks over which V-ONE has little or no
control. As a result, V-ONE believes that its quarterly results are likely to
vary significantly.
V-ONE may be required to ship products shortly after it receives orders.
Consequently, order backlog, if any, at the beginning of any period may
represent only a small portion of that period's expected revenues. As a result,
product revenues in any period will be substantially dependent on orders booked
and registered in that period.
V-ONE plans its production and inventory levels based on internal
forecasts of customer demand, which is highly unpredictable and can fluctuate
substantially. If revenues fall significantly below anticipated levels, V-ONE's
financial condition, results of operations and cash flows could be adversely
effected. In addition, V-ONE may experience significant seasonality in its
business, and V-ONE's financial condition and results of operations may be
effected by such trends in the future. Such trends may include higher revenues
in the third quarter of the year. V-ONE believes that revenues may tend to be
higher in the third quarter due to the fiscal year end of the U.S. government.
RISK OF SALES TO GOVERNMENTS
No government agency or department has an obligation to purchase products
from V-ONE in the future. Accordingly, V-ONE believes that future government
contracts and orders for its network security products will in part depend on
the continued favorable reaction of government agencies and departments to the
development capabilities of V-ONE and the reliability and perceived reliability
of its products.
V-ONE may be unable to sell its products to government departments and
agencies and government contractors and such sales, if any, may not result in
commercial acceptance of V-ONE's products. In addition, reductions or delays in
funds available for projects V-ONE is performing or to purchase its products
could adversely impact V-ONE's government contracts business.
Contracts involving the U.S. government are also subject to the risks of
disallowance of costs upon audit, changes in government procurement policies,
the necessity to participate in competitive bidding and, with respect to
contracts involving prime contractors or government-designated subcontractors,
the inability of such parties to perform under their contracts. V-ONE is also
exposed to the risk of increased or unexpected costs, causing losses or reduced
profits, under government and certain third-party contracts. Any of the
foregoing events could adversely effect V-ONE.
In 1995, V-ONE derived a substantial portion of its revenue from the sale
of SmartWall to departments and agencies of the U.S. government and government
contractors. In 1996, V-ONE's revenues were attributable, in part, to a contract
with the National Security Agency. In 1997, approximately one-half of V-ONE's
total sales were attributable to contracts with various agencies and departments
of the United States government and of state and local governments. This
relationship increased to more than 60% through December 31, 1998.
RISK OF EFFECT OF GOVERNMENT REGULATION OF TECHNOLOGY EXPORTS
V-ONE currently sells its products abroad and intends to continue to
expand its relationships with international distributors. V-ONE's international
sales and operations could be subject to risks such as the imposition of
governmental controls, export license requirements, restrictions on the export
of critical technology, trade restrictions and changes in tariffs. In
particular, V-ONE's information security products are subject to the export
restrictions administered by the U.S. Department of Commerce. These
restrictions, in the case of some products, permit the export of encryption
products only with a specific export license.
These export laws also prohibit the export of encryption products to a
number of countries, individuals and entities and may restrict exports of some
7
<PAGE>
products to a narrow range of end-users. In certain foreign countries, V-ONE's
distributors are required to secure licenses or formal permission before
encryption products can be imported.
V-ONE has obtained a license exception to export strong encryption from
the U. S. Department of Commerce on a worldwide basis (except to the seven
terrorist countries) as long as the end user agrees to use the KRAKit(TM)
session key recreation capability. Foreign competitors that face less stringent
controls on their products may be able to compete more effectively than V-ONE in
the global network security market.
RISKS ASSOCIATED WITH YEAR 2000 ISSUE
The Year 2000 issue concerns the potential exposures related to the
automated generation of business and financial misinformation resulting from the
application of computer programs that have been written using six digits (E.G.,
12/31/99), rather than eight (E.G., 12/31/1999), to define the applicable year
of business transactions.
V-ONE has completed the identification and assessment of most of its IT
systems, and those systems have been modified by the suppliers of those systems
to V-ONE to address Year 2000 problems. In addition to its internal systems,
V-ONE has assessed the level of Year 2000 problems associated with most of its
suppliers of software incorporated or bundled with its products, other
suppliers, customers and creditors. V-ONE has also identified and assessed most
of its non-IT systems, which include its telephone systems, heating and
air-conditioning, elevators, and other business equipment. Almost all of these
suppliers have indicated that their software and other products are Year 2000
compliant. In addition, most of V-ONE's non-IT systems appear to be Year 2000
compliant.
V-ONE's own software products are Year 2000 compliant.
V-ONE's costs to date for its Year 2000 compliance program, excluding the
salaries of its employees, has not been material. In fact, most of V-ONE's IT
systems have been modified by the suppliers of those systems and such
modifications were included as part of normal upgrades of those systems.
Although V-ONE has not completed its assessment, it does not currently believe
that the future costs associated with its remaining IT systems or its non-IT
systems will be material.
V-ONE cannot determine currently its most likely worst case Year 2000
scenario, as it has not identified and assessed all of its systems, particularly
its non-IT systems. As V-ONE completes its identification and assessment of
internal and third party systems, it expects to develop contingency plans for
various worst-case scenarios. V-ONE expects to complete such contingency
planning by September 1999. A failure to address Year 2000 issues successfully
could have a material adverse effect on V-ONE's business, financial condition,
results of operations and cash flows.
EFFECTS OF CERTAIN PROVISIONS OF THE CERTIFICATE OF INCORPORATION, BYLAWS AND
DELAWARE LAW
Certain provisions of V-ONE's Amended Certificate of Incorporation and of
Delaware law could delay or make difficult a merger, tender offer or proxy
contest involving V-ONE. Among other things, these provisions include a
classified board, prohibitions on removing directors except for cause, and other
requirements.
8
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
A Registration Statement on Form S-3 (the "Registration Statement") under
the Securities Act of 1933 as amended relating to the securities offered by this
prospectus has been filed by V-ONE with the SEC in Washington, D.C. This
prospectus does not contain all of the information set forth in the Registration
Statement and its exhibits and schedules. Certain financial and other
information relating to V-ONE is contained in the documents indicated below
under "Incorporation of Certain Documents by Reference." This information is not
presented in this prospectus or delivered with it. For further information with
respect to V-ONE and the securities offered by this prospectus, reference is
made to such Registration Statement, exhibits and schedules.
Statements contained in this prospectus as to the contents of any contract
or other document referred to are not necessarily complete. In each instance
reference is made to the copy of such contract or other document filed as
exhibits to the Registration Statement, each such statement being qualified in
all respects by such reference.
A copy of the Registration Statement may be inspected without charge or
may be obtained from the SEC upon the payment of certain fees prescribed by the
SEC at the public reference facilities maintained by the SEC in Washington, D.C.
at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the
SEC's Regional Offices in New York at 7 World Trade Center, Suite 1300, New
York, New York 10048 and in Chicago at Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661.
V-ONE is subject to the informational requirements of the Securities
Exchange Act of 1934. Accordingly, V-ONE files periodic reports, proxy
statements and other information with the SEC. Such reports, proxy statements
and other information concerning V-ONE may be inspected or copied at the public
reference facilities at the SEC located at 450 Fifth Street, N.W., Washington,
D.C. 20549. Information on the operation of the Public Reference Room may be
obtained by calling the SEC at 1-800-SEC-0330. Copies of such documents can be
obtained at the Public Reference section of the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates or by reference to V-ONE on the
SEC's Worldwide Web page (http://www.sec.gov).
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by V-ONE with the SEC, are
incorporated in this prospectus by reference:
(1) V-ONE's Annual Report on Form 10-K for the year ended December 31,
1998;
9
<PAGE>
(2) V-ONE's Current Report on Form 8-K dated March 31, 1999;
(3) All other reports filed by V-ONE pursuant to Sections 13(a) or 15(d)
of the Securities Exchange Act of 1934 since March 31, 1999; and
(4) The description of V-ONE's common stock contained in V-ONE's
Registration Statement on Form 8-A filed on October 9, 1996, pursuant
to Section 12(g) of the Securities Exchange Act of 1934.
All reports and other documents subsequently filed by V-ONE pursuant to
Sections 12, 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
prior to the filing of a post-effective amendment that indicates that all
securities offered by this prospectus have been sold or that deregisters all
securities then remaining unsold, are deemed to be incorporated by reference in
and to be a part of this prospectus from the date of filing of such reports and
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference in this prospectus is deemed to be modified or
superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus or in the Registration Statement containing this
prospectus or in any other subsequently filed document that also is or is deemed
to be incorporated by reference in this prospectus modifies or supersedes such
statement. Any statement so modified or superseded is not deemed, except as so
modified or superseded, to constitute a part of this prospectus.
V-ONE will provide without charge to each person to whom this prospectus
is delivered, upon the written or oral request of such person, a copy of any or
all of the foregoing documents referred to above that have been or may be
incorporated in this prospectus by reference. Exhibits to such documents will
not be provided (unless such exhibits are specifically incorporated by reference
into the information that this prospectus incorporates). Requests for such
documents should be directed to: V-ONE Corporation, 20250 Century Boulevard,
Germantown, Maryland 20874, attention: Charles B. Griffis, Senior Vice President
and Chief Financial Officer. Mr. Griffis' telephone number is (301) 515-5243.
SELLING STOCKHOLDERS
The following table sets forth the names of the shareholders selling
shares of common stock in this offering, the number of shares of common stock
beneficially owned by each selling stockholder as of March 8, 1999 and the
number of shares of common stock that may be offered for sale pursuant to this
prospectus by each such selling stockholder. Except as set forth below, none of
the selling stockholders has held any position, office or other material
relationship with V-ONE or any of its affiliates within the past three years
other than as a result of the transaction that results in its ownership of
shares of common stock.
The shares may be offered from time to time by the selling stockholders
named below. However, the selling stockholders are under no obligation to sell
all or any portion of such shares, nor are the selling stockholders obligated to
sell any such shares immediately pursuant to the Registration Statement. Because
the selling stockholders may sell all or part of their shares, no estimate can
be given as to the number of shares of common stock that will be held by any
selling stockholder upon termination of any offering made by this prospectus.
Certain of the shares are issuable upon exercise of warrants issued to Advantage
Fund II Ltd. ("Advantage").
10
<PAGE>
The table below shows the shares of common stock beneficially owned by
Advantage. These shares include shares of common stock issuable on exercise of
warrants to purchase 389,441 shares of common stock at an exercise price of
$4.77 per share and warrants to purchase 100,000 shares of common stock at an
exercise price of $2.125 per share (collectively, the "New Warrants"). The
shares of common stock issuable on exercise of the New Warrants are the shares
being offered by this prospectus. The New Warrants expire on September 21, 2003.
The New Warrants contain a provision that permits Advantage to pay some or
all of the aggregate exercise price of these warrants in shares of common stock
that would otherwise be issued on exercise of these warrants instead of in cash.
If this provision is used by Advantage, the shares tendered back to V-ONE are
valued at their then fair market value. Accordingly, if this provision is used
by Advantage, the number of shares beneficially owned by Advantage and the
number of shares to be sold by Advantage pursuant to this prospectus would be
reduced.
Pursuant to Rule 416 under the Securities Act of 1933, Advantage may also
offer and sell an indeterminate number of additional shares of common stock that
may become issuable upon exercise of the New Warrants as a result of
anti-dilution provisions contained in the New Warrants. These additional shares
are not included in the following table.
With respect to the shares of common stock beneficially owned by Advantage
prior to the offering, the table below also includes certain shares issuable on
exercise of certain warrants issued on conversion of shares of Series A
Convertible Preferred Stock ("Series A Warrants"). However, no holder of Series
A Warrants or New Warrants is entitled to receive shares of common stock on
exercise of such warrants to the extent that the sum of (1) the shares of common
stock owned by such holder and its affiliates and (2) the shares of common stock
issuable on exercise of the Series A Warrants and the New Warrants would result
in beneficial ownership by such holder and its affiliates of more than 4.9% of
the outstanding shares of common stock. Beneficial ownership of Advantage for
this purpose is determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, excluding shares of common stock so owned through
ownership of unexercised Series A Warrants or New Warrants. Absent the 4.9%
limitation on beneficial ownership described above, under Section 13(d) of the
Securities Exchange Act of 1934 Advantage would hold 200,000 shares of common
stock and warrants to purchase 633,576 shares of common stock. Accordingly, the
number listed in the table below with respect to Advantage in the column labeled
"Shares of Common Stock Beneficially Owned Prior to Offering" does not include
26,152 shares of common stock as a result of the application of the ownership
limitation.
The table below does not include shares of common stock issuable on
conversion of shares of Series A Convertible Preferred Stock as, on November 20,
1998, V-ONE redeemed all of the 2,462 outstanding shares of Series A Convertible
Preferred Stock held by Advantage for $3,200,600 in the aggregate.
Common Stock Beneficially
Owned After Offering If
All Offered Shares Are Sold
---------------------------
Shares of Common Stock
Name of Selling Beneficially Owned Common Stock Percent of
Stockholder Prior to Offering Offered Hereby Number Outstanding
- --------------------------------------------------------------------------------
Advantage Fund II 807,424 489,441 344,135 2.0
Ltd.
Golden Eagle Partners 68,506 5,000 63,506 *
- --------------------------------------------------------------------------------
* Less than 1%.
11
<PAGE>
From time to time the selling stockholders may transfer, pledge, donate or
assign their shares or the New Warrants to lenders, family members and others
and each of such persons upon acquiring the shares or the New Warrants will be
deemed to be a selling stockholder for purposes of this prospectus. The number
of shares beneficially owned by the selling stockholders who so transfer,
pledge, donate or assign shares or New Warrants will decrease as and when they
take such actions. The plan of distribution for shares sold hereunder will
otherwise remain unchanged, except that the transferees, pledgees, donees or
other successors will be selling stockholders hereunder. If V-ONE is notified by
a selling stockholder that a donee or pledgee intends to sell more than 500
shares, a supplement to this prospectus will be filed.
USE OF PROCEEDS
There will be no proceeds to V-ONE from the sale of the shares by the
selling stockholders. Any proceeds from the sales of common stock received by
the selling stockholders will be retained by the selling stockholders. However,
a warrantholder may choose to exercise warrants to purchase common stock in
order to sell such common stock pursuant to this offering. If a warrantholder
pays the exercise price for warrants to purchase common stock with cash instead
of shares of common stock, V-ONE will receive cash proceeds from the exercise of
such warrants (approximately $2.1 million). V-ONE expects to use these proceeds
for general corporate purposes. There can be no assurance that any of these
warrants will be exercised. See "Selling Stockholders."
V-ONE will pay substantially all of the expenses incident to the
registration, offering and sale of the shares to the public other than
commissions or discounts of underwriters, broker-dealers or agents and the
expenses of counsel to the selling stockholders. Such expenses are estimated to
be approximately $65,000. V-ONE has also agreed to indemnify Advantage and
certain related persons against certain liabilities, including liabilities under
the Securities Act of 1933.
PLAN OF DISTRIBUTION
The shares are being offered on behalf of the selling stockholders, and
V-ONE will not receive any proceeds from this offering. See "Use of Proceeds."
The shares may be sold or distributed from time to time by the selling
stockholders, or by pledgees, donees or tranferees of, or other successors in
interest to, the selling stockholders, directly to one or more purchasers
(including pledgees) or through brokers, dealers or underwriters who may act
solely as agents or may acquire shares as principals, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices, at negotiated prices, or at fixed prices, which may be changed.
The distribution of the shares may be effected in one or more of the
following methods:
. ordinary brokers' transactions, which may include long or short sales
. transactions involving cross or block trades or otherwise on the
Nasdaq National Market or on any other stock exchange or trading
facility on which the common stock may be trading
. purchases by brokers, dealers or underwriters as principal and resale
by such purchasers for their own accounts pursuant to this prospectus
. "at the market" to or through market makers or into an existing market
for the common stock
. in other ways not involving market makers or established trading
markets, including direct sales to purchasers or sales effected
through agents
. through transactions in options, swaps or other derivatives (whether
exchange-listed or otherwise) or
. any combination of the foregoing, or by any other legally available
means.
12
<PAGE>
In addition, the selling stockholders or their successors in interest may enter
into hedging transactions with broker-dealers who may engage in short sales of
shares of common stock in the course of hedging the positions they assume with
the selling stockholders. The selling stockholders or their successors in
interest may also enter into option or other transactions with broker-dealers
that require the delivery by such broker-dealers of the shares, which shares may
be resold thereafter pursuant to this prospectus.
In addition, the selling stockholders may, from time to time, sell short
the common stock of V-ONE. In such instances, this prospectus may be delivered
in connection with such short sales and the shares may be used to cover such
short sales. Any or all of the sales or other transactions involving the shares
described above, whether effected by the selling stockholders, any broker-dealer
or others, may be made pursuant to this prospectus. In addition, any shares that
qualify for sale pursuant to Rule 144 under the Securities Act of 1933 may be
sold under Rule 144 rather than pursuant to this prospectus. The shares may also
be offered in one or more underwritten offerings, on a firm commitment or best
efforts basis.
Brokers, dealers, underwriters or agents participating in the distribution
of the shares as agents may receive compensation in the form of commissions,
discounts or concessions from the selling stockholders and/or purchasers of the
shares for whom such broker-dealers may act as agent, or to whom they may sell
as principal, or both (which compensation as to a particular broker-dealer may
be less than or in excess of customary commissions). The selling stockholders
and any broker-dealers who act in connection with the sale of shares hereunder
may be deemed to be "underwriters" within the meaning of the Securities Act of
1933, and any commissions they receive and proceeds of any sale of shares may be
deemed to be underwriting discounts and commissions under the Securities Act of
1933.
Neither V-ONE nor any selling stockholder can presently estimate the
amount of such compensation. V-ONE knows of no existing arrangements between any
selling stockholder and any other stockholder, broker, dealer, underwriter or
agent relating to the sale or distribution of the shares.
Under applicable rules and regulations under the Securities Exchange Act
of 1934, any person engaged in the distribution of the shares may not
simultaneously engage in market making activities with respect to V-ONE's common
stock for a period of one business day prior to the commencement of such
distribution and ending upon such person's completion of participation in the
distribution, subject to certain exceptions for passive market making
transactions. In addition and without limiting the foregoing, the selling
stockholders will be subject to applicable provisions of the Securities Exchange
Act of 1934 and the rules and regulations thereunder, including, without
limitation, Regulation M, which provisions may limit the timing of purchases and
sales of shares of common stock by the selling stockholders.
At the time a particular offer of shares is made, to the extent required,
a supplemental prospectus will be distributed that will set forth the number of
shares being offered and the terms of the offering including the name or names
of the selling stockholders and any underwriters, dealers or agents, the
purchase price paid by an underwriter for the shares purchased from the selling
stockholders and any discounts, concessions or commissions allowed or reallowed
or paid to dealers.
In order to comply with the securities laws of certain states, if
applicable, the shares may be sold in such jurisdictions only through registered
or licensed brokers or dealers.
DESCRIPTION OF CAPITAL STOCK
GENERAL
V-ONE is authorized to issue up to 33,333,333 shares of common stock,
$0.001 par value, and 13,333,333 shares of preferred stock, $0.001 par value.
The following summary of certain provisions of V-ONE's common stock and
preferred stock does not purport to be complete. It is subject to, and qualified
in its entirety by, the provisions of V-ONE's Restated Certificate of
Incorporation and Restated Bylaws, and by the provisions of applicable law.
13
<PAGE>
COMMON STOCK
As of March 8, 1999, there were 16,761,299 shares of common stock
outstanding that were held of record by approximately 2,000 shareholders.
The holders of common stock are entitled to one vote for each share held
of record on all matters submitted to a vote of shareholders. Dividends, if any,
may be declared by the Board of Directors out of funds legally available for the
payment of dividends. Dividends may be paid in cash, in property or in shares of
capital stock. In the event of any voluntary or involuntary liquidation, sale,
or winding up of V-ONE, the holders of common stock are entitled to share
ratably in all assets remaining after payment of liabilities and liquidation
preferences of any outstanding shares of preferred stock. Holders of common
stock have no preemptive rights to subscribe for any of V-ONE's securities or
rights to convert their common stock into any other securities. There are no
redemption or sinking fund provisions applicable to the common stock.
PREFERRED STOCK
V-ONE's Board of Directors has the authority to issue up to 13,333,333
shares of preferred stock in one or more series and to fix the rights,
preferences, privileges and restrictions thereof, including dividend rights,
conversion rights, voting rights, terms of redemption, liquidation preferences
and the number of shares constituting any series or the designation of such
series, without any further vote or action by shareholders. The issuance of
preferred stock may have the effect of delaying or preventing a change in
control of V-ONE.
LEGAL MATTERS
Certain legal matters with respect to the issuance of the shares of common
stock offered by this prospectus have been passed upon for V-ONE by Kirkpatrick
& Lockhart LLP, 1800 Massachusetts Avenue, N.W., Washington, D.C. 20036.
EXPERTS
The balance sheets as of December 31, 1997 and 1998, and the statements of
operations, shareholders' equity (deficit) and cash flows for each of the three
years in the period ended December 31, 1998, incorporated in this prospectus,
have been incorporated by reference herein in reliance on the report (which
report includes an explanatory paragraph regarding V-ONE's ability to continue
as a going concern and an explanatory paragraph regarding the restatement of
V-0NE's financial statements as of December 31, 1997 and for the years ended
December 31, 1996 and 1997 to reflect a revision of certain revenue recognition
policies) of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of that firm as experts in accounting and auditing.
14
<PAGE>
No dealer, salesperson or any
other person is authorized to give any
information or to make any
representations in connection with this
prospectus and, if given or made, such 494,441 Shares
information or representations must not
be relied upon as having been authorized
by V-ONE. This prospectus does not
constitute an offer to sell or a
solicitation of an offer to buy any
security other than the securities
offered by this prospectus, or an offer
to sell or a solicitation of an offer to
buy any securities by anyone in any
jurisdiction in which such offer or
solicitation is not authorized or is
unlawful. The delivery of this
prospectus shall not, under any
circumstances, create any implication
that the information herein is correct V-ONE CORPORATION
as of any time subsequent to the date of -----------------
the prospectus.
------------------------
TABLE OF CONTENTS
Page COMMON STOCK
----
V-ONE...................................2
Risk Factors............................2
Where You Can Find More
Information.............................9
Incorporation of Certain Documents
by Reference............................9
Selling Stockholders...................10
Use of Proceeds........................12 ----------------
Plan of Distribution...................12 PROSPECTUS
Description of Capital Stock...........13 ----------------
Legal Matters..........................14
Experts................................14
_____________, 1999
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses expected to be incurred by
VONE Corporation (the "Company") in connection with the sale and distribution of
the shares of Common Stock being registered. With the exception of the
registration fee, all amounts shown are estimates.
SEC registration fee...................... $ 405.98
Printing and engraving expenses........... 5,000.00
Legal fees and expenses .................. 40,000.00
Accounting fees and expenses.............. 15,000.00
Miscellaneous fees and expenses........... 4,594.02
--------------
Total............................... $ 65,000.00
==============
Item 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law, as amended ("DGCL"),
provides that a corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation) by reason of the
fact that the person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by the person in connection with such action, suit or proceeding, if
the person acted in good faith and in a manner the person reasonably believed to
be in or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe the
person's conduct was unlawful. Section 145 further provides that a corporation
similarly may indemnify any such person serving in any such capacity who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor, against expenses actually and reasonably incurred in
connection with the defense or settlement of such action or suit if the person
acted in good faith and in a manner the person reasonably believed to be in or
not opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Delaware Court of Chancery or the court
in which such action or suit was brought shall determine upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses that the Court of Chancery or such other court shall deem proper.
II-1
<PAGE>
Article Ninth of the Company's Amended and Restated Certificate of
Incorporation provides that the Company shall indemnify, to the fullest extent
now or hereafter permitted by law, each director, officer, employee or agent
(including each former director, officer, employee or agent) of the Company who
was or is made party to or a witness in or is threatened to be made a party to
or a witness in any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, by reason of the fact
that he is or was an authorized representative of the Company, against all
expenses (including attorneys' fees and disbursements), judgments, fines
(including excise taxes and penalties) and amounts paid in settlement actually
and reasonably incurred by him in connection with such action, suit or
proceeding.
Article VI, Section 6.1 of the Company's Amended Bylaws provides that each
person who was or is made a party to or is otherwise involved in any action,
suit or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding") by reason of the fact that he/she is or was a
Director, officer, agent or employee of the Company, shall be indemnified and
held harmless by the Company to the fullest extent authorized by the General
Corporation Law of the State of Delaware, as the same exists or may hereafter be
amended, against any expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement, actually and reasonably incurred by such person in
connection therewith. Notwithstanding the foregoing, no Director shall be
indemnified nor held harmless in violation of the provisions set forth in the
Company's Amended and Restated Certificate of Incorporation; and no Director,
officer, agent or employee shall be indemnified nor held harmless by the Company
unless:
(i) In the case of conduct in his/her official capacity with the
Company, he/she acted in good faith and in a manner he/she
reasonably believed to be in the best interest of the Company;
(ii) In all other cases, his/her conduct was at least not opposed to the
best interests of the Company nor in violation of the Amended and
Restated Certificate of Incorporation, Bylaws or any agreement
entered into by the Company; and
(iii) In the case of any criminal proceeding, he/she had no reasonable
cause to believe that his/her conduct was unlawful.
II-2
<PAGE>
Exhibit 16. Exhibits.
Number Description of Exhibit
------ ----------------------
5 Opinion of Kirkpatrick & Lockhart LLP*
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Consent of Kirkpatrick & Lockhart LLP (included in
Exhibit 5)*
24 Power of Attorney (see page II-5)*
- ---------------------
* Filed previously.
Exhibit 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement
(or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would
not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective registration
statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the registration statement is on Form S-3 or Form
S-8, and the information required to be included in a post
effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration
statement.
II-3
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Germantown, State of Maryland, on this 7th day
of April, 1999.
V-ONE CORPORATION
By: /s/ David D. Dawson
-------------------------------------
David D. Dawson
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Name Title Date
- ---- ----- ----
/s/ David D. Dawson
- --------------------
David D. Dawson Chairman of the Board, April 7, 1999
President, Chief Executive
Officer and Director
/s/ Charles B. Griffis
- ----------------------
Charles B. Griffis Senior Vice President, April 7, 1999
Chief Financial Officer and
Treasurer
(Principal Financial Officer)
/s/ Mark R. Fields
- -----------------------
Mark R. Fields Controller April 7, 1999
(Principal Accounting Officer)
/s/ Charles B. Griffis*
- -----------------------
James F. Chen Director April 7, 1999
/s/ Charles B. Griffis*
- -----------------------
Charles C. Chen Director April 7, 1999
/s/ Charles B. Griffis*
- -----------------------
A.L. Giannopolous Director April 7, 1999
/s/ Charles B. Griffis*
- -----------------------
William E. Odom Director April 7, 1999
II-5
<PAGE>
*By: /s/ Charles B. Griffis
----------------------
Charles B. Griffis,
Attorney-in-fact
II-6
<PAGE>
EXHIBIT INDEX
Number Description of Exhibit
------ ----------------------
5 Opinion of Kirkpatrick & Lockhart LLP*
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Consent of Kirkpatrick & Lockhart LLP (included in
Exhibit 5)*
24 Power of Attorney (see page II-5)*
- ---------------------
* Filed previously.
II-7
Exhibit 23.1
Consent of Independent Accountants
We consent to the incorporation by reference in this registration statement of
V-ONE Corporation (the Company) on Form S-3 (File No. 333-67625) of our report
dated March 11, 1999, except as to Note 14 which is as of March 31, 1999 on our
audits of the financial statements of the Company as of December 31, 1997, and
1998, and for the years ended December 31, 1996, 1997, and 1998, which report is
included in the Company's Annual Report on Form 10-K for the year ended December
31, 1998. We also consent to the reference to our firm under the caption
"Experts."
/s/ PricewaterhouseCoopers LLP
McLean, Virginia
April 6, 1999
