As filed with the Securities and Exchange Commission on April 17,2000
File No. __________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
V-ONE Corporation
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(Exact name of registrant as specified in its charter)
Delaware 52-1953278
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(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
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(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Margaret E. Grayson
Senior Vice President and Chief Financial Officer
V-ONE Corporation
20250 Century Boulevard
Suite 300
Germantown, MD 20874
(301) 515-5243
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(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
Alan J. Berkeley, 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/
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. /_/ ____
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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. /_/
CALCULATION OF REGISTRATION FEE
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Proposed
Title of Each Class Maximum Proposed Amount of
of Securities To Be Amount To Offering Maximum Registration
Registered Be Registered Price Per Aggregate Fee(1)
Share(1) Offering
Price(1)
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Common Stock, $.001 3,350,000 $3.906 $13,085,100 $3,454.47
par value per share(2)(6)
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Common Stock, $.001 1,287,554 $3.906 $5,029,185 $1,327.71
par value per share(3)(6)
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Common Stock, $.001 219,957 $3.906 $859,152 $226.82
par value per share(4)(6)
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Common Stock, $.001 500,000 $3.906 $1,953,000 $515.60
par value per share(5)
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Total 5,357,511 $3.906 $20,926,437 $5,524.60
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(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 SmallCap Market on April 13, 2000. Registration fee is calculated
pursuant to Rule 457(c).
(2) Includes shares of Common Stock issuable in connection with warrants to
purchase Common Stock issued to certain purchases in connection with the
sale of shares of V-ONE Corporation Series C Preferred Stock.
(3) Includes shares of Common Stock issuable upon conversion of the
outstanding shares of V-ONE Corporation's Series B Convertible Preferred
Stock.
(4) Includes shares of Common Stock issuable in connection with warrants to
purchase Common Stock granted to TBCC Funding Trust II.
(5) Includes 500,000 shares of Common Stock held by Cranshire Capital, L.P.
(6) Pursuant to Rule 416, also includes such indeterminate number of
additional shares of Common Stock as may become issuable to prevent
dilution resulting from stock splits, stock dividends or similar
transactions.
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.
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PROSPECTUS
Subject To Completion, April 17, 2000
5,357,511 SHARES
V-ONE CORPORATION
COMMON STOCK
The 5,357,511 shares of common stock of V-ONE Corporation offered
through this prospectus will be sold by the shareholders listed on pages
9 through 10 of this prospectus. The selling shareholders own their
shares either directly or in the form of warrants to purchase shares of
common stock of V-ONE. 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 SmallCap 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 SmallCap
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.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE
CHANGED. 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.
_________, 2000
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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 addresses
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 accommodate 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 the documents to
be filed by V-ONE with the SEC, specifically V-ONE's 2000 Annual Report on Form
10-K and subsequent fiscal years, which may identify important risk factors for
V-ONE.
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. Readers are also referred to documents
filed by V-ONE with the SEC, which identify important risk factors for V-ONE.
V-ONE'S LIMITED OPERATING HISTORY, ACCUMULATED DEFICIT AND FINANCING
ACTIVITIES. As of December 31, 1999, V-ONE had an accumulated deficit of
approximately $39,645,000. V-ONE currently expects to incur additional net
losses over the next several quarters. V-ONE raised additional capital of
$2,375,000 in March 2000. The Company believes it now has sufficient capital to
augment existing resources.
Because of V-ONE's limited operating history, V-ONE may not achieve or
sustain profitability or significant revenues in the short run. 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,
1998 and 1999 were approximately $1,104,000, $5,319,000, $5,973,000, $6,260,000,
and $4,966,000, respectively.
Losses attributable to holders of Common Stock for 1995, 1996, 1997, 1998
and 1999 were approximately $1,122,000, $7,813,000, $10,828,000, $9,407,000 and
$9,952,000, respectively.
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V-ONE's results of operations 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 until it reaches profitability. In order to maintain V-ONE's
operations and research and development at necessary levels, V-ONE may need to
secure additional financing through the sale of equity securities. If such
additional financing is not available to V-ONE, it will attempt to reduce 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 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.
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 and Margaret E.
Grayson, its Senior Vice President and Chief Financial Officer, 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, 2000, V-ONE had 72 employees, as compared to
77, 83, and 77 employees on January 1, 1999, 1998, and 1997, respectively.
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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.
RISKS OF COMPETITION. V-ONE faces intense competition in all of its market
segments. The market for network security products is very competitive and V-ONE
expects competition to intensify in the future. There can be no assurance that
V-ONE's products will command a significant share of the network security
market. Many of V-ONE's competitors have significantly greater resources,
generate higher revenue and have greater name recognition than V-ONE. There can
be no assurance that V-ONE's competitors will not develop products that are
superior to those developed by V-ONE or adapt more quickly than V-ONE to new
technologies or evolving industry trends. Increased competition may result in
price reductions, reduced gross margins or loss of market share, any of which
could have a material adverse affect on V-ONE's business. There is no assurance
that V-ONE will be able to compete effectively against current or future
competitors.
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 Smart Card
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,
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
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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.
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
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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.
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.
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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 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 and decreased to approximately 35% for
1999.
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
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.
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.
MARKET VOLATILITY. The market price of the Company's Common Stock could be
subject to significant fluctuations in response to variations in quarterly
operating results and other factors, such as announcements of new products by
the Company or its competitors and changes in financial estimates by securities
analysts or other events. Moreover, the stock market has experienced extreme
volatility that has particularly affected the market prices of equity securities
of many technology companies and that has often been unrelated and
disproportionate to the operating performance of such companies. Broad market
fluctuations as well as economic conditions generally and in the software
industry specifically, may adversely affect the market price of the Company's
Common Stock.
WHERE YOU CAN FIND MORE INFORMATION
A Registration Statement on Form S-3 (the "Registration Statement") under
the Securities Act of 1933 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. Some 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.
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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,
1999;
(2) All other reports filed by V-ONE pursuant to Sections 13(a) or 15(d)
of the Securities and Exchange Act of 1934 since March 30, 2000; and
(3) 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: Margaret E. Grayson, Senior Vice
President and Chief Financial Officer. Ms. Grayson's telephone number is (301)
515-5246.
8
<PAGE>
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 April 3, 2000 (except as
noted below) 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 after termination of any offering made by this prospectus.
COMMON STOCK BENEFICIALLY
OWNED AFTER OFFERING IF
ALL OFFERED SHARES ARE SOLD (1)
-------------------------------
SHARES OF
COMMON STOCK COMMON
BENEFICIALLY STOCK
NAME OF SELLING OWNED PRIOR TO OFFERED PERCENT OF
STOCKHOLDER OFFERING HEREBY NUMBER OUTSTANDING
- --------------------------------------------------------------------------------
Peter Boyle & Janine Morgan 19,040 19,040(2) 0 *
Clunford Holding Inc. 95,230 95,230(2) 0 *
Robert Klein & Myriam Gluck 190,470 190,470(2) 0 *
James W. Lawson PC Pension 15,000 10,000(2) 5,000 *
Fund
Levenberg Investments, Inc. 85,710 85,710(2) 0 *
Lincoln Merchandising 152,380 152,380(2) 0 *
Gordon S. Macklin Family Trust 40,000 40,000(2) 0 *
Macklin Family Partnership #1 40,000 40,000(2) 0 *
Ardith McGuire 115,230 95,230(2) 20,000 *
Benton J. Pumpian 19,040 19,040(2) 0 *
Stuart M. Schulman &
Sarah U. Schulman 32,390 26,690(2) 0 *
Aaron L. Schulman &
Michael A. Schulman 5,700 5,700(2) 0 *
Estee Schulman Rev. Trust 5,700 5,700(2) 0 *
Edward W. Schultze 79,140 77,040(2) 2,100 *
Stanley Shapiro Rev. Trust 118,548 76,190(2) 42,358 *
Stanton F. Weissenborn 38,100 38,100(2) 0 *
JMS LLC custodian for Robert 19,030 19,030(2) 0 *
C. Zimmer
Robert C. Zimmer 34,300 34,300(2) 0 *
The Robert Stephens Orphan 400,000 400,000(2) 0 *
Fund, L.P.
The Robert Stephens Offshore 171,420 171,420(2) 0 *
Orphan Fund, L.P.
Lewis M. Schott Rev. Trust 238,090 238,090(2) 0 *
Venture Management 38,090 38,090(2) 0 *
Consultants, LLC
Charles D. Dahan 19,040 19,040(2) 0 *
Aspex Eyewear, Inc. 38,080 38,080(2) 0 *
Joseph Lupo Profit Sharing Plan 608,090 488,090(2) 120,000 *
9
<PAGE>
SHARES OF
COMMON STOCK COMMON
BENEFICIALLY STOCK
NAME OF SELLING OWNED PRIOR TO OFFERED PERCENT OF
STOCKHOLDER OFFERING HEREBY NUMBER OUTSTANDING
- --------------------------------------------------------------------------------
Louis A. Sica 100,000 100,000(2) 0 *
John F. Whittemore III 66,420 51,420(2) 15,000 *
Stahelin Partners, L.P. 95,230 95,230(2) 0 *
Elliott Associates, L.P. 380,950 380,950(2) 0 *
Cranshire Capital, L.P. 799,740 799,740(2)(5) 0 *
TBCC Funding Trust II 219,957 219,957(4) 0 *
Hai Hua Cheng 643,777 643,777(3) 0 *
Wen Dar Wu 643,777 643,777(3) 0 *
- -------------------
* Less than 1%.
(1) Assumes the sale of all shares.
(2) Includes shares of Common Stock issuable in connection with warrants to
purchase Common Stock issued to certain purchases in connection with the
sale of shares of V-ONE Corporation Series C Preferred Stock.
(3) Includes shares of Common Stock issuable upon conversion of the
outstanding shares of V-ONE Corporation's Series B Convertible Preferred
Stock.
(4) Includes shares of Common Stock issuable in connection with warrants to
purchase Common Stock granted to TBCC Funding Trust II.
(5) Includes 500,000 shares of Common Stock held by Cranshire Capital, L.P.
From time to time the selling stockholders may transfer, pledge, donate or
assign their shares to lenders, family members and others and each of such
persons upon acquiring the shares 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 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.
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 $10,000.00. V-ONE has also agreed to indemnify some of the
selling stockholders 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.
10
<PAGE>
The distribution of the shares may be effected in one or more of the
following methods:
o ordinary brokers' transactions, which may include long or short sales
o 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
o purchases by brokers, dealers or underwriters as principal and resale
by such purchasers for their own accounts pursuant to this prospectus
o "at the market" to or through market makers or into an existing market
for the common stock
o in other ways not involving market makers or established trading
markets, including direct sales to purchasers or sales effected
through agents
o through transactions in options, swaps or other derivatives (whether
exchange-listed or otherwise) or
o any combination of the foregoing, or by any other legally available
means.
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. Those shares may
be resold thereafter pursuant to this prospectus.
In addition, the selling stockholders from time to time may 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 may be made pursuant to this prospectus, whether effected by the
selling stockholders, any broker-dealer or others. 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. The 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
11
<PAGE>
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 some 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.
COMMON STOCK
As of March 22, 2000, there were 18,250,780 shares of common stock
outstanding that were held of record by approximately 143 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. V-ONE currently has 1,287,554 shares of Series B Convertible
Preferred Stock ("Series B Shares") outstanding and 335,000 shares of Series C
Preferred Stock ("Series C Shares") outstanding.
On June 11, 1999, the Company issued 1,287,554 Series B Shares. The Series
B Shares rank senior to the Common Stock as to distributions of assets upon
liquidation, dissolution or winding up of the Company. In the event of any
voluntary or involuntary liquidation, sale, or winding up of V-ONE, the holders
of preferred stock hold liquidation preferences and are entitled to share
ratably in all assets remaining after payment of liabilities. The Series B
Shares are not redeemable, do not bear dividends and generally have no voting
rights. Each Series B Share is convertible at the option of the holder at any
time into one share of Common Stock based upon an initial conversion price of
12
<PAGE>
$2.33 per share. The conversion price is subject to adjustment in the event the
Company pays dividends or makes distributions on, splits or reverse splits its
Common Stock. The holders of the Series B Shares are entitled to a liquidation
preference of $2.33 per share. There are no sinking fund provisions applicable
to the Series B Shares.
On September 9, 1999, the Company issued 335,000 Series C Shares and
3,350,000 non-detachable warrants to purchase shares of Common Stock
("Warrants"). Each Series C Share was issued with ten Warrants. The Warrants are
immediately exercisable at a price of $2.625 per share and will remain
exercisable until 90 days after all of the Series C Shares have been redeemed
and the shares of the Common Stock underlying the Warrants have been registered
for resale.
The Series C Shares bear cumulative compounding dividends at an annual
rate of 10% for the first five years, 12.5% for the sixth year and 15% in and
after the seventh year. The dividends may be paid in cash, or at the option of
the Company, in shares of registered common stock. The Series C Shares are not
convertible, rank senior to the Common Stock and to the Series B Shares as to
payment of dividends, and rank senior to the Common Stock and in parity with the
Series B Shares as to distributions of assets upon liquidation, dissolution or
winding up of the Company. Holders of the Series C Shares are entitled to a
liquidation preference of $26.25 per share. There are no sinking fund provisions
applicable to the Series C Shares.
At least 51% of the outstanding Series C Shares must vote affirmatively as
a separate class for (i) the voluntary liquidation, dissolution or winding up of
the Company, (ii) the issuance of any securities senior to the Series C Shares
and (iii) the declaration or payment of a cash dividend on all junior stocks and
certain amendments to the Company's certificate of incorporation. Prior to the
exercise of the Warrants, the holders shall also be entitled to ten common votes
for each Series C Share on all matters on which common stockholders are entitled
to vote, except in connection with the election of the Board of Directors. As
long as at least 51% of the Series C Shares are outstanding, the holders shall
have the right to elect one director to the Company's Board of Directors.
The Company has the right to redeem the outstanding Series C Shares in
whole (i) at any time after the third anniversary of the issuance date, (ii)
upon the closing of an underwritten public offering in excess of $20 million and
at a price in excess of $6.50 per share or (iii) prior to the third anniversary
of the issuance date if the average closing bid price of the Common Stock for
any 20 trading days during any 30 trading days ending within 5 trading days
prior to the date of notice of redemption is at least $3.9375 per share. The
redemption price would be paid in cash in full and would be equal to the greater
of the $26.25 per share purchase price or the fair market value of each Series C
Share plus all unpaid dividends.
At any time after all of the Warrants have been exercised by a holder,
that holder shall have the right to require the Company to redeem all of its
then outstanding Series C Shares. The redemption price for each Series C Share
is the $26.25 per share purchase price plus all unpaid dividends and is payable
at the option of the Company in either cash or shares of common stock.
The Company has granted registration rights to the purchasers of the
Series C and Series B Shares whereby the Company is obligated, in certain
instances, to register the shares of Common Stock issuable upon conversion of
the Series B Shares and exercise of the Warrants attached to the Series C
Shares.
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.
13
<PAGE>
EXPERTS
The financial statements and schedule of V-One Corporation at December 31,
1999, and for the year then ended, appearing in V-One Corporation's Annual
Report (Form 10-K) for the year ended December 31, 1999, have been audited by
Ernst & Young LLP, independent auditors, as set forth in their report thereon
included therein and incorporated herein by reference. Such financial statements
and schedule are incorporated herein by reference in reliance upon such report
given on the authority of such firm as experts in accounting and auditing.
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 two
years ended December 31, 1997 and 1998, respectively, incorporated in this
prospectus, have been incorporated by reference herein in reliance on the report
(which report includes as explanatory paragraph regarding V-ONE's ability to
continue as a going concern) of PricewaterhouseCoopers LLP, independent
accountants, given on the authority of said firm as experts in auditing and
accounting.
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 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 as of any time subsequent to the date of the
prospectus.
------------------------
TABLE OF CONTENTS
PAGE
----
V-ONE..............................2
Risk Factors.......................2
Where You Can Find More
Information......................7
Incorporation of Certain
Documents by Reference...........8
Selling Stockholders...............9
Use of Proceeds...................10
Plan of Distribution..............10
Description of Capital Stock......12
Legal Matters.....................13
Experts...........................14
5,357,511 Shares
V-ONE CORPORATION
-----------------
COMMON STOCK
----------------
PROSPECTUS
----------------
_________, 2000
<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
V-ONE 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...................... $ 5,524.60
Printing and engraving expenses........... 5,000
Legal fees and expenses .................. 50,000
Accounting fees and expenses.............. 10,000
Miscellaneous fees and expenses........... 5,000
==============
Total............................... $75,524.60
==============
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.
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.
II-1
<PAGE>
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.
Item 16. Exhibits.
NUMBER DESCRIPTION OF EXHIBIT
------ ----------------------
5 Opinion of Kirkpatrick & Lockhart LLP
23.1 Consent of Ernst & Young LLP, independent auditors
23.2 Consent of Pricewaterhouse Coopers LLP
23.3 Consent of Kirkpatrick & Lockhart LLP (included in Exhibit 5)
24 Power of Attorney (see page II-4)
---------------
Item 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
II-2
<PAGE>
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.
(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-3
<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 14th day
of April, 2000.
V-ONE CORPORATION
By: /s/ David D. Dawson
-------------------
David D. Dawson
President and Chief Executive Officer
Know all men by these presents, that each person whose signature appears
below constitutes and appoints David D. Dawson and Margaret E. Grayson, and each
of them, his or her true and lawful attorneys-in-fact and agents with full power
of substitution and resubstitution for him or her in his or her name, place and
stead, in any and all capacities, to sign any or all amendments to this
registration statement and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto such attorneys-in-fact and agents and each of them
full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, to all intents and
purposes and as fully as they might or could do in person, thereby ratifying and
confirming all that such attorneys-in-fact and agents, or their substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
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 14, 2000
President, Chief Executive
Officer and Director
/s/ Margaret E. Grayson
- -----------------------
Margaret E. Grayson Senior Vice President, April 14, 2000
Chief Financial Officer,
Treasurer and Director
(Principal Financial Officer)
/s/ John Nesline
- ----------------
John Nesline Controller April 14, 2000
(Principal Accounting Officer)
/s/ James F. Chen
- -----------------
James F. Chen Director April 14, 2000
/s/ A.L. Giannopoulos
- ---------------------
A.L. Giannopoulos Director April 14, 2000
/s/ William E. Odom
- -------------------
William E. Odom Director April 14, 2000
II-4
<PAGE>
EXHIBIT INDEX
NUMBER DESCRIPTION OF EXHIBIT
------ ----------------------
5 Opinion of Kirkpatrick & Lockhart LLP
23.1 Consent of Ernst & Young LLP, independent auditors
23.2 Consent of Pricewaterhouse Coopers LLP
23.3 Consent of Kirkpatrick & Lockhart LLP (included in Exhibit 5)
24 Power of Attorney (see page II-4)
---------------
II-5
Kirkpatrick & Lockhart LLP 1800 Massachusetts Avenue, NW
Second Floor
Washington, DC 20036-1800
202.778-9000
www.kl.com
April 17, 2000
V-ONE Corporation
20250 Century Boulevard, Suite 300
Germantown, Maryland 20874
Re: V-ONE Corporation
Registration Statement on Form S-3
Ladies/Gentlemen:
We have acted as counsel to V-ONE Corporation, a Delaware corporation
("Corporation"), in connection with the preparation and filing of the
above-captioned Registration Statement on Form S-3, Registration Number
333-_____ ("Registration Statement"), under the Securities Act of 1933, as
amended, covering the resale of 3,350,000 shares of Common Stock, $0.001 par
value per share ("Common Stock"), of the Corporation issuable upon exercise of
warrants held by holders of the Company's Series C Preferred Stock ("Series C
Warrants"), 1,287,554 shares of Common Stock issuable upon conversion of the
Company's Series B Convertible Preferred Stock ("Series B Stock"), 219,957
shares of Common Stock issuable upon exercise of warrants held by TBCC Funding
Trust II ("TBCC Warrants") and 500,000 shares held directly by Cranshire
Capital, L.P.
We have examined copies of the Registration Statement, the Prospectus
forming a part thereof, the Certificate of Incorporation and Bylaws of the
Corporation, each as amended to date, the minutes of various meetings and
unanimous written consents of the Board of Directors and the shareholders of the
Corporation, and original, reproduced or certified copies of such records of the
Corporation and such agreements, certificates of public officials, certificates
of officers and representatives of the Corporation and others, and such other
documents, papers, statutes and authorities as we deem necessary to form the
basis of the opinions hereinafter expressed. In such examination, we have
assumed the genuineness of all signatures and the conformity to original
documents of all documents supplied to us as copies. As to various questions of
fact material to such opinions, we have relied upon statements and certificates
of officers and representatives of the Corporation and others.
Based on the foregoing, we are of the opinion that the 500,000 shares of
Common Stock held by Cranshire Capital, L.P. are duly and validly issued, fully
paid and nonassessable, and that the 3,350,000 shares of Common Stock issuable
pursuant to the Series C Warrants, when issued in accordance with the terms of
the Series C Warrants, the 1,287,554 shares of Common Stock issuable pursuant to
<PAGE>
V-ONE Corporation
April 17, 2000
Page 2
the Series B Stock, when issued in accordance with the terms of the Certificate
of Designations of the Series B Stock, and the 219,957 shares of Common Stock
issuable pursuant to the TBCC Warrants, when issued in accordance with the terms
of the TBCC Warrants, will be duly and validly issued, fully paid and
nonassessable.
We hereby consent to the reference to our firm under the caption "Legal
Matters" in the Prospectus forming part of the Registration Statement and to
your filing a copy of this Opinion as an exhibit to said Registration Statement.
Sincerely,
/s/ KIRKPATRICK & LOCKHART LLP
------------------------------
KIRKPATRICK & LOCKHART LLP
Consent of Ernst & Young LLP, Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3, No. 33-00000) and related Prospectus of V-One
Corporation for the registration of 5,357,511 shares of its common stock and to
the incorporation by reference therein of our report dated February 18, 2000
(except Note 11, as to which the date is March 24, 2000), with respect to the
financial statements and schedule of V-One Corporation included in its Annual
Report (Form 10-K) for the year ended December 31, 1999 filed with the
Securities and Exchange Commission.
/s/Ernst & Young LLP
Ernst & Young LLP
McLean, Virginia
April 14, 2000
Consent of Independent Accountants
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated March 11, 1999, except as to the third
and fourth sentences of the first paragraph of Note 3 to which the date is March
31, 1999, relating to the financial statements, which is incorporated by
reference in V-One Corporation's Annual Report on Form 10-K for the year ended
December 31, 1999. We also consent to the references to us under the heading
"Experts" in such Registration Statement.
/s/PricewaterhouseCoopers LLP
-----------------------------------
McLean, Virginia
April 14, 2000
