<PAGE>
As filed with the Securities and Exchange Commission on April 28, 2000
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
VIISAGE TECHNOLOGY, INC.
------------------------
(Exact name of registrant as specified in its charter)
Delaware 04-3320515
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(State of Incorporation) (I.R.S. Employer Identification No.)
30 Porter Road Littleton, MA 01460
- -------------- ------------- -----
(Address of Principal Executive Offices, including zip code)
Thomas J. Colatosti
President and Chief Executive Officer
Viisage Technology, Inc.
30 Porter Road
Littleton, MA 01460
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(Name and address of agent for service)
(978) 952-2200
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(Telephone number, including area code, of agent for service)
Copy to:
Charles J. Johnson, Esq.
Finnegan, Hickey, Dinsmoor & Johnson, P.C.
175 Federal Street
Boston, Massachusetts 02110
(617) 523-2500
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: From time to
time, after this registration statement becomes effective.
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. [_]
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. [_]
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 Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of each Proposed maximum
class of Proposed maximum aggregate
securities Amount to be offering price offering Amount of
to be registered registered per unit/1/ price/1/ Registration fee
- ---------------- ---------- ----------- -------- ----------------
<S> <C> <C> <C> <C>
Common Stock, 1,490,109 $5.1875 $7,729,940 $2,040.70
$0.001 par value
==============================================================================================
</TABLE>
(1) Estimated pursuant to Rule 457(c) under the Securities Act solely for the
purpose of calculating the registration fee, based upon the average of the high
and low sale prices of our common stock on April 24, 2000 on the Nasdaq National
Market.
The information in this prospectus is not complete and may be changed.
These securities may not be sold 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 which prohibits the offer or sale.
<PAGE>
PROSPECTUS
1,490,109 Shares
Viisage Technology, Inc.
COMMON STOCK
_____________________________________________________________________________
Certain of our stockholders are registering up to 1,490,109 shares of our
common stock. The selling stockholders may offer and sell their shares publicly
or through private transactions at prevailing market prices or at negotiated
prices.
We will not receive any of the proceeds from the sale of the shares by the
selling stockholders. We have agreed to bear all expenses (other than selling
discounts, concessions or commissions) in connection with the registration and
sale of the shares that the selling stockholders are offering.
Our common stock is listed on The Nasdaq National Market under the symbol
"VISG." The last reported sale price of our shares on April 24, 2000 was $5.00
per share.
Investing in our common stock involves a high degree of risk. See "Risk
Factors" beginning on page 3.
Neither the Securities and Exchange Commission nor any other regulatory
body has approved or disapproved of these securities or passed upon the accuracy
or adequacy of this prospectus. Any representation to the contrary is a criminal
offense.
The date of this prospectus is April 28, 2000.
<PAGE>
TABLE OF CONTENTS
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<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary...................................................... 1
Risk Factors............................................................ 3
Use of Proceeds......................................................... 8
Transactions with Selling Stockholders.................................. 8
Selling Stockholders.................................................... 9
Plan of Distribution.................................................... 11
Interests of Named Experts and Counsel.................................. 12
Legal Matters........................................................... 12
Experts................................................................. 12
Material Changes........................................................ 13
Where You Can Find More Information..................................... 13
Incorporation of Certain Documents by Reference......................... 14
</TABLE>
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You should only rely on the information contained in this document or to which
we have referred you. We have not authorized anyone to provide you with
information that is different. This document may only be used where it is legal
to sell these securities. This information in this document may only be
accurate on the date of this document.
<PAGE>
PROSPECTUS SUMMARY
This summary highlights certain information found in greater detail
elsewhere in this prospectus. In addition to this summary, we urge you to read
the entire prospectus carefully, especially the risks of investing in our common
stock discussed under "Risk Factors" on page 3 before you decide to buy our
common stock.
OVERVIEW OF OUR BUSINESS
Viisage is a leader in the emerging field of biometrics technology and in
providing digital identification systems and solutions.
Our identification systems and solutions improve personal convenience and
security, deter fraud and reduce identification program costs. We create
complete customized solutions by combining our systems integration capabilities,
software design capabilities, proprietary software and hardware products, and
standard products in the industry. Our turnkey solutions (1) integrate image
and data capture, (2) create relational databases, (3) incorporate multiple
biometrics, and (4) improve customers' abilities to move and manage information.
Customers can apply our technology to:
. drivers' licenses
. voter registration cards
. national identification cards
. law enforcement and corrections applications
. social services applications
. facility access control and surveillance, and
. personal computer network and internet access security.
Our primary customers for these products are United States drivers
licensing agencies. Since our inception in 1993, we have captured approximately
30% of the domestic driver's license market. Each year, our products facilitate
the production of more than 20 million identification documents at about 1,500
locations throughout 12 states and in two foreign countries.
Our biometrics technology includes our patented facial recognition products
used for access control, PC network and internet access security and the real-
time large database identification and verification of individuals. Our "Face-
in-the-Crowd" products can recognize real-time facial images in a crowd from
video and can be used for access control and surveillance. We have current
projects for a police surveillance system in Western Europe and for public
sector customers in Massachusetts, Wisconsin and Illinois, where we have
deployed the world's largest facial recognition database.
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Our principal executive offices are located at 30 Porter Road, Littleton,
Massachusetts 01460, our telephone number is (978) 952-2200 and our internet
website address on the world wide web is Viisage.com. The contents of our
website are not part of this prospectus. In this prospectus, we refer to
Viisage Technologies, Inc., a Delaware corporation, as "Viisage", the "Company",
"we", "us" and "our".
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RISK FACTORS
Any investment in our common stock involves a high degree of risk. You
should carefully consider the following information about these risks, together
with the other information contained in this prospectus, before you decide
whether to buy our common stock. If any of the following risks actually occur,
our business, results of operations and financial condition would likely suffer.
In any such case, the market price of our common stock could decline, and you
may lose all or part of the money you paid to buy our common stock.
The risks and uncertainties described below are not the only ones we face.
Additional risks and uncertainties, including those not presently known to us or
that we currently deem immaterial, may also impair our business.
OUR BUSINESS DEPENDS ON LARGE PUBLIC SECTOR CONTRACTS WHICH CAN INVOLVE DELAYS.
Our business largely depends on a limited number of large public sector
contracts. These contracts result from purchasing decisions made by public
sector agencies that are often subject to political influence, onerous
procurement procedures, budget changes and award protests. These factors can
cause delays which make our quarterly results difficult to predict. This can
also make our ability to meet analysts' expectations equally uncertain and
adversely affect the price of our common stock.
OUR QUARTERLY RESULTS COULD BE VOLATILE AND MAY CAUSE OUR STOCK PRICE TO
FLUCTUATE.
We have experienced fluctuations in our quarterly operating results and
expect those fluctuations to continue. Our quarterly results are affected by,
among other things, factors such as
. the size and timing of contract awards
. the timing of our contract performance
. variations in the mix of our products and services, and
. contract losses and changes in management estimates incident to
accounting for contracts.
THE LOSS OF ANY SIGNIFICANT CUSTOMER COULD CAUSE OUR REVENUE TO DECLINE.
For 1999, four customers each accounted for over 10% of our revenues and a
total of 52% of our revenues for the year. The loss of any significant customer
could cause our revenue to decline and thus have an adverse material effect on
our business and financial condition.
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WE HAVE HAD A HISTORY OF LOSSES AND ARE CURRENTLY NOT PROFITABLE.
Our business operations began in 1993 and, except in 1996, have resulted in
net losses from inception through December 31, 1999. At December 31, 1999, we
had an accumulated deficit of $13,546,000. We intend to continue to invest in
the development of our biometrics division and thus we cannot predict when or if
we will ever achieve overall profitability. Further, no assurance can be given
that we will not need to raise additional funds through public or private
financings.
OUR LEVERAGE CREATES FINANCIAL AND OPERATING RISK THAT COULD LIMIT THE GROWTH OF
OUR BUSINESS.
We have a significant amount of indebtedness. As of December 31, 1999, we
had approximately $22 million in short and long-term debt, lease financing and
subordinated convertible debt. Our leverage could have important consequences
to us including:
. limiting our ability to obtain necessary financing for future working
capital
. limiting our ability to finance the acquisition of equipment needed to
meet customer requirements
. limiting our ability to finance the development of new technologies
. requiring that we use a substantial portion of our cash flow from
operations for debt service and not other purposes, and
. requiring us to comply with financial and operating covenants which
could cause an event of default under our debt instruments.
Further, our ability to make principal and interest payments under long-term
indebtedness and bank loans will be dependent upon our future performance, which
is subject to financial, economic and other factors affecting us, some of which
are beyond our control.
WE MAY BE UNABLE TO OBTAIN ADDITIONAL CAPITAL REQUIRED TO FUND OUR OPERATIONS
AND FINANCE OUR GROWTH.
The installation of our digital identification systems requires significant
capital expenditures. Although we have been successful in the past in obtaining
project financing, we will have ongoing capital needs. If we are unable to
obtain additional funds in a timely manner or on acceptable terms, we may not be
able to fund our operations or expand our business to meet our plans. In
addition, the further development of our biometric and other advanced
technologies is expected to require additional capital. If we are unable to
obtain capital when we need it, we may have to restructure our business or delay
or abandon our development and expansion plans. That could have a material
adverse effect on our business and financial condition.
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OUR RELIANCE ON SOLE AND SINGLE-SOURCE SUPPLIERS COULD CAUSE DELAYS OR INCREASES
IN PROJECT COSTS.
We rely on outside vendors to manufacture or develop components, software
and consumables which are used for our systems and services. Some of these
items are obtained from a single supplier or a limited group of suppliers. Our
inability to obtain adequate deliveries or alternative sources of supply could
cause delays or increases in project costs.
IF OUR TARGET CUSTOMERS DO NOT ACCEPT OUR BIOMETRIC TECHNOLOGIES, OUR GROWTH MAY
BE RESTRICTED.
Our growth plan assumes, in part, that biometric technologies will gain
widespread market acceptance. Although we have had recent success with several
projects, the widespread market acceptance of biometric technologies remains
uncertain.
IF WE FAIL TO KEEP PACE WITH CHANGING TECHNOLOGIES, WE MAY NOT WIN NEW
CUSTOMERS.
Our market is characterized by rapidly changing customer requirements and
evolving industry standards. If we cannot keep pace with these changes, our
business could suffer. To achieve our goals, we need to develop cost-effective
business solutions and methodologies to keep pace with continuing changes in
industry standards and customer preferences.
SYSTEM FAILURES COULD SERIOUSLY DAMAGE OUR BUSINESS.
We depend on our ability to provide customers with complex systems which
can operate on an "as needed" basis. Although we deploy back up systems, system
failures could result in increased costs, lower margins, liquidated damage
payment obligations and harm to our reputation. This could result in contract
terminations and have a material adverse effect on our business and financial
results.
WE ARE CONTROLLED BY A SINGLE STOCKHOLDER WHICH COULD RESULT IN IT TAKING
ACTIONS WHICH OTHER STOCKHOLDERS DO NOT APPROVE.
Lau Technologies ("Lau") owns approximately 59% of our outstanding common
stock. As a result, Lau is currently able to control matters requiring approval
by our stockholders, including the election of all of the directors and most
corporate actions. We have also entered into certain agreements with Lau,
including the licensing of technologies and the provision of administrative
services and facilities. Under the terms of the license agreements, Lau has
reserved the right to use biometric and other technologies in the federal access
control field. There can be no assurance that conflicts of interest will not
arise out of these contractual arrangements.
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COMPETITION FROM NEW ENTRANTS AND BIGGER, MORE ESTABLISHED COMPETITORS WITH
GREATER FINANCIAL RESOURCES COULD DIMINISH OUR BUSINESS OPPORTUNITIES AND LIMIT
OUR GROWTH.
The business areas in which we compete are intensely competitive and
subject to rapid technological change. We expect competition to continue and
intensify. Some of our competitors, notably Polaroid Corporation, have greater
financial resources and name recognition than we have. Our competitors may be
able to respond more quickly to technological developments and changes in
customers' needs.
MISAPPROPRIATION OF OUR INTELLECTUAL PROPERTY COULD HARM OUR REPUTATION, AFFECT
OUR COMPETITIVE POSITION AND COST US MONEY.
We believe our intellectual property, including our proprietary
methodologies, is important to our success and competitive position. If we are
unable to protect our intellectual property against others' unauthorized use,
our reputation among existing and potential customers could be damaged and our
competitive position adversely affected.
Our strategies to deter misappropriation could be undermined in light of
the following risks:
. non-recognition of the proprietary nature of or inadequate protection of
our methodologies in the United States or foreign countries
. undetected misappropriation of our proprietary methodologies, and
. development of similar software or applications by our competitors.
The materialization of any of these risks could require us to spend
significant amounts to defend our rights and could divert our managerial
resources. In addition, our proprietary methodologies may decline in value or
our rights to them may be unenforceable.
OTHERS COULD CLAIM THAT WE INFRINGE ON THEIR INTELLECTUAL PROPERTY RIGHTS WHICH
MAY RESULT IN SUBSTANTIAL COSTS, DIVERSION OF RESOURCES AND MANAGEMENT
ATTENTION, AND HARM TO OUR REPUTATION.
Although we believe that our products and services do not infringe the
intellectual property rights of others, we cannot give any assurances that we
can successfully defend an infringement claim. A successful infringement claim
against us could materially and adversely affect us in the following ways:
. we may be liable for damages and litigation costs, including attorneys'
fees
. we may be enjoined from further use of the intellectual property
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. we may have to license the intellectual property, incurring licensing
fees
. we may have to develop a non-infringing alternative, which could be
costly and delay projects, and
. we may have to indemnify clients with respect to losses incurred as a
result of our infringement of the intellectual property.
Regardless of the outcome, an infringement claim could result in
substantial costs, diversion of resources and management attention, termination
of customer contracts and harm to our reputation.
OUR FAILURE TO MEET NASDAQ NATIONAL MARKET SYSTEM LISTING REQUIREMENTS COULD
ADVERSELY AFFECT THE MARKET FOR OUR COMMON STOCK.
Although our common stock is listed on the Nasdaq National Market System,
continued listing on the National Market System is subject to our ability to
maintain a $5 million public float and to satisfy other Nasdaq criteria. If we
are unable to satisfy this criteria in the future, we could be required to apply
for listing on the Nasdaq SmallCap Market, which may result in less market
visibility and thus adversely affect the price of our common stock.
YOU MAY BE SUBJECT TO DILUTION.
Our preferred stock is outstanding that is convertible into $2.25 million
of common stock at a discount of either 85% or 77% of the then-current market
price, depending on the timing of the conversion. We also have convertible
debt, warrants and stock options outstanding that could result in dilution for
our common stockholders.
YOU SHOULD NOT EXPECT DIVIDENDS FROM US.
We do not expect to declare or pay any cash dividends in the near future.
___________________
This prospectus also contains forward-looking statements that involve risks and
uncertainties. Our actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including the risks faced by us described above and elsewhere in this
prospectus. We assume no obligation to update any forward-looking statements or
reason why actual results might differ.
7
<PAGE>
USE OF PROCEEDS
We will not receive any proceeds from the selling stockholders' sale of
shares.
TRANSACTIONS WITH SELLING STOCKHOLDERS
The following is a description of transactions between the Company and
selling stockholders with respect to the shares being registered pursuant to
this registration statement:
. On December 30, 1999, we issued 1,500 shares of series B convertible
preferred stock to The Shaar Fund, Ltd. ("Shaar") for $1.5 million. These
shares accrue dividends at 7% per annum, payable in cash or stock at our
option. The Company has the right at any time to redeem the preferred shares.
Subject to certain volume limitations, up to one half of the shares are
convertible after June 30, 2000, and the remaining shares are convertible
after September 30, 2000. Shaar may convert $1.5 million in series B
convertible preferred stock, plus accrued dividends, into our common stock at
the lesser of:
. $7.00 per share
. 85% of the market price if the conversion occurs on or before
October 30, 2000, and
. 77% of the market price if conversion occurs on or after November 1,
2000.
In connection with this transaction, the Company paid an investment banking
fee of $60,000 and warrants to purchase 25,000 shares of the Company's common
stock, exercisable for three years, at an exercise price of $8.94 per share
to J.P. Turner & Company, L.L.C ("JP Turner"), which was 130% of the then
current closing price of the Company's common stock. The Company also issued
a warrant to purchase 50,000 shares of the Company's common stock,
exercisable for three years, at an exercise price of $8.94 per share to
Shaar.
. On March 10, 2000, for an initial investment of $4,000,000 (of which
$1,500,000 is to be funded following the effectiveness of this registration
statement), we agreed to issue to Strong River Investments, Inc. ("SRI")
391,917 shares of common stock, a closing warrant to purchase 97,979 shares
of the Company's common stock, exercisable for five years at $11.77 per
share, and an adjustable warrant, exercisable at nominal consideration during
three 25 trading day periods beginning four months following closing (which
may be delayed to December 31, 2000). On March 10, 2000, we issued 244,948 of
these shares of common stock to SRI, and agreed to issue the balance to SRI
upon the funding of $1,500,000 following the effectiveness of this
registration statement. The adjustable warrant terminates if the market value
of the Company common stock exceeds $14.28 for any 20 consecutive trading
days prior to the adjustment periods. If not terminated, the number of shares
that may be acquired under the adjustable warrant is determined by a formula
that is dependent on the extent to which the market value of the Company's
common stock is less than $11.09 per share during the adjustment periods.
Subject to certain closing conditions, two additional investments of
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$3,000,000 each may be invested by SRI between 150 and 170 days after the
initial investment and between 120 and 140 days thereafter on similar terms.
The purchase price of the common stock for each additional investment will be
equal to 115% of the average per share market value for the ten trading days
prior to the applicable closing date and the number of shares of common stock
underlying the closing warrant will be equal to 25% of the common stock sold
pursuant to each investment at an exercise price equal to 125% of the average
per share market price for the five trading days prior to such closing date.
The subsequent adjustable warrant will terminate when the market value of the
common stock on the applicable closing date exceeds 140% for any 20
consecutive trading days prior to the adjustment period. If not terminated,
the number of shares that may be acquired under the adjustable warrant will
be determined by a formula that is based on 108% of the market value of the
Company's common stock. In connection with this transaction, Viisage paid an
investment banking fee of $160,000 to Cardinal Securities, L.L.C.
("Cardinal"), and issued warrants to purchase 75,000 shares of the Company's
common stock to Cardinal exercisable for five years, of which a warrant to
purchase 46,875 shares has an exercise price of $12.35 per share, and a
warrant to purchase 28,125 shares has an exercise price of one hundred thirty
percent (130%) of the current market price as of the applicable date
following the effectiveness of this registration statement.
SELLING STOCKHOLDERS
The selling stockholders whose shares of common stock are being registered
hereby are Shaar, JP Turner, SRI and Cardinal. No selling stockholder has any
affiliation with Viisage or its officers, directors, promoters or principal
stockholders. Shaar is an investment fund that primarily invests in public
companies, and Shaar is not affiliated with any broker-dealer. SRI is also a
private equity investor, and SRI is not affiliated with any broker-dealer.
J.P. Turner and Cardinal are registered broker-dealers and are thus deemed to be
"underwriters" as that term is defined in the Securities Act of 1933, as
amended.
The holder of the closing warrant and adjustable warrant is prohibited from
using them to acquire shares of our common stock to the extent that such
acquisition would result in such holder, together with any affiliate thereof,
beneficially owning in excess of 4.999% of the outstanding shares of our common
stock following such acquisition. This restriction may be waived by the holder
on not less than 61 days' notice to us.
Since the number of shares of our common stock that will be issuable upon
exercise of the adjustable warrant is based upon fluctuations of the market
price of our common stock prior to a vesting thereunder, the actual number of
shares of our common stock that will be issuable and beneficially owned upon
exercise of such adjustable warrant cannot be determined at this time. Because
of this fluctuating characteristic, the Company has agreed to register a number
of shares of our common stock that exceeds the number of our shares of common
stock currently beneficially owned by the holders thereof. The number of
shares of our common stock listed in the table below as being beneficially owned
by SRI includes the shares of our common stock that
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are issuable to it, subject to the 4.999% limitation, upon exercise of the
warrant. However, the 4.999% limitation would not prevent SRI from acquiring and
selling in excess of 4.999% of shares of our common stock through a series of
acquisitions and sales under the warrants while never beneficially owning more
than 4.999% at any one time.
We have agreed to file a registration statement under the Securities Act of
1933 to cover the sale of shares of our common stock that may be issued to the
selling stockholders and to keep such registration statement effective for a
period of one year from the date of this prospectus. We have also agreed to pay
all expenses in connection therewith other than the brokerage commissions and
discounts in connection with the sale of the common stock and the expenses of
counsel.
The following table sets forth the name of the selling stockholders, the
number of shares of common stock owned beneficially by each of the selling
stockholders as of April 21, 2000 (prior to commencement of this offering), the
number of shares which may be offered for resale pursuant to this prospectus and
the amount and percentage of shares of common stock owned beneficially by each
of the selling stockholders after the offering.
The information included below is based upon information provided by the
selling stockholders. Because the selling stockholders may offer all, some or
none of their common stock, no definitive estimate as to the number of shares
thereof that will be held by the selling stockholders after such offering can be
provided. The following table has been prepared on the assumption that all
shares of common stock offered under this prospectus will be sold.
<TABLE>
<CAPTION>
PERCENTAGE OF
SHARES OF COMMON NUMBER OF SHARES SHARES OF COMMON
STOCK BENEFICIALLY OF COMMON STOCK STOCK BENEFICIALLY
NAME OF SELLING OWNED PRIOR TO SHARES OF COMMON BENEFICIALLY OWNED OWNED AFTER
STOCKHOLDER OFFERING (1) STOCK BEING OFFERED AFTER OFFERING(2) OFFERING(3)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
J.P. TURNER & 100,000 25,000 75,000 .75%
COMPANY, L.L.C.
- ----------------------------------------------------------------------------------------------------------------
THE SHAAR FUND, LTD. 528,610 439,610(4) 89,000 0.9%
- ----------------------------------------------------------------------------------------------------------------
STRONG RIVER 342,927(5) 950,499(6) 0 0%
INVESTMENTS, INC.
- ----------------------------------------------------------------------------------------------------------------
CARDINAL 75,000 75,000 0 0%
SECURITIES, L.L.C.
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Each of the parties listed has sole voting and investment power with
respect to all shares of common stock indicated.
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(2) Assumes the sale of all the shares offered hereby.
(3) Based upon 9,945,217 shares of common stock issued and outstanding as of
April 21, 2000.
(4) Consists of shares of common stock being registered on behalf of Shaar
which may be issued upon (a) the conversion of the series B convertible
preferred stock currently held by Shaar on April 24, 2000, assuming an
exercise price of $3.85 (77% of current market price) and (b) the exercise
of a warrant to purchase 50,000 shares of common stock at an exercise
price of $8.94 per share. Subject to certain volume limitations, the
preferred stock is required to be converted into our common stock by
October 30, 2002.
(5) Consists of (a) 244,948 shares issued to SRI as of the date hereof, and (b)
97,979 shares of our common stock which may be acquired by SRI upon the
exercise of a warrant at an exercise price of $11.77 per share.
(6) Consists of (a) 391,917 shares of our common stock which we agreed to issue
to SRI, (b) 97,979 shares of our common stock which may be acquired by SRI
upon the exercise of a warrant at an exercise price of $11.77 per share,
and (c) 460,603 shares of our common stock which could be acquired by SRI
upon the exercise of the adjustable warrant, assuming that the average per
share closing bid price for any ten of the twenty-five trading days
preceding the first vesting date equals $5.10.
PLAN OF DISTRIBUTION
The selling stockholders and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of Common Stock on any stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. The selling stockholders may use any one or more of the
following methods when selling shares:
. ordinary brokerage transactions and transactions in which the broker-
dealer solicits purchasers;
. block trades in which the broker-dealer will attempt to sell the shares
as agent but may position and resell a portion of the block as principal
to facilitate the transaction;
. purchases by a broker-dealer as principal and resale by the broker-
dealer for its account;
. an exchange distribution in accordance with the rules of the applicable
exchange;
. privately negotiated transactions;
. broker-dealers may agree with the Selling Stockholders to sell a
specified number of such shares at a stipulated price per share;
. a combination of any such methods of sale; and
. any other method permitted pursuant to applicable law.
The selling stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this prospectus.
Broker-dealers engaged by the selling stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the selling
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stockholders (or, if any broker-dealer acts as agent for the purchaser of
shares, from the purchaser) in amounts to be negotiated. The selling
stockholders do not expect these commissions and discounts to exceed what is
customary in the types of transactions involved. The selling stockholders and
any broker-dealers or agents that are involved in selling the shares may be
deemed to be "underwriters" within the meaning of the Securities Act in
connection with such sales. In such event, any commissions received by such
broker-dealers or agents and any profit on the resale of the shares purchased by
them may be deemed to be underwriting commissions or discounts under the
Securities Act.
The Company is required to pay the fees and expenses incident to the
registration of the shares. The Company has agreed to indemnify the selling
stockholders against certain losses, claims, damages and liabilities, including
liabilities under the Securities Act.
In order to comply with certain state securities laws, if applicable, the
common stock will not be sold in a particular state unless such securities have
been registered or qualified for sale in such state or any exemption from
registration or qualification is available and complied with.
INTERESTS OF NAMED EXPERTS AND COUNSEL
Finnegan, Hickey, Dinsmoor & Johnson, P.C., Boston, Massachusetts will opine
on our behalf as to certain legal matters in connection with the shares being
registered hereby. Charles J. Johnson, one of our directors, is a member of the
firm of Finnegan, Hickey, Dinsmoor & Johnson, P.C.
LEGAL MATTERS
The validity of the shares of common stock offered hereby has been passed
upon for Viisage by the firm of Finnegan, Hickey, Dinsmoor & Johnson, P.C.
EXPERTS
The financial statements of the Company as of December 31, 1998 and for
each of the two years in the period ended December 31, 1998, included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1999, have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report with respect thereto, and are incorporated by
reference herein in reliance upon the authority of said firm as experts in
giving said report.
The financial statements of the Company for the year ended December 31,
1999, included in and incorporated herein by reference in the Company's Annual
Report on Form 10-K for the year ended December 31, 1999, have been audited by
BDO Seidman, LLP, independent certified
12
<PAGE>
public accountants, to the extent set forth in the report incorporated herein by
reference, and are incorporated herein in reliance upon such reports given upon
the authority of said firms as experts in auditing and accounting.
On November 3, 1999, the Company's audit committee approved the engagement
of BDO Seidman, LLP to replace Arthur Andersen LLP as the Company's independent
public accountants. The Company's change in independent public accountants was
made at the request of its majority shareholder, Lau Technologies. Lau
Technologies has engaged BDO Seidman, LLP to act as its independent public
accountants and desires that the same firm audits the financial statements of
its then 64%-owned subsidiary. There were neither disagreements with Arthur
Andersen LLP on any matter of accounting principles or practice, financial
statement disclosure, auditing scope or procedure nor any "reportable events" as
that term is used in Item 304(a) of Regulation S-K.
MATERIAL CHANGES
All material changes to Viisage's affairs that have occurred since
December 31, 1999 are contained in our filings with the SEC which are
incorporated herein by reference. See "Incorporation of Certain Documents by
Reference" on page 14.
WHERE YOU CAN FIND MORE INFORMATION
This prospectus constitutes part of a registration statement on Form S-3
(the "Registration Statement") filed by Viisage with the Securities and Exchange
Commission, Washington, D.C. 20549, with respect to the shares of our common
stock. This prospectus does not contain all of the information set forth in the
Registration Statement and in the schedules and exhibits thereto. For further
information about us and the securities offered hereby, reference is hereby made
to the Registration Statement and to the exhibits and schedules thereto, which
may be inspected without charge at the principal office of the Securities and
Exchange Commission in Washington, D.C. Copies of all or any part of the
Registration Statement and exhibits and schedules thereto may be obtained from
the Securities and Exchange Commission upon payment of the prescribed fees.
Statements made in this prospectus as to the contents of any contract or other
document are not necessarily complete and in each instance reference is made to
the copy of such contract or other document filed as an exhibit to the
Registration Statement, each such statement being qualified in all respects by
such reference.
We are subject to the periodic reporting and other informational
requirements of the Securities Exchange Act of 1934, as amended, and we file
reports, proxy and information statements, and other information with the
Securities and Exchange Commission. You may inspect and copy such reports, proxy
and information statements and other information which we file at the Public
Reference Section of the Securities and Exchange Commission at Room 1024,
13
<PAGE>
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
regional offices of the Commission located at 7 World Trade Center, Suite 1300,
New York, New York 10048 and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511. You may obtain copies of such material from the Public
Reference Section of the Commission at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates. In addition, we are
required to file electronic versions of these documents with the Securities and
Exchange Commission through the Commission's Electronic Data Gathering, Analysis
and Retrieval (EDGAR) system. The Commission maintains a World Wide Web site at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Securities and Exchange Commission.
In addition, our common shares are traded as "National Market Securities"
on the Nasdaq National Market. Material filed by Viisage may be inspected at
the offices of the National Association of Securities Dealers, Inc., Reports
Section, 1735 K Street, N.W., Washington, D.C. 20006.
We intend to furnish our stockholders annual reports containing financial
statements audited by independent public accountants.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus, and information that we file later with the Securities and Exchange
Commission will automatically update and supersede previously filed information,
including information contained in this document. We incorporate by reference
the documents listed below and any future filings we will make with the
Securities and Exchange Commission under Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act, until this offering has been completed:
1. Viisage's Annual Report on Form 10-K for the year ended December 31,
1999.
2. Viisage's Proxy Statement dated April 7, 2000.
3. All of our filings pursuant to the Exchange Act after the date of
filing the initial registration statement and prior to the
effectiveness of the registration statement.
4. The description of our common stock, which is contained in our
Registration Statement on Form S-1 dated August 22, 1996 (File No. 333-
10649).
We will provide you a copy of any or all of the information that has been
incorporated by reference herein but not delivered with this prospectus, upon
your written or oral request at no cost. Please contact Sean Mack, Treasurer,
at our principal executive offices located at 30 Porter
14
<PAGE>
Road, Littleton, Massachusetts 01460. Our telephone number is (978) 952-2200,
and our internet website address on the world wide web is Viisage.com.
15
<PAGE>
PART II
INFORMATION REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the various expenses in connection with the
securities being registered. All amounts shown are estimates, except the
Securities and Exchange Commission registration fee.
<TABLE>
<CAPTION>
ITEM AMOUNT
<S> <C>
SEC Registration Fee ...................................... $ 2,040.70
Accounting Fees and Expenses .............................. $ 9,000.00
Legal Fees and Expenses ................................... $ 6,000.00
Miscellaneous ............................................. $ 4,000.00
Total ..................................................... $21,040.70
</TABLE>
Viisage will bear all expenses shown above, and the selling stockholders
will not bear any portion of these expenses.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Viisage's bylaws provide that the Company, subject to limited exceptions,
will indemnify its directors and officers, and may indemnify its other employees
and other agents to the fullest extent permitted by Delaware law.
In addition, the Company's certificate of incorporation provides that, to
the fullest extent permitted by Delaware law, the Company's directors will not
be liable for monetary damages for breach of the directors' fiduciary duty of
care to the Company and its stockholders. The certificate of incorporation does
not eliminate the directors' duty of care and, in appropriate circumstances,
equitable remedies such as an injunction or other forms of non-monetary relief
would remain available under Delaware law. Each director will continue to be
subject to liability for:
. breach of the director's duty of loyalty to the Company
. for acts or omissions not in good faith or involving intentional
misconduct or knowing violations of law
. for acts or omissions that the director believes to be contrary to the
best interests of the Company or its stockholders
. for any transaction from which the director derived an improper personal
benefit
. for acts or omissions involving a reckless disregard for the director's
duty to the Company or its stockholders when the director was aware or
should have been aware of a risk of serious injury to the Company or its
stockholders
16
<PAGE>
. for acts or omissions that constitute an unexcused pattern of
inattention that amounts to the abdication of the director's duty to the
Company or its stockholders
. for improper transactions between the director and the Company, and
. for improper distributions to stockholders and loans to directors and
officers.
This provision also does not affect a director's responsibilities under any
other laws, such as the federal securities laws or state or federal
environmental laws.
Item 16. Exhibits.
<TABLE>
<CAPTION>
Exhibit No. DESCRIPTION
- ----------- -----------
<C> <S>
2* Amended and Restated Asset Transfer Agreement, dated as of
August 20, 1996, between the Registrant and Lau Technologies.
4* Specimen certificates for shares of the Registrant's Common Stock.
5. Opinion of Finnegan, Hickey, Dinsmoor & Johnson, P.C. as to the
legality of the shares being registered.
23.1 Consent of BDO Seidman, LLP.
23.2 Consent of Arthur Andersen LLP.
24 Power of Attorney.
* Filed as an exhibit to Amendment No. 2 to Registrant's Form S-1
Registration Statement dated November 4, 1996 (File No. 333-10649).
</TABLE>
ITEM 17. UNDERTAKINGS.
(a) The Company hereby undertakes:
(1) to file, during any period in which offers or sales are being
made, a post-effective amendment of 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;
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement; provided
however, that paragraphs (a)(1)(i) and
17
<PAGE>
(a)(1)(ii) of this section do not apply if the registration statement is on
Form S-3, Form S-8 or Form F-3, and the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed with or furnished to the Commission 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) 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; and
(3) to remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Company'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 the securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) The Company hereby undertakes to deliver or cause to be delivered with
the prospectus, to each person to whom the prospectus is sent or given, the
latest annual report to security holders that is incorporated by reference in
the prospectus and furnished pursuant to and meeting the requirements of Rule
14a-3 or Rule 14c-3 under the Exchange Act; and, where interim financial
information required to be presented by Article 3 of Regulation S-X are not set
forth in the prospectus, to deliver, or cause to be delivered to each person to
whom the prospectus is sent or given, the latest quarterly report that is
specifically incorporated by reference in the prospectus to provide such interim
financial information.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company 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 Company will, unless in the opinion of 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 Securities Act and will be governed by the final
adjudication of such issue.
18
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Company 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 registration
statement to be signed on its behalf by the undersigned, hereunto duly
authorized in Littleton in the Commonwealth of Massachusetts on April 26, 2000.
VIISAGE TECHNOLOGY, INC.
By: /s/ Thomas J. Colatosti
-------------------------------------
Thomas J. Colatosti
President and Chief Executive Officer
19
<PAGE>
EXHIBIT 5
[LETTERHEAD OF FINNEGAN, HICKEY, DINSMOOR & JOHNSON, P.C.]
April 25, 2000
Viisage Technology, Inc.
30 Porter Road
Littleton, Massachusetts 01460
RE: Viisage Technology, Inc.
Registration Statement on Form S-3
File No. 333-
----------------------------
Ladies and Gentlemen:
At your request, we are rendering this opinion in connection with the
proposed sale by certain stockholders (the "Selling Stockholders") of Viisage
Technology, Inc., a Delaware corporation (the "Company") of up to 1,490,109
shares of Common Stock of the Company (the "Shares").
We have examined instruments, documents and records which we deemed
relevant and necessary for the basis of our opinion hereinafter expressed. In
such examination, we have assumed the following: (a) the authenticity of
original documents and the genuineness of all signatures; (b) the conformity to
the originals of all documents submitted to us as copies; and (c) the truth,
accuracy and completeness of the information, representations and warranties
contained in the records, documents, instruments and certificates we have
reviewed.
Based on such examination, we are of the opinion that the Shares to be
issued and sold by the Selling Stockholders are validly authorized, legally
issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the above-
referenced Registration Statement and to the use of our name wherever it appears
in said Registration Statement, including the Prospectus constituting a part
thereof, as originally filed or as subsequently amended or supplemented.
In giving such consent, we do not consider that we are "experts" within the
meaning of such terms as used in the Securities Act of 1933, as amended, or the
rules and regulations of the Securities and Exchange Commission issued
thereunder, with respect to any part of the Registration Statement, including
this opinion as an exhibit or otherwise.
Very truly yours,
/s/ FINNEGAN, HICKEY, DINSMOOR & JOHNSON, P.C.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in the prospectus
constituting a part of this registration statement of our report dated February
4, 2000 relating to the financial statements of Viisage Technology, Inc. (the
"Company") appearing in the Company's Annual Report on Form 10-K for the year
ended December 31, 1999.
We also consent to the reference to us under the caption "Experts" in the
prospectus.
/s/ BDO Seidman, LLP
Boston, Massachusetts
April 27, 2000
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated March 19, 1999
included in Viisage Technology Inc.'s Form 10-K for the year ended December 31,
1999 and to all references to our Firm included in this registration statement.
/s/ Arthur Andersen LLP
Boston, Massachusetts
April 26, 2000
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
We, the undersigned officers and directors of Viisage Technology, Inc.,
hereby jointly and severally constitute and appoint Thomas J. Colatosti and
Charles J. Johnson, and each of them singly, our true and lawful attorneys with
full power to them, and each of them singly, to sign for us and in our names in
the capacities indicated below, the Registration Statement on Form S-3 filed
herewith and any and all amendments to said Registration Statement and generally
to do all such things in our names and on our behalf in our capacities as
officers and directors to enable Viisage Technology, Inc. to comply with the
Securities Act of 1933, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming all signatures as they may
be signed by our said attorneys, or any of them, to said Registration Statement
and all amendments thereto.
Signature Title
- --------- -----
By: /s/ Denis K. Berube Chairman of the Board of Directors
-------------------
Denis K. Berube
By: /s/ Thomas J. Colatosti President and Chief Executive Officer
----------------------- (Principal Executive Officer)
Thomas J. Colatosti
By: /s/ Charles J. Johnson Secretary and Director
----------------------
Charles J. Johnson
By: /s/ Harriet Mouchly-Weiss Director
-------------------------
Harriet Mouchly-Weiss
By: /s/ Peter Nessen Director
----------------
Peter Nessen
By: /s/ Thomas J. Reilly Director
--------------------
Thomas J. Reilly
By: /s/ Charles E. Levine Director
---------------------
Charles E. Levine
