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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
CURENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest reported) February 28, 2000
View Systems, Inc.
(Exact name of registrant as specified in its chapter)
Florida 1-15247 59-2928966
(State or other jurisdiction (Commission (IRS Employer
of incorporation File Number) Identification No.)
825 West Kenyon Avenue, Suite 15, Englewood, Colorado 21048_
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 903 783 9153
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(Former name or former address, if changed since last report)
ITEM 6. OTHER EVENTS
On February 16, 2000, to Rubin Investment Group, an institutional
investment entity, within the meaning of Rule 501(a)(6) promulgated pursuant to
the Securities Act of 1933, as amended, in which all equity owners are
accredited investors, View Systems, Inc. (the
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"Company") sold and issued 800,000 shares of the Company's common stock, a
warrant to purchase (i) 1,000,000 shares of common stock during the five month
period following February 18, 2000, at an exercise price of $2.00 per share, and
(ii) 500,000 shares of common stock during the six month period following
February 18, 2000, at an exercise price of $2.00 per share, and another warrant
to purchase 1,000,000 shares of common stock during the three year period
following February 18, 2000, at an exercise price of $2.00 per share. At
closing, the Company received $400,000. The shares were issued pursuant to
Regulation D promulgated by the Securities and Exchange Commission under the
Securities Act of 1933, as amended. The securities purchased pursuant to the
investment of Rubin Investment Group carry demand and piggyback registration
rights, pursuant to the Registration Rights Agreement attached an exhibit.
As a result of this investment, the Company has agreed to amend its
filed registration statement on Form SB-2, by, among other things, removing the
securities it was planning to offer in the registered offering and including the
securities purchased by Rubin Investment Group.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
EXHIBITS
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4.1 Subscription and Investment Representation Agreement between
View Systems, Inc. and Rubin Investment Group, dated
February 18, 2000.
4.2 First Common Stock Purchase Warrant between View Systems,
Inc. and Rubin Investment Group, dated February 18, 2000.
4.3 Second Common Stock Purchase Warrant between View Systems,
Inc. and Rubin Investment Group, dated February 18, 2000.
4.4 Registration Rights Agreement between View Systems, Inc. and
Rubin Investment Group, dated February 18, 2000.
FORWARD-LOOKING STATEMENTS
This Report contains, in addition to historical information, statements by the
Company with respect to expectations about its business and future financial
results, which are "forward-looking" statements under the Private Securities
Litigation Reform Act of 1995. These statements and other statements made
elsewhere by the Company or its representatives, which are identified or
qualified by words such as "likely", "will," "suggests," "expects," "may,"
"believe," "could," "should," "would," "anticipates" or "plans," or similar
expressions, are based on a number of assumptions that are subject to risks and
uncertainties. Actual results could differ materially from those currently
anticipated or suggested due to a number of factors, including
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those set forth herein, those set forth in the Company's Annual Report on Form
10-K and in the Company's other SEC filings, and including, risks relating to
the dependence on retaining key personnel and the effect of sales of shares of
stock on our share price. All forward-looking statements are based on
information available as of the date hereof, and the Company does not assume any
obligation to update such forward-looking statements.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
View Systems, Inc.
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(Registrant)
Date 4-11-2000 /s/ Andrew L. Jiranek, VP & General Counsel
- -------------------------------- -------------------------------------------
(Signature)*
*Print name and title of the signing officer under his signature.
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Exhibit 4.1 Subscription and Investment Representation Agreement between View
Systems, Inc. and Rubin Investment Group, dated February 18, 2000
RUBIN INVESTMENT GROUP
4929 WILSHIRE BOULEVARD
SUITE 428
LOS ANGELES, CALIFORNIA 90010
310/407-0100
AMOUNT OF INVESTMENT $400,000
VIEW SYSTEMS, INC.
(A FLORIDA CORPORATION)
SUBSCRIPTION AND INVESTMENT REPRESENTATION AGREEMENT
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February 18, 2000
View Systems, Inc.
Gentlemen:
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The undersigned ("Subscriber") subscribes for and agrees to purchase
(a) 800,000 shares of Common Stock (the "Common Stock"), (b) a Common Stock
Purchase Warrant (the "First Purchase Warrant") for up to 1,500,000 shares of
common stock and (c) a Second Common Stock Purchase Warrant (the "Second
Purchase Warrant") for up to 1,000,000 shares of Common Stock (the "Interest")
in View Systems, Inc. (the "Company"), a corporation organized under the laws of
the State of Florida, in the amount indicated above, on the terms and conditions
described herein, relating to the offering (the "Offering") of the Interest. In
accordance with this subscription agreement, Subscriber agrees as follows:
TENDER. Subscriber tenders herewith to the Company cash or a check
made payable to the order of "View Systems, Inc." in the amount of $400,000.
CLOSING AND CLOSING DATE. The transaction contemplated by this
Agreement shall close on or before February 18, 2000. Time is of the essence for
all of the transactions contemplated in this Agreement. The consummation of the
actions described in this section 2 shall constitute the "Closing" and the date
on which the last of such events are consummated shall be deemed the "Closing
Date."
COVENANTS OF THE COMPANY.
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SB-2 REGISTRATION STATEMENT. The Company warrants and represents
that it has filed with the Securities & Exchange Commission (the "SEC"), a
Registration Statement on Form SB-2 (the "Filed SB-2") regarding the proposed
offering of up to one million (1,000,000) shares of Common Stock of the Company.
Promptly after the execution of this Subscription and Investment Representation
Agreement, and the closing hereon, the Company shall amend the Filed SB-2 by (a)
removing all shares of Common Stock proposed to be offered by the Company; and
(b) including in the Registration Statement the offering of all of the Common
Stock and all of the common stock underlying the First Purchase Warrant. The
Company agrees that from the date of this Agreement until the date occurring
ninety (90) days after the effective date of the Filed SB-2 (the "Rubin
Exclusive Period"), that the Company shall not offer, issue, sell or transfer
any shares of its common stock or other capital stock to any person or entity,
provided, however, that the Company may offer or issue not more than one hundred
fifty thousand (150,000) shares of Common Stock to BONA FIDE employees or
consultants of the Company in one or more private placements of securities under
which the securities so sold will be restricted from resale. The Company shall
have the obligation to prepare the amendment to the Filed SB-2 and to take all
other actions necessary for the Filed SB-2 to be declared effective. In order to
facilitate this process, the attorneys for Subscriber will assist in the work on
the Filed SB-2 as reasonably requested by the Company's counsel, and shall be
directed by Subscriber to use their best efforts to assist Company's counsel in
this process. Subscriber will pay the expenses of his attorneys and the Company
shall pay the expenses of its attorneys.
DTC SHEETS. The Company shall send copies of each week's DTC sheet
for its common stock to Subscriber on every Monday (or the next day if a
holiday) as long as Subscriber remains a holder of Company common stock or
warrants.
NO REPRICING OF OUTSTANDING WARRANTS. The Company shall not agree or
consent to any repricing or revision of any of the terms of any currently
outstanding options or warrants to acquire Company common stock.
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Remedies. In the event that the Company (a) fails to comply with any
of its covenants or obligations set forth in this Article 3 or elsewhere in this
Agreement; (b) fails to issue certificates representing shares of common stock
to Subscriber within three (3) business days after Subscriber is entitled to
such shares, whether such entitlement arises as a result of share purchase,
warrant exercise, or otherwise; or (c) intentionally prevents the Filed SB-2
from being declared effective by June 30, 2000, then, and in such event, the
Company shall be in default of its obligations hereunder. For each week that the
Company remains in default of any of its obligations hereunder, without cure
thereof, the Company shall issue to Subscriber its common stock purchase warrant
(the "Additional Warrants") for 5,000 number of shares of common stock, upon all
of the other terms and conditions set forth in the First Purchase Warrant and
the Second Purchase Warrant. All of the common stock underlying any Additional
Warrants issued hereunder shall be registered for resale by the Company on the
filed SB-2 or any other replacement suitable registration form and will have all
of the rights of Registerable Shares under the Registration Rights Agreement. In
addition, if there is any default by the Company of its obligations hereunder,
under the Registration Rights Agreement, the First Purchase Warrant or the
Second Purchase Warrant, Subscriber may suspend his performance under all of the
aforementioned Agreements until the Company has cured such default.
COMPANY'S REPRESENTATIONS AND WARRANTIES. The Company, in order to
induce Subscriber to enter into and execute this Agreement, represents and
warrants as follows:
ORGANIZATION, QUALIFICATIONS AND CORPORATE POWER. The Company is
duly incorporated, validly existing and in good standing under the laws of
Florida and is duly licensed or qualified to transact business as a foreign
corporation and is in good standing in each jurisdiction in which the nature of
the business transacted by it or the character of the properties owned or leased
by it requires such licensing or qualification. The Company has the corporate
power and authority to own and hold its properties and to carry on its business
as now conducted and as proposed to be conducted. The Company has the corporate
power and authority to execute, deliver and perform this Agreement, the
Registration Rights Agreement by and between the Company and the Subscriber and
the First Purchase Warrant and the Second Purchase Warrant, to issue, sell and
deliver the Common Stock pursuant to this Agreement, and to issue and deliver
the shares of common stock of the Company issuable upon exercise of the First
Purchase Warrant and the Second Purchase Warrant. The Company does not (i) own
of record or beneficially, directly or indirectly, (a) any shares of capital
stock or securities convertible into capital stock of any other corporation or
(b) any participating interest in any partnership, joint venture or other
non-corporate business enterprise; or (ii) control, directly or indirectly, any
other entity, except for its interest in Media Comm.
AUTHORIZATION OF AGREEMENTS, ETC. The execution and delivery by the
Company of this Agreement, the Registration Rights Agreement, the First Purchase
Warrant and the Second Purchase Warrant, the performance by the Company of its
obligations hereunder and thereunder and the issuance, sale and delivery of the
Common Stock and the common stock underlying the First Purchase Warrant and the
Second Purchase Warrant have been duly authorized by all requisite corporate
action and will not violate any provision of law, any order of any court or
other agency of government, the Charter or the By-laws of the Company (the
"By-laws"), or any provision of any indenture, agreement or other instrument to
which the Company is a party, or by which any of its properties or assets is
bound, or conflict with, result in a breach of or constitute (with due notice or
lapse of time or both) a default under any such indenture, agreement or other
instrument, or result in the creation or imposition of any lien, charge,
restriction, claim or encumbrance of any nature whatsoever upon any of the
properties or assets of the Company.
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AUTHORIZATION OF SHARES. The shares of Common Stock have been duly
authorized and, when held and issued in accordance with this Agreement, will be
validly issued, fully paid and nonassessable shares of Common Stock with no
personal liability attaching to the ownership thereof and will be free and clear
of all liens, charges, restrictions, claims and encumbrances imposed by or
through the Company, except this Agreement. The shares underlying the First
Purchase Warrant and the Second Purchase Warrant have been duly reserved for
issuance and when so issued and held, will be duly authorized, validly issued,
fully paid and nonassessable shares of Common Stock with no personal liability
attaching to the ownership thereof and will be free and clear of all liens,
charges, restrictions, claims and encumbrances imposed by or through the Company
subject to the terms of this Agreement. Neither the issuance, sale or delivery
of the Common Stock, nor the issuance, sale or delivery of the shares underlying
the First Purchase Warrant or the Second Purchase Warrant are subject to any
preemptive right of stockholders of the Company or to any right of first refusal
or other right in favor of any person except such rights as have been waived.
VALIDITY. This Agreement, the Registration Rights Agreement, the
First Purchase Warrant and the Second Purchase Warrant have been duly executed
and delivered by the Company and constitute the legal, valid and binding
obligations of the Company, enforceable in accordance with their terms.
Authorized Capital Stock. The authorized capital stock of the
Company consists of fifty million shares of Common Stock. Immediately prior to
the Closing, Seven Million Two Hundred Sixty Two Thousand Five Hundred Eighty
(7,262,580) shares of Common Stock will be validly issued and outstanding, fully
paid and nonassessable with no personal liability attaching to the ownership
thereof. Prior to the closing, no Shares of Preferred Stock shall be issued. The
Company does not have any obligation (contingent or otherwise) to purchase,
redeem or otherwise acquire any of its equity securities or any interest therein
or to pay any dividend or make any other distribution in respect thereof. To the
best of the knowledge of the Company, there are no voting trusts or agreements,
stockholders' agreements, pledge agreements, buy-sell agreements, rights of
first refusal, preemptive rights or proxies relating to any securities of the
Company (whether or not the Company is a party thereto).
Financial Statements. The Financial Statements of the Company in the
SB-2 Registration Statement fairly present the financial position of the
Company, in accordance with generally accepted accounting principles
consistently applied. Since the date of the Financial Statements, there has been
no change in the assets, liabilities or financial condition of the Company from
that reflected in the Financial Statements except for changes in the ordinary
course of business which in the aggregate have not been materially adverse, and
(b) none of the business, prospects, financial condition, operations, property
or affairs of the Company has been materially adversely affected by any
occurrence or development, individually or in the aggregate, whether or not
insured against. All of the other information in the Private Placement
Memorandum dated January 10, 2000 is true and accurate as of the date hereof.
Undisclosed Liabilities, Etc. The Company has no liabilities or
obligations of any nature, whether known, unknown, absolute, accrued, contingent
or otherwise and whether due or to become due except (i) as and to the extent
disclosed or reserved against in the Financial Statements, or (ii) for
liabilities and obligations incurred after the date of the Financial Statements
in the ordinary course of business consistent with past practices and not
prohibited by this Agreement. Since January 10, 2000, there has not occurred or
come to exist any event, occurrence, fact, condition, change, development or
effect that, individually or in the aggregate, should reasonably be expected to
materially and adversely affect the Company, or its
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business.
INVESTMENT REPRESENTATION. Subscriber represents and warrants:
In General. Subscriber represents and warrants that it is acquiring
the Common Stock, the First Purchase Warrant and Second Purchase Warrant for its
own account, for investment purposes only, and not with a view to or for the
resale, distribution or fractional-ization thereof, in whole or in part, and no
other person has a direct or indirect beneficial interest in the Common Stock,
the First Purchase Warrant and Second Purchase Warrant.
Illiquidity/Ability to Bear Risk of Loss. Subscriber hereby
acknowledges Subscriber's understanding of the speculative nature of its
investment, that the Company's business and Subscriber's investment in the
Company involve a high degree of risk and may result in the loss of his, her or
its entire investment, and that no Federal or state securities agency has made
any finding or determination, or has passed upon, the terms or fairness of the
Offering. Subscriber understands and agrees that Subscriber must bear the
economic risk of Subscriber's investment for an indefinite period of time
because, among other reasons, the Common Stock, the First Purchase Warrant and
Second Purchase Warrant have not been registered under the Securities Act of
1933, as amended (the "Act") or under the Securities Laws of certain states and,
therefore, cannot be resold, pledged, assigned or otherwise disposed of unless
it is subsequently registered under the Act and under applicable securities laws
of such states or an exemption from such registration is available. Subscriber
represents and warrants that it has the financial ability to bear the economic
risk of its investment in the Company (including the possible loss of
Subscriber's entire investment).
Private Placement Memorandum. Subscriber has received and read the
confidential Private Placement Memorandum, dated January 10, 2000, for this
offering.
Accredited Investor. Subscriber is a qualified institutional buyer
for purposes of Rule 144A or an institutional accredited investor (as defined in
Rule 501(a)(1)-(3), 501(a)(7)-(8) of the Securities Act of 1933).
Residency. Subscriber is a California entity, duly organized and
validly existing, whose principal place of business is Los Angeles, California.
Subscriber is in the business of investment banking transactions, with
sufficient knowledge and experience in investment transactions to evaluate the
merits of this investment.
Pre-existing Arrangement. Subscriber has no contract, undertaking,
agreement or arrangement with any person or entity to sell, hypothecate, pledge,
donate or otherwise transfer (with or without consideration) to any such person
or entity any shares, and has no present plans or intention to enter into any
such contract, undertaking, agreement or arrangement.
Subscriber Covenants. Subscriber covenants that:
5.7.1 Subscriber covenants not to transfer, assign, hypothecate,
pledge or sell the Warrants to third parties and agrees that it can only
transfer, assign, hypothecate, pledge or sell the shares underlying the
Warrants. Further, Subscriber acknowledges that its registration rights run only
to the shares underlying the Warrants.
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5.7.2 Subscriber covenants to promptly and fully disclose to Company
its position on all of Subscriber's accounts while there is a long position on
either stock or warrants.
Short Selling. For so long as Subscriber holds Company securities,
Subscriber and its affiliates shall not engage in any short selling or selling
against the box in the Company's securities.
SECURITIES LAWS COMPLIANCE.
PRIVATE PLACEMENT. Subscriber acknowledges that the Offering is
intended to be exempt from registration under the Act by virtue of the
provisions of Regulation D or Section 4(b) promulgated under the Act.
RESTRICTIONS ON RESALES. Subscriber agrees that Subscriber will not
sell or otherwise transfer the Common Stock, First Purchase Warrant and Second
Purchase Warrant without registration under the Act (and applicable state law)
or an exemption therefrom. Subscriber also understands that sales or transfers
of the Common Stock, First Purchase Warrant and Second Purchase Warrant are
restricted by the provisions of state securities laws. Subscriber also
understands that the certificate for the Common Stock, First Purchase Warrant
and Second Purchase Warrant will bear a restrictive legend describing the
foregoing restrictions.
INFORMATION MADE AVAILABLE/RELIANCE.
INFORMATION. Subscriber has been provided an opportunity to obtain
additional information concerning the Offering and the Company to the extent
that the Company possesses such information or can acquire it without
unreasonable effort or expense and has, further, been given the opportunity to
ask questions of and receive answers from the Company concerning the terms and
conditions of the Offering and other matters pertaining to the investment in the
Common Stock, First Purchase Warrant and Second Purchase Warrant. Subscriber is
satisfied with the scope of information he, she or it has received and confirms
that Subscriber's questions have been dealt with in a satisfactory manner.
RELIANCE ON INDEPENDENT INVESTIGATION AND PROFESSIONAL ADVICE. In
making Subscriber's decision to purchase the Common Stock, First Purchase
Warrant and Second Purchase Warrant, Subscriber has relied solely upon
independent investigations made by Subscriber, directly or indirectly, and has
not relied on the Company with respect to any investment, tax, legal,
accounting, financial or other advice. Subscriber has carefully considered, and,
to the extent Subscriber believes it necessary, appropriate or advisable, has
discussed with his, her or its investment, tax, legal, accounting, financial and
other advisers, the suitability of making an investment in the Company on the
terms set forth in this agreement.
AFFIRMATION OF OTHER INFORMATION. Any information which Subscriber
has heretofore, or simultaneously herewith, furnished to the Company is correct
and complete as of the date of this agreement and if there should be any
material change in such information prior to the Closing Date, Subscriber agrees
to promptly furnish such revised or corrected information to the Company.
INDEMNITY BY SUBSCRIBER. Subscriber agrees to indemnify and hold
harmless the Company, and each other person, if any, who controls or is
controlled by any of them, within the meaning of section 15 of the Act, against
any and all loss, liability, claim, damage and expense
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whatsoever (including, but not limited to, any and all expenses whatsoever
reasonably incurred in investigating, preparing or defending against any
litigation commenced or threatened or any claim whatsoever) arising out of or
based upon any false representation or warranty or breach of covenant or
agreement by Subscriber herein or in any other document furnished by Subscriber
to Company in connection with this transaction, including all agreements
executed contemporaneously herewith.
INDEMNITY BY COMPANY. The Company agrees to indemnify and hold
harmless Subscriber against any and all loss, liability, claim, damage and
expense whatsoever (including but not limited to, any and all expenses
whatsoever reasonably incurred in investigating, preparing or defending against
any litigation commenced or threatened or any claim whatsoever,) arising out of
or based upon any false representation or warranty or any breach of covenant or
agreement by the Company herein or in any other document furnished to Subscriber
in connection with this transaction, including the Registration Rights Agreement
of even date herewith and the First Purchase Warrant and the Second Purchase
Warrant of even date herewith.
MODIFICATION. Neither this agreement nor any provision of this
agreement shall be waived, modified, discharged or terminated except by an
instrument in writing signed by the party against whom any waiver, modification,
discharge or termination is sought.
NOTICES. Any notice, demand or other communication which any party
may be required, or may elect, to give to anyone interested in this agreement
shall be sufficiently given if (a) deposited, postage prepaid, in a United
States mail letter box, registered or certified mail, return receipt requested,
addressed to such address as may be given in this agreement (or the last known
address) or (b) delivered personally at such address. Either party may change
his, her or its address for notice by notice to the other party.
BINDING EFFECT. Except as otherwise provided herein, this agreement
shall be binding upon and inure to the benefit of the parties and their heirs,
executors, administrators, successors, legal representatives and permitted
assigns (collectively "Successors"). If Subscriber is more than one person, the
obligations of Subscriber shall be joint and several and the agreements,
representations, warranties and acknowledgments contained in this agreement
shall be deemed to be made by and be binding upon each such person and each such
person's Successors.
ENTIRE AGREEMENT. This instrument contains the entire agreement of
the parties, and there are no representations, warranties, covenants or other
agreements except as stated or referred to in this agreement.
APPLICABLE LAW. This agreement shall be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
made and to be performed entirely within such state.
COUNTERPARTS. This agreement may be executed through the use of
separate signature pages in any number of counterparts, and each of such
counterparts shall, for all purposes, constitute one agreement binding on all
the parties, notwithstanding that all parties are not signatories to the same
counterpart.
CAPTIONS. Headings contained in this agreement have been asserted
for reference purposes only and shall not be construed as part of this
agreement.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the _______ day of February, 2000.
VIEW SYSTEMS, INC.
By:___________________________
Duly Authorized Agent
SUBSCRIBER:
Rubin Investment Group
By:____________________________
Dan J. Rubin
Chief Executive Officer
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Gunther Than, Chief Executive Officer of the Company, hereby agrees
that he shall not sell, transfer or assign in any manner any of his shares of
Common Stock of the Company (excluding up to 100,000 shares) for a period of
eighteen (18) months from the date of this Agreement, provided that this
restriction shall terminate ninety (90) days after the effective date of the
Company's first effective SB-2, if earlier.
Gunther Than shall also take a one (1) day media course.
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Gunther Than
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Exhibit 4.2 First Common Stock Purchase Warrant between View Systems, Inc. and
Rubin Investment Group, dated February 18, 2000
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THESE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY
NOT BE MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT AN
EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT,
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT.
Right to Purchase up to 1,500,000
Shares of Common Stock of View
Systems, Inc.
No.___
VIEW SYSTEMS, INC.
First Common Stock Purchase Warrant
VIEW SYSTEMS, INC., a Florida corporation (the "Company") hereby
certifies that, for value received, RUBIN INVESTMENT GROUP, (the "Holder") or
his successors or registered assigns, is entitled to purchase up to 1,500,000
shares of common stock, par value $.001 per share (the "Common Stock"), of the
Company, at an exercise price of $2.00 per share (the "Purchase Price"),
beginning on the date hereof and (i) with respect to 1,000,000 shares, until the
date occurring five (5) months after the date of this First Purchase Warrant and
(ii) with respect to the remaining 500,000 shares until the date occurring six
(6) months after the date of this First Purchase Warrant, (the "Expiration
Date"), at which time this Warrant shall expire and the Holder shall have no
further rights hereunder.
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
(a) The term "Company" shall include View Systems, Inc. and any
corporation that shall succeed to or assume the obligations of View Systems,
Inc. hereunder.
(b) The term "Public Offering" refers, to an underwritten public
offering of
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securities of the Company pursuant to an effective registration statement under
the Securities Act covering the offer and sale of such securities to the public.
<PAGE>
(c) The term "Other Securities" refers to any stock (other than
Common Stock) and other securities of the Company or any other person (corporate
or otherwise), which stock or other securities the holder of the Warrant at any
time shall be entitled to receive, or shall have received, on the exercise of
the Warrant, in lieu of or in addition to Common Stock, or which at any time
shall be issuable or shall have been issued in exchange for or in replacement of
Common Stock or Other Securities.
EXERCISE OF WARRANT.
EXERCISE. This Warrant may be exercised in full or in part or not at
all by the person listed on the corporate records as the owner of this Warrant
hereof by surrender of this Warrant and the subscription form annexed hereto
(duly executed by such holder), to the Company at its principal office,
accompanied by payment, in cash, or by certified or official bank check payable
to the order of the Company, in the amount obtained by multiplying (a) the
number of shares of Common Stock designated by the holder in the subscription
form by (b) the Purchase Price.
TRUSTEE FOR WARRANT HOLDERS. In the event that a bank or trust
company shall have been appointed as trustee for the holder of the Warrant, such
bank or trust company shall have all the powers and duties of a warrant agent
appointed pursuant to Section 8 and shall accept, in its own name for the
account of the Company or such successor person as may be entitled thereto, all
amounts otherwise payable to the Company or such successor, as the case may be,
on exercise of this Warrant pursuant to this Section 1. The Company shall give
the holder of the Warrant notice of the appointment of any trustee and any
change thereof.
DELIVERY OF STOCK CERTIFICATES, ETC., ON EXERCISE. As soon as
practicable after the exercise of this Warrant, and in any event within three
(3) days thereafter, the Company at its expense (including the payment by it of
any applicable issue or stamp taxes) will cause to be issued in the name of and
delivered to the holder hereof, or as such holder (upon payment by such holder
of any applicable transfer taxes) may direct, a certificate or certificates for
the number of fully paid and non-assessable shares of Common Stock (or Other
Securities) to which such holder shall be entitled on such exercise, in such
denominations as may be requested by such holder. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
(or Other Securities) upon the exercise of this Warrant, nor shall it be
required to issue script or pay cash in lieu of fractional interests, it being
the intent of the parties that all fractional interests shall be eliminated by
rounding any fraction up to the nearest whole number of shares of Common Stock
(or Other Securities).
NO IMPAIRMENT. The Company will not, by amendment of its Certificate
of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, or any other similar voluntary action, avoid
or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder of the Warrant against
impairment due to such event.
4. TRANSFER OF WARRANT. Prior to the Expiration Date and subject to
compliance with applicable laws, this Warrant and all rights hereunder are not
transferable by the holders hereof, in whole or in part, at the principal office
of the Company. Any such transfer shall be made upon Surrender of this Warrant
together with the Assignment Form attached hereto properly executed, endorsed
and guaranteed. Notwithstanding the foregoing, the Company may prohibit the
transfer of this Warrant if such transfer is not in compliance with applicable
laws.
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Only the shares that may be obtained upon exercise of the warrants may be
transferred and then only in accordance with applicable securities laws.
5. REGISTER OF WARRANTS. The Company shall maintain, at the
principal office of the Company (or such other office as it may designate by
notice to the holder hereof), a register for the Warrants, in which the Company
shall record the name and address of the person in whose name a Warrant has been
issued.
6. REPLACEMENT OF WARRANTS. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of such Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.
7. WARRANT AGENT. The Company may, by written notice to the
registered holder of this Warrant, appoint an agent having an office in New
York, New York, for the purpose of issuing Common Stock (or Other Securities) on
the exercise of the Warrant pursuant to Section 1 and replacing this Warrant
pursuant to Section 6, or any of the foregoing, and thereafter any such
issuance, exchange or replacement, as the case may be, shall be made at such
office by such agent.
8. REMEDIES. The Company stipulates that the remedies at law of the
holder of this Warrant in the event of any default or threatened default by the
Company in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate, and that such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the terms
hereof or otherwise.
9. CLOSING OF BOOKS. The Company will at no time close its transfer
books against the transfer of any Warrant or of any shares of Common Stock (or
Other Securities) issued or issuable upon the exercise of any Warrant in any
manner which interferes with the timely exercise of this Warrant.
10. NO RIGHTS OR LIABILITIES AS A STOCKHOLDER. This Warrant shall
not entitle the holder hereof to any voting rights or other rights as a
stockholder of the Company. No provision of this Warrant, in the absence of
affirmative action by the holder hereof to purchase Common Stock (or Other
Securities), and no mere enumeration herein of the rights or privileges of the
holder hereof, shall give rise to any liability of such holder for the Purchase
Price or as a stockholder of the Company, whether such liability is asserted by
the Company or by creditors of the Company. Dividends are not accruing on the
stock underlying the warrants prior to the time that the Warrant is exercised
and the underlying stock is issued.
11. ANTI DILUTION ADJUSTMENTS. In the event the Company (i) shall
pay a stock dividend in shares of Common Stock, (ii) shall subdivide its
outstanding shares of Common Stock, (iii) shall combine its outstanding shares
of Common Stock into a smaller number of shares or (iv) shall issue by
reclassification of its shares of Common Stock any shares of capital stock of
the Company, then additional shares of Common Stock shall be issued (upon
exercise of the Warrant) to the Holder such that the number of shares subject to
this Warrant immediately after such action shall bear the same relation to the
total number of shares outstanding immediately
<PAGE>
after such action as the number of shares subject to this Warrant immediately
prior to such action bore to the total number of shares outstanding immediately
prior to such action. An adjustment made pursuant to this Section 12 shall
become effective retroactively immediately after the record date in the case of
a dividend or distribution of Common Stock and shall become effective
immediately after the effective date in the case of a subdivision, combination
or reclassification. This section shall not apply to issues of common stock for
value received by the Company in the form of cash, property or services.
12. RESTRICTION ON EXERCISE. In no event shall the Holder of this
First Purchase Warrant be entitled to exercise the First Purchase Warrant to the
extent such exercise would result in such Holder's beneficially owning more than
five percent (5%) of the outstanding shares of the Corporation's Common Stock.
For these purposes, beneficial ownership shall be defined and calculated in
accordance with Rule 13d-3, promulgated under the Securities Exchange Act of
1934, as amended.
13. NOTICES GENERALLY. All notices and other communications from the
Company to the registered holder of this Warrant shall be mailed by first class
registered or certified mail, postage prepaid, at the address for such holder as
it appears on the books of the Company or its agent.
14. MISCELLANEOUS. This Warrant and any term hereof may not be
changed, waived, discharged or terminated without the prior written consent of
the Company and the Holder. This Warrant shall be construed and enforced in
accordance with and governed by the Business Corporation Act of the State of New
Jersey. The headings in this Warrant are for purposes of reference only, and
shall not limit or otherwise affect any of the terms hereof This Warrant is
being executed as an instrument under seal. The invalidity or unenforceability
of any provision hereof shall in no way affect the validity or enforceability of
any other provision.
IN WITNESS WHEREOF, the undersigned has executed this Warrant on the
18th day of February, 2000.
VIEW SYSTEMS, INC,
[Corporate Seal]
By:
-----------------------------
Name: Gunther Than
Title: Chief Executive
Officer and Chairman
Attest:
By:
--------------------------
Name:
Title:
<PAGE>
FORM OF SUBSCRIPTION
(To be signed only on exercise of Warrant)
TO VIEW SYSTEMS, INC.
The undersigned, the holder of the within Warrant, hereby
irrevocably elects to exercise this Warrant for, and to purchase thereunder,
__________ shares of Common Stock of VIEW SYSTEMS, INC. and herewith makes
payment of $________ therefor in cash, and requests that the certificates for
such shares be issued in the name of, and delivered to, RUBIN INVESTMENT GROUP,
whose address is c/o Rubin Investment Group, 2121 Avenue of the Stars, Suite
101, Los Angeles, California 90067.
Dated: __________ __, 2000 ______________________________
(Signature must conform to name of holder as
specified on the face of the Warrant)
------------------------------
------------------------------
(Address)
<PAGE>
Exhibit 4.3 Second Common Stock Purchase Warrant between View Systems, Inc. and
Rubin Investment Group, dated February 18, 2000
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THESE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY
NOT BE MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT AN
EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT,
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT.
Right to Purchase up to
1,000,000 Shares of Common
Stock of View Systems, Inc.
No.___
VIEW SYSTEMS, INC.
Second Common Stock Purchase Warrant
VIEW SYSTEMS, INC., a Florida corporation (the "Company") hereby
certifies that, for value received, RUBIN INVESTMENT GROUP, (the "Holder") or
his successors or registered assigns, is entitled to purchase up to 1,000,000
shares of common stock, par value $.001 per share (the "Common Stock"), of the
Company, at an exercise price of $2.00 per share (the "Purchase Price"),
beginning on the date hereof and until the third anniversary of the date hereof
(the "Expiration Date"), at which time this Warrant shall expire and the Holder
shall have
<PAGE>
no further rights hereunder.
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
(a) The term "Company" shall include View Systems, Inc. and any
corporation that shall succeed to or assume the obligations of View Systems,
Inc. hereunder.
(b) The term "Public Offering" refers, to an underwritten public
offering of securities of the Company pursuant to an effective registration
statement under the Securities Act covering the offer and sale of such
securities to the public.
(c) The term "Other Securities" refers to any stock (other than
Common Stock) and other securities of the Company or any other person (corporate
or otherwise), which stock or other securities the holder of the Warrant at any
time shall be entitled to receive, or shall have received, on the exercise of
the Warrant, in lieu of or in addition to Common Stock, or which at any time
shall be issuable or shall have been issued in exchange for or in replacement of
Common Stock or Other Securities.
<PAGE>
EXERCISE OF WARRANT.
EXERCISE. This Warrant may be exercised in full or in part or not at
all by the person listed on the corporate records as the owner of this Warrant
hereof by surrender of this Warrant and the subscription form annexed hereto
(duly executed by such holder), to the Company at its principal office,
accompanied by payment, in cash, or by certified or official bank check payable
to the order of the Company, in the amount obtained by multiplying (a) the
number of shares of Common Stock designated by the holder in the subscription
form by (b) the Purchase Price.
TRUSTEE FOR WARRANT HOLDERS. In the event that a bank or trust
company shall have been appointed as trustee for the holder of the Warrant, such
bank or trust company shall have all the powers and duties of a warrant agent
appointed pursuant to Section 8 and shall accept, in its own name for the
account of the Company or such successor person as may be entitled thereto, all
amounts otherwise payable to the Company or such successor, as the case may be,
on exercise of this Warrant pursuant to this Section 1. The Company shall give
the holder of the Warrant notice of the appointment of any trustee and any
change thereof.
DELIVERY OF STOCK CERTIFICATES, ETC., ON EXERCISE. As soon as
practicable after the exercise of this Warrant, and in any event within three
(3) days thereafter, the Company at its expense (including the payment by it of
any applicable issue or stamp taxes) will cause to be issued in the name of and
delivered to the holder hereof, or as such holder (upon payment by such holder
of any applicable transfer taxes) may direct, a certificate or certificates for
the number of fully paid and non-assessable shares of Common Stock (or Other
Securities) to which such holder shall be entitled on such exercise, in such
denominations as may be requested by such holder. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
(or Other Securities) upon the exercise of this Warrant, nor shall it be
required to issue script or pay cash in lieu of fractional interests, it being
the intent of the parties that all fractional interests shall be eliminated by
rounding any fraction up to the nearest whole number of shares of Common Stock
(or Other Securities).
NO IMPAIRMENT. The Company will not, by amendment of its Certificate
of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, or any other similar voluntary action, avoid
or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder of the Warrant against
impairment due to such event.
4. TRANSFER OF WARRANT. Prior to the Expiration Date and subject to
compliance with applicable laws, this Warrant and all rights hereunder are not
transferable by the holders hereof, in whole or in part, at the principal office
of the Company. Any such transfer shall be made upon Surrender of this Warrant
together with the Assignment Form attached hereto properly executed, endorsed
and guaranteed. Notwithstanding the foregoing, the Company may prohibit the
transfer of this Warrant if such transfer is not in compliance with applicable
laws. Only the shares that may be obtained upon exercise of the Warrants may be
transferred and then only in accordance with applicable securities laws.
5. REGISTER OF WARRANTS. The Company shall maintain, at the
principal office of the Company (or such other office as it may designate by
notice to the holder hereof), a register for the Warrants, in which the Company
shall record the name and address of the person
<PAGE>
in whose name a Warrant has been issued.
6. REPLACEMENT OF WARRANTS. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of such Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.
7. WARRANT AGENT. The Company may, by written notice to the
registered holder of this Warrant, appoint an agent having an office in New
York, New York, for the purpose of issuing Common Stock (or Other Securities) on
the exercise of the Warrant pursuant to Section 1 and replacing this Warrant
pursuant to Section 6, or any of the foregoing, and thereafter any such
issuance, exchange or replacement, as the case may be, shall be made at such
office by such agent.
8. REMEDIES. The Company stipulates that the remedies at law of the
holder of this Warrant in the event of any default or threatened default by the
Company in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate, and that such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the terms
hereof or otherwise.
9. CLOSING OF BOOKS. The Company will at no time close its transfer
books against the transfer of any Warrant or of any shares of Common Stock (or
Other Securities) issued or issuable upon the exercise of any Warrant in any
manner which interferes with the timely exercise of this Warrant.
10. NO RIGHTS OR LIABILITIES AS A STOCKHOLDER. This Warrant shall
not entitle the holder hereof to any voting rights or other rights as a
stockholder of the Company. No provision of this Warrant, in the absence of
affirmative action by the holder hereof to purchase Common Stock (or Other
Securities), and no mere enumeration herein of the rights or privileges of the
holder hereof, shall give rise to any liability of such holder for the Purchase
Price or as a stockholder of the Company, whether such liability is asserted by
the Company or by creditors of the Company. Dividends are not accruing on the
stock underlying the warrants prior to the time that the Warrant is exercised
and the underlying stock is issued.
11. ANTI DILUTION ADJUSTMENTS. In the event the Company (1) shall
pay a stock dividend in shares of Common Stock, (ii) shall subdivide its
outstanding shares of Common Stock, (iii) shall combine its outstanding shares
of Common Stock into a smaller number of shares or (iv) shall issue by
reclassification of its shares of Common Stock any shares of capital stock of
the Company, then additional shares of Common Stock shall be issued (upon
exercise of the Warrant) to the Holder such that the number of shares subject to
this Warrant immediately after such action shall bear the same relation to the
total number of shares outstanding immediately after such action as the number
of shares subject to this Warrant immediately prior to such action bore to the
total number of shares outstanding immediately prior to such action. An
adjustment made pursuant to this Section 12 shall become effective retroactively
immediately after the record date in the case of a dividend or distribution of
Common Stock and shall become effective immediately after the effective date in
the case of a subdivision, combination or reclassification. This section shall
not apply to issues of common stock for value received by the Company in the
form of cash, property or services.
<PAGE>
12. RESTRICTION ON EXERCISE. In no event shall the Holder of this
Second Purchase Warrant be entitled to exercise the Second Purchase Warrant to
the extent such exercise would result in such Holder's beneficially owning more
than five percent (5%) of the outstanding shares of the Corporation's Common
Stock. For these purposes, beneficial ownership shall be defined and calculated
in accordance with Rule 13d-3, promulgated under the Securities Exchange Act of
1934, as amended.
13. NOTICES GENERALLY. All notices and other communications from the
Company to the registered holder of this Warrant shall be mailed by first class
registered or certified mail, postage prepaid, at the address for such holder as
it appears on the books of the Company or its agent.
14. MISCELLANEOUS. This Warrant and any term hereof may not be
changed, waived, discharged or terminated without the prior written consent of
the Company and the Holder. This Warrant shall be construed and enforced in
accordance with and governed by the Business Corporation Act of the State of New
Jersey. The headings in this Warrant are for purposes of reference only, and
shall not limit or otherwise affect any of the terms hereof This Warrant is
being executed as an instrument under seal. The invalidity or unenforceability
of any provision hereof shall in no way affect the validity or enforceability of
any other provision.
IN WITNESS WHEREOF, the undersigned has executed this Warrant on the
18th day of February, 2000.
VIEW SYSTEMS, INC,
[Corporate Seal]
By:
-----------------------------
Name: Gunther Than
Title: Chief Executive
Officer and Chairman
Attest:
By:
---------------------------
Name:
Title:
<PAGE>
FORM OF SUBSCRIPTION
(To be signed only on exercise of Warrant)
TO VIEW SYSTEMS, INC.
The undersigned, the holder of the within Warrant, hereby
irrevocably elects to exercise this Warrant for, and to purchase thereunder,
__________ shares of Common Stock of VIEW SYSTEMS, INC. and herewith makes
payment of $________ therefor in cash, and requests that the certificates for
such shares be issued in the name of, and delivered to, RUBIN INVESTMENT GROUP,
INC. whose address is c/o Rubin Investment Group, 2121 Avenue of the Stars,
Suite 101, Los Angeles, California 90067.
Dated: __________ __, 2000 ______________________________
(Signature must conform to name of holder as
specified on the face of the Warrant)
------------------------------
------------------------------
(Address)
<PAGE>
Exhibit 4.4 Registration Rights Agreement between View Systems, Inc. and
Rubin Investment Group, dated February 18, 2000
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement is made by and among VIEW SYSTEMS, INC.,
a Florida corporation (the "Company"), and RUBIN INVESTMENT GROUP (the
"Purchaser").
BACKGROUND
The Purchaser has agreed to purchase shares of the Company's Common Stock,
a First Common Stock Purchase Warrant (the "First Purchase Warrant") for
1,500,000 shares of the Company's common stock and a Second Common Stock
Purchase Warrant (the "Second Purchase Warrant") for 1,000,000 shares of the
Company's common stock, pursuant to and in accordance with a Subscription and
Investment Representation Agreement dated as of even date herewith (the
"Purchase Agreement"). (The shares of Common Stock issued by the Company
pursuant to the Purchase Agreement and the shares of the Company's Common Stock
issuable by the Company pursuant to the First Purchase Warrant and the Second
Purchase Warrant are hereinafter referred to as the "Registerable Shares").
The Company has agreed to provide the registration rights set forth in this
Agreement to induce the purchase by the Purchaser of the Shares, First Purchase
Warrant and the Second Purchase Warrant pursuant to the Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
SECTION A. DEMAND REGISTRATION.
1. REQUESTS FOR REGISTRATION. Upon the election of those owning not less
than 50% of the outstanding Registerable Shares, the Purchaser may make a
one-time demand for registration under the Securities Act of 1933 (the "Demand
Registration") of all or any portion of the Registerable Shares by sending
written notice of the demand to the Company. Such notice shall specify the
number of the Registerable Securities sought to be registered. The Company will
then use its best efforts to file with the Securities and Exchange Commission
(the "SEC"), at the earliest possible date but no later than sixty (60) days
following such a demand, the registration statement for the Demand Registration
(the "Demand Registration Statement"). At closing, Purchaser shall be deemed to
have demanded registration of all of Purchaser's Registerable Shares in the
Company's filed SB-2 registration statement or if that registration statement is
not declared effective, in a replacement SB-2 filed by the Company as soon as
possible thereafter.
REGISTRATION OF OTHER SECURITIES. Whenever the Company shall effect a
Demand Registration, no shares of Common
<PAGE>
Stock owned by other stockholders of the Company ("Other Stockholders") other
than the Registerable Securities shall be included among the shares of Common
Stock covered by such registration statement unless the Purchaser shall have
consented in writing to the inclusion of such other shares of Common Stock.
Purchaser shall be deemed to have consented to inclusion of all shareholders who
currently hold contracted piggyback registration rights.
EXPENSES. The Company will pay all of the expenses relating to (i) the
preparation, filing and distribution of the registration statement, including
the filing fees, printing expenses, messenger and delivery expenses, fees and
disbursements of counsel for the Company and for the Purchaser and fees and
expenses of the independent certified accountants relating to the preparation of
the Demand Registration Statement, including the costs and expenses of employees
of the Company who participate in the preparation of the registration statement,
and (ii) the sale of the Registerable Securities, excluding commissions,
discounts and expenses of the underwriters specifically related to the offering
of the Registerable Shares by the Purchaser. Purchaser shall be responsible for
the costs of its counsel and Purchaser's counsel shall provide his best efforts
to assist with the SB-2 registration.
PRIORITY ON DEMAND REGISTRATION. If the managing underwriters advise the
Company that in their good faith opinion the number of the Registerable
Securities and other shares of Common Stock requested to be included in the
Demand Registration Statement exceeds the number that can be sold in such
offering, the Company will include in such Demand Registration Statement (i)
first, the securities the Company is obligated to include by virtue of
previously existing contract rights; (ii) second, the Registerable Securities
requested to be included in such Demand Registration Statement, (iii) third, any
shares of Common Stock that the Company desires to include on its own behalf and
(iv) fourth, where the Company has reserved "cutback" rights, any shares of
Common Stock beneficially owned by the Other Stockholders, pro rata on the basis
of the number of shares of Common Stock that the Other Stockholders wanted to
register.
SELECTION OF UNDERWRITERS. In an underwritten offering, the Company shall
have the right to select reputable, nationally recognized investment banker(s)
and manager(s) for the Demand Registration Statement and make the other
decisions regarding the underwriting arrangements for the offering covered by
the Demand Registration Statement subject to the reasonable concurrence of the
Purchaser.
SECTION B. PIGGYBACK REGISTRATIONS.
<PAGE>
RIGHT TO PIGGYBACK. Provided the First Purchase Warrant is exercised in
full by Purchaser, if at any time after an initial public offering of the
Company's stock, the Company proposes to register any of its shares of Common
Stock under the Securities Act for an underwritten offering, whether or not for
sale for its own account (other than registrations effected pursuant to Form S-4
or S-8 promulgated under the Securities Act of 1933 (the "Securities Act") or
any successor forms thereto or other than in connection with an exchange offer
or offering solely to the Company's Shareholders), and the registration form to
be used may be used for the registration of the Registerable Shares of (a
"Piggyback Registration"), the Company will give prompt written notice to the
Purchaser of such registration. Upon the written request of the Purchaser (given
within 20 business days after the Purchaser's receipt of the Company's notice of
the proposed registration), the Company will use its best efforts to include in
the registration statement for such Piggyback Registration (the "Piggyback
Registration Statement"), subject to the allocation provisions below, all
Registerable Securities with respect to which the Company has received a written
request for inclusion. Purchaser shall not demand Piggyback Registration for any
Registerable Shares that are included in an effective and current Demand
Registration Statement.
PIGGYBACK EXPENSES. In all Piggyback Registrations, the Company shall pay
all of the expenses relating to the preparation of the Piggyback Registration
and the offering of the shares of Common Stock and the Company shall pay the
commissions, discounts and expenses of the underwriters related to the offering
of the shares of Common Stock by the Company, but will not pay the commissions,
discounts and expenses of the underwriters related to the offering of the shares
of Common Stock by the Purchaser and the Other Stockholders registered on the
Piggyback Registration Statement or the fees or expenses of special legal
counsel to the Purchaser.
PRIORITY. If the managing underwriters for the Piggyback Registration
advise the Company that in their good faith opinion the number of shares of
Common Stock requested to be included in such Piggyback Registration exceeds
the number that can be sold in such offering, the Company will allocate the
shares of Common Stock to be included as follows: first, the securities the
Company is obligated to include by virtue of previously existing contract
rights; second, any shares of Common Stock that the Company proposes to sell
on its own behalf; third, any shares of common stock carrying registration
rights that the Company must reasonably grant to underwriters to incentivize
them to underwrite the registration; fourth, Registerable Securities
requested to be included in such Piggyback Registration Statement provided,
however, that the number of Registerable Securities being registered in such
<PAGE>
offering may not be reduced to less than twenty-five percent (25%) of the
Registerable Securities as to which the Purchaser has requested registration
hereunder; and fifth, shares of Common Stock beneficially owned by any Other
Stockholders of the Company, pro rata on the basis of the number of shares of
Common Stock that the Other Stockholders wanted to register.
SELECTION OF UNDERWRITERS. In an underwritten offering, the Company shall
have the right to select reputable, nationally recognized investment banker(s)
and manager(s) for the Piggyback Registration and to make the other decisions
regarding the underwriting arrangements for the offering covered by the
Piggyback Registration Statement. Notwithstanding the foregoing, the managing
underwriter shall be reasonably acceptable to the Purchaser if Registerable
Securities of the Purchaser are included on the Piggyback Registration
Statement.
SECTION C. REGISTRATION PROCEDURES. Whenever the holders of Registerable
Securities have requested that any Registerable Securities be registered
pursuant to Section 1 or 2 of this Agreement, the Company will, as expeditiously
as possible:
prepare and file with the SEC a registration statement with respect to such
Registerable Securities (and any amendment or supplement thereto) and use its
best efforts to cause such registration statement to become effective and to
remain effective until the closing of the underwritten offering, which shall be
within five (5) business days after the registration statement is declared
effective, or in other cases for a period of at least one hundred eighty (180)
days thereafter or until all Registerable Securities have been disposed of (if
earlier);
provide to the Purchaser before filing a registration statement or
prospectus or any amendments or supplements thereto draft copies (that are
subject to change) of all such documents proposed to be filed at least five (5)
business days prior to their filing and will give reasonable consideration in
good faith to any comments of the Purchaser or its counsel;
furnish to the Purchaser such number of copies of such registration
statement and any amendment or supplement thereto and the prospectus included in
such registration statement (including each preliminary prospectus), and such
other documents as the Purchaser may reasonably request in order to facilitate
the disposition of the Registerable Securities owned by the Purchaser;
notify in writing the Purchaser's counsel promptly (i) of the receipt by
the Company of any notification with respect to any comments by the SEC with
respect to such registration statement or prospectus or any amendment or
<PAGE>
supplement thereto or any request by the SEC for the amending or supplementing
thereof or for additional information with respect thereto, (ii) of the receipt
by the Company of any notification with respect to the issuance by the SEC of
any stop order suspending the effectiveness of such registration statement or
prospectus or any amendment or supplement thereto or the initiation or
threatening of any proceeding for that purpose and (iii) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of such Registerable Securities for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purposes;
use its best efforts to register or qualify such Registerable Securities
under such other securities or blue sky laws of such jurisdictions as the
managing underwriter(s) or the Purchaser may reasonably request;
enter into such customary agreements (including an underwriting agreement
in customary form) and take such other customary actions as may be reasonably
necessary to expedite or facilitate the disposition of such Registerable
Securities;
permit the Purchaser to participate in the negotiation of the underwriting
agreement and the pricing terms in connection with a Demand Registration
Statement and to remove the Registerable Securities from a Piggyback
Registration Statement based upon the pricing terms. The Company reserves the
right to make all final decisions regarding the terms of the Offering, including
price.
obtain a "comfort" letter addressed to the Company from its independent
public accountants in customary form and covering such matters of the type
customarily covered by "comfort" letters and provide a copy of such letter to
the Purchaser;
use its commercially reasonable efforts to obtain from its counsel an
opinion of counsel in customary form;
notify on a timely basis each seller of such Registerable Securities at any
time when a prospectus relating to such Registerable Securities is required to
be delivered under the Securities Act within the appropriate period mentioned in
paragraph (ii) of this Section, of the happening of any event as a result of
which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing and, at the request
of such seller, prepare and furnish to such seller a reasonable number of copies
of a supplement to or an amendment of such prospectus as may be necessary so
that, as thereafter
<PAGE>
delivered to the offerees of such shares, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing;
make available for inspection by the Purchaser's counsel or any underwriter
participating in any disposition pursuant to such registration statement and any
attorney, accountant or other agent retained by any such underwriter
(collectively, the "Inspectors"), all pertinent financial and other records,
pertinent corporate documents and properties of the Company (collectively, the
"Records'), as shall be reasonably necessary to enable them to exercise their
due diligence responsibility, and cause the Company's officers, directors and
employees to supply all information (together with the Records, the
"Information") reasonably requested by any such Inspector in connection with
such registration statement. Any of the Information which the Company determines
in good faith to be confidential, and of which determination the Inspectors are
so notified, shall not be disclosed by the Inspectors unless (i) the disclosure
of such Information is necessary to avoid or correct a misstatement or omission
in the registration statement, (ii) the release of such Information is ordered
pursuant to a subpoena or other order form a court of competent jurisdiction or
(iii) such Information has been made generally available to the public. The
seller of Registerable Securities agrees that it will, upon learning that
disclosure of such Information is sought in a court of competent jurisdiction,
give notice to the Company and allow the Company, at the Company's expense, to
undertake appropriate action to prevent disclosure of the Information deemed
confidential;
provide a transfer agent and registrar (which may be the same entity and
which may be the Company) for such Registerable Securities;
issue to any underwriter to which any seller of Registerable Securities may
sell shares in such offering certificates evidencing such Registerable
Securities; provided however, that the Company shall have the right to approve
any such underwriter with such approval not to be unreasonably withheld;
list such Registerable Securities on any national securities exchange on
which any shares of the Common Stock are listed or, if the Common Stock is not
listed on a national securities exchange, use its commercially reasonable
efforts to qualify such Registerable Securities for inclusion on the automated
quotation system of the National Association of Securities Dealers, Inc. (the
"NASD") or such national securities exchange as the holders of a majority of
such Registerable Securities shall request;
<PAGE>
otherwise use its commercially reasonable efforts to comply with all
applicable rules and regulations of the SEC and make available to its security
holders, as soon as reasonably practicable, earnings statements (which need not
be audited) for the Company's fiscal year on form 10-K after the effective date
of the registration statement, which earnings statements shall satisfy the
provisions of Section 11(a) of the Securities Act;
use its commercially reasonable efforts to take all other steps necessary
to effect the registration of such Registerable Securities contemplated hereby;
and
upon the request of those owning not less than thirty percent of the
Registerable Securities, register the Registerable Securities on Form S-3, if
available for use by the Company.
SECTION D. INDEMNIFICATION.
The Company hereby indemnifies, to the extent permitted by law, the
Purchaser and its officers and directors, and each person who controls the
Purchaser (within the meaning of the Securities Act), against all losses,
claims, damages, liabilities and expenses arising out of or resulting from any
untrue or alleged untrue statement of material fact contained in any
registration statement, prospectus or preliminary prospectus or any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading except insofar as the
same are caused by or contained in any information furnished in writing to the
Company by the Purchaser expressly for use therein or by the Purchaser's failure
to deliver a copy of the registration statement or prospectus or any amendments
or supplements thereto after the Company has furnished the Purchaser with a
sufficient number of copies of the same.
In connection with any registration statement in which any Purchaser is
participating, the Purchaser will furnish to the Company in writing such
information as is reasonably requested by the Company for use in any such
registration statement or prospectus and will indemnify, to the extent permitted
by law, the Company, its directors and officers and each person who controls the
Company (within the meaning of the Securities Act) against any losses, claims,
damages, liabilities and expenses resulting from any untrue or alleged untrue
statement of material fact or any omission or alleged omission of a material
fact required to be stated in the registration statement or prospectus or any
amendment thereof or supplement thereto or necessary to make the statements
therein not misleading, but only to the extent that such untrue statement or
omission is contained in information so furnished by the
<PAGE>
Purchaser specifically for use in preparing the registration statement.
Notwithstanding the foregoing, the liability of the Purchaser under this Section
D (ii) shall be limited to an amount equal to the net proceeds actually received
by the Purchaser from the sale of Registerable Securities covered by the
registration statement.
Any person entitled to indemnification hereunder will (i) give prompt
notice to the indemnifying party of any claim with respect to which it seeks
indemnification and (ii) unless in such indemnified party's reasonable judgment
a conflict of interest between such indemnified and indemnifying parties may
exist with respect to such claim, permit such indemnifying party to assume the
defense of such claim with counsel reasonably satisfactory to the indemnified
party. If such defense is assumed, the indemnifying party will not be subject to
any liability for any settlement made without its consent (but such consent will
not be unreasonably withheld). An indemnifying party who is not entitled, or
elects not, to assume the defense of a claim will not be obligated to pay the
fees and expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim.
SECTION E. OTHER AGREEMENTS OF THE COMPANY.
From and after the date of effectiveness of a registration statement with
respect to the Company's securities under the Securities Act or such earlier
date as a registration statement filed by the Company pursuant to the Exchange
Act related to any class of the Company's securities shall have become
effective, the Company shall comply with all of the reporting requirements of
the Exchange Act and with all other public information reporting requirements of
the SEC which are conditions to the availability of Rule 144 for the sale of its
Common Stock. The Company shall cooperate with each Purchaser in supplying such
information as may be necessary for such Purchaser to complete and file any
information reporting forms currently or hereafter required by the SEC as a
condition of the availability of Rule 144.
The Company represents and warrants to the Purchaser that the registration
rights granted to the Purchaser hereby does not conflict with any of the
registration rights granted by the Company. The Company shall not, after the
date hereof, grant any registration rights which conflict with the registration
rights granted hereby.
SECTION F. TERMINATION. The rights and obligations of the parties to this
Agreement shall terminate on the tenth (10th) anniversary of this Agreement.
<PAGE>
SECTION G. MISCELLANEOUS.
NOTICES. Any notice or other communication to be given hereunder shall
be in writing and mailed or telecopied to such party at the address or number
set forth below:
If to the Company: View Systems, Inc.
Gunther Than
925 W. Kenyon Avenue
Suite 15
Englewood, Colorado 80110
Telephone No.: 303 783 9153
Telecopier No.: 303 762 6448
with a copy to: Andrew L. Jiranek, View Systems, Inc.
9693 Gerwig Lane, Suite O
Columbia, Md. 21046
Telephone No.: 410 290 5919
Telecopier No.: 410 290 5917
If to the Purchaser: Rubin Investment Group
4929 Wilshire Boulevard
Suite 428
Los Angeles, California 90010
Telephone No.: 310/407-0111
Telecopier No.: 310/407-0155
with a copy to: Robert L. Davidson, Esq.
Wolf Haldenstein Adler Freeman & Herz, LLP
270 Madison Avenue
New York, NY 10016
Telephone No.: (212) 545-4720
Telecopier No.: (212) 686-0114
or to such other person, address or number as the party entitled to such notice
or communication shall have specified by notice to the other party given in
accordance with the provisions of this Section. Any such notice or other
communication shall be deemed given: (i) if mailed, when deposited in the mail,
properly addressed and with postage prepaid; or (ii) if sent by telecopy, when
transmitted.
AMENDMENTS AND WAIVERS. The provisions of this Agreement may be amended or
terminated and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, if approved in writing by
the Purchaser.
BINDING EFFECT. This Agreement will bind and inure to the benefit of the
respective successors (including any successor resulting from a merger or
similar reorganization), assigns, heirs and personal representatives of the
parties hereto provided, however, that such person or entities shall, as a
<PAGE>
condition to the effectiveness of such assignment be required to execute to this
Agreement whereupon such person or entity shall have the benefits of and shall
be subject to the restrictions contained in this Agreement with respect to the
Registerable Shares. Without limiting the generality of the foregoing, in
addition, if the Purchaser liquidates or reorganizes such that its assets are
transferred to its own partners or to another entity, such partners or entity
shall succeed to all of the rights of the Purchaser hereunder.
GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to such
jurisdiction's principles of conflict of laws. In the event that the Corporation
changes its domicile after the execution and delivery of this Agreement, the law
of that jurisdiction shall govern the terms and conditions of this Agreement
thereafter.
COUNTERPARTS. This Agreement may be executed in counterparts, each of which
shall be considered to be an original instrument and to be effective as of the
date first written above and all of which taken together shall constitute one
and the same instrument.
INTERPRETATION. Unless the context of this Agreement clearly requires
otherwise, (i) references to the plural include the singular, the singular the
plural, the part the whole, (ii) references to one gender include all genders
and (iii) "including" has the inclusive meaning frequently identified with the
phrase "but not limited to." The section and other headings contained in this
Agreement are for reference purposes only and shall not control or affect the
construction of this Agreement or the interpretation thereof in any respect.
SEVERABILITY. In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstances, is held invalid,
illegal or enforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be in any way impaired thereby, it being
intended that all of the rights and privileges of the Purchaser shall be
enforceable to the fullest extent permitted by the law.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the 18th day of February, 2000.
VIEW SYSTEMS, INC.
By:
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DULY AUTHORIZED AGENT
RUBIN INVESTMENT GROUP
---------------------------------
Dan J. Rubin
Chief Executive Officer
