<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of earliest event reported: November 12, 1997
SAF T LOK, INCORPORATED
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
Florida 1-11968 65-0142837
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
</TABLE>
18245 S.E. Federal Highway, Tequesta, Florida 33469
(Address of registrant's principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (561) 743-5625
<PAGE>
ITEM 9: SALES OF SECURITIES PURSUANT TO REGULATION S.
Saf T Lok, Incorporated (the "Company") closed a Regulation S offering of
1,500,000 shares of common stock and two year stock purchase warrants for a
total of 2,500,000 shares of common stock (2,000,000 shares at $2.00 per share
exercise price and 500,000 shares at $3.00 per share exercise price) for a total
purchase price of $3,000,000 to three foreign purchasers on November 12, 1997.
Of this offering, 1,250,000 shares and warrants for 2,083,333 shares were
delivered to the foreign purchasers and the Company received gross proceeds of
$2,500,000. The balance of the offering closed in escrow with 250,000 shares
and warrants for 416,667 shares (333,334 shares at $2.00 per share exercise
price and 83,333 shares at $3.00 per share exercise price) and $500,000 being
held in escrow. If the Company is in compliance with all applicable regulatory
requirements on December 1, 1997, the $500,000 will be released to the Company
and the 250,000 shares and warrants for 416,667 shares (333,334 shares at $2.00
per share exercise price and 83,333 shares at $3.00 per share exercise price)
will be delivered to the foreign purchaser. If the Company is not in compliance
with applicable regulatory requirements on December 1, 1997, the shares and
warrants will be returned to the Company and the cash ($500,000) will be
returned to the foreign purchasers.
In connection with the placement of this sale of common stock to the
foreign purchasers, the investment banking firm of State Street Securities
received a fee of 13.5% of the sales price of the common stock sold to the
investors and $60,000 for legal fees. State Street Securities will receive a
13.5% fee of the sales price of the stock underlying the warrants if the
warrants are exercised. As required by the Placement Agreement with State
Street Securities, the Company intends to enter into a financial and management
consulting services agreement with A.B. & Associates, Inc. for a fee of $250,000
and a financial public relations agreement with Marketing Direct Concepts for a
fee of $375,000 payable upon execution and a fee of $375,000 payable upon the
receipt by the Company of the proceeds from the exercise of a minimum of
$1,500,000 of the stock purchase warrants.
As a result of the Company's receipt of the net proceeds from the sale of
the 1,250,000 shares, as well as the recent conversion of all of the remaining
outstanding convertible debentures, the Company's stockholders' equity as of
November 12, 1997 was $3,143,003. As of November 12, 1997, the Company's total
assets were $3,921,539. The above noted stockholders' equity and total assets
amounts are reflected in the Unaudited Consolidated Balance Sheet attached
hereto as Exhibit 99.1.
The Company is estimating its stockholders' equity and total assets on
November 12, 1997, for the purpose of satisfying certain listing qualifications
standards for the Nasdaq SmallCap Market.
2
<PAGE>
EXHIBITS
<TABLE>
<CAPTION>
Exhibit Number Exhibit Table
- -------------- --------------------------------------------------------------------
<C> <S>
99.1 Saf T Lok Incorporated Unaudited Consolidated Balance Sheets as of
November 11, 1997.
99.2 Placement Agent Agreement with Addendum
99.3 Form of Offshore Subscription Agreement with Addendum
99.4 First Page and Signature page of Each Offshore Subscription
Agreement
99.5 Form of Warrant for the Purchase of Common Shares
99.6 First Page of Each Warrant for the Purchase of Common Shares
99.7 Letter Regarding Escrow, dated November 10, 1997
</TABLE>
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.
Saf T Lok, Incorporated
Date: November 13, 1997 By: /s/ John Gardner
------------------ -------------------------------------
John Gardner, President and
Chief Executive Officer
3
<PAGE>
EXHIBIT 99.1
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
UNAUDITED CONSOLIDATED BALANCE SHEET
AS OF NOVEMBER 12, 1997
-----------------------
ASSETS
------
<TABLE>
<CAPTION>
CURRENT ASSETS
<S> <C>
Cash and Cash Equivalents $1,846,118
Accounts Receivable (net of allowance
for doubtful accounts of $13,310) 4,394
Inventories 457,850
Prepaid Expenses 23,796
Total Current Assets $2,332,158
PROPERTY AND EQUIPMENT, NET OF
ACCUMULATED DEPRECIATION $1,064,730
OTHER ASSETS
Patents, (net of accumulated
amortization of $53,000) $ 343,147
Loans Receivable 180,529
Other Assets 975
Total Other Assets $ 524,651
TOTAL ASSETS $3,921,539
</TABLE>
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
UNAUDITED CONSOLIDATED BALANCE SHEET
AS OF NOVEMBER 12, 1997
-----------------------
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
<TABLE>
<CAPTION>
CURRENT LIABILITIES
<S> <C>
Notes Payable - current portion $ 80,649
Accounts Payable and Accrued
Expenses 664,293
Total Current Liabilities $ 744,942
LONG TERM LIABILITIES
Notes Payable, net of current portion $ 33,564
Total Long Term Liabilities $ 33,564
TOTAL LIABILITIES $ 778,506
SHAREHOLDERS' EQUITY
Common Stock, $.01 par value $ 94,781
Capital in excess of par 13,144,109
Deficit (10,095,857)
TOTAL SHAREHOLDERS' EQUITY $ 3,143,033
TOTAL LIABILITIES AND EQUITY $ 3,921,539
</TABLE>
<PAGE>
EXHIBIT 99.2
PLACEMENT AGREEMENT
-------------------
AGREEMENT AND ADDENDUM ("Agreement") executed as of this 13th day of
October, 1997, by and BETWEEN SAF T LOK INCORPORATED, a Florida corporation (the
"Company"), and STATE STREET SECURITIES, INC (the "Placement Agent").
W I T N E S S E T H:
In consideration of the mutual covenants and promises herein contained,
it is hereby agreed as follows:
1. Representations of the Company. The Company hereby represents and
------------------------------
warrants to and agrees with the Placement Agent that the following are true and
correct as of the date hereof:
(a) The Company will, as of each Closing Date (as defined herein), be
duly organized, validly existing and in good standing under the laws of the
State of Florida. The Company has been duly qualified to do business as a
foreign corporation under the corporation law of, and is in good standing as
such in, every jurisdiction where the ownership or leasing of property, or the
conduct of its business, requires such qualification.
(b) The confidential First Offshore Securities Subscription
Agreements, dated as of October 13, 1997, between the Company and the Buyers and
the Second Offshore Securities Subscription Agreements, including any amendments
or supplements thereto and exhibits thereto including Public Relations
Consulting Agreement and Financial Consulting Agreement (the "Memorandum"), does
not include any untrue statement of a material fact and does not omit any
material fact required to be
<PAGE>
stated therein or necessary to make the statements therein made, in light of the
circumstances under which they were made, not misleading. The Memorandum has
been prepared in conformity with the disclosure requirements of Regulation S
("Regulation S") promulgated under the Securities Act of 1933, as amended (the
"Act"). In connection with the transactions contemplated hereby, neither the
Company, nor any affiliate thereof, has taken or will take any action which is
in breach of, or in any manner contrary to, the requirements of Regulation S.
(c) The financial statements of the Company included in the Memorandum
accurately and fairly represent the financial position of the Company at the
date to which they apply.
(d) The Company is not in default in the performance of any
obligation, agreement or condition contained in any contract, agreement, note or
other instrument to which the Company is a party or by which it may be bound,
which default might materially adversely affect either the financial condition
of the Company or the ability of the Company to enter into this Agreement and to
consummate the transactions contemplated hereby. The consummation of the
transactions described in the Memorandum and compliance with the terms and
conditions of the contracts and commitments described therein will not in a
material respect conflict with or result in a breach of or constitute a default
under any of the terms, conditions or provisions of the Certificate of
Incorporation or by-laws of the Company or of any contract, agreement, note or
other instrument to which the Company or any affiliate thereof is a party.
2
<PAGE>
(e) Except as disclosed in the Memorandum, there is neither pending
nor, to the knowledge of the Company, threatened any action, suit or proceeding
at law or in equity, or any arbitration, to which the Company is a party or by
which the company or any of its assets may be bound.
(f) The Company has filed all tax returns required to have been filed.
(g) The shares of the Common Stock, par value $.01 per share,
described in the Memorandum (the "Stock") are duly authorized and, upon issuance
in accordance with the terms of the Memorandum, will be validly issued and
conform to the description thereof contained in the Memorandum, and except as
otherwise set forth in or contemplated by the Memorandum, the liability of
purchasers thereof will be limited to their respective total agreed-upon
investment therein
2. Representations of the Placement Agent. The Placement Agent represents
--------------------------------------
and warrants to and agrees with the Company that as of the date hereof;
(a) The Placement Agent has been duly organized and is validly
existing and in good standing under the laws of the state of its incorporation.
(b) The Placement Agent is authorized to enter into this Agreement and
to consummate the transactions contemplated in the Memorandum, and has taken any
and all necessary or appropriate action in connection therewith;
(c) The Placement Agent is a registered broker-dealer under the
Securities Exchange Act of 1934, as amended (the "1934
3
<PAGE>
Act"), and its entry into this Agreement and its consummation of the
transactions contemplated hereby and compliance with the terms and conditions
hereof will not cause it to be in violation of such Act.
(d) ALL STEPS TAKEN BY THE Placement Agent in connection with the
offering and sale of the Stock were and will be affected in compliance with all
the terms and conditions of Regulation S.
3. Employment of The Placement Agent. Upon the foregoing representations
---------------------------------
and warranties and subject to the terms of this Agreement, the Company hereby
retains the Placement Agent, and the Placement Agent agrees to act, as exclusive
placement agent for the placement of 1,500,000 shares of Common Stock and
2,500,000 Common Stock Purchase Warrants (the "Warrants"), and in connection
therewith, the Placement Agent will use its best efforts to offer for sale and
to sell the Stock and the Warrants for the price and upon the terms and
conditions set forth in the Memorandum.
4. Compensation of the Placement Agent.
-----------------------------------
Commission and Expenses. In consideration for the services rendered by
-----------------------
the Placement Agent as placement agent in connection with the sale of the Common
Stock and the costs incurred by the Placement Agent in connection therewith, the
Company shall make a first payment to the Placement Agent out of the proceeds of
the sale of the Common Stock of a placement fee at a dollar amount equal to 15%
of the aggregate purchase price of all of the Private Placement shares of Common
Stock offered.
4
<PAGE>
The Company shall also make payment to the Placement Agent out of the proceeds
received upon the exercise of a minimum portion of the Warrants for at least
500,000 shares, and all subsequent exercises of the Warrants, of a placement fee
at a dollar amount equal to 15% of the aggregate funds received by the Company
at the times of the exercises of the Warrants offered.
5. Use of Proceeds.
Out of the proceeds of the sale of the Common Stock, the Company
agrees.
(a) to retain Marketing Direct Concepts ("MDC") as a public relations
firm at a fee of $750,000 aggregate for 12 months services which fee Buyers will
pay directly out of proceeds of offering, $375,000 at the time of Closing and
$375,000 at the time of the exercise of a minimum portion of the Warrants for at
least 500,000 shares. A copy of the Financial Public Relations Agreement is
attached as an exhibit.
(b) to retain the services of a business consulting firm to be
designated by Purchaser for a one year fee of $250,000 to be paid at closing out
of proceeds of offering.
(c) to pay a fee equal to 2% of the Common Stock purchased at the
Closing to cover Investor's legal fees.
(d) that its shares of Common Stock will continue to be listed on
NASDAQ and obtain the approval of NASDAQ to the terms of the Offering.
6. Closing.
A consummation of the sale and purchase of the Common Stock and
Warrants as contemplated hereby (the "Closing") and in
5
<PAGE>
the Memorandum shall take place at the offices of Cohen & Cohen or at such other
location an may be agreed upon by the Placement Agent and the Company on one or
more dates (each individually, a "Closing Date") which shall be prior to
October 30, when, as and if the Closing occurs, the Placement Agent will cause
certain persons or entities who qualified to be buyers under Regulation S to
become investors in the Company ("Buyers") and will cause such Buyers to
purchase and pay for the stock, and the Company will sell to such Buyers the
Stock, all in the manner set forth herein and in the Memorandum. Such purchase
and payment, if made, shall be made by delivery of the Memorandum, and cash by
Buyers in the respective amounts and on the terms set forth in the Memorandum.
7. Various Agreements.
------------------
(a) If any event shall occur as a result of which it shall be
necessary to amend or supplement the Memorandum in order to make the statements
contained therein, in the light of circumstances under which they are made, not
misleading, the Company promptly shall cause to be prepared and furnished,
without charge to the Placement Agent, either amendments or supplements to the
Memorandum so that the statements in the Memorandum, as so amended or
supplemented, shall not be misleading in the light of the circumstances under
which they are made.
(b) The Company shall pay all the costs and expenses incident to the
preparation and reproduction of the Memorandum (including its printing costs and
costs of the Company's legal counsel and accountants).
6
<PAGE>
(c) For a period of six months after the Closing, neither the Company
nor any direct or indirect subsidiary of the Company shall sell, offer to sell
or otherwise issue any "security" if within ten (10) business days after notice
to the Placement Agent of any such proposed offering, the Placement Agent
advises the Company or any affiliate thereof, as the case may be, that the
Placement Agent has received an opinion of its counsel to the effect that such
offering would adversely affect the qualification of the offer and sale of the
Common Stock and Warrants as a private offering transaction under Regulation S.
(d) Prior to and after the Closing, the Company shall deliver to the
Placement Agent, upon the written request of the Placement Agent, such
documents, agreements and instruments relating to the offering of the Common
Stock and Warrants or to the business and affairs of the Company as may be
reasonably requested by the Placement Agent .
8. Right of First Negotiation. During the twelve (12) month period
following the date of this Agreement, the Placement Agent will have a right of
first negotiation to obtain equity financing on behalf of the Company on the
same terms as are proposed by the Company. The Company shall promptly notify the
Placement Agent in writing of the terms of an offer for equity financing
proposed by the Company. The Placement Agent shall then have fifteen days to
provide the Company with a funding commitment to provide such equity financing
on the same terms. If the Placement Agent fails to provide such commitment, the
Company may proceed with such proposal (the "Proposed
7
<PAGE>
Financing"). If the Proposed Financing is not completed within six (6) months
thereafter, or if the terms of the Proposed Financing are materially changed to
the detriment of the Company, the Company shall be obligated to resubmit the
proposed terms to the Placement Agent and start the process again. During the
twelve (12) month period, the failure of the Placement Agent to exercise its
right of first negotiation shall not affect its right with respect to the
proposed equity financings during the twelve month period.
9. Indemnification.
---------------
(a) The company hereby covenants and agrees to indemnify and hold
harmless the Placement Agreement and each officer, director and controlling
person of the Placement Agent as follows:
(i) from and against any and all loss, liability, claim, damage and
expense whatsoever arising as a result of any untrue statement or alleged untrue
statement of a material fact contained in the Memorandum or in any filing
executed by the Company filed with any state or jurisdiction necessary to
qualify the Stock for offer and sale under the "blue sky" or securities laws of
such states or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statement" therein not
misleading in the light of the circumstances under which they were made; and
(ii) from and against and all loss, liability, claim, damages and
expense whatsoever to the extent of the aggregate amount paid in settlement of
any litigation, commenced
8
<PAGE>
or threatened, or any claim whatsoever based upon any such untrue statement or
omission or any such alleged untrue statement or omission if such settlement is
effected with the written consent of the Company.
(b) The Placement Agent hereby agrees to indemnify and hold harmless
the Company, its directors, officers, employees and agents from and against all
loss, liability, claim, damage and expense arising out of any action based upon
violations or alleged violations of the Act or any state securities or "blue
sky") laws by the Placement Agent or arising as a result of a breach by the
Placement Agent of any warranties or covenants or from the untruth of any
representation made by the Placement Agent pursuant to this Agreement or as a
result of statements made in the Memorandum based solely upon information
supplied by the P1acement Agent in writing to the Company or based upon the
improper conduct of the Placement Agent or any of its employee or agents acting
as Placement Agent for the offering of the Stock and sale hereunder.
(c) After receipt by an indemnified party hereunder of notice of the
commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against the identifying party, give timely notice to the
indemnifying party in writing of the commencement thereof, provided that the
failure to timely notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Agreement. Notice to the indemnifying party shall be timely if given at such
time as not to impair
9
<PAGE>
substantially the rights of such party hereunder. In case any such action shall
be brought against any indemnified party and the indemnifying party has been
notified of the commencement thereof, the indemnifying party shall be entitled
to participate therein and to assume the defense thereof including the right to
settle such action, with counsel satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party hereunder for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof.
10. Miscellaneous.
-------------
(a) Notice. All notices and other communications hereunder shall be in
------
writing and shall be deemed to have been given when actually received or
overnight courier or mailed, by certified or registered mail, return receipt
requested, as follows:
If to the Company, to:
Saf T Lok Incorporated
18245 SE Federal Highway
Tequesta, Florida 33469
Attention: John Gardner, President
with a copy to:
Gray, Harris & Robinson, P.A.
201 East Pine Street, Suite 1200
Orlando, Florida
Attention: William A. Grimm, Esq.
If to Placement Agent, to:
State Street Securities, Inc.
10
<PAGE>
c/o Law Offices of Mitchell S. Segal, P.C.
1010 Northern Boulevard, Suite 208
Great Neck, NY 11201
with a copy to:
Cohen & Cohen
445 Park Avenue
New York, NY 10022
Attention: Frank R. Cohen, Esq.
(b) Successors. This Agreement will be binding upon and inure to the
----------
benefit of the Company and the Placement Agent and its successors and, as
permitted hereunder, assigns. Nothing expressed or mentioned herein is intended
or will be construed to give any persons other than the persons described in
this Paragraph 10(b) any legal or equitable right, claim or remedy under or in
respect of this Agreement or any provisions herein, it being intended that this
Agreement and all conditions and provisions hereto are for the sole and
exclusive benefit of such persons and for the benefit of no other persons. No
Investor will be deemed a "successor" as that term is utilized in this Paragraph
10(b) by virtue of such Investor's purchase of Stock.
(c) Assigns. No party hereto may assign its rights or obligations
-------
hereunder without the prior written consent of all parties hereto.
(d) Applicable Law. This Agreement shall be governed by and construed
--------------
in accordance with the laws of the State of New York.
(e) Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed an
11
<PAGE>
original and all of which shall be deemed to be one and the same instrument.
(f) Survival, All representations, warranties, covenants and
--------
agreements herein contained shall survive the execution hereof and the Closing.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
SAF T LOK INCORPORATED
By: /s/ John L. Gardner
-------------------
Name: John L. Gardner
Title: President & CEO
STATE STREET SECURITIES, INC.
By: /s/ Irving Minnaker
-------------------
Name: Irving Minnaker
Title: Treasurer
12
<PAGE>
ADDENDUM TO PLACEMENT AGENT AGREEMENT
-------------------------------------
Agreement to Submit Information to the Nasdaq Market, Inc.
- ----------------------------------------------------------
The Placement Agent and the Company agree to submit to The Nasdaq Market, Inc.,
all documents and agreements relating to this transaction to The Nasdaq Market,
Inc., including all information requested by Nasdaq as set forth in the letter
dated October 21, 1997 from The Nasdaq Market, Inc., attached hereto as an
exhibit immediately upon the execution of this Agreement and to make full
disclosure of all of the facts concerning this transaction as requested by The
Nasdaq Market, Inc.
Closing Held in Escrow Pending Action by the Nasdaq Market
- ----------------------------------------------------------
The Company and the Placement Agent agrees that upon closing, the Closing shall
be held in escrow by Cohen & Cohen, 445 Park Ave., New York, New York, 10022
(the "Escrow Agent") under the supervision of Frank R. Cohen, Esq., pursuant to
the terms set forth in Memorandum.
All documents, stock certificates, legal opinions, stock purchase warrants and
cash pertaining to the Closing shall be held in escrow by the Escrow Agent.
In the event the Company is notified by Nasdaq that the Company's common stock
will not be delisted from the Nasdaq SmallCap Market after Nasdaq has reviewed
the Information (the ''Nasdaq Notification"), the Company will immediately
notify the Escrow Agent by fax letter with a copy of the determination letter by
Nasdaq. Upon receipt of such notification, the Escrow Agent will deliver all of
the documents, stock certificates, legal opinions, stock purchase warrants and
cash to the respective parties and the Placement Agent as required by this
Agreement and the Placement Agreement between the Company and State Street
Securities dated .
-------------------
In the event that the Company has not received the Nasdaq Notification by 5:00
p.m. November 4, 1997, the Closing shall be deemed not to have occurred, all
agreements relating to this transaction, including this Placement Agent
Agreement, shall be void and the Escrow Agent shall promptly return all
documents, stock certificates, legal opinions, stock purchase warrants and cash
to the respective parties as if the Closing had not occurred.
This Addendum shall be initialed by the parties to indicate the attachment of
this Addendum to this Agreement.
Placement Agent: /s/ President
--------------------
Its authorized agent
13
<PAGE>
EXHIBIT 99.3
FORM OF OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
--------------------------------------------------
THIS OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT dated as of October 13, 1997
(this "Agreement") is executed in reliance upon the transaction exemption
afforded by Regulation S ("Regulation S") as promulgated by the Securities and
Exchange Commission ("SEC"), under the Securities Act of 1933 as amended.
Capitalized terms used herein and not defined shall have the meanings given to
them in Regulation S.
This Seller of Shares of Common Stock of Saf-T-Lok Inc., a Corporation
organized under the laws of the state of Delaware, with executive offices
located at 28245 S.E. Federal Highway, Tequesta, Florida 33469, and Firstimpex,
Inc., Mercacorp Inc. and Dafico Investment Corp. (collectively the "Buyer")
hereby represent, warrant, and agree as follows.
THE COMMON STOCK OFFERED HEREBY HAS NOT AND WILL NOT BE REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER (THE "1933 ACT"), AND MAY NOT BE OFFERED OR SOLD WITHIN
THE UNITED STATES (AS DEFINED IN REGULATION S OF THE 1933 ACT) OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S OF THE l933 ACT)
EXCEPT PURSUANT TO REGISTRATION UNDER OR AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT.
1. AGREEMENT TO SUBSCRIBE; PURCHASE PRICE
--------------------------------------
(a) Subscription. The Buyer (and each of them) represent that it qualifies
------------
under Regulation S to purchases shares of Common Stock of Seller and agrees to
purchase the numbers of shares of Seller's Common Stock as set forth on
Schedule A annexed hereto.
(b) Purchase Price. The purchase price for the Shares of Common Stock shall be
--------------
per share or for the purchase of shares to be paid at
a Closing to be held no later than October 30, 1997. Each Buyer shall also
receive two (2) Common Stock Purchase Warrants for each share of Common Stock
purchased. Each Warrant entitles the holder to purchase one share of Common
Stock at per share for a period of twenty-four months from October 13,
1997.
(c) Payment. The aggregate purchase price for the Shares shall be payable at
--------
closing by delivering immediately available funds in United States Dollars by
wire transfer to the designated depository for closing by delivery of Securities
versus payment.
(d) Closing. Subject to the satisfaction of the conditions set forth in
-------
Sections 8 and 9 hereof, the closing of the transactions contemplated by this
Agreement shall occur on October 15, 1997 or such earlier or later date as is
mutually agreed to in writing by Buyer and Seller.
1
<PAGE>
2. SUBSCRIBER REPRESENTATIONS: ACCESS TO INFORMATION.
-------------------------------------------------
(a) Offshore Transaction. In connection with the sale of the shares, Buyer
--------------------
represents and warrants to Seller as follows:
(i) Buyer is not organized under the laws of any jurisdiction within the
United States was not formed for the purpose of investing in Regulation S
securities and is not otherwise a U.S. Person, as that term is defined in
Section 902(o) of Regulation S. Buyer is not, and on the closing date will not
be, an affiliate of Seller;
(ii) At the time the buy order was originated, Buyer was outside the United
States and is outside of the United States as of the date of the execution and
delivery of this Agreement;
(iii) No offer to purchase the Shares was made in the United States;
(iv) Buyer is purchasing the Shares for its own account or for the account
of persons (who are not U.S. Persons), each of whom has entered into an offshore
securities subscription agreement in a form substantially similar to this
Agreement, and Buyer and each such person is qualified to purchase the Shares
under the laws of its residence and the offer and sale of the Shares will not
violate the securities or other laws of such jurisdiction;
(v) All subsequent offers and sales of the Shares by buyer shall be made in
compliance with any applicable Securities laws of any applicable jurisdiction
and with Regulation S or pursuant to registration of securities under the 1933
Act or pursuant to an exemption from registration. In any case, the Shares will
not he resold by Buyer to a U.S. Person or within the United States until after
the end of the forty (40) day period commencing on the later of the date of
closing of the purchase of the Shares by Buyer or the date of the first offer of
the Shares to persons other than a distributor (the "Restricted Period");
(vi) The transactions contemplated by this Agreement (a) have not been and
will not be pre-arranged by Buyer with a purchaser located in the United States
or a purchaser which is a U.S. Person and (b) are not and will not be part of a
plan or scheme by Buyer to evade the registration provisions of the 1933 Act;
(vii) Buyer understands that the Shares are not registered under the 1933
Act and are being offered and sold to it in reliance on specific exemption from
the registration requirements of Federal and State securities laws, and that
Seller is relying upon the truth and accuracy of the representations,
warranties, agreements, acknowledgments and understandings of Buyer set forth
herein in order to determine the applicability of such exemptions and the
suitability of Buyer to acquire the Shares;
(viii) Buyer shall take all reasonable steps to ensure its compliance with
Regulation S and shall promptly send to each purchaser who acts as a distributor
of the Shares, who purchases prior to the expiration of the Restricted Period
referred to in subparagraph (v) above, a confirmation or other notice to the
purchaser stating that the purchaser is subject to the same restrictions on
offers and sales as Buyer pursuant to Section 903(c)(2)(iv) of Regulation S;
2
<PAGE>
(ix) Buyer has not conducted any "directed selling efforts" as that term is
defined in Rule 902(b) of Regulation S nor has Buyer conducted any general
solicitation relating to the offer and sale of the securities which are the
subject of this transaction in the United States or elsewhere;
(x) This Agreement has been duly authorized, validly executed and delivered
on behalf of Buyer and is a valid and binding agreement in accordance with its
terms, subject to general principles of equity and to bankruptcy or other laws
affecting the enforcement of creditors" rights generally;
(xi) The execution and delivery of this Agreement and the consummation of
the purchase of the Shares and the transactions contemplated by this Agreement
do not and will not conflict with or result in a breach by Buyer of any of the
terms or provisions of, or constitute a default under, the articles of
incorporation or by-laws (or similar constitutive documents) of Buyer or any
indenture, mortgage, deed of trust, or other material agreement or instrument to
which Buyer is a party or by which it or any of its properties or assets are
bound, or any existing applicable law, rule or regulation of the United States
or any State thereof or any applicable decree, judgment or order of any Federal
or state court, Federal or State regulatory body, administrative agency or other
United States governmental body having jurisdiction over Buyer or any of its
properties or assets;
(xii) All invitations, offers and sales of or in respect of, the Shares by
Buyer and any distribution by Buyer of any documents relating to any offer by it
of the Shares will be in compliance with applicable laws and regulations and
will be made in such a manner that no prospectus need be filed and no other
filing need be made by Seller with any regulatory authority or stock exchange in
any country or any political sub-division of any country;
(xiii) Buyer will not make any offer or sale of Shares by any means which
would not comply with the laws and regulations of the territory in which such
offer or sale takes place or to which such offer or sale is subject or which
would in connection with any such offer or sale impose upon Seller any
obligation to satisfy any public filing or registration requirement or provide
or publish any information of any kind whatsoever or otherwise undertake or
become obliged to do any act; and
(xiv) Neither Buyer nor any of its affiliates has entered, has the intention
of entering, or will during the Restricted Period enter or into any put option,
short position or other similar instrument or position with respect to the
Shares or securities of the same class as the Shares.
(b) No Government Recommendation or Approval. Buyer understands that no
----------------------------------------
Federal or State agency has passed on or made any recommendation or endorsement
of the Shares.
(c) Current Public Information. Buyer acknowledges that it and its advisors,
--------------------------
if any, have been furnished with all materials relating to the business,
finances and operations of Seller and all materials relating to the offer and
sale of the Shares which have been requested by Buyer. Buyer further
acknowledges that it and its advisors, if any, have received complete and
satisfactory answers to such inquiries. Without limiting the generality of the
foregoing, Buyer has received Seller's (1) Annual Report on Form 10-K for the
fiscal year ended December 31, 1996, (2) Quarterly Report on Form 10-Q for the
fiscal quarter ended June 30, 1997, (3) Form 8-K, reporting event dated June 27,
1997, and (4) Form 8-K, reporting event dated August 27, 1997. (Items 3 and 4
are attached to this Agreement.)
(d) Buyer's Sophistication. Buyer acknowledges that the purchase of the
----------------------
Shares
3
<PAGE>
involves a high degree of risk, including the total loss of Buyer's
investment. Buyer has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of purchasing the
Shares.
3. SELLER REPRESENTATION.
---------------------
(a) Reporting Company Status. Seller is a "Reporting Issuer" as defined by
------------------------
Rule 902 of Regulation S. Seller has registered its Common Stock pursuant to
Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the Common Stock is listed and trades on the Nasdaq Small Cap Market
Seller has filed all material required to be filed pursuant to all reporting
obligations under either Section 13(a) or 15(d) of the Exchange Act for a period
of at least twelve (12) months immediately preceding the offer or sale of the
Shares (or for such shorter period that Seller has been required to file such
material).
(b) Current Public Information. Seller has furnished buyer with copies of
--------------------------
its most recent reports filed under the Exchange Act referred to in Section 2(c)
above, and other public available documents.
(c) Offshore Transaction. Seller has not offered the Shares to any person in
--------------------
the United States, any identifiable groups of U.S. citizens abroad, or to any
U.S. Person.
(i) At the time the buy order was originated, Seller and/or its agents
reasonably believe Buyer was outside of the United States and was not a U.S.
person, based solely on the representations of Buyer in Section 2(a) hereof.
(ii) Seller and/or its agents reasonably believe that the transaction has
not been pre-arranged with a buyer in the United States, based solely on the
representations of Buyer in Section 2(a) hereof.
(iii) No offer to buy or sell the shares was or will be made by Seller to
any person in the United States.
(iv) The sale of the Shares by Seller pursuant to this Agreement will be
made in accordance with the provisions and requirements of Regulation S.
(v) The transactions contemplated by this Agreement (a) have not been and
will not be pre-arranged by Seller with a purchaser located in the United States
or a purchaser which is a U.S. Person, and (b) are not and will not be part of a
plan or scheme by Seller to evade the registration provisions of the 1933 Act.
(d) No Directed Selling Efforts. In regard to this transaction, Seller has
---------------------------
not conducted any "directed selling efforts" as that term is defined in Rule 902
of Regulation S nor has Seller conducted any general solicitation relating to
the offer and sale of the securities which are the subject of this transaction
in the United States or elsewhere.
(e) Concerning the Shares. The Shares when issued and delivered will be duly
---------------------
and validly authorized and issued, fully paid and non-assessable and will not
subject the holders thereof to personal liability by reason of being such
holders. There are no preemptive rights of any shareholder of the Company.
4
<PAGE>
(f) Subscription Agreement. This Agreement has been duly authorized, validly
----------------------
executed and delivered on behalf of Seller and is a valid and binding agreement
in accordance with its terms subject to general principles of equity and to
bankruptcy or other laws affecting the enforcement of creditors' rights
generally.
(g) Non-Contravention. The execution and delivery of this Agreement and the
-----------------
consummation of the issuance of the Shares and the transactions contemplated by
this Agreement do not and will not conflict with or result in a breach by Seller
of any of the terms or provisions of, or Constitute a default under, the
articles of incorporation or by-laws of Seller or any indenture, mortgage, deed
of trust, or other material agreement or instrument to which Seller is a party
or by which it or any of its properties or assets are bound, or any existing
applicable law, rule or regulation of the United States or any State thereof or
any applicable decree, judgment or order of any Federal or State court. Federal
or State regulatory body, administrative agency or other United States
governmental body having jurisdiction over Seller or any of its properties or
assets.
(h) Approvals. Seller is not aware of any authorization, approval or consent
---------
of any governmental body which is legally required for the issuance and sale of
the Shares as contemplated by this Agreement.
4. EXEMPTION: RELIANCE ON REPRESENTATIONS. Buyer understands that the
---------------------------------------
offer and sale of the Shares not being registered under the 1933 Act. Seller and
Buyer are relying on the rules governing offers and sales made outside the
United States pursuant to Regulation S. Seller acknowledges that Buyer may
resell the Shares outside the United States to non-U.S. Persons in reliance on
Regulation S at the same or a different price than the purchase price hereunder,
and that Buyer is under no obligation to purchase or retain any of the Shares
for its own account; provided, all offers and sales by Buyer are made in
---------
accordance with Regulation S and this Agreement.
5. TRANSFER AGENT INSTRUCTIONS. Seller's transfer agent will be
---------------------------
instructed to issue one or more share certificates representing the Shares sold
hereunder without restrictive legend in the name of Buyer (or its nominee (being
a non-U.S. person) or such non-U.S. Persons as may be designated by Buyer prior
to the closing) and in such denominations to be specified prior to closing.
Seller further warrants that no instructions other than these instructions and
instructions to impose a "stop transfer" instruction with respect to the
Certificates until the end of the Restricted Period have been given to the
transfer agent and that the Shares shall otherwise be freely transferable on the
books and records of Seller. Nothing in this section, however, shall affect in
any way Buyer's obligations and agreement to comply with all applicable
securities laws upon resale of the Share.
6. STOCK DELIVERY INSTRUCTIONS. The Share certificates in the form
---------------------------
required to be delivered by Section 5 above shall be delivered to the Buyer on a
delivery versus payment basis at such time and place as shall be mutually agreed
by Seller and Buyer; provided that such certificates shall be made available for
inspection at such reasonable time as Buyer may request prior to closing.
7. USE OF PROCEEDS. Seller intends to use the proceeds of the sale of
---------------
the Shares to Buyer for working capital, acquisitions and general corporate
purposes.
8. CONDITIONS TO SELLER'S OBLIGATION TO SELL. Seller's Obligation to
-----------------------------------------
sell the Shares is conditioned upon:
5
<PAGE>
(a) The receipt and acceptance by Buyer of this Agreement as evidenced by
execution of this Agreement by the Chairman of the Board or President of Buyer.
(b) Delivery into the closing depository of good funds by Buyer as payment in
full of the aggregate Purchase Price of the Shares.
(c) The receipt by Seller of a certificate from an authorized officer of Buyer
certifying that the representations and warranties contained in Section 2 hereof
are true and correct as of the closing date.
9. CONDITIONS TO BUYER'S OBLIGATION TO PURCHASE. Buyer's obligation to
--------------------------------------------
purchase the Shares is conditioned on:
(a) The receipt and acceptance by Seller of this Agreement as evidenced by
execution of this Agreement by the duly authorized officer of Seller.
(b) Delivery of certificates representing the Shares as described in Section 5
hereof.
(c) Delivery of an opinion of counsel to Seller substantially in the form of
Exhibit A hereto.
- ---------
(d) The absence of any event or circumstance that could reasonably be expected
to have a material adverse effect on the financial condition of Seller, or the
market price of Seller's stock on the Nasdaq Small Cap Market, in any such event
as determined by Buyer in its reasonable discretion.
(e) The receipt by Buyer of a certificate from an authorized officer of Seller
certifying that the representations and warranties Contained in Section 3
thereof are true and correct as of the closing date and that, to the knowledge
of Seller, the conditions set forth in subsection (d) above have been complied
with.
10. OFFERING MATERIALS. All offering materials and documents used in
------------------
connection with offers and sales of the Shares prior to the expiration of the
Restricted Period referred to in Section 2(a)(v) hereof shall include statements
to the effect that the Shares have not been registered under the 1933 Act and
that neither Buyer, nor any direct or indirect purchaser of the Shares from
Buyer, may directly or indirectly offer or sell the Shares in tile United States
or to U.S. Persons (other than distributors) unless the Shares are registered
under the 1933 Act, or an exception from the registration requirements of the
1933 Act is available, Such statements shall appear (1) on the cover of any
prospectus or offering circular used in connection with the offer or sale of the
Shares (2) in the underwriting section of any prospectus or offering circular
used in connection with the offer or sale of the Shares, and (3) in any
advertisement made or issued by Seller, Buyer, any other distributor, any of
their respective affiliates, or any person acting on behalf of any of the
foregoing.
11. Until the end of the ninety (90) day period immediately following
the closing of the purchase and sale of the Shares hereunder, and except for any
agreement between Buyer and Seller concerning distribution of securities of
Seller by Buyer pursuant to Regulation S, Seller shall not issue or enter into
6
<PAGE>
any agreement to issue any shares of its capital stock or other equity
securities, or options, warrants, rights, or debt instruments exercisable or
exchangeable for or convertible into shares of its capital stock or other equity
securities, except for (i) the issuance of stock pursuant to outstanding stock
options, (ii) the grant of stock options to officers and employees.
12. MISCELLANEOUS.
-------------
(a) Except as specifically referenced herein, this Agreement constitutes the
entire contract between the parties, and neither party shall be liable or bound
to the other in any manner by any warranties, representations or covenants
except as specifically set forth herein. Any previous agreement among the
parties related to the transactions described herein is superseded hereby. The
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties hereto.
Nothing in this Agreement, express or implied, is intended to confer upon any
party, other than the parties hereto, and their respective successors and
assigns, any rights, remedies, obligations or liabilities under or by reason of
this Agreement, except as expressly provided herein.
(b) Buyer is an independent contractor, and is not the agent of Seller. Buyer
is not authorized to bind Seller, or to make any representations or warranties
on behalf of Seller.
(c) Seller makes no representation or warranty with respect to Seller, its
finances, assets, business prospects or otherwise, except as expressly set forth
herein. Buyer will advise each purchaser and potential purhaser of the Shares of
the foregoing sentence, and that such purchaser is relying on its own
investigation with respect to all such matters, and that such purchaser will be
given access to any and all documents and Seller personnel it may reasonably
require for such investigation.
(d) All representations and warranties contained in this Agreement by Seller
and Buyer shall survive the closing of the transactions contemplated by this
Agreement.
(e) This Agreement shall be construed in accordance with the internal laws of
Bermuda and shall be binding upon the successors and assigns of each party
hereto. This Agreement may be executed in counterparts, and the facsimile
transmission of an executed counterpart to this Agreenient shall be effective as
an original.
7
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first set forth above.
Official Signatory of Seller:
SAF-T-LOK INC.
By: /s/ John L. Gardner
------------------------------------
Name: John L. Gardner
Title: President
Official Signatory of Buyer:
FIRSTIMPEX, INC.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
MERCACORP INC.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
DAFICO INVESTMENT CORP.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
Title:
8
<PAGE>
ADDENDUM TO OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
------------------------------------------------------
Receipt of all filings with the SEC since January 1, 1997.
- ----------------------------------------------------------
Buyers acknowledge receipt of all filings made by the Company with the
Securities and Exchange Commission since January 1, 1997, including the Form 8-K
filing made on October 28, 1997, disclosing the number of shares of Common Stock
outstanding as a result of the conversion of convertible debentures and shares
issued to service providers and stock options recently granted.
Agreement to submit information to The Nasdaq Market, Inc.
- ----------------------------------------------------------
The Buyers and the Company agree to submit to The Nasdaq Market, Inc., all
documents and agreements relating to this transaction to The Nasdaq Market,
Inc., including all information requested by Nasdaq as set forth in the letter
dated October 21, 1997 from The Nasdaq Market, Inc., attached hereto as an
exhibit, immediately upon the execution of this Agreement.
Closing Held In Escrow Pending Action by The Nasdaq Market.
- -----------------------------------------------------------
The Company and the Buyers agree that upon closing, the Closing shall be held in
escrow by Cohen & Cohen, 445 Park Ave., New York, New York, 10022 (the "Escrow
Agent") under the supervision of Frank R. Cohen, Esq. Pursuant to the terms set
forth in this Addendum.
All documents, stock certificates, legal opinions, stock purchase warrants and
cash pertaining to the Closing shall be held in escrow by the Escrow Agent.
In the event the Company is notified by Nasdaq that the Company's common stock
will not be delisted from the Nasdaq SmallCap Market after Nasdaq has reviewed
the Information (the "Nasdaq Notification"), the Company will immediately notify
the Escrow Agent by fax letter with a copy of the determination letter by
Nasdaq. Upon receipt of such notification, the Escrow Agent will deliver all of
the documents, stock certificates, legal opinions, stock purchase warrants and
cash to the respective parties and the Placement Agent as required by this
Agreement and the Placement Agreement between the Company and State Street
Securities dated .
-------
In the event that the Company has not received the Nasdaq Notification by 5:00
P.M. November 4, 1997, the Closing shall be deemed not to have occurred, all
agreements relating to this transaction shall be void and the Escrow Agent shall
promptly return all documents, stock certificates, legal opinions, stock
purchase warrants and cash to the respective parties as if the Closing had not
occurred.
This Addendum shall be initialed by the parties to indicate the attachment of
this Addendum to the Agreement.
<PAGE>
Buyers:
-------------
As attorney in fact for the Buyers
Saf T Lok, Incorporated
By:
---------------
President
<PAGE>
EXHIBIT 99.4
OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
------------------------------------------
THIS OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT dated as of October 29,
1997 (this "Agreement") is executed in reliance upon the transaction exemption
afforded by Regulation S ("Regulation S") as promulgated by the Securities and
Exchange Commission ("SEC"), under the Securities Act of 1933 as amended.
Capitalized terms used herein and not defined shall have the meanings given to
them in Regulation S.
This Seller of Shares of Common Stock of Saf-T-Lok Inc., a Corporation
organized under the laws of the state of Florida, with executive offices located
at 28245 S.E. Federal Highway, Tequesta, Florida 33469, and Firstimpex, Inc.,
Mercacorp Inc. and Dafico Investment Corp. (collectively the "Buyer") hereby
represent, warrant, and agree as follows.
THE COMMON STOCK OFFERED HEREBY HAS NOT AND WILL NOT BE REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED AND THE RULES AND
REGULATIONS PROMULGATED THEREUNDER (THE "1933 ACT"), AND MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES (AS DEFINED IN REGULATION S OF
THE 1933 ACT) OR TO, OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS (AS
DEFINED IN REGULATION S OF THE 1933 ACT) EXCEPT PURSUANT TO REGISTRATION
UNDER OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933
ACT.
1. AGREEMENT TO SUBSCRIBE PURCHASE PRICE
-------------------------------------
(a) Subscription. The Buyer (and each of them) represent that it qualifies under
------------
Regulation S to purchase shares of Common Stock of Seller and agrees to purchase
the numbers of shares of Seller's Common Stock as set forth on Schedule A
annexed hereto.
(b) Purchase Price. The purchase price for the Shares of Common Stock shall be
--------------
$2.00 per share or $1,000,000 for the purchase of 500,000 shares to be paid at a
Closing to be held no later than October 30, 1997. Each Buyer shall also receive
one (1) Common Stock Purchase Warrant for each share of Common Stock at $3.00
per share for a period of twenty four months from October 13, 1997.
(c) Payment. The aggregate purchase price for the Shares and Convertible Notes
-------
shall be payable at each of the closings by delivering immediately available
funds in United States Dollars by wire transfer to the designated depository for
closing by delivery of Securities versus payment.
(d) Closing. Subject to the satisfaction of the conditions set forth in Sections
-------
8 and 9 hereof, the closing of the Common Stock transaction contemplated by this
Agreement shall occur on or before October 30, 1997 or at such later dates as
are manually agreed to in writing by Buyer and Seller.
1
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first set forth above.
Official Signatory of Seller:
SAF-T-LOK INC.
By: /s/ John L. Gardner
------------------------------------
Name: John L. Gardner
Title: President
Official Signatory of Buyer:
FIRSTIMPEX, INC.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
MERCACORP INC.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
DAFICO INVESTMENT CORP.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
Title:
2
<PAGE>
OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
------------------------------------------
THIS OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT dated as of October 13, 1997
(this "Agreement") is executed in reliance upon the transaction exemption
afforded by Regulation S ("Regulation S") as promulgated by the Securities and
Exchange Commission ("SEC"), under the Securities Act of 1933 as amended.
Capitalized terms used herein and not defined shall have the meanings given to
them in Regulation S.
This Seller of Shares of Common Stock of Saf-T-Lok Inc., a Corporation
organized under the laws of the state of Delaware, with executive offices
located at 28245 S.E. Federal Highway, Tequesta, Florida 33469, and Firstimpex,
Inc., Mercacorp Inc. and Dafico Investment Corp. (collectively the "Buyer")
hereby represent, warrant, and agree as follows.
THE COMMON STOCK OFFERED HEREBY HAS NOT AND WILL NOT BE REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER (THE "1933 ACT"), AND MAY NOT BE OFFERED OR SOLD WITHIN
THE UNITED STATES (AS DEFINED IN REGULATION S OF THE 1933 ACT) OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S OF THE l933 ACT)
EXCEPT PURSUANT TO REGISTRATION UNDER OR AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT.
1. AGREEMENT TO SUBSCRIBE; PURCHASE PRICE
--------------------------------------
(a) Subscription. The Buyer (and each of them) represent that it qualifies
------------
under Regulation S to purchases shares of Common Stock of Seller and agrees to
purchase the numbers of shares of Seller's Common Stock as set forth on
Schedule A annexed hereto.
(b) Purchase Price. The purchase price for the Shares of Common Stock shall be
--------------
$2.00 per share or $2,000,000 for the purchase of 1,000,000 shares to be paid at
a Closing to be held no later than October 30, 1997. Each Buyer shall also
receive two (2) Common Stock Purchase Warrants for each share of Common Stock
purchased. Each Warrant entitles the holder to purchase one share of Common
Stock at $2.00 per share for a period of twenty-four months from October 13,
1997.
(c) Payment. The aggregate purchase price for the Shares shall be payable at
--------
closing by delivering immediately available funds in United States Dollars by
wire transfer to the designated depository for closing by delivery of Securities
versus payment.
(d) Closing. Subject to the satisfaction of the conditions set forth in
-------
Sections 8 and 9 hereof, the closing of the transactions contemplated by this
Agreement shall occur on October 15, 1997 or such earlier or later date as is
mutually agreed to in writing by Buyer and Seller.
3
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first set forth above.
Official Signatory of Seller:
SAF-T-LOK INC.
By: /s/ John L. Gardner
------------------------------------
Name: John L. Gardner
Title: President
Official Signatory of Buyer:
FIRSTIMPEX, INC.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
MERCACORP INC.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
DAFICO INVESTMENT CORP.
By: /s/ Michael D. Blutrich
------------------------------------
Name: Michael D. Blutrich
Title: As Attorney, POA
Title:
4
<PAGE>
EXHIBIT 99.5
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- ___________ SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that ______________ or its permitted assigns is
entitled to purchase from the Company, at any time or from time to time after
October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, __________________
___________________ (___________) fully paid and non-assessable shares of common
stock, par value $.01 per share, of the Company for an aggregate purchase price
of $_______ (computed on the basis of $_________ per share). (Hereinafter, (i)
said common shares, together with any other equity securities which may be
issued by the Company in substitution therefor, are referred to as the "Common
Shares", (ii) the Common Shares purchasable hereunder are referred to as the
"Warrant Shares", (iii) the aggregate purchase price payable hereunder for the
Warrant Shares is referred to as the "Aggregate Warrant Price", (iv) the price
payable hereunder for each of the Warrant Shares, as adjusted in the manner set
forth in Section 3, is referred to as the "Per Share Warrant Price" and (v) this
Warrant and all warrants hereinafter issued in exchange or substitution for this
Warrant are referred to as the "Warrants".) The Aggregate Warrant Price is not
subject to adjustment. The Per Share Warrant Price and the number of Warrant
Shares are subject to adjustment as hereinafter provided.
<PAGE>
1. EXERCISE OF WARRANT. This Warrant may be exercised, in whole at any
-------------------
time or in part from time to time (such partial exercises to be in amounts of
not less than 25,000 Warrant Shares), on and after October 13, 1997, but prior
to 5:00 P.M. on October 13, 1999, by the holder of this Warrant) the ("Holder")
by the surrender of this Warrant (with the subscription form at the end hereof
duly executed) at the principal office of the Company at 18245 SE Federal
Highway, Tequesta, Florida 33469, together with proper payment of the Aggregate
Warrant Price applicable on such date, or the proportionate part thereof if this
Warrant is exercised in part. Payment for Warrant Shares shall be made by check
or checks, payable to the order of the Company. If this Warrant is exercised in
part, this Warrant must be exercised for a number of whole Warrant Shares, and
the Holder is entitled to receive a new Warrant covering the number of Warrant
Shares in respect of which this Warrant has not been exercised and setting forth
the proportionate part of the Aggregate Warrant Price applicable to such Warrant
Shares. Upon such surrender of this Warrant, the Company will (a) issue a
certificate or certificates in the name of the Holder for the largest number of
whole Warrant Shares to which the Holder shall be entitled and, if this Warrant
is exercised in whole, in lieu of any fractional Warrant Share to which the
Holder shall be entitled, cash equal to the fair value of such fractional share
(determined in such reasonable manner as the Board of Directors of the Company
shall determine), and (b) deliver the other securities and properties receivable
upon the exercise of this Warrant, or the proportionate part thereof if this
Warrant is exercised in part, pursuant to the provisions of this Warrant.
2. RESERVATION OF WARRANT SHARES. The Company agrees that, prior to the
-----------------------------
expiration of this Warrant, the Company will at all times have authorized and
will reserve, and will keep available, solely for issuance of delivery upon the
exercise of this Warrant, the shares receivable upon the exercise of this
Warrant, the Warrant Shares and other securities and properties as from time to
time shall be receivable upon the exercise of this Warrant, free and clear of
all restrictions on sale or transfer (except as may arise under applicable
securities laws) and free and clear of all preemptive rights.
2
<PAGE>
3. PROTECTION AGAINST DILUTION.
----------------------------
(a) If, at any time or from time to time after the date of this Warrant,
the Company shall issue to the holders of the Common Shares any Common Shares by
way of a stock dividend or stock split (including, without limitation, a reverse
stock split), then, and in each such case, the Per Share Warrant Price on the
date of such stock dividend or stock split shall be adjusted, or further
adjusted, to a price (to the nearest cent) determined by dividing (i) an amount
equal to the number of Common Shares outstanding immediately prior to such
issuance multiplied by the Per Share Warrant Price in effect immediately prior
to such issuance by (ii) the total number of Common Shares outstanding
immediately after such issuance. Upon each adjustment in the Per Share Warrant
Price resulting from a stock split or stock dividend, the number of Warrant
Shares shall be adjusted by dividing the Aggregate Warrant Price by the Per
Share Warrant Price in effect immediately after such adjustment. Notice of each
such adjustment and each such readjustment shall be forthwith mailed to the
Holder.
(b) If the Company shall be consolidated with or merged into another
corporation, or shall sell all or substantially all of its assets in part of a
reorganization to which the Company is a party within the meaning of the
Internal Revenue Code of 1986, as presently in effect, or shall issue a security
convertible into its Common Shares as a dividend on its Common Shares, or shall
reclassify or reorganize its capital structure (except a stock split covered by
Subsection 3(a) hereof), each Warrant Share shall be replaced for the purposes
hereof by the securities or properties issuable or distributable in respect of
one Common Share upon such consolidation, merger, sale, reclassification or
reorganization, and adequate provisions to that effect shall be made at the time
thereof. Notice of such consolidation, merger, sale, reclassification or
reorganization, and of said provisions so proposed to be made, shall be mailed
to the Holder not less than 15 days prior to such event.
(c) If the Company shall sell all or substantially all of its assets,
other than as part of a reorganization to which the Company is a party within
the meaning of the Internal Revenue Code of 1986, as presently in effect, or
shall distribute its assets in dissolution or liquidation (other than as part of
such a reorganization), the Company shall mail notice thereof to the Holder and
shall make no distribution to shareholders until the expiration of 15 days from
the date of mailing of said notice and then only to shareholders
3
<PAGE>
of record as of a date at least 15 days after the date of mailing of said
notice.
(d) If the Board of Directors of the Company shall declare any dividend
or other distribution in cash with respect to the Common Shares, other than out
of surplus, the Company shall mail notice thereof to the Holder not less than 15
days prior to the record date fixed for determining shareholders entitled to
participate in such dividend or other distribution.
4. FULLY PAID SHARES; TAXES. The Company agrees that the Common Shares
------------------------
represented by each and every certificate for Warrant Shares delivered on the
exercise of this Warrant shall, at the time of such delivery, be validly issued
and outstanding, fully paid and non-assessable, and the Company will take all
such actions as may be necessary to assure that the par value or stated value,
if any, per Warrant Share is at all times equal to or less than the then Per
Share Warrant Price. The Company further covenants and agrees that it will pay,
when due and payable, any and all Federal and state stamp, original issue or
similar taxes which may be payable in respect of the issue of any Warrant Share
or certificate therefor.
5. LOSS, ETC. OF WARRANT. Upon receipt of evidence satisfactory to the
---------------------
Company of the loss, theft, destruction or mutilation of this Warrant, and of
indemnify reasonably satisfactory to the Company, if lost, stolen or destroyed,
and upon surrender and cancellation of this Warrant, if mutilated, and upon
reimbursement of the Company's reasonably incidental expenses, the Company shall
execute and deliver to the Holder a new Warrant of like date, tenor and
denomination.
6. WARRANT HOLDER NOT SHAREHOLDER. Except as otherwise provided therein,
------------------------------
this Warrant does not confer upon the Holder any right to vote or to consent or
to receive notice as a shareholder of the Company, as such, in respect of any
matters whatsoever, or any other rights or liabilities as a shareholder, prior
to the exercise hereof.
7. COMMUNICATION. No notice or other communication under this Warrant
-------------
shall be effective unless the same is in writing and is mailed by first-class
mail, postage prepaid, addressed to:
(a) the Company 18245 SE Federal Highway, Tequesta, Florida 33469, or
such other address as the Company has designated in writing to the Holder, or
4
<PAGE>
(b) the Holder c/o Cohen & Cohen, 445 Park Avenue, New York, NY 10022,
or such other address as the Holder has designated in writing to the Company.
8. HEADINGS. The headings of this Warrant have been inserted as a matter of
--------
convenience and shall not affect the construction hereof.
9. APPLICABLE LAW. This Warrant shall be governed by and construed in
--------------
accordance with the laws of the State of New York.
IN WITNESS WHEREOF, SAF T LOK, INC. has caused this Warrant to be signed by
its President and its corporate seal to be hereunto affixed this 13th day of
October, 1997.
ATTEST: SAF T LOK, INC.
- --------------------------- By: -------------------------------
Secretary
[Corporate Seal]
5
<PAGE>
ASSIGNMENT
(TO BE EXECUTED BY THE REGISTERED HOLDER TO EFFECT A
TRANSFER OF THE WITHIN WARRANT)
FOR VALUE RECEIVED, _____________________ hereby sell, assign and transfer unto
(Name)
(Address)
the right to purchase _________ shares of Common Stock of Saf T Lok, Inc.
evidenced by the within Warrant, together with all right title and interest
therein, and do irrevocably constitute and appoint
(Name)
attorney to transfer the said right on the books of said Corporation with full
power of substitution in the premises.
Dated:______________________
__________________________
Signature
6
<PAGE>
PURCHASE FORM
------------
(To be executed upon exercise of Warrant)
To: SAF T LOK, INC.
The undersigned hereby exercises the right to ___________ shares of
Common Stock of Saf T Lok, Inc., evidenced by the within Warrant according to
the terms and conditions thereof, and herewith makes payment of the purchase
price in full.
Dated:______________________________,
_________________________________
Signature
Signature
7
<PAGE>
EXHIBIT 99.6
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
WARRANT FOR THE PURCHASE OF COMMON SHARES
-----------------------------------------
NO. W- 555,556 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Dafico Investment Corp. or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time after October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, Five
Hundred Fifty Five Thousand Five Hundred and Fifty Six (555,556) fully paid and
non-assessable shares of common stock, par value $.01 per share, of the Company
for an aggregate purchase price of $1,111,112 (computed on the basis of $2.00
per share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
WARRANT FOR THE PURCHASE OF COMMON SHARES
-----------------------------------------
NO. W- 111,112 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Dafico Investment Corp. or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time after October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, One
Hundred Eleven Thousand One Hundred Twelve (111,112) fully paid and
non-assessable shares of common stock, par value $.01 per share, of the Company
for an aggregate purchase price of $222,224 (computed on the basis of $2.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 27,777 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Dafico Investment Corp. or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time after October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, Twenty
Seven Thousand Seven Hundred and Seventy Seven (27,777) fully paid and non-
assessable shares of common stock, par value $.01 per share, of the Company for
an aggregate purchase price of $83,331 (computed on the basis of $3.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 138,889 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Dafico Investment Corp. or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time after October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, One
Hundred and Thirty Eight Thousand Eight Hundred and Eighty Nine (138,889) fully
paid and non-assessable shares of common stock, par value $.01 per share, of the
Company for an aggregate purchase price of $416,667 (computed on the basis of
$3.00 per share). (Hereinafter, (i) said common shares, together with any other
equity securities which may be issued by the Company in substitution therefor,
are referred to as the "Common Shares", (ii) the Common Shares purchasable
hereunder are referred to as the "Warrant Shares", (iii) the aggregate purchase
price payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 555,555 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Mercacorp Inc. or its permitted assigns is
entitled to purchase from the Company, at any time or from time to time after
October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, Five Hundred Fifty
Five Thousand Five Hundred Fifty Five (555,555) fully paid and non-assessable
shares of common stock, par value $.01 per share, of the Company for an
aggregate purchase price of $1,111,110 (computed on the basis of $2.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 111,111 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Mercacorp Inc. or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time after October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, One
Hundred Eleven Thousand One Hundred Eleven (111,111) fully paid and non-
assessable shares of common stock, par value $.01 per share, of the Company for
an aggregate purchase price of $222,222 (computed on the basis of $2.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 27,778 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Mercacorp Inc. or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time after October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, Twenty
Seven Thousand Seven Hundred and Seventy Eight (27,778) fully paid and non-
assessable shares of common stock, par value $.01 per share, of the Company for
an aggregate purchase price of $83,334 (computed on the basis of $3.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 138,889 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Mercacorp Inc. or its permitted assigns is
entitled to purchase from the Company, at any time or from time to time after
October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, One Hundred and
Thirty Eight Thousand Eight Hundred and Eighty Nine (138,889) fully paid and
non-assessable shares of common stock, par value $.01 per share, of the Company
for an aggregate purchase price of $416,667 (computed on the basis of $3.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 555,555 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Firstimpex Inc. or its permitted assigns is
entitled to purchase from the Company, at any time or from time to time after
October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, Five Hundred Fifty
Five Thousand Five Hundred Fifty Five (555,555) fully paid and non-assessable
shares of common stock, par value $.01 per share, of the Company for an
aggregate purchase price of $1,111,110 (computed on the basis of $2.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 111,111 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Firstimpex Inc. or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time after October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, One
Hundred Eleven Thousand One Hundred Eleven (111,111) fully paid and non-
assessable shares of common stock, par value $.01 per share, of the Company for
an aggregate purchase price of $222,222 (computed on the basis of $2.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 27,778 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Firstimpex Inc. or its permitted
assigns is entitled to purchase from the Company, at any time or from time to
time after October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, Twenty
Seven Thousand Seven Hundred and Seventy Eighty (27,778) fully paid and non-
assessable shares of common stock, par value $.01 per share, of the Company for
an aggregate purchase price of $83,334 (computed on the basis of $3.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER REGULATION S PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). THIS WARRANT SHALL NOT CONSTITUTE AN OFFER TO SELL
NOR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE SECURITIES REPRESENTED BY THIS
WARRANT ARE RESTRICTED AND MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS PERMITTED
UNDER THE ACT PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
SAF T LOK, INC.
---------------
FORM OF WARRANT FOR THE PURCHASE OF COMMON SHARES
-------------------------------------------------
NO. W- 138,889 SHARES
FOR VALUE RECEIVED, SAF T LOK, INC., a Florida corporation (the
"Company"), hereby certifies that Firstimpex Inc. or its permitted assigns is
entitled to purchase from the Company, at any time or from time to time after
October 13, 1997 but prior to 5:00 P.M. on October 13, 1999, One Hundred and
Thirty Eight Thousand Eight Hundred and Eighty Nine (138,889) fully paid and
non-assessable shares of common stock, par value $.01 per share, of the Company
for an aggregate purchase price of $416,667 (computed on the basis of $3.00 per
share). (Hereinafter, (i) said common shares, together with any other equity
securities which may be issued by the Company in substitution therefor, are
referred to as the "Common Shares", (ii) the Common Shares purchasable hereunder
are referred to as the "Warrant Shares", (iii) the aggregate purchase price
payable hereunder for the Warrant Shares is referred to as the "Aggregate
Warrant Price", (iv) the price payable hereunder for each of the Warrant Shares,
as adjusted in the manner set forth in Section 3, is referred to as the "Per
Share Warrant Price" and (v) this Warrant and all warrants hereinafter issued in
exchange or substitution for this Warrant are referred to as the "Warrants".)
The Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
Price and the number of Warrant Shares are subject to adjustment as hereinafter
provided.
1
<PAGE>
EXHIBIT 99.7
[GRAY, HARRIS & ROBINSON, P.A. LETTERHEAD APPEARS HERE]
November 10, 1997
VIA FACSIMILE
Frank R. Cohen, Esq.
Cohen & Cohen
445 Park Avenue, 15th Floor
New York, New York 10022
Re: Saf T Lok Incorporated $3,000,000 Regulation S Offering
Dear Frank:
I received your letters concerning the escrow arrangements for the $3,000,000
offering to your clients under Regulation S. The purpose of this letter is to
clarify the terms of the transaction.
Assuming that the Board of Directors of Saf T Lok Incorporated ("Saf T Lok")
is satisfied with its background check of A.B. & Associates, Inc., and assuming
that the Placement Agent fee is reduced to 13.5%, and assuming that your clients
understand that there is a risk that Nasdaq will delist Saf T Lok based on the
terms of this transaction, Saf T Lok agrees to the following:
1. A closing will take place today, November 10, 1997, or as soon as
possible thereafter for $2,500,000 with the number of shares and the stock
purchase warrants reduced proportionately from the $3,000,000 transaction.
2. $500,000 in cash from the investors will be held in escrow along with
stock certificates for a total of 250,000 shares and stock purchase warrants for
a total of 416,667 shares until the close of business on December 1, 1997.
3. If the investors and Saf T Lok agree that as of the close of business on
December 1, 1997, Saf T Lok is in compliance with all applicable regulatory
requirements, the Escrow
<PAGE>
Frank R. Cohen, Esp.
Page 2
November 10, 1997
Agent will release the $500,00 to Saf T Lok and deliver the stock certificates
for 250,000 shares and the stock purchase warrants of 416,667 shares to the
investors.
If, as of the close of business on December 1, 1997, Saf T Lok and the
investors determine that Saf T Lok is not in compliance with all applicable
regulatory requirements, the Escrow Agent shall return the $500,000 to the
investors and return the stock certificates for 250,000 shares and the stock
purchase warrants for 416,667 shares to Saf T Lok.
4. If Saf T Lok does not receive the $500,000 from escrow, Saf T Lok shall
not be required to pay the second $375,000 to Marketing Direct Concepts, Inc.
unless and until $1,500,000 of stock purchase warrants have been exercised.
5. Saf T Lok has received the letters from the attorneys for each of the
investors as previously requested.
Please advise me by fax whether or not your clients agree to the above closing
requirements.
Very truly yours,
/s/ William A. Grimm
William A. Grimm
cc: John L. Gardner (via fax)
